Thursday, November 29, 2012

Pokemon - getting started

I am not sure why but at work today, I decided that I wanted to collect pokemon cards. Before I had my dinner, I popped by Bishan and found a store selling them. After I had my dinner, I made a trip back to Bishan and plunked some money on card protector, card box as well as 12 booster packs. I guess my journey to the world of pokemon starts now. 10,000 hours to being an expert.

Visiting Legoland soon

A group of friends have decided to take a day trip across the Causeway to visit Legoland about a month from now. I did a quick search online and despite its proximity, there are so many deals that will get us there.  Will post something after the trip is done.

Saturday, November 24, 2012

Property discussions continued

In earlier post, I wrote about my colleagues who had bought or sold property. Colleague A is now developing a rude awakening because she cannot find a property (specifically condominium) with the size she has in mind, with her current budget. Her original intention was to sell her current property, rent and wait for the crash. But with rents of at least SGD 6,000 being asked, any profit gained after deducting for interest and CPF will be quickly diminished. I do think that there is nothing wrong with renting a HDB. I am sure it is much cheaper over a longer period than a condominium, but that is just me. Time is now ticking for her as she has to move out by early next year.

Etika FY12 earning down 23.8 per cent

You can read more about their results here and here. This stock forms the biggest part of my portfolio. Ever since the stock announced a bonus issue, its share price has been on the downward trend for a very long time. It has stopped announced new acquisitions but margins are still hurt by volatile raw material prices to the extent it has ventured into the retail F&B business. I know we should not have hope when investing, but I do hope that the stock recovers in its share price.

Wednesday, November 21, 2012

Olam: Like a bridge over Muddy Waters

Olam International's stock plunged on Tuesday after a negative report by Muddy Waters Research, a company known for not so positive reports as well as shorting them. Now, Olam International has threatened to "take appropriate legal action against" Muddy Waters. I do not own shares in Olam but this is the second time that a research company has issued something negative on it, specifically its accounting practices. And apparently, the analyst that wrote it is no longer with CLSA, although it is not clear whether he/she left as a result of that report.

Sunday, November 11, 2012

where have all the bloggers gone?

I found some time recently and was trying to catch up on the Singapore stock market by reading blogs. I was quite disappointed however because there has been a lack of good posts. Not unlike Rockson Tan, some of the good bloggers to read on and off have gone into cold storage mode. Music Whiz has sworn off blogging at the start of the year, Donmihaihai posts as infrequent as ever, while Wealth Buch is slowing down because he is concentrating on his tuition business. Ghchua still posts his portfolio on a monthly basis but due to the sheer size of his investments, he offers not much in depth analysis. Most of what I can find is mainly day to day posting of videos and link, without much company analysis (SGX-listed companies!).

What constitutes a good blog? There are four things that I look out for, namely, relevance, regularity, research and revealing. As I have named myself, I am most interested in companies listed on the Singapore Exchange because that is the extent I can invest my small amount of money. Having said that, I recently acquired NYSE-listed shares as part of my company's performance bonus. Secondly, regularity in posting is always good in general and by that, twice a month would be a good frequency. This is related to the fact that I am more interested in the medium and long term  (anything from two years out) horizon and daily postings will not bring much value. This leads to the third point, the research content of the post. Simple charts and some opinion would be good enough. This would involve revenue and earnings from the past five years and just a paragraph in the investment thesis. Finally, a good blog or post should reveal a lot about the blogger's personally life. When we can relate to someone even if he is anonymous, we stay a bit longer on the person's blog. Which is why I tend to follow WB's post as he is about the same age as I am and of almost the same educational background. But if you do boast of a 500 k portfolio I think there will still be a stream of followers, both good and bad, like for this guy

Most of the good blogs I know out there done by Singaporeans are mainly on food and politics. I do no read food blogs but blogs on politics tend to be better because they are highly relevant and have a constant stream of material to focus on. But why are there so many crummy blogs on stocks. I think the proliferation of not so good blogs on investments is due to one main issue, the lack of an incentive. There are very few identified financial bloggers and most have remained anonymous. Those that are out there tend to already have a business giving financial advice. Those that are not out there, such as myself, can attest to the fact that the "passive income" from Adsense and Nuffnang. Therefore, there is not much incentive for anonymous bloggers to write extensively on a company (other than for the love of it).  And as a result, one of the tactics to drive traffic and clicks on a blog is to re-post links. I am guilty of this sin about 50% of the time and my defence is that there are blogs that exists wholly to re-post content without adding any of their insight. 

