Portfolio Updates

Portfolio Update July 2023 – Portfolio Flattish But Tech Stocks Power The Market Higher

Calvin Lo

After strong June, both portfolios have taken a bit of a breather in July. However, the S&P 500 and Nasdaq 100 continued to power on, rising 2.8% and 3.6% respectively, thanks mainly to Alphabet (GOOG), Meta (META) and Nvidia (NVDA).

Source: Finviz

As expected, the Fed raised interest rates by 25 bps and signalled that they remain open to more rate hikes if necessary but will remain data-dependant. There’s no FOMC in Aug, and the next one is in Sep, where the market is currently expecting 85% chance of no rate change. Although expected, markets still cheered the decision, in conjunction with cooling inflation prints.

Moving over to China, the regulators have been sending the clearest signals yet that the tech crackdown is well and truly over. It seems that the Chinese authorities are finally satisfied with the changes Big Tech have made, and have started to lean heavily into them again in an attempt to restart China’s flagging economy. I’ve shared about my thoughts on China Tech and how I’m positioning the portfolio in the video below:

On the fixed income front, SSB yield for Aug SSB was pretty attractive at 2.99% but below the average yield of my existing holdings so I didn’t apply for any. Sep SSB is more attractive at 3.06% so I may consider getting some. There was a 1-year T-bill auction but the cut-off yield came in at a disappointing 3.74%. I’ll be watching the next 6-mth T-bill auction on 3 Aug closely for clues on where T-bill yields are headed.

On the cash management front, fixed deposit rates continue to fall further with most banks continuing to cut rates. IMO, FD are no longer attractive alternatives to government bonds.

In view of the bull market and strength of the US economy, I continue to deploy more cash into the stock market.

See my thoughts on last month’s SSB issuance: Singapore Savings Bond (SSB) Aug 2023 – Yield Might Increase Further Next Month But Likely To Peak Soon

See also my Fixed Income Tracker and SSB tracker.

See my Portfolio page for more details on my portfolio value, holdings, and strategy.

Family Portfolio

  • Value as at end July: S$232K
  • July performance: -0.9% vs SPX +2.8% vs NDX +3.6%
  • YTD performance: +25.8% vs SPX +19.7% vs NDX +44.7%
  • All-time performance (since Aug 2016): +6.3% (+8.3% including dividends)
  • July dividends: S$73 (n.m.)
  • Bought: VT, QQQ, ARKK, SGX:HST, LSE:VWRD, SGX:SRT, VTIP, PYPL, SQ, SE, PLTR
  • Sold: NVDA, ABNB, META, SGX:BUOU
Family Portfolio as at 2nd Aug 2023

In July, I was again uncharacteristically active in trading stocks. As I shared before, I’ve been accumulating since the start of the S&P 500 bull market, based on historical data that shows that bull markets tend to last much longer than bear markets on average. I think we’re currently in a pretty sweet spot, being at the start of a bull market but still below previous all-time highs.

The only new addition to the portfolio is the Vanguard Short-Term TIPS ETF (VTIP). Since I’m bullish on US Treasury bonds (I’m already holding TLT) but wanted to hedge a bit more against potentially sticky inflation, I decided to buy VTIP instead of adding to TLT. However, inflation seems to be cooling more than expected, so VTIP might underperform.

I’ve also added to VWRD, in line with my intention to move more towards passive indexing. With VWRD, I get to keep more of the dividends due to lower withholding tax. However, currently I’m not aware of any way to RSP into VWRD, so I continue to RSP into VT instead concurrently via FSMOne.

Read: VT vs VWRD – Vanguard World ETF Comparison

Read also: Automating Your Investments With FSMOne

I’ve also added to beaten down tech stocks PayPal (PYPL), Block (SQ), and Sea Ltd (SE), which also averages down my cost basis. The Palantir (PLTR) buy was just 1 share to take advantage of Tiger stock vouchers. Surprisingly, Tesla (TSLA) and PLTR have become top 3 individual stock holdings after both stocks performed well so far in 2023 YTD.

