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More in equities or fixed income? Update on my health.

Thursday, April 20, 2023

This started out as a reply to a reader's comment but it got pretty long.

I also feel that there are things which many people might want to eavesdrop on.

So, the reply is here as a blog.

Hi yuhui,

I like your phrase "super bloomers" more than "late bloomers."

Before I continue, I want to caution you about having only one meal a day which is the most extreme form of intermittent fasting.

I tried that for a few months last year and lost so much weight that my mom got worried. 

She told me I looked like Chew Chor Meng who was quite ill.

When I met Kenji and Victor, my friends from The Fifth Person, about 6 months ago, they were shocked by how thin I was.

Anyway, I have since gone back to having at least 2 meals a day, eating within a window of 6 to 8 hours each day.

So, I am still doing intermittent fasting but a less extreme form.

I have recovered from being borderline underweight, putting on 5 kgs in the last few months.

Anyway, please be cautious because it is very hard to get sufficient nutrition for a regular person by having only one meal a day.

As for what I have done in the stock market, I did nothing in April.

In January, I bought back some stock of ComfortDelgro.

In February, I sold my investment in SATS.

In March, I bought some stock of OCBC.

I have been mostly focused on increasing exposure to fixed income in the last few months.

The question is whether someone who doesn't have as much exposure to equities should be deploying more funds into equities or fixed income at this point?

To help with the decision making process, look at the prevailing risk free rates.

Please bear in mind that this is only one of many possible considerations and it is just a starting point.

If we have an investment horizon of 10 years, an idea could be to compare the 10 year average yield of the Singapore Savings Bond with the estimated returns from investing in a business.

The risk free rate is around 3% per annum.

So, if we were to invest in a business which is not risk free, we would demand a higher return.

Investing in Singapore's banks is not risk free but they are relatively safe compared to Centurion Corporation, for example.

Therefore, a sustainable 5% dividend yield from the banks would be more acceptable than a 5% dividend yield from Centurion Corporation which has a much weaker balance sheet and less robust asset quality.

A 5% dividend yield from ComfortDelgro is acceptable because they have a very strong balance sheet and, therefore, should be relatively safe.

A 5% distribution yield from a REIT which is highly geared is, in my opinion, undesirable, because a REIT distributes at least 90% of its income to investors.

If by distributing 90% of its income to investors, a REIT is only able to eke out a 5% distribution yield, to me, it is not an attractive investment, especially in today's high interest rate environment.

If I must invest in REITs, for a start, I would look for those with relatively low gearing, a high interest cover ratio and a distribution yield of 7% or more in order to be competitive.

The final mix of equities and fixed income we have in our portfolio will depend on what we believe is right for us.

We can only hope to be approximately right and by using some common sense, we should be able to avoid being absolutely wrong.

"What we do is not beyond anyone else’s competence." - Warren Buffett

This isn't an exact science.

If AK can do it, so can you!

Update on Evening with AK and friends 2023:

A few tickets left. Ticketing: HERE.

1. Retirement adequacy for late bloomers.
2. Saving for income: SSB and T-bill.
3. Building investment in OCBC.
4. 1Q 2023 passive income.


yuhui said...

alamak.... really champion sotong. I meant to ask about your opinion on entry price for aim apac reit as I couldn't find any info but it was the

AK71 said...

Hi Yuhui,

Alamak. How like that? ;p

Aiyoh, don't ask me if it is a good price to buy now lah.

I always avoid such questions de. ;p

Chiew said...

Hi Ak,

Will be good to read/hear more since you seems to be serious about intermittent fasting:

AK71 said...

Hi Chiew,

Thanks for sharing this!

I follow Dr. Sten Ekberg who has numerous videos on IF.

Here is one example:
Dr. Sten Ekberg on food for IF.

So far, IF has been helpful to me. :)

Cory said...

I practise 12hr without food and see some results. But One day a meal is too little. We can have the wealth of the world but without Health is not worth anything. My family make sure our diets are varied including fruits. They aren't cheap but is not for saving. Take care friend.

AK71 said...

Hi Cory,

I have tried various durations and found 18 hrs fasting or eating only within a 6 hours window to be the best for me.

It allows me to have 2 proper meals and also a snack or two. ;p

You take care too and thanks for touching base. :)

SgFire said...


We just need once a week intermittent fasting. ie eat one meal on any particular day in a week

If do everyday will be too extreme

AK71 said...

Hi SgFire,

I watched an interview with Mr. Shanmugam, our law minister, recently.

He is doing daily intermittent fasting too but, for him, his last meal of the day is lunch.

My last meal of the day is dinner because I skip breakfast.

Daily intermittent fasting, eating only within a 6 hours window, is supposed to have health benefits.

I agree that one meal a day doesn't seem like a good idea; at least for me it isn't. -.-"

SgFire said...

Hi ak

He may be overweight and needed more cutting. Everyone is different.

HH said...

Hi AK, most of the better managed reits the yield is less than 7%.

If the interest coverage ratio and gearing meets the criteria but the yield is less than 7%, will you still nibble at reits?

HH said...

Hi AK,

Most of the well run reits the yield is less than 7%.

If the gearing is low and the interest coverage is high, will u consider to nibble a bit if the yield is less than 7%?

AK71 said...

Hi SgFire,

Shanmugam has never looked overweight to me but looks can be deceiving. ;p

I went on a ketogenic diet to lose weight a few years ago and it worked.

Now, intermittent fasting is really for autophagy which is supposed to be good for us.

You are right to say everyone is different, of course.

We must not follow blindly what someone else is doing.

The gain will outweigh the loss.

AK71 said...

Hi Unknown,

If the gearing is closer to 30% and the interest cover ratio is 5x or more, then, a distribution yield of lower than 7%, maybe at 6%, is probably OK.

Of course, without looking at the other factors such as asset quality and third party risks, this is a very general statement to make.

If the distribution yield is at 5% or lower, we are probably better off just investing in DBS, OCBC or UOB even at today's prices.

Learn how to become a millionaire.

SgFire said...

Hi Ak

I will try out intermittent fasting once a week. Sleep @10 pm n skip breakfast next day.


AK71 said...

Hi SgFire,

That sounds good for a start.

You can gradually increase the frequency to twice or thrice a week.

Hope intermittent fasting helps you in some way. :)

Yv said...


I am also doing daily IF with just lunch and dinner. Coming to almost 2 years already although it gets difficult when I am on holidays as there's so many interesting foods to try. Just got back from a short 3d trip and IF was thrown out of the window.

I find that I am more focused and less lethargic throughout the day when I eat less. I also find that cutting down on wheat-based stuff also helps to see sustainable result in terms of overall health and has the added benefit of controlling my eczema flare-ups.

AK71 said...

Hi Yv,

I agree with you that eating less makes me feel more focused.

When I eat too much, I feel sleepy. -.-"

I stayed away from wheat and all kinds of grains for while and I felt the benefits but it is really hard to stay that way because my sister bakes such good cakes and cookies. ;p

Oh, well, imperfect IF is better than no IF.

I console myself. LOL.

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