One company posted a formula to calculate its employees salaries - How measurable it is?

For most companies we worked with, we were always told that salaries and remunerations are confidential information and should not be shared with other employees in the company. The main reason for this is probably to refrain colleagues from comparing and resenting another's employees salary, especially if one's productivity is lower but receives a higher pay.

One recent Social Entrepreneur start-up company based in San-Fransisco - "Buffer" - has surprised everyone by being a company that publishes a transparent formula for all of its employees. But just how much measurable and effective is it?

If you see from the formula, the only subjective element is probably the "Experience" factor, which to me is probably the most important factor but surprisingly has one of the least multiplier. So take for instance, a fresh-grad who has a "Junior" level of experience earning a 1x multiplier versus a mid-level candidate with an "Intermediate" level of experience who has worked for several years and earning only a 1.1x multiplier - the difference seems so meager and uncalled for.

I am actually a little surprised that being an US company they did not put any multiplier on the level of education (Degree, Masters, PHD, etc) that a candidate has completed. From what I know, US is one of the few developed countries who has put much focus and respect on its education metrics.

The formula also did not take into account the better performer versus the average performer and pays everything according to the formula. So we could have a situation where an employee hit a high level of experience, living in Hong Kong and choose a salary choice but put minimal effort and still goes home with the most amount of paycheck.

I wonder how sustainable will this formula be for the employees.

Can a paycheck be measured effectively by such a formula? What do you think?

My Investing Goal for 2014

As we draws down the rest of the days in 2013, most of us will take this time to reflect back on the things that has happened in 2013 and set a goal for the upcoming new year of 2014.

An overlook back of my investing journey in 2013 would see that I started off the year with about S$ 128,210 worth of shares. Based on the market value as of 13 Dec 2013, the portfolio value stands at S$219,130. That is an overall 71% year on year increase to my delight. Some of the major contributor to this significant increase includes:

- Active income from job (Proportion of savings rate were in the 80% range for 2013)

- Realised profits from capital gain

- Dividend income reinvested

- Other trading income from soccer betting

While 2013 was great personally, 2014 will be a different field altogether as I plan to focus on a few new things that was never present in my life previously.

1.) Life Insurance

I've decided to enhance the protection for my insurance coverage to cover life. The coverage that I have decided is S$500,000. In order to do this, I will have to fork out S$543/month for the 20 years ahead, for which I will then be covered until 100 years old. The breakeven price for the surrender value is around 25 years, by which I would have become financially freedom (hopefully, finger crossed). But I am not too concerned with this as the main objective is to provide enough coverage in case things doesn't go as planned.

2.) Child's Expense

My finally awaited long dream is about to come true. Yes, my wife is currently expecting and my child is expected to born in the mid of April 2014. While many parents are stressed over the financial issues they will have when they have kids, people who have planned well should have no issue dealing with it. For me, I am planning to accrue S$1K/month for a start for my kids expense. That will bring down my savings rate down by about 20% based on my current pay. Again, I am not too overly concerned with this. I am ready to be a father and am ready financially to give the best for my child.

3.) SMU - MBA Graduation

This has been tough for me to juggle between working and studying at the same time. I have about a year to go before I will graduate (hopefully) in Dec 2014. With the born of my child to come in 2014, I will now have to juggle even harder among the three. But I am optimistic. If people can do it, then B can do it too.

4.) Betfair $20K endowment

Let's call it an endowment shall we :D

For those who are in the same groundfield as myself, we will know what is this. This so called "endowment" will mature in May 2014 giving me a very good returns on investment. But with high returns comes high risk. Let's hope everything goes to plan.

5.) Dividend Investing purchase

My main objective is still on finding good value stocks which yields good returns for my long term portfolio. With many funds manager dumping their dividend shares and going for more growth shares in 2014, dividend investors could have opportunities to add on to their portfolios. My goal is to increase the total dividend income for 2014 to $16K/year. Let's see if the market presents any opportunity to add on to some value stocks.

