Genesis
The 15HWW Permanent Portfolio was built during late 2016 with a capital of around $140,000 and I started tracking it from Jan 2017.
The aim of a permanent portfolio is to create a liquid portfolio with low volatility and a respectable return. A comparative benchmark is the CPF SA return of 4%.
To keep the portfolio as simple as possible, there is neither rebalancing nor injection of funds.
Purpose
Personally, I view many components of this portfolio as a form of emergency fund. For example, the cash and bonds are invested in very liquid and safe instruments and can be sold and cashed out within a matter of days.
Another reason is that by showcasing and regularly updating this humble portfolio, I hope it will inspire confidence in some readers to take some risk, invest and build wealth steadily with a low-effort portfolio.
Portfolio Value From Jan 2017 To Oct 2022
October 2022 Update
Annualised Return: 4.2% p.a. (Jan 2017 to Oct 2022)
We are in a bear market and at this point, the portfolio return is barely beating CPF SA’s 4% yield. I guess the consolation is that I can access this portfolio anytime whereas if I had parked everything in CPF SA, the funds will be locked up until I am 55. Which is still almost two decades away.
In short, I have been enduring volatility (quite low) to protect liquidity.
Another silver lining is that the fall in value of the portfolio has moderated as compared to the previous quarter. Hopefully we are much nearer to the light at the end of the tunnel.
Annex: A Brief On The Various Components Of The 15HWW Permanent Portfolio
1. STI ETF (Initial Allocation: 20%)
It comprises the 30 biggest listed companies in Singapore and many of them are dividend-paying. The ETF distributes the dividends semi-annually, in February and August every year.
2. Berkshire B (Initial Allocation: 20%)
The idea is to use Warren Buffett’s holding company to loosely replicate the S&P 500 for US equities exposure. Since foreigners investing in US stocks are taxed on dividends, it is an advantage that Berkshire B does not pay any dividends.
3. Gold (Initial Allocation: 20%)
I used to hold some paper gold but have since converted them to physical gold. The portfolio consists of 9 pieces of 50g PAMP Gold Bar bought from UOB Bank. They are fairly liquid since they can be sold back to UOB Bank at a small spread. You can also check the prices here.
4. Cash/Bonds (Initial Allocation: 30%)
The majority is invested in Astrea Bonds and Singapore Saving Bonds (SSBs) which are very liquid in nature. Astrea Bonds are traded on the market while SSBs can be redeemed at par value, usually in a week or two’s time.
5. Bitcoin (Initial Allocation: 5%)
Added in 2021 to diversify away from cash and gold as a store of value. As many centralised crypto exchanges have abused users’ trust in them, my bitcoin is now stored in a cold wallet.
6.. Ether (Initial Allocation: 5%)
Added in 2022 since I am not a Bitcoin Maxi. As many centralised crypto exchanges have abused users’ trust in them, all my ether is staked on-chain.
Thanks for reading.
If you enjoyed this article or found it useful, do subscribe to my blog via email to receive notifications of new posts.
Do follow me on social media for updates too!
Thanks for the support!
Personally, I am irritated by ads and pop-ups so I do not use any of them on this blog too.
One Reply to “The 15HWW Permanent Portfolio Update: October 2022”