Right here is the replace for my Daedalus portfolio for December 2025. If work shouldn’t be too busy, I’ll attempt to present an replace the place potential.
I defined how I constructed this portfolio in Deconstructing Daedalus Earnings Portfolio and Why I Presently Put money into These Funds for Daedalus. You won’t perceive what I wrote under for those who haven’t learn this put up.
All my private planning notes equivalent to earnings planning, insurance coverage planning, funding & portfolio building shall be below my private notes part of this weblog. You can too discover the previous updates just like this within the private planning notes part.
Portfolio Change Since Final Replace
The portfolio was valued at $1.6420 million on the finish of November and is at $1.646 million on the finish of December.
We reported a portfolio change of $4,000 for December 2025.
The portfolio is valued in SGD as a result of that’s the forex that I’d almost definitely be spending on.
As of 2nd December 2025, the portfolio is valued at $1.647 million.
Full 12 months Returns
Since that is the final month of 12 months, I’ll report the complete 12 months portfolio efficiency.
- Portfolio Beginning Worth: $1,481,000
- Portfolio Ending Worth: $1,646,000
- Capital Injection: $15,000 SRS Cash
- Capital Withdrawal: $0
Return primarily based on XIRR: 10.05%.
Portfolio Attribution – Why did the portfolio do higher/worse evaluate to final month [or a year ago if this is a December update]?
All of us wish to know what trigger the portfolio to do higher or worse. If in case you have only one fund that covers the MSCI World, or you have got a bunch of funds, would you recognize if it did higher or worse?
On this part, I attempt my greatest to elucidate the portfolio efficiency in my means.
Listed below are the first safety holding returns for the month-to-date and year-to-date for the funds that I personal [the top fund table] and reference benchmark ETFs [the bottom Major Index ETF table]:
The desk that exhibits the fund holdings denotes the month-to-date and year-to-date efficiency of the funds that I personal, towards Main Index ETFs. The Main Index ETFs is current to match the efficiency. Simply to be clear, I don’t personal the foremost index ETFs and you must see the highest desk (Fund) as what I personal. The underside desk (Main Index ETFs) are benchmark ETFs to offer efficiency reflections.
The returns of all funds are in USD. This contains the efficiency of the Dimensional funds, which I exploit the returns of the USD share class in order that the returns are comparable. I’ve additionally listed the foremost index ETF efficiency for comparability.
I added the WSML, ticker for the MSCI World Small Cap UCITS ETF in order that we will reference the Avantis World Small Cap Worth and Dimensional World Focused Worth higher.
Identical to that, another 12 months has handed.
I evaluation final 12 months December’s replace and this 12 months, virtually all of the funds did higher than 2024. But the compounded annualized return is LOWER than final 12 months.
One of many foremost perpetrator is the distinction in SGD towards the USD.
- 2024: SGD weakened 3.39% towards the USD
- 2025: SGD strengthened 6.18% towards the USD
A story of two totally different quick forex regimes.
What I achieve in 2024 in forex, I gave again in 2025 and extra. This may inevitably deliver up whether or not you must hedge the forex and emotionally you’d really feel that you must however hedging additionally comes with a price. Secondly, we additionally can’t low cost {that a} weaker forex (be it USD or SGD) could assist volumes of providers and items for one facet, leading to some increased revenue margins and comparatively increased EPS progress. How do you separate this stuff out?
You possibly can’t.
I shared with sufficient of us you’ll want to take into consideration WHY you put money into these areas, these sectors, as oppose to doing it in Singapore in predominately SGD income incomes investments. If you happen to can’t discover robust sufficient causes then why don’t you shift all of all of them the way in which again into Singapore? You’d have some causes and this query challenges your readability about your portfolio.
a. Common Fairness Efficiency
Equities usually finish the month of December doing higher with mounted earnings not shifting a lot. We didn’t have the Santa Claus rally.
