Hello there!
It has been such a long time since I have blogged. Apologies, as I have not made any move in the stock market recently until Brexit happened.
The market fell last Friday (24.06.2016) and a strong rally happened so much so that I was thinking "Have the markets gone crazy or what???!"
Frasers Centrepoint Trust reached its 52 week high of $2.12 and I sold it off immediately.
I have blogged before on when you should sell a stock here and I was rather convinced that it might be overpriced.
I like the saying "A bird in the hand is worth 2 in the bushes". In this case, since I have made a 10% gain over the year, I quickly sold off the stock.
Will repurchase when the market comes to its senses again :)
Friday, 1 July 2016
Monday, 18 April 2016
Capitaland Mall Trust Results Review (Q12016)
CapitaLand Mall Trust released its Q1 2016 yesterday.
1st Key Metric: Funds from Operations Per Share (FFOPS)
To assess Reits/Trusts, a very important metric to use is Funds from Operations(FFO) as it measures the profitability of the reit/stock after taking into account of depreciation and gains from disposal of assets. Funds from operations is a much more reliable metric to assess how well the trust/reit is doing.
The formula : Net income - Interest income + Interest expense + Depreciation- Gains on asset sales + Losses on asset sales = Funds from operations
For CapitaLand Mall Trust, FFOPS:
1Q2015: 0.0297
1Q2016: 0.0317
There is an improvement of about 6%
2nd Key Metric: NAV Per Share
The NAV of a company is its Assets minus liabilities, divided by the outstanding number of shares, we get the NAV per share. It is the 'book value' of a stock. If the market price of the stocks is below the NAV, it may mean a good opportunity to buy the stock.
Current NAV (1Q2016): $1.88
Current Stock price: $2.17
Premium: 15%
Earnings implication- Saved by Bedok Mall
1st Key Metric: Funds from Operations Per Share (FFOPS)
To assess Reits/Trusts, a very important metric to use is Funds from Operations(FFO) as it measures the profitability of the reit/stock after taking into account of depreciation and gains from disposal of assets. Funds from operations is a much more reliable metric to assess how well the trust/reit is doing.
The formula : Net income - Interest income + Interest expense + Depreciation- Gains on asset sales + Losses on asset sales = Funds from operations
For CapitaLand Mall Trust, FFOPS:
1Q2015: 0.0297
1Q2016: 0.0317
There is an improvement of about 6%
2nd Key Metric: NAV Per Share
The NAV of a company is its Assets minus liabilities, divided by the outstanding number of shares, we get the NAV per share. It is the 'book value' of a stock. If the market price of the stocks is below the NAV, it may mean a good opportunity to buy the stock.
Current NAV (1Q2016): $1.88
Current Stock price: $2.17
Premium: 15%
Earnings implication- Saved by Bedok Mall
1. The revenue of Bedok Mall- $14.6m attributed mainly to the increase in revenue. This means that if CMT did not acquire Bedok Mall, its revenue would have been $152.7, a decrease as compared to 1Q2015 which inherently means the other malls are not faring as well. The improvement of IMM by $1.3m can barely save all the other malls.
This is why for a reit to grow, it is important to acquire new assets and improve on the existing ones.
2. Other assets- Jcube, Sembawang Shopping Centre, Clarke Quay, The Atrium @ Orchard are performing worse.
Looking at this chart, retention rate for:
Clarke Quay: 66.7%
The Atrium: 44.4%
Other assets (Jcube and Sembawang shopping centre): 71.4%
Not a very good sign..
This also means that Heartland malls are doing much better, which Frasers Centrepoint Trust is very strong at.
Overall- Will not buy now.
Better than expected performance results, DPU also increased. But the current price of $2.17 sets a premium of 15% to its NAV value.
Not a good bargain.
I am also cautious of how the other malls are doing in future especially Clarke Quay, Jcube, Orchard.
Bedok mall cannot save the day, all the time.
Monday, 21 March 2016
When should you sell a stock?
The market has been bullish these 2 weeks.
I would like to maximize my profits, sell at the peak (hopefully) and repurchase when the stock is low. However, to time the market is very difficult and I do not encourage that too.
But there are still some very valid reasons on when I sell my stock.
A P/E ratio that is ridiculously high or a very bullish stock that keeps going up within a short period(a few days) without any significant company news can indicate that the stock is being driven by speculators.
I monitor the stock market every hourly x8 hours x 5 days a week x 12 months a year, and so far it has been 1 yr 8 months. Really eat too free lol.
