Showing posts with label Investments. Show all posts
Showing posts with label Investments. Show all posts

Sunday, 11 October 2020

US ETF Portfolio Update - September 2020

Hello everyone, 

 Our apologies on the lack of updates but we both are currently pretty swamped with school assignments. Life has really been about chasing deadlines. That being said, the market is currently rather erratic, with Trump confirmed with COVID and the presidential elections on the way. I did made a few additions to my ETF portfolio during September, you may find the numbers in USD here:


I take reference to the market closing price on 8 October 2020.  And I do not include any dividends received into my computation.

Stay safe,
O

Monday, 7 September 2020

US ETF Portfolio Update - August 2020

 Hello everyone,


Here's a quick update on my US ETF portfolio. As the US market turn red in the last part of last week following news that vaccine will not be released early as planned, my portfolio took quite a hit on it. However, the gains in the early part of the month have mitigated this impact. I still managed to see green month-on-month. 

Here are the numbers in USD:

ETFQuantityTotal CostMarket Value
VOO2562.00629.64
VHT1195.00201.81
XLP4239.16262.28
XLK2196.00236.24
ARKK3199.27261.15
Total1391.431591.12
Gain14.35%

I take reference to the market closing price on 4 September 2020.  And I do not include any dividends received into my computation. If this pullback continues, I am definitely adding more of each ETFs.


Stay Safe,
O

Thursday, 6 August 2020

US ETF Portfolio Update - July 2020

Hello everyone,

Here's a quick update on my US ETF portfolio. As Nasdaq and S&P continue to see gains, my portfolio was also able to share some of it. I am happy with the overall performance of it. I am currently busy with internship while T is busy with his matriculation to University. I did however had some time to do a quick trade earlier this week which I will perhaps share over the upcoming long weekend. 

Anyway, here are the numbers in USD:

ETFQuantityTotal CostMarket Value
VOO2562.00610.3
VHT1195.00205.68
XLP4239.16252.72
XLK2196.00227.72
ARKK3199.27256.83
Total1391.431553.25
Gain11.63%

I take reference to the market closing price on 5 August 2020.  And I do not include any dividends received into my computation. I might increase my holdings in the portfolio during August to do some rebalancing (although I feel that the portfolio is relatively balanced already). But I am definitely looking to add more if the opportunity allows.

Happy National Day!

Stay Safe,
O

Thursday, 30 July 2020

TSMC: 20% upside within a week

Hello friends,

As we ease into the long weekend, I would like to do a review on TSMC. Previously, I did a short introduction of the company (here). Since then, there were some rather significant developments to the semiconductor scene – rather positive ones for me personally.


Firstly, TSMC’s earnings release were above expectations. And overall revenue increase by 28% yoy and net income by 81% yoy. I think this came in rather expectedly due to the production capacity of TSMC being fully booked. I believed the stock price then was already priced in for the earnings hence there wasn’t much movement in the price despite the better than expected results.

 

Second, the recent issue of Intel’s failure to meet its demand due to shortage of supplies gave TSMC an even further boost – in two ways. I briefly talked about this problem of Intel in the previous post. AMD (one of TSMC’s main client) is a direct rival of Intel. Both are neck at neck in terms of the development CPUs scene where Intel used to hold an almost monopoly position in the past. Naturally, given the current circumstances, AMD is gaining more market share due to orders flowing in from Intel to AMD, and hence increasing their orders to TSMC. (I do acknowledge that there might be a level of client stickiness to Intel, but given the current pandemic, Intel would need a long time to be able to get its supply back on tracks.) Evidently, client stickiness is not as significant given the recent AMD’s earnings call which expects revenue to grow by 32% in 2020. AMD rose 12% in one day.

The next point is what I believed caused TSMC’s share price to increase by more than 20% in less than a week. There were rumours that Intel was considering to revamp its whole IDM model and to stop manufacturing its own chips following its 7nm chip delay. Consequently, there were speculations that the manufacturing will be outsourced to TSMC.

 

Will TSMC actually help Intel manufacture their chips?

 

I believe the situation is still rather unclear. But it is important to note that TSMC have no more capacity to manufacture the chips even if Intel decides to outsource to them. Furthermore, I am not too sure whether there will be a conflict of interest between AMD and Intel.

