High class ice cream without the high price.

I have two big weaknesses when it comes to food: chocolates and ice cream. Put the two together and it is a killer combination as far as I am concerned!

Fairprice Express, the supermarket chain found at Esso petrol stations is running a "Buy 1 Get 1 Free" promotion for this particular ice cream:

So, as you might have guessed, I gave in to the triple temptation of chocolate, ice cream and reduced price.

The box has a cute little badge at the bottom left hand corner:

Wah! Environmentally friendly ice cream! Eat with less guilt!

The box opens like a treasure chest. Oooh, that's different:

It is a bit like a Black Forest Cake but without the cake:

After I was done, I took a closer look at the box and found that the ice cream was produced in Germany! Wow! Atas!

Price: $4.90 for two.
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Added on 7 August 2017:

Burp.

Hock Lian Seng: Buying on weakness.

In my last blog post on Hock Lian Seng, I said that we could see its share price moving lower and it has moved lower. 

Do I believe that this is the lowest it could go?





Well, I certainly do not know if the stock price will stop declining although I will say that it could have found support. 

We can see this if we draw a trendline connecting various lows. 

Also, the higher low in the CMF gives us a positive divergence against a declining share price.

More likely than not, there will be a host of positive catalysts for Hock Lian Seng's share price to move higher but investors must be willing to wait. 

While waiting, the company's payment of meaningful dividends to shareholders annually will provide some comfort. 

If the dividend per share should be a more conservative 1.5c, with a share price of 26c, we will have a yield of 5.77%.





The weakness in Hock Lian Seng's share price allows me to buy more with a bigger margin of safety and any further weakness will create more opportunities to accumulate.

Related post:
1. Hock Lian Seng: Dividend of 1.8c per share.
2. Hock Lian Seng: Insider buying.

Show Luo and his hair.

I am not a fan of Show Luo, nickname Xiao Zhu (Little Pig), but I was told that he is very particular about his hair. Quite the diva, apparently.

I couldn't stop laughing when I stumbled upon the following photo:

I wonder if EC House can do this for me. I want to be fashionable too.

Had a good laugh?

Whoever is responsible for this, thanks for brightening my day. :)

More blog posts to tickle you:
1. Tea with AK71: Funny!
2. Holey curry puff!
3. A short fairy tale!
4. Male cheerleader brings it on!
5. This kid can dance!

Old Chang Kee: More free curry puffs on the way!

In an interview earlier on in the year, I talked about Old Chang Kee as being a very rewarding investment for me. I also mentioned how a 5c dividend which went XD in January was a pleasant surprise.

Well, Old Chang Kee announced a final dividend of 1.5c for FY2013. This is nice although I will be receiving half of what I would usually receive in absolute amount since I divested half of my investment in the company earlier on in the year.

Amidst rather more difficult business conditions, Old Chang Kee's management has shown a high level of business savvy as they improved production efficiency, closed non-profitable outlets and revised prices last December. As of March 2013, it had a total of 76 outlets in Singapore which is 6 outlets lesser than a year ago.

Net profit improved from $4.51m to $4.98m and EPS improved from 4.75c to 4.96c. These figures are on the back of improved gross profit margin from 60.1% to 61.4%.

What is more impressive is that the $4.51m net profit for the preceding year was based on a 15 months financial year because Old Chang Kee announced a change of its financial year in August 2011.

So, if we were to assume an average net profit of $1.245m per quarter in FY2013, over 5 quarters would give us $6.225m. This means that net profit increased almost 40%, year on year. Impressive!

Business costs are expected to remain high but Old Chang Kee's management have, so far, impressed with their business savvy and with the brand deeply entrenched in Singapore, it is reasonable to expect the company to continue doing well.

At 56c a share, PER is 11.29x. Not cheap but not expensive either. I would say it is fairly valued. What am I going to do now? Wait to receive the dividend and maybe buy some curry puffs tomorrow.

Related posts:
1. Old Chang Kee: Have my curry putt and eat it too.
2. Old Chang Kee: Initiated long position at 26c.
3. Tea with AK71: An audio interview.

What should I do? A letter from a 64 year old retiree.

I am sharing an exchange I had with a reader a few days ago because I think others could possibly be interested in it:

Hi, AK71,

1.        I have been following your blog for quite some time and find your explanation and reasoning of the stock market very interesting.  Not many people are so frank like you that are willing to give an in-depth advice of the financial market.    So far, I did not pen anything in your blog to ask for your advice, as I could not express myself well in writing. 
 

2.        I would like to seek your kind advice to set up a reasonable and proper stock portfolio to earn passive income.  I am a 64 years old retiree and living on passive income from dividends from my 44 stocks in my portfolio.  Overall, I have made a capital gain of about 15 - 20% from these 44 stocks (with some profits and some losses for each stock).    I know that 44 stocks are very difficult to monitor but I do not know how to diversify them.  Each time the market drop, my heart drop too.  At this age, I cannot effort to loss much of my hard earned money, as I do not have time to wait for the market to recover again.
 