There was a time where Q&M irrationally shot up to $1.00 at its peak. The normal trading price was around $0.68-$0.72 over the year.
StarHub traded at its peak of $4.46 when the average over the year was about $4.05-$4.18 before the 4th Telco came in.
For one to see when your stock is overvalued, I think you would really have to know your own stock SO WELL until you know how it might behave according to STI's movements.
There are some technical movements and volatility (we call that 'Beta' in a stock) unique to each stock Some stocks have very high beta (Noble) whereas some stocks are forever so stagnant (Reits). You can only confidently sell your stock if you know it has suddenly behaved irrationally.
In 2015, the announcement of the 4th Telco came and there were already plans for its entry. That was a good time to say goodbye to Starhub and M1 :(
A shift of fundamentals include the overall industry outlook and the company's competitiveness.
True enough, A-Reit hit a high about 2 months later and I sold it off again. I am still pessimistic about the market especially in the US side. I highly believe that US is heading for a recession this year.
Digress, I do need some funds for my war chest. I do not think that my opportunity cost to hold off a bit later will be that high.
Well, these are just my opinions learnt through several heart aches; I hope I am improving :)
I would like to maximize my profits, sell at the peak (hopefully) and repurchase when the stock is low. However, to time the market is very difficult and I do not encourage that too.
But there are still some very valid reasons on when I sell my stock.
1. When it is very likely (i.e. beyond a reasonable doubt) that the stock is overvalued.
A P/E ratio that is ridiculously high or a very bullish stock that keeps going up within a short period(a few days) without any significant company news can indicate that the stock is being driven by speculators.
I monitor the stock market every hourly x8 hours x 5 days a week x 12 months a year, and so far it has been 1 yr 8 months. Really eat too free lol.
There was a time where Q&M irrationally shot up to $1.00 at its peak. The normal trading price was around $0.68-$0.72 over the year.
StarHub traded at its peak of $4.46 when the average over the year was about $4.05-$4.18 before the 4th Telco came in.
For one to see when your stock is overvalued, I think you would really have to know your own stock SO WELL until you know how it might behave according to STI's movements.
There are some technical movements and volatility (we call that 'Beta' in a stock) unique to each stock Some stocks have very high beta (Noble) whereas some stocks are forever so stagnant (Reits). You can only confidently sell your stock if you know it has suddenly behaved irrationally.
2. When its fundamentals have changed
In 2015, the oil price started to spell trouble and that was a good time to sell oil stocks like Keppel when it was trading at $9+.In 2015, the announcement of the 4th Telco came and there were already plans for its entry. That was a good time to say goodbye to Starhub and M1 :(
A shift of fundamentals include the overall industry outlook and the company's competitiveness.
3. When you know you have a better opportunity
I sold Capital mall trust when I earned some decent profits then and I believed that at that particular time, it has hit a high. I sold it off and bought Ascendas Reit when I honestly think it was undervalued (at that time). This is a reason to sell a stock- to purchase a stock that is performing better (hopefully undervalued).True enough, A-Reit hit a high about 2 months later and I sold it off again. I am still pessimistic about the market especially in the US side. I highly believe that US is heading for a recession this year.
Digress, I do need some funds for my war chest. I do not think that my opportunity cost to hold off a bit later will be that high.
Well, these are just my opinions learnt through several heart aches; I hope I am improving :)
Wednesday, 24 February 2016
Another scam: Aquilaria Tree Scheme
The Aquilaria Tree Scheme
I read Straits Times today and saw this news:
The "deal" in summary:
Pay $230 per sapling or $550 per semi-mature tree
Tenure: 6-7 years when tree matures
Returns: 6-7 times when Agarwood is harvested from each tree
What does this mean: 100% returns averaged out in 1 yr.
In 2013, my friend proudly told me her investment in this Aquilaria Tree. She said that she bought a few trees and when these trees matures, it produces Agarwood which can be sold. She can sell at $400-$600 for each tola of Agarwood oil harvested.
I told her then that this was very likely a scam. How can there be such a good deal? $400 return after 6 yrs when the investment is only $500?
SURE ANOT? 100% return?
She told me that she was very sure. The investors even told her they could bring her to see the actual trees planted. Furthermore, it was a Singapore based company.
Hai.. so now this Singapore company has folded and gone MIA. Hard earned money of my friend all gone..
Previously, I have written a post about Pre-IPO Scams, link here.