Rising markets (EIMI) did higher than Developed markets (IWDA) this month. This explains the higher efficiency of ACWD (Developed + Rising Markets).
Rising markets did 32% this 12 months versus 21% developed markets. US giant caps (CSPX) did 17.5% this 12 months, mid caps (SPY4) did 7.7% and small caps (USML) did 6.6% this 12 months. The Russell 2000 did 12% for the 12 months. What shouldn’t be proven right here is developed ex US did 32% within the 12 months.
The theme for 2025 may be stated as dispersion.
It sort of exhibits which you could have good returns not simply within the US, and that ought to give buyers confidence about placing their cash. If in case you have a worth lens, momentum lens, profitability lens, you then would have larger concepts.
Daedalus was hit more durable if we evaluate to giant cap develop and rising market fairness as a result of:
- 32% of Daedalus is in US/World Small Caps which is mostly weaker (in all probability 16% vs 22%)
- 13% of Daedalus is in intermediate period international mounted earnings (4.7%)
In a means Daedalus is extra of a 87% fairness 13% mounted earnings portfolio.
b. Developed Fairness Efficiency
There have been a couple of multifactor funds concentrating on the developed equities area in Daedalus:
- JPGL
- GGRA
- AVGC
- IFSW
AVGC and IFSW did higher than IWDA whereas JPGL and GGRA lagged. GGRA is a high quality dividend progress systematic technique, which tends to present you corporations that develop their dividends at a excessive clip. Or increased high quality corporations. High quality in some segments haven’t completed properly this 12 months and you will get years like this. However high quality is a moderately broad time period as a result of for those who ask me and one other extra subtle buddy, the standard we lean nearer to is likely to be totally different.
AVGC and IFSW are multifactor technique and so they every have their very own means of contemplating high quality. AVGC partly will think about primarily based on increased working money movement, adjusting for accrual, relative to ebook worth, whereas IFSW, think about accrual, funding asset progress, gross profitability, earnings momentum. I suppose this 12 months, it favors AVGC and IFSW however we acquired to see long run.
JPGL is a high quality, worth, momentum technique but it surely tends to be extra equal weighted throughout sectors so you will get JPGL doing higher if client staples, utilities, power, supplies do higher as a result of the market cap index at present weigh much less to them.
I been creating these notes publicly for about 1.5 years and customarily absolutely deployed for two.5 years or so and this can be a quick time to evaluation this stuff. For all you recognize, information tech received’t do properly within the subsequent 10 years for some causes, regardless of our excessive confidence. And you will note issues like GGRA and JPGL do higher.
Whereas I’m not invested in Dimensional World Core fairness, I famous its underperformance however extra uniquely how Avantis World fairness was doing higher. We saved saying each Dimensional and Avantis efficiency ended up related however then over 1 12 months one finally ends up above and one finally ends up below the MSCI World. I’d nonetheless think about this efficiency to be fairly shut. There are going to be years the place Dimensional technique will do higher than years the place Avantis goes to do higher.
c. Developed + Rising Markets Fairness Efficiency
I’m invested in Dimensional World Fairness, which is a scientific lively technique, in my SRS account. The distinction between World Fairness and World Core are two issues:
- World contains rising market equities.
- There are 2 stage of tilt to worth, profitability and dimension. World tilts extra and World tilt much less
Which you select is a matter of the way you design your portfolio, the diploma of granular management you want and the way tilted you’re. (sorry if this comes off a bit bizarre haha)
The World Fairness haven’t completed properly for two years. I used to be checking with our portfolio supervisor and head of investments simply in case I observe the unsuitable factor. I feel I used to be mislead that worth was doing higher than progress in developed markets however that isn’t the case. Worth was doing barely worse than progress in each developed and rising markets.
The place worth is doing properly is in developed ex-US markets. The MSCI World ex USA Worth did 37.5% as much as November whereas MSCI World ex USA did 28.9%.
