SG Hedge Funds Underperformance
I have been following the performance of Singaporean based hedge funds who practice value investing. It is interesting they have been under-performing the Asia Pac Ex Jap index based on last 5 years’ returns. I am guessing that part of the reasons is due to higher returns from tech shares and these hedge funds have under-weighted tech shares.
Tech shares have seen declines recently. If this trend continues, we may see these funds outperforming the index this year.
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Returns |
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|
2016 |
2017 |
2018 |
2019 |
2020 |
Cumulative |
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|
|
Aggregate
Asset |
11% |
13% |
-10% |
2% |
4% |
20% |
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|
Inclusif Class A |
- |
- |
-9% |
9% |
6% |
5% |
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Heritage
Fund |
21% |
12% |
-13% |
8% |
-1% |
26% |
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|
Lighthouse
Advisors |
5% |
21% |
-21% |
-5% |
13% |
8% |
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|
Lumiere
Capital (SGD) |
-8% |
11% |
-14% |
8% |
-3% |
-8% |
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Asia
Pac Ex Japan* |
7% |
30% |
-11% |
19% |
19% |
77% |
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FTSE
Asia ex Japan Index ETF (HK 2805) |
6% |
40% |
-14% |
17% |
24% |
83% |
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*Extracted
from Aggregate Asset webpage |
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Over-diversification?
I have been wondering lately if I have over-diversified my holdings and hence affect the performance of my stock portfolio
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Number
of Stocks |
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At
end 2016 |
21 |
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At
end 2020 |
39 |
|
At 5
Mar 2021 |
35 |
In 2021, I have started to reduce my holdings with the following allocation guidelines:
· Initial stock position of 3%
· Can build to 5% if the stock prices fall further or there is secular growth trend behind it
· Can build to at most 8% if the stock is very undervalued
· Stock position cannot be more than 20%. (This has not occurred so far, as I will start to reduce the position as the stock price rises)