How to identify potential investment scams:
1. It promises high returns with a very low risk.
What is high return?
Returns through various investments:
0.025% savings account
1.3% 1-year FD
3.25% OCBC 360 Account
7.8% S&P 500
15% Warren Buffet
Warren Buffet, one of the richest person on Earth, returns from the stock market is about 15%. Do you honestly think that you can get an investment that yields a higher return than Buffet consistently and at a low risk?
2. You are enticed through telemarketing
A good investment will be secretly kept in wraps and for traders/big investors to earn. Heck, if I can earn via arbitrage or if I know a very good investment, I will keep it a secret and profit hugely myself.
If a good investment has to be promoted through telemarketing, it is just desperate.
Lastly, some lessons to learn:
1. 'Alternative Investments' such as venture capital, private equity, hedge funds, real estate investment trusts, commodities as,precious metals, rare coins, wine, and art are normally directly sold to people with high net worth. You may a private banker from a known bank helping you to invest in such things.
Such a creative idea... Aquilaria Tree and agarwood lol.
2. Read more and understand better before investing. You should be sure of what you are buying, please read more and please read from expert reports. If you do not know anything, at least GOOGLE.
3. If you cannot resist the temptation to make money quickly and easily, you are bound to lose money. I have written a post here . There is no easy and quick money in the world la alamak. Warren buffet reads 8 hours a day and is innately talented, and his returns are 15%.
Ok, that's all from me in this matter. :)
Thursday, 18 February 2016
Sold off Ascendas-Reit
Sold Ascendas-Reit at $2.42, when it hit a high this week. My return from this stock is about 10%.
I don't have the time to write an essay to explain why I am selling A-Reit.
So.. this is becoming like Twitter, just a few sentences to say why.
1. When I buy Reits, I analyze its FFO (Free cash flow from operations) per share & NAV.
2. A-Reit honestly, is doing WELL in terms of these two matrices . Coupled with its high DPU, it is really quite a good stock to buy.
3. However, sentiments from the market seems to show that given the current volatile economy, this price is overvalued at the moment.
4. I am rather confident that I can enter at a lower price in a few months to come.
5. Economy is not doing well- US is headed for a recession (after reading so many expert reports). Sg export market has dropped, also heading to a technical recession. China is losing its steam.
6. Oh Well.. I am cashing out to build up a war chest first. Will purchase when the recession is confirmed ;)
I don't have the time to write an essay to explain why I am selling A-Reit.
So.. this is becoming like Twitter, just a few sentences to say why.
1. When I buy Reits, I analyze its FFO (Free cash flow from operations) per share & NAV.
2. A-Reit honestly, is doing WELL in terms of these two matrices . Coupled with its high DPU, it is really quite a good stock to buy.
3. However, sentiments from the market seems to show that given the current volatile economy, this price is overvalued at the moment.
4. I am rather confident that I can enter at a lower price in a few months to come.
5. Economy is not doing well- US is headed for a recession (after reading so many expert reports). Sg export market has dropped, also heading to a technical recession. China is losing its steam.
6. Oh Well.. I am cashing out to build up a war chest first. Will purchase when the recession is confirmed ;)
Sunday, 14 February 2016
It is here.. Robots replacing humans for jobs.
Last weekend, I went to MacDonald's to buy an ice cream. Wow.. when I stepped in, instead of the usual cashiers and tables in the usual lay out, I saw this:
SELF SERVICE KIOSK.
Now, instead of queuing, all I had to do is to press a touchscreen, make some selections, pay on the spot, and Tada! I get a queue no. and I wait for my ice cream, all done in less than 10 minutes.
JOBS REPLACED BY SOFTWARE BOTS-BILL GATES
In 2014, Business Insider wrote an article where Bill Gates states that "People don't realize how many jobs will soon be replaced by Software Bots"
This what he said:
I digress a little. I am hugely interested in what experts say about future developments, especially when people like Bill Gates had been very spot on on their predictions decades ago.
Bill gates, in 1999, predicted about Social Media/Home monitoring/Internet payments/ mobile devices/ price comparison sites ..etc.
It was scarily accurate.
Now, I have to sit up and seriously look into what he says lah!
Instead of jobs being replaced by foreign talents, I think the real danger is software bots -_-
WHAT DOES THIS IMPLY?
In 20 years time, these jobs will become irrelevant:
In 20 years time, I will be in my 40s-50s and my job falls nowhere near the 'safe zone' :(
In 20 years time, our children will be the ones facing the brunt and unless they have high skill sets, it's going to be difficult for them.