I’ve this impression the Dimensional World Fairness ought to do higher this 12 months and was stunned it didn’t. Issue and area efficiency make a distinction however implementation in a means do as properly. How far can a technique steer away from its father or mother index’s regional and sectoral weighting?
I don’t want to change my SRS implementation it’s what it’s.
d. Rising Markets Fairness Efficiency
Rising markets did properly.
When USD weaken, worldwide and rising markets do properly primarily based on how issues look traditionally.
The EIMI did 32% this 12 months. If we evaluate MSCI Rising Markets Worth with blended Rising Markets efficiency was not too totally different. EMSD, which is the rising small cap that I personal did solely 20%.
Given this, the primary 12 months of AVEM is fairly darn good at 36% as a result of if it’s not worth, nor small cap, then what induced the outperformance?
I think it’s who has how a lot in Hynix and miners lol.
e. Small Cap Fairness Efficiency.
That is the place the efficiency has been dragged down as a result of I’ve a bigger allocation to small caps than relative extra individuals (except you run a person inventory portfolio).
The issue wasn’t simply small caps. If you happen to have a look at the S&P 500 equal-weight (11%), Mid-cap (7.7%). Small cap worthwhile (6.6%), small cap non-profitable (12%), every little thing is lagging.
They been lagging for 3.5 years as their earnings per share progress have stalled. This lends to the possible concept that ex the AI-beneficiary, many of the market is like in a recession already.
On condition that, it’s fairly okay efficiency.
In distinction the MSCI World Small Cap , which is developed small cap did 20%. Worldwide small cap did 31% (as much as Nov not full 12 months).
The extra non-profitable small cap within the US did higher than the worthwhile ones as a result of there’s a bunch of 200% movers like Sandisk, AI, Quantum computing, don’t-know-what miners.
Given all this, I must be fairly happy that USSC which is MSCI USA value-weighted did so properly towards the Russell or S&P 600.
Avantis World Small Cap Worth additionally did properly however in a means… their efficiency appears to trace the world small cap and we will’t see the worth premium.
However I feel what we’re seeing is small cap worth not doing properly within the US, and small cap worth doing very properly in ex-US. AVGS may be seen as 2/3 US and 1/3 Worldwide, and you may view the efficiency of Avantis’ US integrated USA and Worldwide Small Cap worth ETF AVUV and AVDV respectively.
AVUV was a disappointing 7.5% (really nonetheless higher than the S&P 600) however AVDV is nearly 50%. So the 1/3/ worldwide small cap worth did a variety of the heavy lifting to drag up AVGS’s 20% annual efficiency.
In a means, viewing AVDV efficiency, and in a means how EMSD can rebound laborious, greater than the US give me quiet confidence that given some catalyst we will anticipate some loopy magnitude of fine efficiency. It’s only a matter of when. It makes me uneasy if I ever have the sensation of shifting away.
f. World Mixture Bond Efficiency
12.7% of the portfolio is in iShares Core World Mixture Bond UCITS ETF (AGGU).
Morningstar will say the efficiency is 4.7% in USD. The World Mixture Bond ETF have damaged even from its plunge close to Dec 2020. That’s in all probability 4.8 years to breakeven .
Since AGGU is a continuing period mounted earnings technique with an efficient period of 6.2, its excellent news that it has damaged sooner than 6 years. Sadly, I feel some bond buyers shall be disillusioned as a result of for those who have a look at the cumulative 5 years return, its 0.8% and that’s in USD!
Given the depreciation of 6% in USD this 12 months, technically the 12.7% mounted earnings portion has been a drag on Daedalus. I’ve to be sort of clear the function of the mounted earnings in Daedalus and never preserve considering this can be a drag on efficiency.
Something that isn’t equity-like will end in a distinction in efficiency and we acquired to be clearer why its there within the first place. Having a money war-chest can also be a non-equity like efficiency.