I’ve also continued to add pretty aggressively to S-REITs, mainly via CSOP iEdge S-REIT Leaders index ETF (SGX:SRT) and Syfe REIT+ portfolio. Both track the same index, the iEdge S-REIT Leaders index. S-REIT prices still look pretty attractive to me, especially after taking another hit from the Fed rate hike.

Syfe managed portfolios is currently valued at $15.6k with total returns of +$62 (as at 2nd Aug 2023). No change to regular monthly contributions of $200 into each of the Core Equity100 and REIT+ portfolios, but I did pump an additional $2k into REIT+ in July. I aim to hit $20k soon to qualify for Black Tier which comes with a lower 0.5% annual management fee.

I’ve decided to gain more exposure to bonds also through Syfe Income+, instead of switching from Core Equity100 to Core Growth. I’m taking more risk here by banking on active fund management skills of PIMCO, so hopefully it turns out well.

Read my reviews of Syfe Income+, Syfe REIT+, and Syfe Core Equity100.

In terms of divestments, I completely sold out of Meta Platforms (META) and Airbnb (ABNB) after both stocks run up quite a bit. I realised that I wasn’t particularly interested in holding META although I think it’s a great company to own. Playing around with newly-launched Threads for a few days didn’t help my conviction either. Personally, I prefer Twitter (now X) as a product.

As for ABNB, I’m really excited about the company’s prospects and admire CEO Brian Chesky, but I felt that risks have increased with concerns around a potential real estate market collapse. If homeowners start to struggle with higher mortgage loan interest rates, that might running Airbnb makes less sense economically. High inflation and high interest rates also could reduce disposable incomes, leading to less discretionary travel spend. That said, I’m not ruling out getting back into ABNB in future at a hopefully lower price.

Lastly, I trimmed more Nvidia (NVDA) as the stock continues to defy gravity and valuations. Learning from 2021, valuations don’t matter until they do, and that’s when things crash. So, I’m limiting my risk exposure but still retain a meaningful weightage of ~2.3%.

Personal Portfolio

  • Value as at end July: S$57.1K
  • July performance: +5.3%
  • YTD performance: +83.7%
  • All-time performance (since July 2020): +12.2%
  • Bought: TSLA, DIS
  • Sold: TSLA, PLTR, SQQQ
Personal Portfolio as at 2nd Aug 2023

Tesla (TSLA) stock took a breather in July, ending the month relatively flat at -0.3%. Luckily, Palantir (PLTR) continued its strong performance, up another +30% in July.

The main reason for selling TSLA was so that I could close my Saxo account and move everything to moomoo. Fortunately, TSLA stock price was pretty flat so I managed to switch over without having to pay much higher prices. So, my TSLA position didn’t change much actually.

Read my investment thesis on TSLA here.

As for PLTR, I trimmed more as prices continued to surge. Since this is a trading account, I’m more comfortable taking profits and waiting for better opportunities. In the long-term though, I’m still very bullish on Palantir, that why I’ve not touched any of my PLTR shares in the Family Portfolio.

Since we’re in bull market, I’ve decided to finally cut my SQQQ position in half. Better late than never. Left half the position to hedge against the reducing likelihood of a recession.

It’s been a while since I’ve added a new position in this portfolio, but I’ve just initiated one in Disney (DIS). With the return of Bob Iger as CEO, I see this one as a speculative turnaround play in the short to medium term. Depending on the momentum, I might add to this position as the price breaks through various resistance levels.

How did your portfolio perform in July and what are your plans for August?

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Disclaimer: This is not financial advice. I am not professional financial advisor nor do I work in the finance industry. Anything I write here is purely my personal opinion. Please do your own research and due diligence before investing into anything. All investments come with associated risks. Best to consult a financial advisor if you’re still unsure.

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