I’ve been really busy lately replying messages and moving money around. Still, I wanted to post quickly my thoughts on how I will be investing for the second half of 2020.
It seems like COVID-19 will be with us much longer than I expected. Travel this year is out of the question, and there is still a lot of uncertainty about it in 2021.
With the discussions of stepping down government support soon, I think many companies will throw in the towel. Many were hopeful that COVID-19 will pass in a few months, and hung on. But it’s becoming clearer that restrictions will be lasting a long time, perhaps years.
It’s so tough. Revenue is halved because of safe distancing measures, yet compliance costs has increased. How many can survive like that?
There was a very good interview with DBS’ CEO at CNBC. He says that the worse is yet to come, and I think he’s right. Once government support goes, it will be the banks and private sector taking the hits.
For these reasons, I wouldn’t go into REITs, banks, or Singapore stocks in general. I wrote about my aversion with these already, but I don’t see any improvement soon. I have trouble deploying Singapore dollars since investment opportunities are scarce. Short-term money market funds and insurance policies should be my SGD outlet.
It’s not to say that everyone is doing badly now. It’s a market of extremes. Some people are doing really well. Heartland malls are benefiting from the lack of activity in the CBD. Tech and data centre stocks are skyrocketing.
I now view tech stocks as safe havens. I know for sure they won’t go out of business, and their sales are improving. To me, their increased valuation is justified. With the pandemic going into extra time, these stocks should continue to do well.
I’m almost done refining my portfolio, will be posting it hopefully this month.
Take care all.