3.        I would appreciate your kind professional advice.  Thank you.

My reply:

Hi J,

I really hate to disappoint you but I am not a professional financial adviser. I would suggest that you find professionals and engage their services.

However, what would I do if I were in your shoes? This is the part where I talk to myself. Please ignore me.

First, understand my motivations! I am in my 60s and retired. I am not able to suffer another market crash for more reasons than one. I am interested in a predictable flow of passive income.

Secondly, go through my portfolio of 44 stocks. Compartmentalise the investments into those that match my motivations and those which do not.

Thirdly, keep the investments which match my motivations and think about possibly increasing exposure to these investments when prices are softer. Sell those investments which do not match my motivations at an opportune time and never look back.

Fourthly, money from divestments should go into a dedicated "war chest" to buy more stocks which match my motivations during times when Mr. Market goes into manic depression.

Throughout, I have to understand that this is the general framework that I must keep in mind but being a framework, it will overlook finer details which could influence my decision to invest or to divest in specific instances.

Best wishes,
AK

Everyone has different circumstances and motivations. There is never a universal solution to all problems. If we understand our motivations, we will know what is most appropriate for us.

Related posts:
1. A letter from a 66 year old retiree.
2. A letter from a reader in his early 20s.
3. A letter from a 24 year old fresh grad.
4. Voices, noises and choices.

City Harvest Church: A personal account.

One story I have been following is City Harvest Church's.

I am just so amazed by how so much money was accumulated and how so much money was misused. $50 million!

Just now, I was directed to a personal account shared by someone who used to be a Ministry Member of the church.

The church used peer pressure very successfully to get people to give to the building fund... from getting people to pledge and using testimonies... I remembered people giving their hearts out for the Jurong West building. Never once, were members informed that monies from the Building Fund were used to fund Sun Ho's career, and certainly not about monies being invested in Xtron or Firna.

CHC and its pastors have lost it. They have twisted and traded the gospel for another, and the astounding thing is that, they still believe they are doing the right thing.

Read the full account in Facebook: Assi AK.

Having an extra $1,200 a year!

I like plain white porridge with a bit of ikan bilis for dinner regularly. Last night, for some reason, I was not feeling hungry and, so, the porridge was stored in the fridge.

Today, I brought the porridge and ikan bilis to work. Sprinkle the ikan bilis on the porridge and voila:

For tea later, I will be having my regular oatmeal which is what I usually have for lunch. I have taken to adding soya bean milk to my oatmeal these days to get some extra protein and good taste.

Healthy and money saving meals.

If you have not tried bringing home cooked food to work, maybe you want to consider it. Depending on where you work, you could save up to $10 a day on meals! Just bringing your own food to work half the time could mean saving $100 a month on meals or $1,200 a year.

An extra $1,200 a year in your bank account? Very nice!

Related posts:
1. 7 money habits of AK71's.
2. Home made sandwich.
3. Barley and winter melon.

Asian Pay Television Trust (APTT): 201 lots.

Asian Pay Television Trust (APTT) was my first IPO application in donkey years. So, you can imagine I was somewhat excited.

When I heard that people who applied for 100 to 499 lots would get 80 lots if successful, I was even more excited! I applied for 201 lots!

Apparently, only 7 out of every 50 applicants were successful for the range of 100 to 499 lots. Chances were slim and chances were even slimmer for people who applied for 99 lots or less.

Chances improved markedly for those who applied for 500 to 999 lots. 33 out of every 50 applicants were successful and they would get 374 lots each! Wow!

This was an IPO that favoured the bigger players, it would seem. Be ready to either make a big killing tomorrow or be killed big time. I think the former is more likely.

Congratulations to all successful applicants!

Related post:
Asian Pay Television Trust: IPO

Sex for grades case: Guilty!

On so many occasions, I was simply amazed by how shameless some people are. Take the instance of Tey Tsun Hang, the disgraced NUS law professor. To any reasonable person, what Tey did was quite obviously wrong but instead of showing some shame and admitting his guilt, he insisted that he was innocent which resulted in a trial spanning 5 months.

For someone who knows the law but chose to break it, there can be no leniency. He should be given the maximum sentence of five years in jail and the maximum fine of S$100,000 on each charge, especially when he has shown no remorse.

Read: Sex for grades case.

SPH: A REIT investment.

It was almost a year ago when I mentioned in a blog post that investing in SPH could be better than investing in a retail S-REIT. Then, in March this year, news that SPH could establish a REIT sent its share price rocketing. Yesterday, more details were released and we could see a SPH sponsored REIT by July 2013.

From what is available in the news, SPH will hold 70% of the REIT. This is good news for the future REIT unit holders because a sponsor with a big share of units is more likely to have its interests aligned with those of smaller unit holders.

So, how will SPH shareholders benefit from this? The most obvious benefit is a special dividend of 18c per share, post IPO. A longer lasting benefit is ownership of an SPH with an even stronger balance sheet with NAV increasing and net gearing reducing, both significantly.

