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Me & My Money Series (Sunday Times)
Wow this guy is good! He does NOT own a car or private property and has more than S$1 million in equities alone.... 
Nov 21, 2010
me & my money
Punter takes stock and prospers after losing money
Long-time investor has steadily built up a blue-chip portfolio worth more than $1m
By Lorna Tan, Senior Correspondent
Mr Brennen Pak, 47, does not own private property or a car. He lives in a Woodlands HDB flat and believes in parking his funds in the stock market instead. -- ST PHOTO: KEVIN LIM
The year 1998 was a watershed for Mr Brennen Pak. He lost nearly $100,000 in the stock market during the Asian financial crisis.
After 10 years of working and dabbling in stocks in his free time, Mr Pak was left with just $22,000 in savings. He realised he did not really have a proper strategy in his stock trading. For example, he did not even know the businesses of the counters that he was trading in.
Mr Pak pursued a part-time Master of Applied Finance at the University of Western Sydney that year. 'It... gave me insights into why I was doing so badly in stock trading,' he recalled.
Slowly and steadily, he grew his stock portfolio which now stands at more than $1 million. His portfolio comprises about 20 stocks which are mainly blue chips like DBS Bank, OCBC Bank, Jardine Matheson and Singapore Press Holdings (SPH).
Last year, he left aluminium production firm Alcan Aluminium Valais where he had worked since 2000. In April this year, he set up BP Wealth Learning Centre with an initial investment of $40,000. Prior to Alcan, he worked in Defence Materials Organisation as a project engineer and then as a manager for 12 years.
Mr Pak, 47, graduated from National University of Singapore with a bachelor's degree in engineering in 1988 and obtained an MBA from the University of Leicester in 1997.
He is married to housewife Chua Lay Choo, 38, and they have a son, Tze Bin, four.
Q: Are you a spender or saver?
A saver. When I was an employee, I could easily save 60 to 70 per cent of my salary. Given that I have just set up my new business which is not yet profitable, I have cut down on my expenditure. It helps that my family can live on passive income from my dividends. I cultivated all these good money management habits during my younger days.
Q: How much do you charge to your credit cards every month?
I have three cards but I use only one actively. My total expenditure, which includes charges to my credit card, is about $3,000 to $3,500 a month, including insurance premiums.
I have no debts and all my credit card bills are paid fully every month. I withdraw about $150 to $200 from the ATM each week.
Q: What financial planning have you done for yourself?
My investments are mainly in Singapore stocks. I also have another $10,000 invested in unit trusts which I bought online. They are mainly Asian equity funds as well as commodities funds. I have insurance policies, including one accident and two whole life ones, and I am covered for a sum of $300,000 on my life.
I have invested in stocks for the past 20 years. I generally hold stocks for the long term. I also hold a high level of cash in case some interesting investments come along. I have cash savings which are equivalent to five years of my expenses.
When selecting a stock, I will analyse the management team, the business of the firm, and quantitative ratios like price to earnings and growth potential.
I will buy stocks when I feel there's good value. During a market run-up, I may divest myself of firms that I don't wish to keep for the long term and keep the cash as a war chest for future market dips. My yearly dividend income averages 4 to 6 per cent.
Q: Moneywise, what were your growing-up years like?
I was the sixth child in a family of eight children. My father was the main breadwinner, working as a subcontractor for painting jobs. All my textbooks during primary school were on loan from schools. The 10 of us lived in a two-room rental flat in Lower Delta Road. I had to walk about 1km to my primary school. When I was in secondary school, I walked 2km to school in tattered or worn-out shoes. Sometimes the shoes were so worn out that I literally walked barefoot to school. My mother was a good 'manager' at home, sometimes holding two part-time jobs such as being a maternity confinement lady to make ends meet. She died more than a year ago. I picked up frugal habits from my father.
Q: How did you get interested in investing?
Many years ago, when I was in primary school, my father was house-bound for a month after being hit by a crane hook at a construction site. During that time, he lamented that he was not earning an income. I resolved then that when I started working, I would continue to earn an income even in the event that I got incapacitated.
My earlier investment days were bad. Nobody taught me how to invest and I had to learn it the hard way. At that time, I had a very short-term view. That is the reason I want to start a wealth-learning centre, to help people jump-start the financial learning process. It was painful to have lost 10 promising years of my working life in bad stock investments.
Q: What property do you own?
