Invested in ST Engineering for >20 years! BUY more now?

For readers who prefer reading to watching videos, this is the transcript of a recent YouTube video I produced on ST Engineering.

In the video, I reminded myself of my history with ST Engineering as well as how I would decide on whether Mr. Market was offering a fairly good price?

Don't worry as it isn't rocket science.

Just some quick and dirty number crunching, oppa AK style!
---------------------------------- 

I found a newspaper article I cut out in the year 2003.

It was about ST Engineering, a company which I have been a shareholder of for more than 20 years by now.

ST Engineering's stock trades at $3.70 a share and it has been paying out dividends annually without fail since I first became a shareholder.

I cannot remember how much exactly from year to year but, off the top of my head, an average of 15c annually in dividend per share cannot be too wrong.

In case you are wondering, yes, I am still holding on to those shares I bought at $1.55 a piece more than 20 years ago.



What would have happened if I had decided to spend that money all those years ago on a luxury watch to show that I had arrived instead of investing in ST Engineering?

If I did that, I think I would still not have arrived.

Isn't there something to be said about delaying gratifications and investing for income?

Once people are determined to make an improvement to their personal finances, once they try out some of the ideas I have blogged about, they will see for themselves that the magic that AK has, they have it in them too.

Suddenly, it isn't so mystical after all.



A reader told me this in 2017.

I remember you mentioned ST Engineering in Evening with AK and friends a couple of years back in 2015.

At that point, you mentioned you would look at adding if it went below $2.90 per share. 

It was hovering around $3.20.

It was my first time attending your talk.

I just managed to scoop some at $2.70!

AK told the reader.

$2.70 a share is a very good price.

I would hold on to it.

ST Engineering is a good income generating asset.

At the time, I also said the following.

I reminded myself how I would determine a fair entry price for ST Engineering.

ST Engineering PE ratio has always been pretty high, but I would not let that deter me.

Instead, I use the ratio to guide me.



Even during the Global Financial Crisis, ST Engineering's PE ratio was 15 times.

That could be considered as crisis valuation for ST Engineering, and I have used that as a yardstick for the stock for a long time.

Today, ST Engineering trades at a PE ratio of some 23 times.

In one of my past blogs, I said if I were to invest in ST Engineering not during a crisis, I would only do so if its PE ratio is 20 times or lower.

What about dividend yield?

Of course, that is something I would look at too as an investor for income.

Today, it is about 4.6% which is higher than the 4.2% ComfortDelGro offers.



However, we have to remember that ST Engineering is no longer the same as it was 20 plus years ago.

When I first invested in ST Engineering, it was sitting on a billion dollars in cash which it didn't know what to do with.

So, it paid out 100% of its earnings yearly to its shareholders.

Getting 15 cents dividend per share for a stock I paid $1.55 a share for was so sweet that it could have given me diabetes.

Today, ST Engineering is in a net debt position to the tune of almost six billion dollars.

That translates to a gearing level of almost 250%!

So, don't just take that 4.6% dividend yield at face value.

That dividend yield is achieved on the back of some amazing leverage.



In comparison, ComfortDelGro is in a net cash position and its 4.2% dividend yield is not achieved with leverage.

I would not be adding to my investment in ST Engineering although I am quite happy to hold on to my existing investment.

My investment in ST Engineering is free of cost and has been so for some time.

Getting free money regularly makes me happy.

However, to add to my investment in ST Engineering, I would have to see its gearing level reduce substantially.

Of course, if we had a crystal ball which was able to tell us that would certainly happen and soon, if ST Engineering should trade at a PE ratio of 20 times or lower, it would be a BUY for me.

If AK can talk to himself, so can you!

Recently published:
ComfortDelgro: BUY more now?

Invested in ST Engineering at the right price.

Reader says...
Hi AK,

I remembered you mentioned ST Engineering in one of the session (Evening with AK and friends) a couple of years back (2015) and shared that through one of your readers, you have a greater understanding of their business model. 