Lastly, CANNOT BEAT SOFTWARE BOTS? JOIN THEM.
Become a software developer.
Unfortunately, it is really 'easier said than done'. A coder needs to possess really innate logical thinking and clearly, not anyone can do it.
SELF SERVICE KIOSK.
Now, instead of queuing, all I had to do is to press a touchscreen, make some selections, pay on the spot, and Tada! I get a queue no. and I wait for my ice cream, all done in less than 10 minutes.
JOBS REPLACED BY SOFTWARE BOTS-BILL GATES
In 2014, Business Insider wrote an article where Bill Gates states that "People don't realize how many jobs will soon be replaced by Software Bots"
This what he said:
“Software substitution, whether it’s for drivers or waiters or nurses … it’s progressing. … Technology over time will reduce demand for jobs, particularly at the lower end of skill set. … 20 years from now, labor demand for lots of skill sets will be substantially lower. I don’t think people have that in their mental model.”
Bill gates, in 1999, predicted about Social Media/Home monitoring/Internet payments/ mobile devices/ price comparison sites ..etc.
It was scarily accurate.
Now, I have to sit up and seriously look into what he says lah!
Instead of jobs being replaced by foreign talents, I think the real danger is software bots -_-
WHAT DOES THIS IMPLY?
In 20 years time, these jobs will become irrelevant:
In 20 years time, our children will be the ones facing the brunt and unless they have high skill sets, it's going to be difficult for them.
Lastly, CANNOT BEAT SOFTWARE BOTS? JOIN THEM.
Become a software developer.
Unfortunately, it is really 'easier said than done'. A coder needs to possess really innate logical thinking and clearly, not anyone can do it.
Wednesday, 10 February 2016
Why I will not top up my CPF SA voluntarily
Personal financial planning is a topic which I seldom talk about, but I do have my own plan and I would like to share it here.
About topping up my CPF SA account voluntarily.
The good:
4% interest.
I find that topping up the CPF SA account is very good viable option as it earns you a 4% interest and when compounded over the years, the amount of money can be substantial. The earlier you start, the better the effects of compounding is seen.
Tax benefits
Up to $14k. If you do that for 10 years, you would have saved $140k!!
BUT BUT BUT..This is not my plan.
My plan is this:
To invest in stocks/ liquid assets and get my 2nd property/3rd property in years to come.
If I were to put my money into SA account, the move is IRREVERSIBLE. So how can I get to buy my 2nd property ?
Investment in Real Estate
I want to invest in real estate, at least this is what I believe works in Singapore. Many people say that Singapore is heading a property crash, but the real estate, like stocks, goes through cycles too.
In Year 2003, some condos are for sale at $300k. Right now, in Year 2016, these condos have doubled or even tripled in value.
If you are investing for a long term 10-20 years horizon, houses, due to increase of prices in land/construction/manpower (inflation) , will likely appreciate decently too.
And yes, Do not think of buying properties in Malaysia/Cambodia/Vietnam, I am not referring to investment in these countries, not for properties please.
What i like about real estate is I can utilize leverage (mortgage) to get some passive rental income, enjoy some capital appreciation, and if all things goes badly, at least I can stay in it!
Lastly, plan early.
Do what you are comfortable with, but at least plan ahead and stick to it. The worse is not planning anything and making haphazard investment decisions!
About topping up my CPF SA account voluntarily.
The good:
4% interest.
I find that topping up the CPF SA account is very good viable option as it earns you a 4% interest and when compounded over the years, the amount of money can be substantial. The earlier you start, the better the effects of compounding is seen.
Tax benefits
Up to $14k. If you do that for 10 years, you would have saved $140k!!
BUT BUT BUT..This is not my plan.
My plan is this:
If I were to put my money into SA account, the move is IRREVERSIBLE. So how can I get to buy my 2nd property ?
Investment in Real Estate
I want to invest in real estate, at least this is what I believe works in Singapore. Many people say that Singapore is heading a property crash, but the real estate, like stocks, goes through cycles too.
In Year 2003, some condos are for sale at $300k. Right now, in Year 2016, these condos have doubled or even tripled in value.
If you are investing for a long term 10-20 years horizon, houses, due to increase of prices in land/construction/manpower (inflation) , will likely appreciate decently too.
And yes, Do not think of buying properties in Malaysia/Cambodia/Vietnam, I am not referring to investment in these countries, not for properties please.
