Black Gold

After the rise of gold and silver, the next commodity that got the world’s attention is crude oil, known as “black gold” colloquially. The recent conflict in the Persian Gulf saw the chokehold of the vital waterway known as the Strait of Hormuz, affecting some 20% of the world’s daily crude oil supply, majority of which were destined for Asia.

The effects were already felt within the last week or so. Most of the crude oil prices had passed the USD 100 per barrel mark, prompting diesel and petrol prices to spike, and the consequential prospect of inflation returning caused by rising costs of transportation of goods.

 

Picture generated by Meta AI

 

Crude Oil in The Bedokian Portfolio

Crude oil is one of the three items to include in the commodities asset class of The Bedokian Portfolio. Unlike gold and silver, both of which can be held physically, for crude oil the simplest way for a layman investor to hold them would be via exchange traded funds (ETFs). The tricky part is that almost all these ETFs use derivatives called futures as their underlying assets, and due to their mechanics (like contango and “rollovers”), they do not really reflect the actual movement of spot oil prices. Hence, I consider crude oil to be optional for inclusion for investors who do not understand how they work.

The recent trade volume of crude oil ETFs had increased not seen since the start of the Russian-Ukraine conflict in 2022, denoting interest in such financial instruments in light of the recent confrontation. Using the United States Brent Oil Fund (BNO) ETF, which I oft utilised for oil plays, the price had shot up almost 41% since 27 Feb 2026¹, the day before the attacks began.

The Bedokian’s Take

If the fighting goes on and the oil blockade enforced, oil prices would likely remain elevated. The duration of wars is unpredictable, and for them to end would require at least one side to capitulate or both sides to agree, something which only the direct participants would know.

On the investment front, if one has the oil ETFs bought before the current crisis, the choice is either to realise some profits or to average up slowly using around 10-20% of the initial capital; the latter method is to provide a price buffer and some gains if oil prices come down suddenly.

Crude oil aside, there are other non-related counters that experienced a drop in prices, too. This is where one could find underpriced but fundamentally stronger companies to invest.

Finally, some analysts and economists were viewing this scenario akin to that of the 1973 Oil Crisis, where it was followed by a period of stagflation, i.e., inflation with slow economic growth. Whether this may happen is uncertain, but it always pays to have a diversified portfolio.

Disclosure

The Bedokian is NOT vested in BNO currently.

Disclaimer

1 – Yahoo Finance.

“How To Generate $XX Per Month From Your Portfolio”

Occasionally there will be blogposts and social media videos teaching how to generate an amount of income per month (or year) from one’s portfolio, which I find it a good thing as they give expectations on the approximate sizing of portfolio and yield required.

Picture generated by ChatGPT

While it is a relatively simple theoretical exercise involving percentage mathematics, it works when everything else is static, i.e., on a ceteris paribus basis (assume all other things are equal). However, executing it would be slightly difficult as market conditions do not really listen to what the theory was supposed to espouse. For instance, the yield or yields from the various asset classes and securities do not remain at that fixed number throughout, and so does the portfolio size that the yield(s) is based on.

Admittedly we do come out with such calculations for retirement/step-down planning for our portfolios, but we would also take in variables that may boost or hinder this model of determining monthly income. Of course, the first thing to do would be to derive the overall annual yield across the asset classes using the asset class allocations and their average yields, which goes something like this as an example (Figure 1):

 

Asset Class	Allocation (%)	Average Annual Yield (%)	Weighted Yield (Allocation x Average Yield)  (%)
Equities	35	5	1.75
Real Estate Investment Trusts	35	6.5	2.275
Bonds	20	2.5	0.5
Commodities	5	0	0
Cash	5	1	0.05
Overall Annual Yield			4.575

 

Fig.1: Overall annual yield of the balanced Bedokian Portfolio using assumed average yield per asset class.

The average yield could be obtained from a few sources, like from one’s own portfolio numbers, figures from finance sites showing the current yield, etc. Do note that the term "average" is used; yield figures have been sourced from multiple references and consolidated to present a mean value. The advantages of using the average are two-fold: the result gives a benchmark value if the actual portfolio is below it, or a buffer if the actual portfolio is above it.

If one is still not comfortable with the average number, a margin of safety can be introduced, corresponding to an imagined portfolio value drop; if one is prepared for a 30% drop of capital, he/she could adjust the expected yield number by 30% to 3.2%, and then plan the spend on the reduced income amount. This conservative approach would have the psychological effect of viewing amounts above the yield to be “windfall” and thus using them as savings and/or further capital to invest (and grow more yield).