At that point, you mentioned you would look at entering the market if it goes below $2.9 per share, it was hovering around $3.2.

It was my first time attending your session so my memory is pretty hazy. 

But I am hoping if you can shed more insights in how you look at valuing ST Engineering? 

I managed to scoop a little shares at $2.7! :)

Thanks,
YC




AK says...
Hi YC,

That was probably many moons ago. $2.7 a share is a very good price. 

I would hold on to it. ST Engineering is a good income generating asset. :)

I shared how I valued ST Engineering using PE ratio before. 

I said this towards the end of 2014 when ST Engineering was trading at $3.30 a share:

Best wishes,
AK

Although I continue to be invested in ST Engineering because I like the consistent and meaningful dividends, to add to my investment, I will not pay more than a 20x PE ratio. 




With FY16 earnings per share (EPS) at 15.6c, that means I would not pay more than $3.12 per share.

Related post:
Mystical art of wealth accumulation.

A wealth building strategy that has worked for AK.

Investors must have the temperament to be philosophical about market fluctuations.




This blog post is in reply to a reader's long and thoughtful comment on AK's wealth building strategy which a screen capture could only snap partially:

Read the full comment: here.

My reply to the reader as follows:

Hi Millionfaith,

Thank you for the very insightful comment. :)

Here are my thoughts:


1. I agree with you, generally. 

However, if we invest in a business for income, if it has good income generating ability and if we entered at a good enough price, it could be a case of simply sitting back and not doing very much after that. 

An example in my case could be ST Engineering which I started buying at $1.55 a share donkey years ago. 

There are probably a few other examples in my portfolio.





2. For most of us, it is about working hard and smart while being financially prudent to accumulate wealth. 

Then, the next step is investing in fairly good income producing assets to grow our wealth, taking care not to do something foolish (too often). 

If we did not overpay, there might also be a chance of capital gains which should give us a leg up. 

I am only human and I was very greedy during the GFC and my war chest was emptied. 

Being pragmatic has helped me on my journey.





3. I always say that I have been mostly lucky and I truly believe this. 

I have been able to capitalise on opportunities to buy at lower prices offered by Mr. Market when he felt depressed. 

GFC aside, I deployed almost $100K into the stock market last August. 

More recently in February this year, I bought more DBS shares at $13+ a piece. 

These were times when Mr. Market felt depressed.




Was there any way I could tell when Mr. Market would feel that way? Nope.

I could not predict but I was prepared.


The journey towards financial freedom needs preparation. 

It is not just about gaining knowledge in FA and TA. 

It is also about having the right temperament.






Of course, temperament is not the easiest thing to acquire, unlike knowledge of FA and TA. 

This is why self knowledge is so important.


Know ourselves and know that there are many ways to build wealth and find the way that is best for us. 

What has worked for me might or might not work for another person.






Related posts:
1. The mystical art of wealth accumulation.
2. Financial prudence at any age.
3. The "secret" to AK's success as an investor.
4. Journey to financial freedom needs preparation.
5. To be richer, be comfortable with being invested.

2015 full year income from non-REITs.

Before I reveal the numbers, let me talk to myself about what I did in 4Q 2015, investments wise.

I re-initiated a long position in ARA as I felt that its stock price declined to a reasonably attractive level. 

ARA's rights issue which followed not long after was unexpected but I took up my entitlement and applied for excess rights as I looked at it as an opportunity to buy more on the cheap. I will probably buy more if the stock declines further in price.

Of course, those who follow my blog will also remember another rights issue and that was by Croesus Retail Trust. I too participated fully in that rights issue.

A back of the envelope calculation shows that Croesus Retail Trust is now trading at a 10% distribution yield. 

Croesus Retail Trust has rather high gearing level but if we were to take that away, Croesus Retail Trust is actually still generating more than a 5% distribution yield (i.e. non-leveraged yield) which I think is very attractive for a portfolio of mostly freehold retail properties in Japan. 

