Friday, September 30, 2011

Portfolio in pain as Transatlantic fears return

It has been a horrible 3 months or so. The problems in America and Europe show no signs of abating since returning to haunt the markets in 2011.

Shares of C&O look likely to be suspended as the acquirer looks to shore up to the 95% level. I am not sure if I can still sell them at the open market or just wait for them to re-tender. In anycase, I will make a slight loss on this investment.

This is nothing compared to Stratech. The shares of this Singapore technology company has slid continually even before the recent meltdown, because it has been hardly turning a profit. It has recently announced an acquisition to be satisfied partly through the issuance of new shares.

There is not much to say for the rest of the portfolio as they have not been able to escape the flight from assets with any sort of risk.

Things have been busy at work. I just crossed the one year mark with the company and I think there are things to do and more skills to development. I am still lacking in terms of industry knowledge and recent events have made me realised that I may not be the best person for the current job. But then again, seldom is there a perfect fit.

Will take the weekend to recharge and consider my options as well as game plan.

Monday, September 12, 2011

is this the double dip we are looking for

Is this the double-dip that everyone was talking about 2-3 years ago? Based on the past month alone, this scenario seems very likely. There has been a steady flow of negative news and economists are already predicting a recession in the latter half of this year.

In my opinion, there is a double-dip in the stock market but not in the global economy. The reason for the stock market to decline precipitously is that all the money that has been pumped in - QE I and  QE II - were not put to productive use. Rather, they were used to give stock prices a boost. When the underlying does not improve, stock prices that are pumped up using borrowed money, will have to obey the law of gravity. This is what we are seeing the past weeks.

What about the economy? In my opinion, it was hardly out of the woods when the whole thing began. When I say the whole thing, I am referring to the fact that we were entering the down phase of the business cycle. The fact that America has not been able to sort out its credit woes, with the mortgage sector the most important one, economic activity in the the number one economy had to revert to a realistic condition. That is why despite the Obama's administration best efforts, job figures are still as bad.

Will the stock market get better? Based on recent events, I would think that things will get shakier before getting better. Sub-2,800 levels of the STI looks like a decent range to be trading in. Once all the big money is flushed out of stocks and into other asset classes, that is the time to get in.

Thursday, September 1, 2011

Portfolio sinks in pain, opportunities missed

This was a miserable month as the portfolio reverted to June levels. What was frustrating were the uncertainties in the market and the wild swings has planted doubts into my head whether to increase my stake in Etika International.

It was not all that bad as GMG Global recovered and is currently at 24.5 cents. I did not take any action on my C&O Pharmaceutical and am now waiting for the stock to be suspended should the 90% threshold be achieved by the acquirers.