Projected dividends for 2014 (based on latest holdings)

Companies	lots	Dividends ($)/lot	Total Dividends ($)
FraserCenterpoint Trust	30	109	3,270
SPH	7	220	1,540
Vicom	6	187	1,122
Ascott	15	89	1,335
FraserCommercial Trust	14	78	1,092
Neratel	20	40	800
First Reit	13	63	819
Sembcorp Ind	2	150	300
ST Engineering	3	168	504
China Merchant Pacific	8	55	440
ParkwayLife Reit	3	106	318
Second Chance	13	34	442
Ascendas Hospitality Trust	7	64	448
Mapletree Log Trust	1	71	71
			12,501

Last but not least, I would like to wish readers and each and everyone a Merry Christmas and a blessed New year ahead in 2014.

Singapore Pools to take more market share in Singapore

Singapore Pools - Towards Community Purpose and Benefit

A couple of weeks ago, the government plans on the possibility of limiting access to online gambling platforms and sites. They quote the reasons as being harmful and people will get addicted easier when betting online than on site. Being a regular in this field, I can vouch that it is absolutely true and fair enough to the government for doing that.

Then the news came (not sure whether they are really doing that or not)...

Singapore Pools are now looking to launch their first licensed gambling website to be based in Singapore. Of course, they can somewhat state a few rules to ban Singaporeans from registering online, but it looks remotely unlikely. By doing this, they would be capturing more market share of people who previously were betting in other gambling sites elsewhere.

This brings me to then my next question. What is the point of banning people from other gambling websites and then subsequently create on of each own. And to add to that, they are offering at a much lower odds compared to other gambling sites such as WilliamHill or Bet365. So it seems like the government is contradicting their own reasoning.

I hope the government will think this properly...or else there will be chance for the social to have more attacks on the government coming 2016.

"Dec 13" - SG Transactions & Portfolio Update"

No.	Counters	No. of Lots	Market Price (SGD)	Total Value (SGD) based on market price	Allocation %
1.	FraserCenter Point Trust	30	1.75	52,500.00	24.0%
2.	SPH	7	4.00	28,000.00	13.0%
3.	Vicom	6	4.85	29,100.00	13.0%
4.	Ascott Reit	15	1.17	17,550.00	8.0%
5.	FraserCommercial Trust	14	1.23	17,220.00	8.0%
6.	Neratel	20	0.68	13,600.00	6.0%
7.	First Reit	13	1.04	13,520.00	6.0%
8.	SembCorp Ind	2	5.22	10,440.00	5.0%
9.	ST Engineering	3	3.78	11,340.00	5.0%
10.	China Merchant Pacific	8	0.91	7,280.00	3.0%
11.	Plife Reit	3	2.18	6,540.00	3.0%
12.	Second Chance	13	0.455	5,915.00	3.0%
13.	Ascendas Hosp. Trust	7	0.73	5,110.00	3.0%
14.	Mapletree Logistic Trust	1	1.015	1,015.00	1.0%
	Total SGD			219,130.00	100.00%

This is the last portfolio update for the month in the year 2013. Before we know it, we'll soon head out into the year 2014 and be welcoming the horse year :)

This month, I've done a couple of early year end shopping for a couple of my favorite list of stocks: ST Engineering, Ascott and Mapletree Logistic Trust.

I've bought the first round of ST Engineering at a price of $3.80. As mentioned in my previous post, I think it is fair to say that it is trading at fair historical valuation, nothing sort of compelling buy everyone is shouting for. Earnings growth has disappoint so far this financial year and it looks to stay the same in the 4th quarter. Having said that, I am expecting EPS to remain flat for this year and dividends to remain at $168/lot, giving in excess of 90% payout to investors.

I've also finally received the results for my Ascott Reit rights allocation this month. I applied fully for my 2,200 rights and also successfully received my 1,800 excess allocation application at $1 a share, bringing my Ascott allocation up to my top 5 holdings.