In terms of income, post IPO, SPH will receive a 70% share of income distributions from the proposed REIT and will also collect a fee as the manager of the REIT.

For me, as a shareholder, apart from doing nothing and collecting dividends which is pretty much what I have been doing for so many years, I will also look at possibly making an application at the IPO of the REIT.

I like the assets (i.e. Paragon and Clementi Mall). I like the sponsor. I like how the sponsor will retain a 70% stake in the REIT. Next, I will need to know the estimated distribution yield and gearing. If they compare favourably to established retail S-REITs, then, I will be making a beeline for the nearest ATM.

The last I checked, the distribution yield of established retail S-REITs ranges from 4.5% for CMT to 5.2% for FraserCT. Gearing ranges from 30.5% for Starhill Global to 40.9% for Mapletree Commercial.

So, if SPH REIT were to offer a distribution yield closer to 6% and with a gearing closer to 30%, Mr. Market should respond more favourably.

It seems that boring SPH has become a more exciting investment.

Related post:
SPH: Better investment than retail S-REITs.

The mystical art of wealth accumulation!

The wall next to my desk doesn't need a fresh coat of paint because it is pasted over with notes, cards and newspaper cuttings! 

Someone told me that if everyone was like me, the wallpaper companies would go out of business.




Today, I took down some of the "wallpaper" and I found a newspaper article I cut out in the year 2003. 

It was about ST Engineering, a company which I have been a shareholder of for more than 10 years by now.

Here is the article in question:

Today, ST Engineering's stock trades at $4.17 a share and it has been paying out dividends annually without fail since I first became a shareholder. 

I cannot remember how much exactly from year to year but, off the top of my head, an average of 15c annually in dividend per share cannot be too wrong.

This is one investment I have fond memories of and not only because the dividends it paid funded my annual holidays in Japan and Korea for many years in a row.

In case you are wondering, yes, I am still holding on to those shares I bought at $1.55 a piece more than 10 years ago.




What would have happened if I had decided to spend all that money all those years ago on a brand new luxury watch instead of investing in ST Engineering? 

Isn't there something to be said about delaying gratifications and investing for income?

Many times, people are sceptical about what I have achieved. 

Well, they can be sceptical all they want but once they are determined to make an improvement to their personal finances, once they try out some of the ideas I have blogged about, they will see for themselves that the magic that AK has, they have it in them too. 

Suddenly, it isn't so mystical after all.




Remember that AK has done it and you can do it too!

Related posts:
1. The very first step to becoming richer.
2. Do not love unless it is worth the loving.
3. Why a wealthy nation cannot afford to retire?
4. 7 steps to passive income from the stock market.
5. Create more passive income with limited capital.

Teaching young children financial literacy.

In the papers today, I read about two ladies who started a business in Singapore to teach financial literacy to children. 

I think it is a good thing they are doing.

This reminds me of a book which a friend told me about over dinner some time back. 

He said he wanted to teach his son financial literacy but found it difficult. 

I mean how do we talk to primary school kids about passive income without boring them to tears?





Anyway, my friend found a book which did the job and I am now inspired to share the book here with readers who might be in the same shoes as he was.

Buy from BetterWorldBooks.com 

and help fund literacy for the poor.

The sooner children realise it is a good idea to make money work for them, the better off they will be in future. 

Want your children to be financially literate from a young age? 

Give them this book.

The curious case of Mr. Tan Kang Hua.

Today's INVEST section in The Sunday Times profiled Mr. Tan Kang Hua, a 27 year old engineer and avid investor who has had more hits than misses in his journey as an investor. 

It was reported that Mr. Tan often dresses shabbily as he does not want to flash his wealth. 

I guess he does not want to attract any attention. I can empathise with this.





However, accepting an interview by our national newspaper and having photos of him and his family published in full color must attract quite a bit of attention. 

Now, everyone who knows him and even people who didn't would know about him and his wealth. 

Curious why he would want to do this.

It was also revealed that his best investment to date was the first property he owned which was a 3 bedroom condo he bought in 2010 when he was 24 and still in university. 

He sold it off last year for a profit of $300,000 which translates to a ROI of 200%. 

Curious how did he manage to get a loan to buy a 3 bedroom condo when he was still in university.





I wonder if Mr. Tan Kang Hua is a reader of ASSI and if he could help satisfy my curiosity. 

Failing this, could anyone help to answer these questions?




Related posts:
1. Retiring a millionaire is not a dream.
2. Making your first million dollars in real estate investment.
3. Excuse me, are you an investor?

Inexpensive chill out ideas.

Life can be hectic especially in a city like Singapore. In fact, it often is.

Today, I had breakfast in a rather nice setting before going for a stroll in a nearby park.

Oishi!

Green is the most soothing color to the eye.

Breakfast: $6.95.
Newspapers: $0.90.
Visit to the park: $0.00.

Inexpensive, yummy and therapeutic.

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Updated on 1 August 2016.

Visited another park in Singapore today.

Lower Peirce Reservoir. 

I like it and will visit again!

Related post:
What to do in Singapore on National Day?