Dear Students of Batch 10,
It’s been a great honour and privilege to be able to conduct a 2-Day Early Retirement Workshop for you.
The investment decisions made by Batch 10 was very unique compared to the decisions made by previous batches, and this goes to show how much a portfolio can be moulded by the personalities of the cohort in spite of the fact that the underlying stock strategies have not changed too much from last month.
For this masterclass, there are two interesting developments that deviated from the norm of previous batches of students:
The first development is that the class rejected almost all the banks that have been shortlisted by the quantitative model. Right until Batch 9, banks were a hot favourite of the students of this program so much so that I will ordinarily force the class to reject one bank to prevent the portfolio from being dominated by banking counters. But this time round, DBS and OCBC bank were rejected by the class after a qualitative review. The main reason is that class believed that we are now in an era of lowering interest rates and this will affect the profits from the loans business moving forward. Interestingly, the class decided to keep only UOB in the portfolio, which is consistent with broker digest published by the Edge magazine this weekend where UOB was the only bank to receive BUY, ACCUMULATE or ADD calls by all of their selected brokers.
The second development was that the class failed to reject any of the REITs that they reviewed during the exercise, effectively accepting all 10 counters that have been offered to them. The class was even able to accept BHG REIT, which lacked a decent analyst report and has been rejected by every batch of ERM students since the class began in September 2018. The catalyst for this change was the acquisition of a Beijing Outlet Mall 5 days ago which the class believed that may benefit from the Chinese economy becoming more consumption driven over the next few years. We will know in time to come whether these will turn out be good decisions.
Beyond these two interesting developments, we were able to run our emigration exercise a second time and this time we reviewed Malaysia, Indonesia, UK, US and Taiwan as emigration destinations. In the end, Taipei narrowly defeated Kuala Lumpur by one vote. Taiwan was a popular destination because of its cultural similarity to Singapore.
Finally, I also learnt a lot from you over the weekend. When you found out that I have Type II diabetes, you were very open with sharing some ideas on how to control my blood sugar control. I will be trying out the powder from the Amla (Indian Gooseberry) fruit once I get into a mini-mart in Woodlands. I will also be looking at the different dieting plans that you have shared with me.
Christopher Ng Wai Chung