Last but not least, I've also open a small position in Mapletree Logistic Trust (MLT) at $1. MLT, having the most geographical industrial location and longest lease structure as compared to other industry Reit, is giving a greater earnings visibility of their future earnings. With more than 7% yield, I am watching this by opening a small position.

That's it!!! I'll be reviewing my investment for the year 2013 in my next post and the upcoming goals and resolution for 2014. Until then, hope everyone is well and take care to celebrate the festive season :)

Recent Actions - ST Engineering X'mas Sale

First warchest for ST Engineering activated and my first X'mas present for the month :)

I entered a small position for ST Engineering today at $3.80 after a few days of general continuous decline in the STI market.

ST Eng has always been a stock that I've always liked due to its defensive nature. 

I've previously bought and sold the stock for massive profits and now I am glad to have them back at a price I am comfortable to hold them again.

At current price, they are slightly below the 5 years historical PE mean of 20.62. With the overall market declining, there could be potentially more meats to go down. At that point, I will accumulate a few more of this potentially strong stock.

How will S-Reits perform in 2014?

With just over less than a month to go, it seems that investors favorite, S-Reits will end up its performance in 2013 in negative territory.

To date in 2013, S-Reits have returned -7.7% price return YTD, underperforming the STI ETF by 6.4%. This is in stark contrast to the stellar performance it has given investors in 2012, registering a 41% price increase in previous year.

So how will S-Reits perform in 2014? With impending QE fears on the rise, it looks like many investors and analysts are not favoring and considering S-Reits as part of their portfolio for 2014. If you are still in the favor for S-Reits like me, then it is important to be selective on our picks.

Office Sectors

Analysts have been most bullish about the office sectors in particular as they have cited office rents in Singapore to have bottomed and rental growth to resume in 2014 and 2015 by about 6%.

CapitaComm (CCT) and FraserComm (FCOT) are two examples of S-Reits which has exposure to Grade A and Grade B offices respectively in Singapore.

For instance, in Q3 2013, CCT's average office rents rose 0.9% QoQ to $8.03/month and is also the fifth consecutive quarterly increase. It seems that as economic outlook are getting stronger in Singapore, the rents price would follow as well.

Retail Sectors

I suspect retail sectors are going to lag and underperform in 2014 due to the many available new malls built in Singapore recently. With the addition of the recent Bedok Malls and Westgate (with SPH's Seletar Malls due in 2014), the competition for higher rental prices will be harder to achieve with occupany rate another factors management have to take a closer look at.

Hospitality Sectors

I like the hospitality sectors as a longer theme play for Singapore tourism outlook on the rise. This perhaps explains why I do have a considerable amount of hospitality Reits in my portfolio. However, the RevPar for the hospitality sectors are on a downtrend and many companies are facing competition from the increase in supply of hotel room in Singapore. This sector nevertheless gives a good yield and I will be adding only if they cross over my 7% target.

Healthcare Sectors

With Singapore having the least number of baby born across the other 209 countries (baby born ratio is 0.93), it seems almost inevitable that Singapore, together with Japan are going to have an ageing population in the near future. Given its defensive nature, the healthcare sectors hardly gives any decent yield. And with rising interest rates impending, it could costs some downside risks for the sectors.

Industrial Sectors

Industrial sectors is the only sector missing from my portfolio.

It is quite ironic that Ascendas remains my 2nd top pick list but yet I am not feeling great about the industrial sectors in general. Although manufacturing remains an important economic pillar of Singapore's 2014 growth, inflationary cost pressures and supply competition will eat up rental profits for the sectors. But if the price remains right, I will still be happy to add them into my portfolio.


With that all being said, it looks like S-Reits will once again underperform the index in 2014 as most sectors have their respective worries. So if you are still looking to buy on Reits, you need to be more selective. I still somehow believe that 2014 will present a good opportunity to buy Reits, especially when the Fed finally tapers and the price hit bottom.