I do not own any property other than the flat that I live in. It is a 1,600 sq ft HDB executive flat in Woodlands. I paid up the mortgage loan in full by 2006, about 18 years ahead of schedule. My wife and I bought the flat in 1997 for $365,000. It is currently worth more than $400,000.
I do not own any private property, as I prefer to invest my money in the stock market. The rental yield for a private property is low at 3 to 5 per cent yearly.
Q: What's the most extravagant thing you have bought?
I paid $4,000 for a training course on starting a business last November and another $3,000 on a course in money attitudes in March. I consider my expenditure on these two financial courses as most extravagant as I didn't get any value out of them.
Q: What's your retirement plan?
I've been financially independent since this year. This means I have enough savings and a passive flow of dividend income. I currently need $3,500 a month and I expect to require the same amount when I do retire. I will be very comfortable with a nest egg of $2 million.
I want to build my new business into a profitable company so that I can continue with my investments and consultancy work indefinitely. I also do some social work regularly.
Q: Home is now...
My Woodlands flat.
Q: I drive...
I do not own a car. I estimate that the cost of owning a car is $18,000 a year. With that, I could have bought two lots of OCBC or one lot of DBS or five lots of SPH. I cannot find more happiness or convenience owning a car anyway. Public transport is convenient enough.
lorna@sph.com.sg
--------------------------------------------------------------------------------
WORST AND BEST BETS
Q: What has been your worst investment to date?
I incurred a paper loss of $22,500 in a counter of which I own 60,000 shares. I bought the shares at an average price of 44 cents and now they are about five cents each.
It was a good company in the early 1990s but it started getting complacent and made some risky investments. Since then, it has gone into different businesses and the management team has kept changing through the years. It has not paid dividends since 2001.
Q: And your best investment?
They include buying 244,000 shares of Stamford Land at an average price of 31 cents; 21,000 shares of Cerebos shares at an average price of $2.50 and 90,000 shares of Osim at an average price of 20 cents. Stamford and Cerebos are currently trading at 55.5 cents and $4.81, respectively. I've also earned dividends along the way.
My returns on Osim alone are 600 per cent as it is now trading at $1.22. What I like about Osim is that the firm started buying back its shares in order not to create an overhang situation following its rights issue during the global financial crisis. By doing this, it gives investors confidence in holding their shares. They are even buying back at 91 cents to mop up additional liquidity in the market. This reflects very well on the management.
Nov 21, 2010
me & my money
Punter takes stock and prospers after losing money
Long-time investor has steadily built up a blue-chip portfolio worth more than $1m
By Lorna Tan, Senior Correspondent
Mr Brennen Pak, 47, does not own private property or a car. He lives in a Woodlands HDB flat and believes in parking his funds in the stock market instead. -- ST PHOTO: KEVIN LIM
The year 1998 was a watershed for Mr Brennen Pak. He lost nearly $100,000 in the stock market during the Asian financial crisis.
After 10 years of working and dabbling in stocks in his free time, Mr Pak was left with just $22,000 in savings. He realised he did not really have a proper strategy in his stock trading. For example, he did not even know the businesses of the counters that he was trading in.
Mr Pak pursued a part-time Master of Applied Finance at the University of Western Sydney that year. 'It... gave me insights into why I was doing so badly in stock trading,' he recalled.
Slowly and steadily, he grew his stock portfolio which now stands at more than $1 million. His portfolio comprises about 20 stocks which are mainly blue chips like DBS Bank, OCBC Bank, Jardine Matheson and Singapore Press Holdings (SPH).
Last year, he left aluminium production firm Alcan Aluminium Valais where he had worked since 2000. In April this year, he set up BP Wealth Learning Centre with an initial investment of $40,000. Prior to Alcan, he worked in Defence Materials Organisation as a project engineer and then as a manager for 12 years.
Mr Pak, 47, graduated from National University of Singapore with a bachelor's degree in engineering in 1988 and obtained an MBA from the University of Leicester in 1997.
He is married to housewife Chua Lay Choo, 38, and they have a son, Tze Bin, four.
Q: Are you a spender or saver?
A saver. When I was an employee, I could easily save 60 to 70 per cent of my salary. Given that I have just set up my new business which is not yet profitable, I have cut down on my expenditure. It helps that my family can live on passive income from my dividends. I cultivated all these good money management habits during my younger days.
Q: How much do you charge to your credit cards every month?
I have three cards but I use only one actively. My total expenditure, which includes charges to my credit card, is about $3,000 to $3,500 a month, including insurance premiums.
