Bounty May Dividend $26,191

 

The month of May saw a bountiful amount of dividend $$$ as many companies close their Financial Year and distribute their profits to their faithful shareholders 😎

Apart from taking some profit from Sembcorp Industries and nimbling Wilmar, UOB and tbills, it was quite another boring month *yawn*

Also looking at the S&P500 and USA Debt Ceiling, which is approaching the final line. I entered a buy queue for IVV.US at $410 but was unsuccessful. On hindsight, should have been more decisive in buying up the S&P500 index, as the US markets seem amazingly strong, considering the many political and social issues that they have. I guess though democracies have its cons, at least we are able to openly see these issues, as compared to other closed autocratic countries. In the long run, these issues should iron out through the system, though not perfect, for the economic success of US to continue over the next decade

Coming back to Singapore market, as usual kiasu investors are probably jittery over US defaulting and the lack lustre China reopening data. UOB and DBS banks retrace back to their short term supports of $28 and $31 respectively

Could not resist nimbling abit due in part to boredom 😂 and to hopefully earn some kopi money to exercise my brain. Another interesting thing is that I have started to also use Yahoo charts instead of InvestingNote and other brokerage account charts, as their share prices are adjusted for dividends/rights etc. As I consider dividends as part of the opportunity cost of owning a share, would prefer these price levels to be unadjusted as the original share prices

With the upcoming month of June, hopefully things would be more interesting and profitable in the weeks ahead!

Related:

Uneventful Apr $8,437

My 7-Figures Singapore Portfolio

On Target for 6-Figures 2023 Income

T-Bill 3.78% vs HSBC EGA 4.55% (May 2023)

The latest t-bill BS23109E has been a respectable 3.78% for our hard earned monies 😂 Was actually expecting it to be slightly lower at around 3.5% as some of the new CPF monies pour into this t-bill auction for the new month of May, so as not to lose another additional month of CPF interest for April. Seems more people are bidding the t-bills more sensibly now, which benefits more people in the long run. 

For me, I have not been bidding t-bills for a few months because of the new HSBC EGA account which I have opened in March. With the EGA account moving to the 3rd month, I will no longer be eligible for the extra 1% Everyday+ Rewards. Still it's a respectable 4.55% slightly higher than the current t-bill of 3.78% yield. Probably it's time to look for a better yield instrument in the month of June.

HSBC 5.55% EGA Savings Account

The month of June brings some volatility as the USA Debt Ceiling croaches near, and political brinksmanship comes into obvious play. It's just concerning that Parties become more important than Country, as Right vs Left idealogy clash. Still I hope that at the end of the day, clear minds prevail as both sides agree that Default is not the option. 

Maybe this could be good opportunities to buy into local bank stocks or S&P500 index. Savings account and T-bills should just be temporal sandbox to park our excess funds to capitalise on better investment opportunities. With core inflation at 4%, it basically just matches the current purchasing power of our cash today. To build wealth, unfortunately we still need to do some calculated risks to overcome high inflation moving forward.

The local bank stocks have been feeling jittery over the upcoming USA debt limit, and are showing first signs of pullback, as usual from kiasu Singaporean investors 😅 S&P500 instead is still holding pretty well. Let's see if next week brings more volatility. I recall hearing some Economist from Bloomberg stating that usually investors tend to react 2 weeks before the deadline, as in 2011 when USA credit rating was downgraded from AAA.

USA Republican Convention

Can only pray for true Leaders to rise up and save the political situation! 😇

Headwinds for MIT? (Hint: Cyxtera Technologies)

 

Mapletree Industrial Trust can be considered as one of the blue-chip Reits of Singapore. Part of the reasons include a strong govt linked sponsor, well established history, diversified portfolio of properties in Singapore and USA (which includes lucrative Data Centres).

It recently announced a slightly disappointing Q4 & FY22 results, which saw a slight dip to 3.33c in DPU. As seen from the chart below, MIT had a previous solid history of increasing DPU since FY10, with the exception of FY20 due understandably to Covid pandemic, though it has since recovered strongly to increasing payouts again. However in recent years of FY21/22, we are seeing a plateau and even worrying decreasing trend of falling DPU. Are the best years of MIT over?!

Of course with the previous 9 interest rate hikes since Mar 2022 till now, Reits being a leveraged business is not spared from the increase interest rate expanses to its loans. Though 75% of its debt is in Fixed rates, the impact on DPU can still be seen with the increase in base interest rates. To be fair, no one would have honestly thought in early 2022, that the USA Fed would increase the interest rates so quickly and so frequently.

Another area of concern could be with MIT's 3rd largest tenant (3.2% rental income) rumoured to be Cyxtera Technologies. Even MIT CEO commented on the 2023 outlook to be "a challenging year with increased risk to global financial stability due to the banking crisis and geo-economic fragmentation."

Conerns of Cyxtera Technologies:

1. Posted US$355M loss for 2022 and cancelled earnings call amid ongoing efforts to extend maturing debt

https://www.datacenterdynamics.com/en/news/colo-q4-2022-results-cyxtera-posts-a-355m-net-loss-for-2022-cancels-earnings-call/

2) Moody's downgraded Cyxtera from B3 to Caa2, rated as speculative grade investment of  poor quality and very high credit risk

https://www.theedgesingapore.com/news/reits/cyxteras-long-term-debt-us853-million-matures-2024

3) Price of Cyxtera plunged from $15 to just $0.325! (Nasdaq: CYXT)

Looking at this scary price chart below, it seems the company is heading towards Chapter 11 bankrupcy filings

Do u have any thoughts or insights to Cyxtera or MIT? Let me know in the comments section below 😅

Disclosure: I am currently vested in MIT