 

Ultimately, the prospects of TSMC are very forward-looking and the upcoming gaming consoles launch will be another potential catalyst to note. I am continuing to be bullish on this stock after these series of events and will be looking for more opportunities to add more of it into my portfolio.

 


Stay safe and healthy, 

O



*Disclaimer: I have positions in TSMC and AMD.

Tuesday, 28 July 2020

High-dividend stock on my watchlist!

Hey everyone,

hope that y'all have been doing well recently! Haven't had the chance to post in the past two weeks, but I'm coming back today to discuss a stock that I have placed on my watchlist for the past few months!

The stock in question is Micro-Mechanics (SGX: 5DD). A brief introduction about what Micro-Mechanics does. It designs, manufactures and markets high-precision parts and tools for the semiconductor and other high technology industries. It has five factories across the world, located in Singapore, Malaysia, China, Philippines and the USA, with direct sales presence in Taiwan and Europe.

Micro-Mechanics first caught my eye as I saw that it's dividend payout has never decreased over the past 10 years, while holding a healthy balance sheet. If it manages to maintain a $0.1 dividend payout this year, it would be offering a 5.32% yield at its current price, which is surprisingly good considering the stock's recent performance has it returning to pre-March crash levels. It is currently trading at 1.88, with a 52-week range of 1.32 - 2.00.

Micro-Mechanics has a distinct advantage, that is being in the semi-conductor industry. While Micro-Mechanics' current P/E ratio of 19 might be unappealing to some, I believe there is still further room for growth, considering how strong the semi-conductor industry as a whole rebounded well during the COVID-19 situation. This industry seems to be only looking upwards for the next few years to come, with the world being forced to digitalize at a much faster pace due to COVID.

An area for concern for me would be its dividend payout ratio, as it exceeded 100% during its' last fiscal year. With it's strong balance sheet, it does not seem like much of a concern for now, especially since it's 5-yr average of dividend-payout ratio is at 64.74%, but it could be something I look out for going forward.


Micro-Mechanics have been on my watchlist for quite some time, and I would definitely be looking for an entry once I manage to gather some liquidity. Till my next post, take care!

Stay Safe,
T

Thursday, 16 July 2020

Portfolio Review 1H 2020 - Accomplished my goal 6 months earlier!

Hi everyone, 

I did a quick calculations of my overall net worth and see that I have achieved the first goal I set for the year - 30k by end 2020. In fact, I actually achieved it last month but due to uncertainties in the market, I felt that the market value could potentially dipped down any time. Nevertheless, as I cross a little more above the mark, I thought I pen it down here.

Cash           7,30023%
Bonds           1,0003%
Equities         23,00073%
Total $ 31,300.00100%

I am glad I took the leap of faith to continue to trust on the fundamentals of companies and purchase the shares despite the bearish sentiments earlier in the year. I believe these sentiments might come back soon and I will seize the opportunity as well. Networth to reach 40k by end of year? I hope I can achieve that.... The second goal of $600 dividends for the year is also well on track and I will perhaps make a post about it when I hit it or end the of the year. 

Side note: TSMC's earnings is released at the time of this post and I hope that the strong fundamentals of this company prevails. The semiconductor industry just barely took off.


Thanks for reading,

Sunday, 5 July 2020

US ETF Portfolio Update - June 2020

Hello everyone,

As the US market closes for the weekend one day earlier to commemorate Independence Day, I thought I will do an  update on the US ETF Portfolio that I started last month. With a better than expected jobs report out on Thursday, the portfolio saw some nice gains overall. Also, I decided to increase the proportion of VOO in the portfolio and hence bought another share of it at the same price.

ETFQuantityTotal CostMarket Value
VOO2562.00573.62
VHT1195.00195.65
XLP4239.16237.12
XLK2196.00210.54
ARKK3199.27224.82
Total1391.431441.75
Gain3.62%

Only the consumer staples (XLP) is seeing a slight red. XLP, XLK and VOO also paid dividends in the month of June. I did not take into account the dividends into my calculation as my focus for this portfolio is not dividends. I am happy with the overall performance of this portfolio, with an unrealised 3.62% gain in just a month. I look to average my cost price down should the market see a slight pullback. 

