Saturday, December 30, 2023

How much do I have in stocks? | Financial Snapshot - Dec 2023

This is a snapshot of my finances at the end of 2023.

Naturally, I do not want to disclose too many details or my net worth, the amount I have in banks, etc. so I will just share the following:

Not included in the above are bank savings, insurance policies, CPF, SRS, etc. The above is just the amount of stocks and cash in my 3 stock brokerage accounts, the stocks in my BCIP, SRS, and Robo-advisor accounts, and the bonds I am holding at the moment. Since I worked in the US before, I also added my 401K and Wealthfront investments to the above. For completeness, cryptocurrencies are included in the Stocks portfolio (though only a small percentage). 

For 2023 my stocks increased 18.53% from last year. This is a pretty decent amount. With the current economic situation, the US market is expected to rise further. This is because the Fed has indicated they will stop raising interest rates, as inflation is cooling off. 2024 is expected to be a good year for stocks, bonds, and REITs:

Some basic rules of thumb:
  • As interest rates fall, stock prices will increase - this is because now folks can make more money by investing than putting money in banks
  • As interest rates fall, bond prices will increase. Follows the same logic as above. Also, note that long-term (10-year or more) bond yields have a positive correlation with interest rates - so if interest rates fall, bond yields fall, which means bond prices must go up
  • As interest rates fall, REITs prices will increase - this is because now REITs are easier to get financing from banks with lower interest rates ie. fewer costs on their books
  • As interest rates fall, bank stocks will fall. This is because they earn less from loans with lower interest rates. 

Clearly, the above relationships are deliberately put in a basic manner so that it is easy to understand and remember. What goes on in the backend is much more technical and complicated - not possible to remember for the long-term unless you do this as a job every day. 

Here's a visualization of the Stocks (SGD) and Bonds (SGD) over the years: 


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