The typical coupon is 2.96% and in a 12 months’s time the portfolio will earn roughly that return from the coupon itself.
Its efficiency will look higher and higher.
Function of Portfolio
The objective of the portfolio is to generate regular, inflation-adjusted earnings to cowl my important dwelling bills. It’s constructed utilizing a conservative preliminary withdrawal fee of two.0–2.5%, which is designed to carry up even below extraordinarily robust market circumstances — together with eventualities just like the Nice Melancholy, extended intervals of excessive inflation (averaging 5.5–6% over 30 years), or main international conflicts. In different phrases, it’s stress-tested to face up to a few of the worst monetary environments in historical past.
The earnings must final: from as we speak (age 45) for the remainder of your life — probably perpetually.
I’m at present not drawing down the portfolio.
For additional studying on:
- My notes relating to my important spending.
- My notes relating to my fundamental spending.
- My elaboration of the Protected Withdrawal Fee: Article | YouTube Video
Based mostly on present portfolio worth, the quantity of month-to-month passive earnings that may be conservatively generated from the portfolio is
The decrease the SWR, the extra capital is required, however the extra resilient the earnings stream is.
Nature of the Earnings I Deliberate for
Usually, different earnings methods produce various kinds of earnings streams. They’ll range by:
- Consistency: Some present regular earnings, others fluctuate over time
- Inflation Safety: Some modify with inflation, others stay mounted
- Length: Some final for a set variety of years, others are designed to final indefinitely (perpetual)
An earnings stream primarily based on the Protected Withdrawal Fee framework is constant and inflation-adjusted, and if we use a low preliminary Protected Withdrawal Fee of two.0-2.5%, the earnings stream leans in the direction of a protracted period to perpetual.
Here’s a visible illustration of how the earnings stream shall be primarily based on the present portfolio worth:
The earnings for the preliminary 12 months is predicated on a 2% Protected Withdrawal Fee. The earnings for subsequent years is predicated on the inflation fee within the prior 12 months (seek advice from the underside pane of inflation within the earlier 12 months). If the inflation is excessive, the earnings scales up and if there may be deflation, the earnings is diminished.
Quantity of Money Circulation/Earnings Withdrawn/Extracted from Daedalus Earnings Portfolio
I want to be absolutely clear concerning the schedule of withdrawals from the portfolio as a result of if the objective of the portfolio is ultimately or at present present earnings for spending, you’d have an interest to know the way a lot is taken out from the portfolio.
There haven’t been any withdrawals or money movement extraction for spending for the reason that publication of the portfolio. I’ll replace as and when it occurs.
Funding Technique & Philosophy
After attempting my greatest to learn to make investments for some time, the portfolio expresses my ideas about investing at this level.
The portfolio is run in a
- Strategic: allocation doesn’t change by short-term occasions.
- Systematic: guidelines/decision-tree-based applied both myself or an exterior supervisor.
- Low-cost: funding implementation price is saved fairly low each on the fund stage and in addition on the custodian stage.
- Passive: I spend comparatively little effort mentally contemplating investments and in addition action-wise.
You possibly can learn extra on this be aware article: Deconstructing Daedalus My Passive Earnings Funding Portfolio for My Important & Fundamental Spending.
Portfolio Change Since Final Replace (Often Final Month)
There are some portfolio actions within the month.
I’ve clarify a few of the developed markets re-allocation on this weblog put up right here: Why I re-allocate A part of My Developed World Fairness Allocation to iShares STOXX World Fairness Multifactor UCITS ETF (IFSW)
The opposite transfer is to progressively shift from US small cap worth weighted to extra international small cap worth weighted.
This cut back the pure US allocation to 18%.
The great factor about systematic-active methods is that I wouldn’t have to fret a lot about costly valuation. Worth is a component of my funding philosophy and it may be a bit bushy contemplating that the worldwide small cap worth has gone up 50%, whether or not it’s a shift from low cost to costly. However since this can be a technique that continuously reallocates from comparatively expensive to comparatively cheaper, the worldwide worth half nonetheless stays 10 instances PE.