Using ChatGPT To Review Our Bedokian Portfolio

Out of curiosity, we asked ChatGPT (free version) to review our Bedokian Portfolio, after reading up online on what other investors had done. With the exception of removing our holdings list, the answers were “as is” from ChatGPT (though from the replies you could catch a glimpse of what we are holding). 

Picture generated by ChatGPT

The prompted question was: Please analyse the following portfolio. Numbers denoting quantity of securities of the ticker. Only the counter names and number of securities were provided to ChatGPT.

I will give my take at the end of the post. Meanwhile, enjoy the ChatGPT review!

---

Below is a structured, portfolio-level analysis based on your holdings and quantities. I’ll focus on asset allocation, concentration, risk profile, income vs growth balance, and key strengths/risks, then end with practical suggestions(not advice).

---

 

1. High-Level Asset Allocation (by asset type, not market value)

Because prices aren’t provided, this is qualitative weighting based on number of holdings and intent.

🏢 REITs & Property (Very Heavy)

~30–40%+ of portfolio (likely more by value)

Observations

• Strong Singapore REIT bias
• Diversified across industrial, retail, office, and data centres
• Heavy reliance on interest-rate direction and refinancing risk

Pros

• Stable income
• Inflation-linked rents (partial hedge)
• Familiar regulatory environment (SG)

Risks

• Rate-sensitive
• Geographic concentration (Singapore-centric)
• Structural office risk (Suntec, Lendlease)

---

📈 Equities – Growth & Quality

~25–35%

Observations

• Strong tilt to US mega-cap tech
• Nvidia + ASML = high semiconductor cycle exposure
• Berkshire adds stability and capital discipline

Pros

• Long-term growth engine
• Currency diversification (USD exposure)
• High-quality franchises

Risks

• Tech valuation cyclicality
• Concentration risk (AI/semiconductor theme)

---

🇸🇬 Singapore Equities (Non-REIT)

~10–15%

Pros

• Defensive, cash-generative businesses
• Dividends and balance-sheet strength

Risks

• Slower growth
• Small-cap liquidity (YHI)

---

💵 Fixed Income / Bonds (Very Strong)

~25–30%

Observations

• Excellent capital preservation sleeve
• Laddered duration via SSBs
• High credit quality overall

Pros

• Stability
• Income buffer during equity drawdowns
• Strong SGD base

Risks

• Reinvestment risk if rates fall
• Lower real returns long term

---

🌱 Thematic / Satellite ETFs

~5–8%

Pros

• Optionality and upside themes
• China exposure via A-shares (policy levered)

Risks

• Volatility
• Policy and regulatory risk (China, clean energy)

---

🪙 Commodities / Hard Assets

~3–5%

Pros

• Inflation hedge
• Crisis insurance

Risks

• No yield
• Silver volatility

---

2. Portfolio Characteristics Summary

Dimension	Assessment
Income Generation	⭐⭐⭐⭐⭐ Very strong
Capital Preservation	⭐⭐⭐⭐½
Growth Potential	⭐⭐⭐⭐
Geographic Diversification	⭐⭐⭐½
Interest Rate Sensitivity	⚠️ High
Currency Diversification	Moderate (SGD + USD heavy)

---

3. Key Concentration Risks to Watch

🔴 1. Singapore REIT + SGD Risk

• REITs + SGD bonds + SG equities = macro concentration
• If SG property or rates move adversely, multiple assets correlate

🔴 2. Interest Rate Sensitivity

• REITs + bonds move inversely to yields
• A sharp rate spike would pressure both income sleeves

🔴 3. AI / Semiconductor Cycle

• Nvidia + ASML + S&P 500 exposure
• Fantastic upside, but cyclical drawdowns can be severe

---

4. Strengths of This Portfolio

✔ Well thought-out income + growth barbell
✔ Strong use of ETFs for efficiency
✔ Conservative bond allocation cushions volatility
✔ Real assets + equities + bonds = true multi-asset structure
✔ Suitable for long-term wealth preservation with income

---

5. Optional Refinement Ideas (Not Advice)

You may consider:

