Ok let's talk about the good news first. It came as a surprise that my system's US portfolio managed to remain in the green for 2022. Not only that, what is even more more surprising is, it managed to bag a double digit gain of +11.79% despite all three US indexes in the deep red for most part of the year. The portfolio was hovering around the breakeven region throughout the year until December, then it suddenly soared. The stocks the system bought were hardly familiar, most of them I have never heard of (the system is designed to be good at picking up these kinds of hidden gems). Refer to the list of top trades below to know what I mean. No matter bull or bear market, there are always some up trending stocks to buy.
Here is my US portfolio return for the year 2022.
2022 return: +11.79% (vs SPY -18.18%)
Total return since inception (June 2016) +143.20% (vs SPY +105.64%)
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On the other hand, the not-as-good news is my SG portfolio didn't perform as well compared to STI which is heavyweight on the banks (local banks were doing great due to the rising interest rates). There were some great profitable stocks in the portfolio but were nullified by some big losses. Fortunately, the SG portfolio still managed to make a slight gain for the year.
Here is my SG portfolio return for the year 2022. At least it goes down in the record as a green year for the SG portfolio.
2022 return: +1.55% (vs ES3 +7.61%)
Total return since inception (June 2016) +125.36% (vs ES3 +40.70%)
The 3 best performing stocks in SG for 2022 were Moya Asia (SGX:5WE) with profit +45.90%, Chip Eng Seng (SGX:C29) with profit +38.10% and Dyna-Mac Holdings (SGX:NO4) +12.50%.The 3 worst performing stocks were Mencast Holdings -21.69%, Matex International (SGX:M15) -18.42% and Del Monte (SGX:D03) -15.48%.
Here are the YTD charts for the system's monthly portfolio compared with the indexes. From the chart, you can see that the portfolios are in fact less volatile than the indexes! This is due to the high cash components that helped to reduce the beta and smoothen the curve.
Here are the yearly return table for the portfolios since inception.
Here are the charts for the system's monthly performance since inception.
1 multibagger in US, no multibagger in SG for 2022
There is one multibagger in US which I shared in a previous post. it has since risen to even greater heights and I'm still holding it. Unfortunately, there is no multibagger in SG this year.
I updated below the top 10 trades the system has produced so far for US and SG. The list can also be found here.
US Portfolio
| Name (Ticker) | % P/L | Entry / Exit |
|---|---|---|
| KEMET Corporation (KEM) | 370.60% | Nov'16 / Sep'17 |
| Entravision Communications Corp (EVC) | 250.00% | Oct'20 / Nov'21 |
| LightInTheBox (LITB) | 130.91% | Jul'20 / Aug'20 |
| North European Oil Royalty Trust (NRT) | 86.40% | Mar'21 / Nov'21 |
| RADA Electronic Industries (RADA) | 79.13% | Jun'17 / Nov'17 |
| Avalon Holdings Corp (AWX) | 66.50% | Nov'20 / Mar'21 |
| Bovie Medical Corp (BVX) | 61.49% | Apr'18 / Oct'18 |
| Nevsun Resources Ltd (NSU) | 61.17% | Apr'18 / Sep'18 |
| Deswell Industries, Inc (DSWL) | 56.57% | Jun'17 / Nov'17 |
| DRDGOLD Ltd (DRD) | 46.56% | Jun'19 / Sep'19 |
Singapore Portfolio
| Name (Ticker) | % P/L | Entry / Exit |
|---|---|---|
| AEM Holdings (AWX.SI) | 247.16% | Dec'16 / May'17 |
| PropNex (OYY.SI) | 185.67% | Oct'20 / Sep'21 |
| Del Monte (D03.SI) | 140.04% | Dec'20 / Aug'21 |
| Medtecs Intl (546.SI) | 130.91% | Jun'20 / Jul'20 |
| Union Gas (1F2.SI) | 102.40% | Oct'20 / Aug'21 |
| 800 Super (5TG.SI) | 51.53% | Oct'16 / Jul'17 |
| HMI (588.SI) | 48.81% | Aug'16 / Feb'17 |
| Moya Holdings Asia Ltd (5WE.SI) | 45.90% | Aug'22 / Sep'22 |
| Chip Eng Seng Corp (C29.SI) | 38.10% | Jun'22 / Nov'22 |
| Perennial Hldgs (40S.SI) | 36.19% | May'20 / Jul'20 |
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Remember my 2022 mantra? "Keep CASH or get TRASHED". It will be the same for 2023.
Cash is king. Loading up on T-bills and Fixed Deposits
In 2022, if you are cash rich, you would be having a great time reaping from the high interest rates in T-Bill, SSB or fixed deposits. During last year's performance report, I mentioned that for 2022, the stock market will likely weaken due to the rising interest rates and that the system would be in risk off mode. Throughout 2022, both my US and SG portfolios were heavyweight in cash. On average, the portfolios were having around 50% cash, at some points they were holding 100% cash. Thanks to the rising interest rates, I parked some of the idle cash in fixed income to generate some extra income. Some were in T-bills generating around 3-4%. Even those in fixed deposits were able to generate more than 3% in the later part of the year. I didn't account for this in the return calculation above as there is too much manual work. Psst, Standard Chartered Esaver account is currently having a promotional rate of 3.80%. One good thing with this account is that the money is not locked for the duration. The flexibility helps especially when I need to move the cash back and forth among the trading accounts.
Rising interest rates and home loans
Looking back to 2020 when I was contemplating whether to pump cash to pay off my mortgage loans or to put the extra cash to investments, I am just glad that I decided to do the former. I fully paid off my home loan back in 2020. Now that the mortgage rates have grown to more than 4%, it has been a wise decision. So I have been debt-free for two years now, which is great as it is one huge burden off my shoulders. I always tell myself "Debt is certain, profit is not. So clear your debt first."
Crystal-balling attempt for 2023
Last year's attempt at crystal balling has been spot on. Of course this is not based on wild guesses, it is based on the risk appetite of the system and the overall trend of the market. As mentioned at the end of last year, the system will be in risk off mode and true enough, the US market went into bear territory. This market weakness should continue for next year as the Fed continues its hawkish tone and plan to keep interest rates high to fight inflation. Never fight with the Feds. For SG, if the interest rates continue to remain high, the number of bad loans will increase which could impact the banks' bottom line next year and in turn pull the index down along with them. So at least for the first half of next year, the same mantra should apply "Keep CASH or get TRASHED".
It is end of the year. Time to relax
Remember I mentioned about this "side hustle" I have been working on? Well, I'm still working on it. The load has gotten even heavier in 2022. Due to my performance, I have even been promoted to management level. I finally managed to take a little time off at the end of December and treat myself for a little getaway. I didn't manage to plan early as the timeline is quite uncertain so this is where I ended up recently.
Wish everyone a great holiday and a wonderful 2023!
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