As the Trust's unit price declined, I added to my position again in the middle of December at 78c a unit.

I also increased my investment in Accordia Golf Trust as its stock price declined. The last time I did this was in mid-December at 51c a unit.

Investing in Accordia Golf Trust, we must realise that weather plays an important part in its performance. So, we have to expect its revenue to fluctuate quite a bit seasonally, much like investing in hospitality REITs.

With sentiments pretty negative, if Mr. Market were to offer me meaningfully lower prices, I would probably be buying more.

I also did a bit of trading in 4Q 2015. I reduced my long positions in Wilmar and ST Engineering as their stock prices recovered. That gave me some trading gains for the quarter.

I don't trade very much anymore as it requires a bit more work. Now, I might not even look at the stock market for several days in a row.

I added to my long position again in ST Engineering as its stock price declined by more than 10% from my recent selling price. 


ST Engineering is still one investment for income and growth. I definitely want to buy more if Mr. Market goes into a depression.

For those who do not follow my comments section, I initiated a smallish long position in DBS. Some know that I have been thinking of buying into the three local banks for a while and have been waiting for their stock prices to become cheaper.

I chose DBS first because it was trading at the smallest premium to NAV compared to OCBC and UOB. There is also consensus that DBS would be the biggest beneficiary of rising interest rates.

I also added to my investment in SingTel as its stock price declined. We invest in SingTel, Starhub and M1 because they are defensive income generators but with SingTel, there is also a nice element of growth.

Finally, I added to my long position in APTT this month after having left it alone since its inception. The rapid plunge in APTT's unit price up till middle of December seemed excessive to me even though I have mentioned before that a DPU of 8c a year is unsustainable in the longer run.


A much lower DPU of between 4c to 5c would probably be more sustainable for APTT. So, adding to my long position at 63c a unit, I am expecting a more realistic distribution yield of 6.3% to 7.9%.


A more recent development was an expression of interest by a party to acquire Ascendas Hospitality Trust which I included in my income portfolio in 3Q 2014. I have added to my investment on a few occasions since then, as and when its unit price declined.

The last time I increased exposure to Ascendas Hospitality Trust was on 24 August 2015 at 58.5c a unit. With an estimated annual DPU of 5.5c, I was looking at a distribution yield of almost 10%.

Although I hope that the offer is going to be at a fairly attractive premium to valuation, I am aware that if the Trust should be taken private, my income from non-REITs next year would take a hit.

Very safe to show hand like this.

Including my first income distribution from Religare Health Trust (RHT), dividends from my investments in non-REITs in Q4 brings my income in 2015 from them to a grand total of S$76,804.69.

This works out to be about S$6,400.00 a month.

Including the distributions from S-REITs this year, I am pretty satisfied with the total income generated by my investment portfolio.


Related post:
1. ARA: Re-initiating long position.
2. Croesus Retail Trust: Rights.
3. Trading ST Engineering.
4. Religare Health Trust: Entered at 88c.
5. 9M 2015 income from non-REITs.

Trading around core positions for extra money.

Some might remember me talking about how I was trading stocks a bit more in the past. I also talked about how it is possible to trade around our core investments for income here and there.

If we are good at it, we could make some extra money from trading and yet retain a portion of our investments for regular income.



I don't trade stocks as much these days because it entails more work. It isn't just about buying stocks and holding them for dividends. We have to look at charts and decide when to sell and, of course, hope that prices might come down again so that we could buy.

However, sometimes, I just feel like doing a bit of trading and one example in the last two weeks was ST Engineering. I partially divested at $3.35 a share at the end of October with the intention to buy again if its stock price should decline meaningfully.

I decided to sell at $3.35 because that was where the mildly declining 200d MA was approximating back then. 

As ST Engineering's stock price declined over a few days, I resisted the urge to buy as connecting the lowest and second lowest price points gave me a trend line which suggests that there is probably going to be stronger support at $2.98 thereabouts which happens to be where the 123.6% Fibo retracement line is also located.