Till then,
P

Friday, 26 June 2020

Is it a good time to buy? - Elevator Pitch on TSMC

Hello everyone,

I hope everyone spent some time catching up with friends and families in small groups with the phase 2 reopening. As the stock market is still relatively uncertain about the direction it wants to go, I rather adopt the mentality of looking at companies that I do not minding holding for a long term, probably 5-10 years. I have decided to look at Taiwan Semiconductor Manufacturing Company Limited (TSMC) (NYSE: TSM) (TWSE: 2330), and will share 3 main fundamental points that I think will propel this company forward.

Background: Established in 1987 and headquartered in Hsinchu Science Park, Taiwan, TSMC pioneered the pure-play foundry business model by focusing solely on manufacturing customers' products. By choosing not to design, manufacture or market any semiconductor products under its own name, the Company ensures that it never competes directly with its customers.

Notable clients: Apple, AMD, Nvidia, Qualcomm, Sony, (Huawei)

Leading Edge Technology
TSMC has set plans for a very sound logic node progression. As of now, TSMC have started the production for 5nm chips and plans are in place to ramp up the production capacity. In terms of the chips advancements, TSMC has also started to assemble a R&D specially for the development of the 3nm chips. I like this move a lot as it shows that the management has lots of hindsight and do not forgo the future development just because the current clients do not demand it. In terms of its competitors wise, the main competitor would be Samsung who also has acquired the expertise for 5nm production. The rest of its competitors are rather back dated due to the fact that the capital expenditure for developing the chips are extremely high, going into billions of dollars. Another competitor, Global Foundries abandoned its 7nm efforts due to the sheer complexity and costs involved. I see a first mover advantage here for TSMC.

Dominant Market Position
TSMC runs on a pure-play foundry business model, which means that they do not have any semiconductor products under its name. Because of this, clients are more willing to engage TSMC. For instance, it is unlikely for Apple to approach Samsung to manufacture its chips as they are direct competitors in the smartphones industry. Hence, there is really no clear or direct competitors that TSMC needs to be wary of as of now. Barriers to entry is also high given the high CAPEX.

Seen below, TSMC has been in a dominant position in the industry, with more than half of the market share.

                Market share in 2019 (%)

It might be worthy to note that one of TSMC's key clients was Huawei in 2019. However, with the ongoing trade war between China and USA, TSMC have since stopped taking orders from Huawei. Huawei made up about 10-15% of TSMC's revenue in FY2019.
Yet, I do not have much worries about this. Recent news have seen Apple's desire to cut orders from Intel for its Mac chips and to start designing its own chips. Reports have stated that the chips will be manufactured by TSMC, and are said to be more advanced than the current chips provided by Intel. You can refer to this link for more information.
The only worry I then have is that TSMC might be overly reliant on Apple and its performance. But I do see a very high potential for it to tap on Apple's growth.

Speaking of Intel, the shortage of CPUs supplies by Intel have given AMD a chance to acquire market share in the industry. I see the partnership between AMD and TSMC to significantly benefit the latter as AMD continues to ramp up its production to meet the demand that Intel failed to meet.

Incoming Gaming Cycle
With the ongoing pandemic, stay home entertainment such as gaming has been on the rise. Nvidia, one of TSMC's clients will launch their 7nm GPUs this year. They have also locked down TSMC's capacity for 5nm production in 2021. 
Furthermore, the highly raved and anticipated launch of PS5 has also been confirmed by Sony. PS5 will be utilising the 7nm chips from TSMC. It has been 7 years since the PS4 was launched and I believe that demand for PS5 will be extremely high at the launch.
Perhaps only drawback here is the rise of mobile phone gaming, which will result in lower than expected demand in this aspect. 

On a final note, TSMC's production line has not been as badly affected by the pandemic as its closest competitor, Samsung. The former's manufacturing plants in Taiwan did not face any stringent regulations while Samsung's plants in South Korea met with lock down orders. There are also news of an incoming second wave of infection that might further hinder Samsung's plans to resume production. We might see some clients shift here should Samsung failed to meet the orders.

I might do a financial highlights review of TSMC, but for now, I continue to keep it in my watchlist. I have no holdings in TSMC as of now. 

Stay safe and healthy,
P