Latest Asset Allocation – 30 December 2015

Tomorrow is the end of 2015. The investment climate for this year is challenging. The world’s richest billionaires lost billions in 2015 including Warren Buffet lost US$11.3 billion and Bill Gates lost US$3 billion.

People like most of us could not get away unscathed.

Investment gurus and textbooks advocate diversification to avoid horrendous losses in investments during uncertain investment climate.

My asset allocation as at end of 2015 when compared with March was shown below.

Asset Class 30.12.2015 (%) 29.3.2015 (%)
Preference shares of local bank 21.0 21.1
Cash (including fixed deposits) 18.6 16.7
Singapore equity 14.4 11.3
Unit trusts – equity 10.1 7.7
Bonds Funds 9.8 9.9
Insurance plans (annuity) 9.4 10.4
Currency investments 8.1 12.2
Structured deposits with banks 5.7 5.7
Retail bonds traded on Singapore Exchange 2.8 4.9

I started 2015 by saying that I would be careful and intended to place money in fixed deposits when some investments matured. On that front, cash including fixed deposits is now 18.6% of total portfolio, up from 16.7%.

The biggest investment amount went to buying preference shares of a local bank offering 4% dividend.

Singapore equity was increased to 14.4% from 11.3%. This was not a good move as the market value was down 19%.

I went on to buy additional equity unit trusts during the year bringing the allocation to 10.1%.

I reduced foreign currency exposure to just 8.1% down from 12.2%. This is now just Australian dollar deposit and its value is down 15.5%.

On a net basis, the total portfolio is down 4.5%. The diversification helps to cushion some of the losses in some asset classes.

As for income earned and realised during the year, it was 4.26% on invested assets (excluding cash and savings accounts which do not earn much interests.)

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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