My BUY order at $2.98 today was filled.

Of course, it does not mean that the stock price will not go lower from here. 

Technical analysis simply shows us where the supports are. It doesn't say if the supports will hold. Now, if the support should break, we might see $2.88 tested next. I could buy more then.

Now, what if the stock price did not decline but went higher instead? 

Trading around a core position means that we still have a core investment retained for income generation.

So, some might remember that the mistake I made with ARA a few years ago was not retaining a core position whereas I sold only half of my investment in Old Chang Kee and retained half for income, for example.

So, when employing such a strategy, it is important to buy into stocks which we would be quite happy to hold because of the regular income we will receive. If the opportunity for a trade should present itself, sell a portion of our investment and retain a core position.

If prices go up, we are happy. If prices go down, we are happy too.

I don't think anyone would be unhappy with such a situation or am I mistaken?

Related posts:
1. Have my curry puff and eat it too!
2. ARA: Re-initiating a long position.
3. ST Engineering: Mystical art.

The "secret" to AK's success as an investor.

I was talking to a friend over a cup of tea recently and we agreed that most people naturally do not have the temperament to be good investors.

Most of us are not born into a family of good investors. Those who are will have an advantage, for sure. For the vast majority of people, AK included, we might start the journey later in life and we might have to try a bit harder but unless severely disadvantaged, financial freedom is definitely not beyond us.

Having the right philosophy in life is essential as our philosophy will guide all our thoughts and actions. I have achieved what I have today financially largely because of my philosophy in life. Remember the story about the grasshopper and the ant? (See my blog post on being a happy peasant.)

Regular readers would know that I believe in saving money, the more the merrier, of course.




Something I blog about pretty often is the CPF and how we should try to take full advantage of it as Singaporeans. 

I said that if we bulk up our CPF-SA as soon as we could, we would be helping the CPF to help us build a more meaningful retirement fund more quickly. Compounding at 4% per annum over a long period of time without risk would be more magical if there is a larger base to start with.

Imagine compounding $10,000 over 20 years at 4% per annum versus compounding $100,000 over 20 years at 4% per annum. How much we get at the end of 20 years would depend on how much we put in right at the start, everything else remaining equal.

Quite easy to see that, isn't it?




Many of us are probably familiar with the idea that our CPF savings is not going to be enough for us to retire on and that we should save more money. 

Of course, a more sophisticated idea is that we should have investments that will help to fund our retirement and this argument is a very attractive one too.

At this point, let me tell you a story.

One of the stories which I enjoy sharing is how I bought my very first lot of ST Engineering's stock at $1.55 a share donkey years ago. I was attracted to how they were paying 100% of their earnings as dividends to shareholders. 

Back then, when I told some friends what I did and I had more friends donkey years ago, some went:

"Wah! So expensive! That is $1,550 a pop and then there is brokerage fee! You so rich!"

Well, something like that. 

Brokerage fee was more expensive in those days and, yes, one lot was 1,000 shares until not so long ago.

Of course, for us young people who just graduated and drew a salary of about $3,000 a month, $1,550 was a lot of money. Yes, I was a young person once upon a time.

A reader's little niece drew this.

What was even more amazing to many, including my mom, was how I bought more of ST Engineering's stock as its price rose. I remember buying at $1.70, $1.80, $1.90 etc. Well, not at those exact prices but you get the idea. 

I was buying almost every month and I have reaped the benefits of being a shareholder over many years. The very first 1,000 shares I bought are probably free of charge twice over or so by now.

So, similar to my narrative on the CPF and my strategy, it is about saving as much money as possible early in life and putting the money to work as early as possible in life, investing in good dividend payers. 

We don't have to be a genius to do this but the will to save more money right from the start must be strong.








Not too long ago, a fellow blogger whom I respect said that he admires my money habits. He commented that I am probably successful more because of my money habits than my investment acumen. I cannot remember his exact words but his comment is in my blog's comments section somewhere. 