Why am I saying all these? I guess the main reason is that I am looking for investment ideas and need someone to seed my investment thesis. There use to more bloggers with good analysis but sadly, the longer you are into it, you just cannot be as enthusiastic as you used to be.

Friday, November 9, 2012

Not enough time

I have not been spending enough time tracking my stocks. The months of September and October have been so busy for me that I do not even have enough time to spend on my hobby. I guess this is a good thing in some ways. Firstly, I have developing my skills by reading as well as enrolling for a masters programme. Although it is early days, I do feel that the masters has not been as stimulating as I had hoped for. Secondly, I have been spending time either with my loved ones, family or exercising. Lastly, it just occurred to me that I  went to Japan in July and spent a good 10 days there. I will have to do a write up on it then.

What is not so good is that I am not able to monitor the performance of the portfolio as accurately or reliably as I had hoped for. Well, you cannot always win them all. 

Thursday, November 8, 2012

Bought Petra Foods

I bought two lots of Petra Foods at SGD 2.64. It was between this or Wilmar International. I am buying into this stock because it is a consumer staple and non-cyclical stock. This brings my invested cash to SGD 34,000, there about because I net off the dividends that came in.  I will figure someway to track the performance of my portfolio given this change. At the moment, the portfolio comprises mainly those companies that deal with food or commodities. the top five holdings as a percentage of current portfolio are: Elite KSB, Etika International, Petra, GMG Global and UOB-Kayhian. 

Saturday, November 3, 2012

Property discussions

Recently, two colleagues I know made bought or sold properties, all of them private property. Colleague A just gave birth and so a bigger house was in order. However, she was not going to buy another property but rent from someone for the next 12-24 months. Colleague B bought a private apartment because she was in no way eligible for HDB housing. I on the other hand, am in the process of putting money down for a HDB flat that will only be delivered in 2016. It is affordable - around SGD 550 k for 90 + 3 square metre or SGD 569 per square feet. It is affordable because my colleagues are dealing with millions of dollars.

It is apparent that there will be a difference in opinion between the three of us and it is apparent from the conversations that I had. Let us analysis each of our positions.

Colleague A: Market has reached a peak. Sell now to realise the gains, and rent a place in the medium term and hope to pickup a cheaper unit when the market cools down when the supply comes online.

Analysis: I think that this is a good move, provided she rents a much cheaper place in the medium term. Otherwise, any capital appreciation might be wiped out from renting from a hot market. I did tell her that she should just rent a five-room HDB but she said that she is used to living in a condominium.

Colleague B: Just bought a unit and hence Colleague B's actions disconfirms her own belief that the market will keep going up. Her theory is that the government will not allow the market to crash

Analysis: She is suffering from buyer's remorse. She is partially right in believing that the government will not allow the property market to crash. This is backed up by the fact we are heading towards 6 million people in Singapore by some time frame.

Myself: 2016 is a long time. If I wait any longer, I will have to buy a resale flat or worse, an expensive private home. My theory is that the market will crash in 2015-2016 but I cannot wait till be proven right.

Analysis: I agree with Colleague B but I am okay even if the market crashes because I still have the option of staying in the HDB in 2016 onward and wait for the next cycle. Moreover, the effects of the loan will not come in till much later. More importantly, which part of the market crashes matters a lot. while I do not think that the government will engineer a crash in Public Housing, it may try to cool the Private Housing sector because it drives prices in the resale market. 

What do you think?