So what do you think of the different sectors and which sectors do you think will outperform in 2014?

Ascott Reit - Rights Units Applications

 Results of Rights Units Applications for Ascott Reits are as follows:

	No. of Rights Units	% of Rights Issue
Valid Acceptances	246,557,766	97.2
Excess Applications	168,453,301	66.4
Total	415,011,067	163.6

From the results, it seems many investors subscribe to the rights allocation they were entitled to. In fact, only 2.8% were available for the excess applications. This came as a surprise as Reits are generally getting weaker and weaker each day from the news of Fed tapering. Perhaps, the huge discount plays a big factor in subscribing, at least that's for my case.

I don't hope much of getting excess applications. But at least I will be entitled to my rights, just like the 97.2% of people who subscribed to it.

When is the market going to crash down?

This has been the Billion dollar question for everyone since we had Dow hitting record high 16,000, S&P hitting record high 1,800 and Nasdaq hitting record high 4,000.

It has been common that when major indexes hit their respective record high, retail investors become more wary of their reversal turnaround and expecting a crashdown in the stock market.

My colleague at work says that Mar 2014 is the turnaround day the market will come crashing down. Another colleague says the Fed will extend its buying program and keeps interest low until 2015. Research Analyst at UOB mentioned investors to be wary of Fed tapering in Jan 2014. Marc Faber, Dr. Bearish, has been warning investors that stock market could gone crashing down next year worse than the state of economy in 2008.

What about some market statistics?

We have the Shiller PE ratio, which measures PE based on a 10 year adjusted inflation, currently at a high of 25.42. Historically, it has a mean of 16.50. Based on past statistics, the higher the Shiller PE ratio, the lower the returns investors are going to get in the future.

Mean:	16.50
Median:	15.90
Min:	4.78
Max:	44.20

We also have another indicator in the CBOE VIX, where it is a key measure of market expectations of near term volatility. Currently, VIX is hovering around 13 to 15, which currently is at the 52 weeks low. As this is only an indication, it might stay low for a good number of years. But nevertheless, it is still a good indication that your returns would be lower in the future with a lower VIX than a higher VIX.

As we enter towards the final month of the year, there will probably be volatility in the market due to markets hitting recent record high which makes investors cashing in on profits. Fund managers have also been seen taking off profits off their portfolio by rebalancing their respective weightage during the window dressing period. Until then, not you and I can predict where's the market heading in 2014, but we can do so more prudently by playing our trump cards cautiously, even if it means obtaining lesser returns in the next couple of months.

The Myers Briggs Personality Test and How much should you be earning?

Many companies have now used the Myers Briggs Personality Test as the first round of elimination to search for suitable candidates. I remember the time when I had to do some sort of the Myers Briggs test for my current job. Applying for an Accountant position, it is a no brainer that they are looking for some sort of good organization, set-up and comfortable with numbers. If you are a creative type of person, then perhaps you might want to consider being an Accountant.

The Myers Briggs test are broken down into 4 main categories which is then further broken down into sub-categories. 

It is interesting to see that the ENTJ commands the highest household income amongst all other types. These are the types of people who are "Reformers" - Innovative, Leadership and Strategic being their main strengths. These are the people who are CEO in the company. They lead the entire team structure and have to be objective with their goals.

Maybe not surprisingly so, the "Idealist" are at the bottom of the foodchain in terms of their household income. These are the types of people who works for charitable and non-profit organization and  make the world a better life to live in.

So which personality do you belong?

Recent Actions - Boustead runs on Steroids

With the recent Dow and S&P hitting the high 16,000 and 1,800 respectively, it seems no stopping the market going higher and higher. This is despite all the tapering noise that we are hearing for months now.

On the local market, we don't seem to have a run-up well above the 3,200 mark on the STI. It seems that markets are lost for directions and there simply no company that can well lead the way for the STI.