1. Reducing REIT concentration over time and reallocating to:
• Global infrastructure
• Global dividend ETFs
2. Adding non-US developed equities beyond EAFE (e.g. factor or dividend tilt)
3. Monitoring duration risk if rates fall sharply (bond reinvestment strategy)
4. Rebalancing AI exposure periodically due to valuation swings

---

Bottom Line

This is a mature, income-anchored, institution-style portfolio with:

• Strong downside protection
• Sensible growth engines
• Some macro concentration risk that is manageable with rebalancing

---

The Bedokian’s Take

We were somewhat surprised by ChatGPT’s analysis, yet we also found the results fairly consistent with our portfolio construction. Reviewing point 2, Portfolio Characteristics Summary, ChatGPT awarded a 5-star rating for income generation, a 4½-star rating for capital preservation, and a 4-star rating for growth potential. When considering the portfolio strengths mentioned in point 4, it became clear that our current Bedokian Portfolio aligns well with our expectations.

Looking at the drawbacks, the main issue was the portfolio's high sensitivity to interest rates. This had been anticipated since the Bedokian Portfolio allocates a significant portion (20% to 40%) to REITs. Although REITs serve as valuable sources of income, they are notably sensitive to interest rate changes—a trend we have observed from early 2022 to recent months.

In addition to the Singapore Dollar bias that ChatGPT identified (without prior information about its focus on Singapore-based investors), another risk highlighted was the considerable exposure to artificial intelligence and semiconductor sectors. This aspect of our Bedokian Portfolio includes stocks like ASML, Nvidia, Apple, Alphabet, and is further influenced by the technology-heavy S&P500 index. Such a composition was purposefully chosen for growth, as explained in this post, and to capture extra alpha as detailed in my previous blog entry.

Overall, this exercise was insightful and confirmed several objectives we set for the Bedokian Portfolio. We may consider providing more data to ChatGPT and other AI tools to gain further views on our investment approach.

OMGS! (Oh My Gold and Silver!)

Never had I seen a sudden interest in masses of metal, shiny yellow and gray ones to be exact, and in the shape of coins and bars. I was taken aback by social media videos of long queues at bullion shops where in my previous visits, there was not much of a huge crowd then. And this phenomenon not only happens in Singapore, but elsewhere lines are forming, even at gold jewellery retail outlets.

Picture generated by Meta AI

Recent news had reported gold returns had surpassed the S&P500’s for the last 20 years, with an average annualised return of 10.9% versus 10.5%, and a total return of 690.8% versus 632.1%¹. This could be explained with an exponential climb of gold prices between 2023 and now, specifically from the first quarter of this year.

Silver also took the limelight recently, surpassing the last high back in March 2011. Within the space of just six months since April 2025, it had risen close to 60%, mimicking the steep climb experienced by gold. This is likely the result of a perfect convergence of silver being gold’s spillover substitute and its usefulness as a raw industrial material in (after many degrees) of driving artificial intelligence (AI) growth.

Frankly, being FOMO (fear of missing out) on gold and silver is a bit of an oxymoron; such FOMO-ness on these precious metals usually occurs when the markets (and skies) are falling. Yet, we are seeing boomtown events in equities particularly on AI, and on real estate due to the faster-than-expected interest rate drops. Furthermore, a weakening US dollar (which is seen as inversely correlated with gold), interest rate cuts, and the dedollarisation plus central bank gold buying, had given the suggestion of further price strengthening, not to mention of the finite supply unlike fiat currency.

After taking into consideration of the above, the next question logically would be: is it too late to enter gold and silver? It depends.

The Bedokian Portfolio espoused between five and ten percent into commodities, which included gold and silver in the make-up. Hence, if one had started including these commodities in an investment portfolio in the first place, then it is only a matter of rebalancing by averaging up the holdings, whether through physical or paper (exchange traded funds or ETFs, gold/silver saving accounts, etc.). 

However, if one wants to go into gold and/or silver for the first time, taking the first step is the most important, for it is a way to have one’s toehold into the commodities asset class, and from there average up or down depending on his/her rebalancing period and/or set entry price levels.

There is no way to tell how high (or how low) gold and silver would go, so therefore in the meantime, let us enjoy the ride. 

Disclosure

The Bedokian is vested in physical gold and silver, and in a silver ETF.

Disclaimer

1 – Comparing S&P 500 and Gold: Building resilient Singapore portfolio in 2025. StashAway. 8 Oct 2025. https://www.stashaway.sg/r/snp500-gold-assets-comparison (accessed 17 Oct 2025)