I will be the first to say that I am not a very good investor but I can grow my wealth relatively quickly. This is not because I make a lot of money. It is because I do save a lot of money relatively quickly.

Be much better savers as early as possible in life. 




If we do this, it will allow us to become wealthier faster as it gives us more capital to invest with earlier in life and we will have more time to reap the rewards of being invested (i.e. becoming wealthier). 

If we are able to save much more money than our peers, even if we are not fantastic investors, just by investing prudently for income, all else being equal, we are most likely going to enjoy a much better outcome financially compared to our peers.

Related posts:
1. To be a happy peasant.
2. How did AK create a 6 digits passive income?
3. Greater financial well being is not beyond us.
4. The Millionaire Next Door.
5. Buying a $500,000 watch after 3 years of work.

9M 2015 passive income from non-REITs.

Some wonder if Mr. Market could go into a depression? I don't know but I do know that many stocks became much more attractively priced in the last three months.

Consistent with my strategy to diversify my portfolio to reduce reliance on S-REITs for income, I added to my long positions in the following as their stock prices declined more significantly recently:

1. Accordia Golf Trust

2. Ascendas Hospitality Trust

3. ST Engineering

4. Starhub

5. SembCorp Industries

In the last three months, I also initiated long positions in the following as investments for income:

5. VICOM
"A 15x PE ratio would give us a fair value of $5.36 or so per share."

6. Religare Health Trust
"Trust has demonstrated its ability to improve its revenue organically quite strongly which makes up for the expiration of the sponsor's waiver to their share of the distributable income."

7. King Wan
"King Wan is in a net cash position and it also has an order book that would provide earnings visibility until 2018."

Finally, I accumulated the following stocks which have a bit of an income investing angle but the main reason is because I think they are worth much more and at lower prices, they became even more attractive:

8. Wilmar

9. OUE Limited

If you should be interested, you could search ASSI for more of my blog posts on these stocks and why I decided to add them to my portfolio when I did.

Of course, stocks could stay undervalued for a long time but regularly receiving some dividend in the meantime makes the waiting more palatable. I like to be paid while I wait.

If you suspect that I have dipped into my war chest in the last three months, you are right. 

Could we see another big decline in the stock market? We could and we should be ready. So, being cautious, I have not exhausted my war chest.

I have a couple of fixed deposits maturing next month in October and I will probably be keeping the money close at hand instead of putting it in another fixed deposit or two.

In Q3 2015, the following non-REITs paid dividends:

1. SATS

2. Old Chang Kee

3. APTT

4. SingTel

5. SCI

6. SMM

7. Wilmar

8. NeraTel

9. ST Engineering

10. QAF Ltd.

11. Starhub

12. HongLeong Finance

13. Croesus Retail Trust

For the first 9 months of 2015, total passive income received from non-REITs: S$ 57,747.59. 

This works out to be S$ 6,416.40 per month.

Have a shopping list and be ready to pounce if Mr. Market becomes depressed.

Related post:

6M 2015 passive income from non-REITs.

ST Engineering: A letter from a reader.

We are supposed to be emotionless as investors. This is not easy to achieve. Well, at least I am still working on it. I am a poor candidate for a ninja, er, I mean, investor.


Dear AK,

I went to your last seminar because of a friend. I have been investing for a year but I never make money. After your seminar and reading your blog, I understand why my friend said you are good.

At the seminar, you and the audience discussed ST engineering. I was inspired by your own story about your first lot at $1.55 almost 20 years ago and holding till now. I was excited that the stock pays you every year.

Some people said they know the business and also bought the stock. I remember one guy said he keeps buying every year. You gave me confidence when you said you bought again at around $3.30 and $3.40. You said it was not expensive. So, I bought that week.

Today, it is $3.77. I am very happy. Don't worry. I know you will say bu yao hai wo. You said to understand price and value. I have been reading your old blog posts. I know price can go lower in crisis. But I just feel happy. So, many thanks. You are a good person.