One position I've made today is liquidating all my shares for Boustead. I've divested them away at $1.585 for 6 lots and S$1.65 for 1 lot. Overall, this has been a good profits made well over 50% since I've purchased them couple years ago. I think this is a good stock for the long term run by a well managed management but the risk has gone up by a lot with current price sitting at the $1.65 range.

The reason I've decided to sell Boustead is because I feel the recent run-up has priced in forward earnings and expectations which the markets expected to be very good. Multiple PE valuations based on forward earnings have also gone up beyond their historical valuations and it is easy to see the risk. Sure, Boustead has a good upstream catalyst in their Iskandar investment, potential industrial pipeline, etc. But should the market suddenly turn southwards or any news that will affect Boustead, we can easily see its price go all the way to the $1.30-$1.40 range, which is the range I will be comfortable to pick them up again.

I've also divested small lots of FCOT today at $1.265 to reduce my exposure in Reits and raise further cash holdings.

With all the selling so far, my cash position has increased and it is in the comfortable range to pick up any opportunities should the market turn southwards.

"Nov 13" - SG Transactions & Portfolio Update"

No.	Counters	No. of Lots	Market Price (SGD)	Total Value (SGD) based on market price	Allocation %
1.	FraserCenter Point Trust	30	1.81	54,300.00	25.0%
2.	SPH	7	4.25	29,750.00	13.0%
2.	Vicom	6	4.90	29,400.00	13.0%
4.	FraserCommercial Trust	14	1.265	17,710.00	8.0%
5.	Neratel	20	0.695	13,900.00	6.0%
6.	First Reit	13	1.075	13,975.00	6.0%
7.	Ascott Reit	11	1.225	13,475.00	6.0%
8.	SembCorp Ind	2	5.39	10,780.00	5.0%
10.	Boustead	7	1.52	10,640.00	5.0%
11.	China Merchant Pacific	8	0.895	7,160.00	3.0%
12.	Plife Reit	3	2.25	6,750.00	3.0%
13.	Second Chance	13	0.455	5,915.00	3.0%
14.	Ascendas Hosp. Trust	7	0.76	5,320.00	2.0%
	Total SGD			219,075.00	100.00%

It's the time of the month again where I share with readers my updated monthly transactions and purchase for the month. I get excited whenever I update this section of the posts as I can see the fruits of my labor grow each day by each day. As the market price tends to fluctuate during any time of the economy, I usually tend to focus more on the dividends I will receive from each individual lots of my 14 holding shares. I hope it will be an inspiration to new young investors more than just showing off the value of the portfolio.

This month's stock performer in my portfolio is Boustead. With most companies reporting their quarterly results, prices are bounds to fluctuate during the month as there were some who did well and some who did not perform to expectations. But the story for growth for Boustead keeps going, from winning contracts and doing well all across the 4 segments of the business.

The only purchase I have made for the month is on Ascott Reit. As previously mentioned on my posting on Ascott, my strategy was to purchase to round it up to the best combination possible odd lots. It will probably ended up with 14 lots by the end of Dec once the rights application is open.

I think with quarterly reporting now behind us and many shares going ex-dividends in Dec, there will probably be opportunities to deploy some of the cash I have on hand. ST Eng, Plife Reit, Jardine and Neratel are a few of those I am monitoring closely. 

Due to the huge percentage allocation I currently have in Reits in my portfolio, I would probably not further add more Reits. So Plife is probably out of the way. Jardine is a little expensive to me in terms of the price it is priced in per lot (in fact, the current valuation of the company looks reasonable) and a little over my budget at the current closing price of $34 so unless it is going down to $28-$29 range I will probably give it a skip too.

We have only one final month left to the new year so be cautious, plan your cashflow accordingly and prepare enough funds if there's a sale in the market or if there is one in ... the New Robinson Mall ^.^.