Investing in 2015 – to stay calm was difficult

It is too soon the year is coming to an end. One word to describe 2015 with regard to investing, it was volatile. One word to describe 2015 as a whole, it was uncertainty. There was uncertainty throughout 2015 as to when the Federal Reserve is going to increase federal fund interest rate. (Fed decided only in December to increase 0.25% point.)

When 2015 started, we did not know that China is gong to devalue Yuan in August. I did not expect Brent crude oil could drop to below US$35 per barrel recently from US$56 in January 2015. This was a drop of 37.5%. The price was above US$100 in August 2014! Oil prices have collapsed and this brought a new dynamic to economic growth of countries.

China’s, the world’s second largest economy, economic slowdown affected Asia, Australia and others. Europe and Japan had to institute accommodative monetary polices to prop up their economies. US is the only bright spot but the world’s biggest economy cannot lift the economies of others.

Singapore Gross Domestic Products (GDP) real growth rate is expected to be close to 2% this year. It was 2.9% in 2014 and 4.4% in 2013. 2015 is turning out to be the worst year since 2009. 2016 is not going to be good as well. The Ministry of Trade and Industry forecasted it to be between 1.0% to 3.0%.

The Straits Times Index (STI) climbed to 3,549.85 points in April. Since then, the STI was on a downtrend. It was 2,861.18 points on 17 December 2015. Between April and now, the change was negative 19.3%. From the start of 2015, the drop was 15%.

If one is invested in the Singapore stock market, capital gains were harder to achieve. However if one is invested in dividend stocks, the dividend yield was ok. My overall dividend yield based on my stock portfolio was 3.41%. But I am nursing a paper loss of about 18% much like the STI change in the year.

Copyright © 2015, limkimtong for Living Investment

The material presented is intended to be general and written in layman’s language as much as it is possible. The author shall not be liable for any direct or consequential loss arising from any use of material written. Please seek professional advice from your financial advisor or financial institutions on material written covering financial matters.

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