Saturday, October 10, 2009

Week 3

While week-on-week the STI rose 1.84%, the portfolio rose only paltry 0.55%. This highlights one of the weakness of a portfolio that does not weight accordingly to the benchmark. Nonetheless, if you are a fan of stock picking, periods of lagging the index should not stop you from feeling disheartened.

In case you have not been reading the news, Li Heng's proposed restructuring was rejected by the SGX. The move would have seen a Newco list in Hong Kong, with the Singaporean counterpart being a shell company. This would be in effect a delisting. Li Heng has been in fact, most creative in its effort to dual list, unlike other S-Chips, which have a straightforward formula.

Also, Australia's central bank raised its interest rates, becoming the first G-20 nation to do so since the onslaught of the financial crisis. Ina Bloomberg report, singapore is believed to have managed gains to its GDP. Gold prices have also hit new highs with spot prices climbing past the US$1,000/oz mark convincingly.

Reporting season for third quarter is near for Singapore stocks, it would be good to see how have some of the heavy weights like SPH and Keppel will perform. A good exercise during this period is to see how analyst earnings projections for those index company measure up against the real earnings.

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