I have no debts and all my credit card bills are paid fully every month. I withdraw about $150 to $200 from the ATM each week.
Q: What financial planning have you done for yourself?
My investments are mainly in Singapore stocks. I also have another $10,000 invested in unit trusts which I bought online. They are mainly Asian equity funds as well as commodities funds. I have insurance policies, including one accident and two whole life ones, and I am covered for a sum of $300,000 on my life.
I have invested in stocks for the past 20 years. I generally hold stocks for the long term. I also hold a high level of cash in case some interesting investments come along. I have cash savings which are equivalent to five years of my expenses.
When selecting a stock, I will analyse the management team, the business of the firm, and quantitative ratios like price to earnings and growth potential.
I will buy stocks when I feel there's good value. During a market run-up, I may divest myself of firms that I don't wish to keep for the long term and keep the cash as a war chest for future market dips. My yearly dividend income averages 4 to 6 per cent.
Q: Moneywise, what were your growing-up years like?
I was the sixth child in a family of eight children. My father was the main breadwinner, working as a subcontractor for painting jobs. All my textbooks during primary school were on loan from schools. The 10 of us lived in a two-room rental flat in Lower Delta Road. I had to walk about 1km to my primary school. When I was in secondary school, I walked 2km to school in tattered or worn-out shoes. Sometimes the shoes were so worn out that I literally walked barefoot to school. My mother was a good 'manager' at home, sometimes holding two part-time jobs such as being a maternity confinement lady to make ends meet. She died more than a year ago. I picked up frugal habits from my father.
Q: How did you get interested in investing?
Many years ago, when I was in primary school, my father was house-bound for a month after being hit by a crane hook at a construction site. During that time, he lamented that he was not earning an income. I resolved then that when I started working, I would continue to earn an income even in the event that I got incapacitated.
My earlier investment days were bad. Nobody taught me how to invest and I had to learn it the hard way. At that time, I had a very short-term view. That is the reason I want to start a wealth-learning centre, to help people jump-start the financial learning process. It was painful to have lost 10 promising years of my working life in bad stock investments.
Q: What property do you own?
I do not own any property other than the flat that I live in. It is a 1,600 sq ft HDB executive flat in Woodlands. I paid up the mortgage loan in full by 2006, about 18 years ahead of schedule. My wife and I bought the flat in 1997 for $365,000. It is currently worth more than $400,000.
I do not own any private property, as I prefer to invest my money in the stock market. The rental yield for a private property is low at 3 to 5 per cent yearly.
Q: What's the most extravagant thing you have bought?
I paid $4,000 for a training course on starting a business last November and another $3,000 on a course in money attitudes in March. I consider my expenditure on these two financial courses as most extravagant as I didn't get any value out of them.
Q: What's your retirement plan?
I've been financially independent since this year. This means I have enough savings and a passive flow of dividend income. I currently need $3,500 a month and I expect to require the same amount when I do retire. I will be very comfortable with a nest egg of $2 million.
I want to build my new business into a profitable company so that I can continue with my investments and consultancy work indefinitely. I also do some social work regularly.
Q: Home is now...
My Woodlands flat.
Q: I drive...
I do not own a car. I estimate that the cost of owning a car is $18,000 a year. With that, I could have bought two lots of OCBC or one lot of DBS or five lots of SPH. I cannot find more happiness or convenience owning a car anyway. Public transport is convenient enough.
lorna@sph.com.sg
--------------------------------------------------------------------------------
WORST AND BEST BETS
Q: What has been your worst investment to date?
I incurred a paper loss of $22,500 in a counter of which I own 60,000 shares. I bought the shares at an average price of 44 cents and now they are about five cents each.
It was a good company in the early 1990s but it started getting complacent and made some risky investments. Since then, it has gone into different businesses and the management team has kept changing through the years. It has not paid dividends since 2001.
Q: And your best investment?
They include buying 244,000 shares of Stamford Land at an average price of 31 cents; 21,000 shares of Cerebos shares at an average price of $2.50 and 90,000 shares of Osim at an average price of 20 cents. Stamford and Cerebos are currently trading at 55.5 cents and $4.81, respectively. I've also earned dividends along the way.
My returns on Osim alone are 600 per cent as it is now trading at $1.22. What I like about Osim is that the firm started buying back its shares in order not to create an overhang situation following its rights issue during the global financial crisis. By doing this, it gives investors confidence in holding their shares. They are even buying back at 91 cents to mop up additional liquidity in the market. This reflects very well on the management.
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