Yours sincerely,
W

I think we discussed STE at the 3rd "Evening with AK and friends"

Hi W,

Your last paragraph saved me from having to write you an email on the difference between price and value. Sounds like you have emerged from a fog and are beginning to plot your route in the stock market as an income investor.

It is, of course, normal to feel happy that our investments are doing well. However, please be mentally prepared that we might see prices sink one day. Knowing something could happen and being prepared for it are two different things. Apart from being mentally prepared, we should be financially prepared as well. So, have a war chest ready too.

I am glad that you have found my blog useful and that one of my chit chat sessions (not seminars) started you on your journey as an investor for income. Stay the course and, I believe, you will do well enough over time. Gambatte!

Best wishes,
AK

Related posts:
1. Seven steps to creating passive income.
2. 2014 full year income from non-REITs.
3. The mystical art of wealth accumulation.

2014 full year income from non-REITs.

This is the first time I am blogging about my full year income from investments in non-REITs. As my passive income generated from investments in S-REITs has for many years overshadowed income received from non-REITs, it wasn't very meaningful to blog about the latter.



Now that passive income received from S-REITs took a plunge, it has become more essential to talk to myself about what I have done in the non-REIT space which has shored up dividends received this year, making income contributions by non-REITs a more significant part of my total annual income from the stock market.


Before I continue, readers might want to bear in mind that a few of my investments in the non-REIT space have been with me for many years. They are not all new investments, therefore.

Anyway, non-REITs which have contributed to my passive income in 2014 are:

1. Croesus Retail Trust
2. Hock Lian Seng
3. Perennial China Retail Trust *
4. CapitaMalls Asia *
5. NeraTel
6. Wilmar
7. Yongnam
8. APTT
9. ST Engineering
10. SPH
11. QAF
12. Old Chang Kee
13. K-Green Trust *
14. SATS
15. Ascendas Hospitality Trust
16. Singapura Finance

* Sold and will not contribute any income in 2015.

New or old, I have blogged about all the above stocks before. So, if you should be interested in understanding why and when I invested in these stocks, just do a search for them in my blog and you will find the relevant blog posts.

Of these 16 stocks, I increased my long positions or initiated long positions in the last 12 to 15 months in Croesus Retail Trust, Hock Lian Seng, NeraTel, ST Engineering, SPH, SATS, Ascendas Hospitality Trust and Singapura Finance. 

Apart from Singapura Finance, it is quite obvious that I increased or initiated exposure to these stocks because of their relatively attractive dividend yields. I am still an income investor at heart.

I wouldn't say that all the stocks are of the "good to hold forever" variety but it should be obvious to regular readers that I am not averse to selling a stock if I am no longer impressed by its prospects. 

There are many examples which I have blogged about in the past and examples from this year are Perennial China Retail Trust and K-Green Trust in the list shared earlier.

Anyway, the total amount of dividends from non-REITs in 2014 is beefed up mostly by my rather big investment in Croesus Retail Trust which happened when its unit price took a severe beating shortly after its IPO. 

The relatively large increases to my investments in SPH and NeraTel also helped.

Income from non-REITs in 2014:
S$ 61,752.66

This figure could increase in 2015 despite losing the contributions from Perennial China Retail Trust, CapitaMalls Asia and K-Green Trust. This is because Ascendas Hospitality Trust will make a full year income contribution in 2015.

Of course, it is hard to say at this point in time if I could divest partially or fully some of the investments mentioned here in 2015. 

Indeed, I could also put more money to work in the stock market. So, nothing is set in stone. However, I do know that if valuations should go closer to crisis levels, I will be buying more.

I understand that the stock market could get a bit bumpy but my investments for income should provide me with much comfort and also help to fill my war chest in the meantime.