The apprehension is extra that I ate a interval of poor US broad market efficiency and if I shift to extra worldwide and US broad market do properly, I missed out on that efficiency. The affect primarily based on portfolio allocation might be 1%.
The identical for the developed fairness. IFSW and AVGC is about 15.5 instances PE and 16 instances PE respectively. GGRA and JPGL is nineteen instances PE and 15.8 instances PE. I really went extra worth in a means by the shift.
Present Holdings – By Greenback Worth and Percentages
The next desk is grouped primarily based on common technique, whether or not they’re:
- Fastened Earnings / Money to scale back volatility.
- Systematic Passive, which tries to seize the market danger in a scientific method.
- Systematic Energetic, which tries to seize varied confirmed danger premiums equivalent to worth, momentum, high quality, excessive profitability, and dimension in a scientific method.
- Lengthy-term sectorial positions.
Portfolio by Account Supply Location
Portfolio by Area Publicity of Securities
Portfolio by Fund, Money or Particular person Safety
Portfolio by Technique.
What Systematic Energetic Means: Funds that assist me execute passively very particular, repeatable underlying securities choice on an ongoing foundation. Listed below are some examples of the systematic lively methods in my portfolio:
- World Multifactor: From a basket of 1,600 developed market giant and mid-cap shares, rank the shares by their worth, by their 12-month momentum, by their diploma of ROE and debt to asset, after which personal the highest 300. Do that each half-yearly or quarterly. You find yourself with a technique that persistently owns 300 corporations which might be cheaper, high quality and have larger momentum relative to a market cap weighted index.
- Small Cap Worth: From a basket of three,000 developed market small cap shares, rank the shares primarily based on price-to-book worth (embrace intangibles within the ebook worth). Additionally rank the shares by working earnings minus curiosity divide by ebook worth. Remove the businesses with low profitability. What we find yourself is 2 group of small cap shares: The extra worthwhile small caps however not too costly, and the small caps shares which might be at the very least worthwhile however are very low cost. Personal the highest 30-35% of this cohort persistently. Have a supervisor that persistently helps me execute this.
The Most important Custodians for the Securities on this Portfolio
The present custodians are:
- Money: Interactive Brokers LLC (not SG)
- SRS: Philips FAME
If you wish to commerce these shares I discussed, you possibly can open an account with Interactive Brokers. Interactive Brokers is the main low-cost and environment friendly dealer I exploit and belief to take a position & commerce my holdings in Singapore, the USA, London Inventory Alternate and Hong Kong Inventory Alternate. They let you commerce shares, ETFs, choices, futures, foreign exchange, bonds and funds worldwide from a single built-in account.
You possibly can learn extra about my ideas about Interactive Brokers in this Interactive Brokers Deep Dive Collection, beginning with how one can create & fund your Interactive Brokers account simply.
Kyith is the Proprietor and Sole Author behind Funding Moats. Readers tune in to Funding Moats to study and construct stronger, firmer wealth foundations, how one can have a Passive funding technique, know extra about investing in REITs and the nuts and bolts of Energetic Investing.
Readers additionally comply with Kyith to learn to plan properly for Monetary Safety and Monetary Independence.
Kyith labored as an IT operations engineer from 2004 to 2019. Presently, he works as a Senior Options Specialist in Insurance coverage Begin-up Havend. All opinions on Funding Moats are his personal and doesn’t signify the views of Providend.
You possibly can view Kyith’s present portfolio right here, which makes use of his Free Google Inventory Portfolio Tracker.
His funding dealer of alternative is Interactive Brokers, which permits him to put money into securities from totally different exchanges everywhere in the world, at very low fee charges, with out custodian charges, close to spot forex charges.
You possibly can learn extra about Kyith right here.
