Saturday, 24 December 2016

My current Portfolio

This may be an odd date to post an update of my current portfolio, as a portfolio update is typically done on the first day/last day of each month, however it should be noted that this is the first time I am posting with regards to my portfolio! In the future, I aim to provide a portfolio update as soon as possible whenever I make a trade, so stay tuned! 😬

Number of Shares
Current Market Value per
Portfolio %
Raffles Medical Group
Singapore O & G
First REIT
CapitaMall Trust
Parkway REIT

Concentration Risk?

As you can see, my portfolio is very heavily concentrated on the healthcare industry. In fact >50% of it is concentrated in the industry. Although this seems to result in greater risks, I believe that it bodes for greater stability. The world is facing an aging population, and there will be a natural increase in demand for healthcare services over time. I will not be going into the technicalities in this post, but I will be talking broadly about my concentration thesis.

Tech Disruption

At present, many industries are being disrupted by improvements in technology, the retail industry and the supermarket industry are recent examples of this. Brick and mortar stores are being replaced by e-retailers such as amazon and ebay, where suppliers or even retailers can reach out to buyers directly. 

A manifestation of the rise in e-retail, in conjunction with many other factors (such as an increase in land and mall-space supply, negative sentiments etc) will contribute to a decrease in mall occupancies over time. (this is my personal opinion, however the Straits Times also reported that shopping mall vacancies in town are at 5 year high levels as of 23rd April this year)

On the 2nd of November this year, the media also reported that Amazon may launch selective services in Singapore as early as 2017, and some of these services are rumoured to be Amazon Fresh, a grocery service. Undoubtedly this may disrupt the local supermarket and Grocery Chains scene (Some notable listed companies include Dairy Farms and Sheng Siong). I will not go in depth into this at the moment (and it seems that I have sidetracked a little), as my point was that in the NEAR FUTURE, I do not foresee any significant Tech disruption to healthcare services, people need to get a check-up in person in order to get a proper diagnosis, call services and even video-calls are also unlikely to be useful. Furthermore the idea of healthcare professionals being "delivered" (visiting) to patients with a click of a button online is a very far-fetched idea which also seems very inefficient to me, with lots of travelling time incurred by the professional who probably can well utilise the time to see more patients at the hospital or clinic (It is also worth noting that some clinics do offer house visits but these services are often only used in the case of an emergency and significant waiting time is often involved too, hence it is no wonder why these services have not expanded). Coupled with the aging population, demand for traditional healthcare services are therefore likely to remain and even increase over time.

Of course there are disruptors to healthcare service providers too - other healthcare service providers. Not everyone has great access to healthcare at the moment, however healthcare service providers are expanding at a faster rate than population growth. Hence it is only a matter of time before an equilibrium (between needs and services) is reached and (eventually) breached again, and at that point in time, healthcare companies will need to battle for market share, and only the 'good' or better companies can continue to perform well (economically speaking). On that note, I will be writing specifically with regards to why I have chosen to invest in the companies in my portfolio, and why I believe they are in a position to succeed in my other posts in the future.

Thank you for reading and I wish you a Very Blessed Christmas. 😬

(image credits to: clipart panda)

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