How much have I earned and lost in 2020?

Objective for 2020: Maintaining the current level of passive income works -- Income was $16,200 ($1,350/month). I thought it was a simple objective but I didn't meet it. In fact, income was $0 because I had to write-off some of my capital.

After so many years of setting objectives, not one was remotely close too achieving target, which shows how unpredictable the markets are.

Average stock dividend yield in

2017 = 4.56%

2018 = 4.73%

2019 = 4.55%

2020 = 3.83%

This year, the verdict for Hyflux was out, and I wrote off my Hyflux CPS investments. I can imagine how painful it is for the rest of the creditors who have to write off >$3.3b investments. I was fortunate that I sized it small (3000 units during IPO), although I made the mistake to buy more CPS (added 10000 units) just 2 months before they were due to redeem the CPS. I learnt an expensive lesson.

I sold off my loss-making stock - Silverlake Axis, because they haven't been able to grow their profits, and they have a lot more competitors today as compared with 5 years ago.

I reduced position in Keppel Corp, mainly to not have more than 10% of my stocks in 1 company. I still like Keppel Corp because of their property.

I profited 20% from Dairy Farm and Comfort Delgro trades. They just happened to present good value, and they just happened to increase 20% after I bought, so I decided it was better to take profit because I couldn't convince myself that their business had fundamentally improved to warrant the higher prices.

I bought SPH REIT, AIMS REIT, STI ETF, Haw Par, Hongkong Land, mainly because I am bullish on property. Liquidity will definitely lead to inflated property prices in a matter of time.

I only managed to use a fraction of my warchest because the market corrected only for a few weeks. Sometimes when I read about people who criticise people (like me) who only buy on dips (actually I buy when prices are discounted and present good value), I wonder why they are so eager to preach their strategy. In any case, the more important thing is to stick with one strategy because switching between these two strategies is a certain wealth destruction strategy. Eventually, both sides will win, just that somehow one side makes a lot more noise than the other.

As the hurdle savings accounts all cut their interest rates this year, I decided to make housing refund to CPF. I bet many people did that too because it made the most sense. For those who say that CPF money cannot be touched if you were to do a refund, it's true, but you still can use it to buy stocks and funds and property with it. So I will treat it as my warchest too, just more restricted. I still hold cash, but not as much as before.

I am still holding my money in Autowealth. I like Vanguard funds, diversified and low-cost.

I bought into a few funds via Manulife ILP when prices were lower in Jun. It was a case of wanting to buy in Mar, but because of some admin issues, I didn't end up buying. Trying a new financial advisor for this case. Friends told me that I have too much money to experiment.

For all my effort, I barely broke even this year. Considering how many businesses had to close down this year, I think I am just lucky to be not affected (yet).

Objective for 2021 will be to buy more good stocks. I can't predict what the future will be, I can't control the dividend income, but I think that there will be more opportunities to buy good stocks at discounted prices because of market volatility. I will be targeting companies with property and/or high cash flow. Volatility is likely going to run through the whole year because 

1. industries are undergoing structural changes due to changes in demand, changes in consumer behaviour, caused by travel restrictions, this will translate to many jobs lost, and new jobs created. The new jobs will likely have talent shortage, which drives up manpower costs, and hinders the progress; 

2. markets have prices in hopes in the vaccine, and that economic recovery is certain in the next 1 year. However, if another pandemic hits, or if the vaccine faces an issue and need to be recalled or halted, or if the virus mutates and the vaccine is deemed useless, or if the vaccination takes longer than expected to be effective, or if travel restrictions need to remain longer, etc.; 

3. many governments will start to run out of pandemic budgets and have to tighten their spending on many keep-the-lights-on stuff, which will cause a government-induced demand contraction. The services required will likely remain the same, but the government will pay a lower price, consequently, down the food chain, margins are squashed because the government sets the prices. 

It's been a memorable year.