Related posts:
1. 2014 full year income from S-REITs.
2. AK went shopping in the (stock) market.
3. Be comfortable with being invested.
4. Mystical art of wealth accumulation.
5. Portfolio review: Unexpectedly eventful.
"... my decision to increase my level of investment in SPH and NeraTel last year so that my overall portfolio is less reliant on S-REITs for passive income was pre-emptive. Enlarging investments in Hock Lian Seng and Croesus Retail Trust earlier this year has also helped to reduce reliance on S-REITs for passive income."

AK went shopping in the (stock) market.

Mr. Market has been feeling rather pessimistic of late.

Winter has come?

In the last trading session, I bought stocks of the following companies':

1. SembCorp Marine
2. SembCorp Industries
3. ST Engineering

These companies have relatively strong balance sheets and order books to keep them busy for years. It is hard to imagine that they might be going the way of the Dodo.

Of course, prices could weaken further. If they should weaken significantly, I would probably buy some again. Buy some again? Yes, I will continue to pace my purchases in the face of possible continual market weakness. We do not know when prices have bottomed until we are past the bottom.

So, nibble, don't gobble.

Not quite the Great Singapore Sale, for sure.

During the GFC, we saw SembCorp Marine and SembCorp Industries trading at PE ratios of 7x to 9x. Personally, I do not think that we will see another GFC but we could see a soft landing. So, PE ratios of 10x to 11x, perhaps? Based on my estimates, SembCorp Industries could see its share price at between $4.00 to $4.40 then. What about SembCorp Marine? Perhaps, as low as $2.50 a share.

ST Engineering's PE ratio has always been somewhat higher and even during the GFC, its PE ratio was still pretty high at about 15x. Currently, ST Engineering is trading at a PE ratio of almost 20x which isn't crisis cheap but seems fair enough with a prospective dividend yield of about 3.8%, assuming a 75% pay out ratio. Compared to about $4.40 a share more than a year ago, current price level presents a more comfortable entry in more ways than one.

Learn from the squirrels?

Of course, it is hard to say whether Mr. Market would go into a depression or not. So, it is important to have a war chest ready. When to roll out that war chest? When valuations approach crisis levels and if that should happen, we want to be able to take advantage of the much cheaper valuations.

Related posts:
1. SembCorp Industries: A safe price.
2. SembCorp Marine: A nibble.
3. Mystical art of wealth accumulation.

The mystical art of wealth accumulation!

The wall next to my desk doesn't need a fresh coat of paint because it is pasted over with notes, cards and newspaper cuttings! 

Someone told me that if everyone was like me, the wallpaper companies would go out of business.




Today, I took down some of the "wallpaper" and I found a newspaper article I cut out in the year 2003. 

It was about ST Engineering, a company which I have been a shareholder of for more than 10 years by now.

Here is the article in question:

Today, ST Engineering's stock trades at $4.17 a share and it has been paying out dividends annually without fail since I first became a shareholder. 

I cannot remember how much exactly from year to year but, off the top of my head, an average of 15c annually in dividend per share cannot be too wrong.

This is one investment I have fond memories of and not only because the dividends it paid funded my annual holidays in Japan and Korea for many years in a row.

In case you are wondering, yes, I am still holding on to those shares I bought at $1.55 a piece more than 10 years ago.




What would have happened if I had decided to spend all that money all those years ago on a brand new luxury watch instead of investing in ST Engineering? 

Isn't there something to be said about delaying gratifications and investing for income?

Many times, people are sceptical about what I have achieved. 

Well, they can be sceptical all they want but once they are determined to make an improvement to their personal finances, once they try out some of the ideas I have blogged about, they will see for themselves that the magic that AK has, they have it in them too. 

Suddenly, it isn't so mystical after all.




Remember that AK has done it and you can do it too!

Related posts:
1. The very first step to becoming richer.
2. Do not love unless it is worth the loving.
3. Why a wealthy nation cannot afford to retire?
4. 7 steps to passive income from the stock market.
5. Create more passive income with limited capital.