Sunday, February 05, 2017

Financial Review - January, 2017

January was a good month for the portfolio with small gains across the board producing a 2.61 percent increase in net assets.

For the year, the portfolio is up 2.61%. The adjusted change from when I retired in September 2013 is an 8.92% increase. Hong Kong liquidity stands at 38.6 months of estimated outgoings. 

Here are the details:

1. my Hong Kong equities increased. I added some additional shares in HSBC (HK:5) at HK$64.20 in January;

2. my AU/NZ equities appreciated slightly. I sold my shares in Hellaby Holding (NZX: HBY) at NZ$3.60 under a takeover offer for a nice profit (although I will miss the dividends). I purchased some additional shares in NZ Exchange (NZX: NZX) at NZ$1.06 and opened a position in Colonial Motor Company (NZX: CMO) at NZ$7.25. I am still looking for more investments in New Zealand to get a better match between income and expenses in that currency; equity ETFs were up (India, Hong Kong and China) in line with the local markets;

4. my position in silver rose;

5. all tenants are paying on time but we have one vacancy and a second tenant moving out shortly. The current vacancy is in a building is currently subject to a lengthy renovation exercise. A new tenant has agreed to starting a new lease in three weeks' time at a rent which is above the discounted rate which the previous tenant was paying but below the level the property would achieve after the building renovation has been completed - a much better outcome than having an extended vacancy. The property needs to be to be redecorated (it has been several years since it was last done). I have already secured a new tenant for the property which will become vacant shortly and will only need to do minor touch up work before the new tenant moves in. The rent is about 4% lower than the previous rent;

6. both the NZD and thee AUD rose against the HKD/USD. I purchased some NZ$ @ 5.56 HK$;

7. my position in bonds remains small;

8. expenses were very high due to starting my elder daughter in boarding school (school fees, air tickets, hotel, hire car etc) but had been fully accrued;

9.there were no transfers to Mrs Traineeinvestor;

10. there were no derivative transactions this month.

My HK cash position fell during the month due to the high expenses and the remittance of funds to New Zealand. I currently hold 38.6 months of expenses in HKD cash or equivalents.

I also had another look at total household gearing. Total liabilities (including accruals) is less than 10 percent of total assets. There is obviously plenty of capacity there to increase debt levels if I could find the right opportunity.