$1.45 mil Daedalus Income Portfolio Update – February 2025

Here is the update for my Daedalus portfolio for January 2025. If work is not too busy, I will try to provide an update where possible.

I explain how I constructed this portfolio in Deconstructing Daedalus Income Portfolio. You might not understand what I wrote below if you haven’t read this post.

All my personal planning notes such as income planning, insurance planning, investment & portfolio construction will be under my personal notes section of this blog. You can also find the past updates in the section.

Portfolio Change Since Last Update

The portfolio was valued at $1.534 million at the end of January and is at $1.501 million at the end of December.

We reported a portfolio change of $33,000 for February 2025.

As of 6th March 2025, the portfolio is valued at $1.453 million.

Here are the primary security holding returns for the month-to-date and year-to-date:

The returns of all funds are in USD. This includes the performance of the Dimensional funds, which I use the returns of the USD share class so that the returns are comparable. I have also listed the major index ETF performance for comparison.

Markets had a rough end to February when there were more trade war announcements but more so, the 10-year yield moved down, an early indication that the market detects greater weakness in the US economy. There are more signs that the economy is weakening rather than seeing inflation pick up.

Major index ETF weakened especially small cap. While USSC and AVGS have performed well because small cap value with profitability perform better than the Russell 2000 or S&P 600, the decline were larger than the large cap.

Dimensional Global Targeted Value did particularly well despite being a small cap versus the others. I chalked it down to how Dimensional design the small cap relative to Avantis. They are more value oriented than profitability oriented.

The Global indexes (All Country World, All Country World IMI and World) continues to do better than the US. Emerging markets also did better.

JPGL really shined this month because they were more equal-weight compared to GGRA, AVGS, IFSW. All did better than the cap-weighted MSCI World this year.

Intermediate maturity fixed income AGGU did well this year, up 0.77% and their good performance continues into March.

The portfolio lost 0.55% due to the weakening SGD against the USD. And they continue to lose a further 1.52% in the past 3 trading days of Mar. So in total, the portfolio lost 2%, or about $30,000 worth of value just by currency movement.

Role of Portfolio

The goal of the portfolio is to provide consistent, inflation-adjusted income for my essential and basic spending. The portfolio is sized based on a conservative 2.0-2.5% Initial Safe Withdrawal Rate (SWR) so that the income can last even considering challenging historical sequences such as the Great Depression, external war and 30 years of high inflation averaging 5.5-6% p.a.

The timeframe that the income stream to be planned for: 60 years to Perpetual

I am currently not drawing down the portfolio.

For further reading on:

1. My notes regarding my essential spending.
2. My notes regarding my basic spending.
3. My elaboration of the Safe Withdrawal Rate: Article | YouTube Video

Based on current portfolio value, the amount of monthly passive income that can be conservatively generated from the portfolio is

The lower the SWR, the more capital is needed, but the more resilient the income is.

Nature of the Income I Planned for

Different income strategies will give you different characteristics of income streams. They can be more consistent or volatile, inflation-adjusted or non-inflation-adjusted, for limited duration or perpetual.

An income stream based on the Safe Withdrawal Rate framework is consistent and inflation-adjusted, and if we use a low initial Safe Withdrawal Rate of 2.0-2.5%, the income stream leans towards a long duration to perpetual.

Here is a visual illustration of how the income stream will be based on the current portfolio value:

The income for the initial year is based on a 2% Safe Withdrawal Rate. The income for subsequent years is based on the inflation rate in the prior year (refer to the bottom pane of inflation in the previous year). If the inflation is high, the income scales up and if there is deflation, the income is reduced.

Investment Strategy & Philosophy

After trying my best to learn how to invest for a while, the portfolio expresses my thoughts about investing at this point.

The portfolio is run in a

1. Strategic: allocation doesn’t change by short-term events.
2. Systematic: rules/decision-tree-based implemented either myself or an external manager.
3. Low-cost: investment implementation cost is kept reasonably low both on the fund level and also on the custodian level.
4. Passive: I spend relatively little effort mentally considering investments and also action-wise.

You can read more in this note article: Deconstructing Daedalus My Passive Income Investment Portfolio for My Essential & Basic Spending.

Portfolio Change Since Last Update (Usually Last Month)

I would usually have $15,300 a year in SRS allocation. I bought $4,000 in Dimensional World Equity SGD and $3,500 in Dimensional Global Targeted Value SGD. Given how markets are, I might put in the other $7,500 earlier this month.

I reallocated $30,000 from JPGL to AVGC and another $30,000 from USSC to AVGS this month. I will continue to reallocate more of USSC to AVGS so that the small cap allocation is more global.

Current Holdings

The following table is grouped based on general strategy, whether they are:

1. Fixed Income / Cash to reduce volatility.
2. Systematic Passive, which tries to capture the market risk in a systematic manner.
3. Systematic Active, which tries to capture various proven risk premiums such as value, momentum, quality, high profitability, and size in a systematic manner.
4. Long-term sectorial positions.

Portfolio by Account Location

Portfolio by Region of Securities

Portfolio by Fund, Cash or Individual Security

Portfolio by Strategy.

Main Custodians

The current custodians are:

1. Cash: Interactive Brokers LLC (not SG)
2. SRS: iFAST Financial

If you want to trade these stocks I mentioned, you can open an account with Interactive Brokers. Interactive Brokers is the leading low-cost and efficient broker I use and trust to invest & trade my holdings in Singapore, the United States, London Stock Exchange and Hong Kong Stock Exchange. They allow you to trade stocks, ETFs, options, futures, forex, bonds and funds worldwide from a single integrated account.

You can read more about my thoughts about Interactive Brokers in this Interactive Brokers Deep Dive Series, starting with how to create & fund your Interactive Brokers account easily.

Kyith is the Owner and Sole Writer behind Investment Moats. Readers tune in to Investment Moats to learn and build stronger, firmer wealth foundations, how to have a Passive investment strategy, know more about investing in REITs and the nuts and bolts of Active Investing.

Readers also follow Kyith to learn how to plan well for Financial Security and Financial Independence.

Kyith worked as an IT operations engineer from 2004 to 2019. Currently, he works as a Senior Solutions Specialist in Insurance Start-up Havend. All opinions on Investment Moats are his own and does not represent the views of Providend.

You can view Kyith’s current portfolio here, which uses his Free Google Stock Portfolio Tracker.

His investment broker of choice is Interactive Brokers, which allows him to invest in securities from different exchanges all over the world, at very low commission rates, without custodian fees, near spot currency rates.

You can read more about Kyith here.