What i like about real estate is I can utilize leverage (mortgage) to get some passive rental income, enjoy some capital appreciation, and if all things goes badly, at least I can stay in it!
Lastly, plan early.
Do what you are comfortable with, but at least plan ahead and stick to it. The worse is not planning anything and making haphazard investment decisions!
Sunday, 31 January 2016
Looking elegant with the least $$
First impressions matter.
I think that looking presentable and elegant, while emanating some sophistication for a modern woman is very important in the workplace.
The cosmetics industry is always so lucrative, thanks to woman who always want to look pretty.
Anyway, I am no exception.
Except that savings and value matter to me a lot and I spend only the very minimal on looking good.
This is where I...
1. Get my hair dye done:
I watch youtube videos on "how to dye your own hair" and buy Liese Hair dye to do it myself. I can say that I am really impressed with my own work. Lol.
This Liese works wonders! It is easy and convenient.
Damage: $20.
Damage if I go to hair salon instead: $100
Savings: $80
2. Rebond my hair:
Aunty XiuZhen at Jurong West home salon.
This Aunty specializes ONLY on rebonding hair and she has been doing it for 10+ years. Her work is awesome and she uses Sheseido hair products ok.
Damage: $65
Damage if I go to hair salon instead: $150
Savings: $85
3. Makeup products
Silkygirl cosmetics
Don't need to spend on Chanel products which costs over $100+. Simple low cost cosmetics like Silkygirl will do. I watch youtube videos on how to makeup and learn it. Really, the skill in making up is more important than buying expensive make up products!
Damage: $20+
Damage if I buy branded: $100+
Savings: $80+
4. Clothes/Household items
Taobao is a god send!! I save SO much money over the years buying from Taobao instead of brick and mortar shops. Clothes/baby clothes/household items/ winter clothes/ toys so many things!
And I do not use agents like 65Daigou. I learn how to ship direct from Taobao. Just spend some time figuring out how to use China agents to ship over. It is much cheaper that way.
I am also vested in Alibaba shares as I can see its great potential in time to come ^^
Cost savings: 50%
Conclusion..
I often read AK's blog on the importance of saving and spending prudently. Really, it all adds up.
Spending prudently is also learning about 'delayed gratification' -the notion of enjoying your rewards later.
First impressions matter and really, it does not need a lot of money to do that.
I think that looking presentable and elegant, while emanating some sophistication for a modern woman is very important in the workplace.
The cosmetics industry is always so lucrative, thanks to woman who always want to look pretty.
Anyway, I am no exception.
Except that savings and value matter to me a lot and I spend only the very minimal on looking good.
This is where I...
1. Get my hair dye done:
I watch youtube videos on "how to dye your own hair" and buy Liese Hair dye to do it myself. I can say that I am really impressed with my own work. Lol.
This Liese works wonders! It is easy and convenient.
Damage: $20.
Damage if I go to hair salon instead: $100
Savings: $80
2. Rebond my hair:
Aunty XiuZhen at Jurong West home salon.
This Aunty specializes ONLY on rebonding hair and she has been doing it for 10+ years. Her work is awesome and she uses Sheseido hair products ok.
Damage: $65
Damage if I go to hair salon instead: $150
Savings: $85
3. Makeup products
Silkygirl cosmetics
Don't need to spend on Chanel products which costs over $100+. Simple low cost cosmetics like Silkygirl will do. I watch youtube videos on how to makeup and learn it. Really, the skill in making up is more important than buying expensive make up products!
Damage: $20+
Damage if I buy branded: $100+
Savings: $80+
4. Clothes/Household items
Taobao is a god send!! I save SO much money over the years buying from Taobao instead of brick and mortar shops. Clothes/baby clothes/household items/ winter clothes/ toys so many things!
And I do not use agents like 65Daigou. I learn how to ship direct from Taobao. Just spend some time figuring out how to use China agents to ship over. It is much cheaper that way.
I am also vested in Alibaba shares as I can see its great potential in time to come ^^
Cost savings: 50%
Conclusion..
I often read AK's blog on the importance of saving and spending prudently. Really, it all adds up.
Spending prudently is also learning about 'delayed gratification' -the notion of enjoying your rewards later.
First impressions matter and really, it does not need a lot of money to do that.
Thursday, 28 January 2016
IPO of Secura Group (Review)
Secura Group, the newest company to get its share listed at SGX yesterday, opened at $0.24 and closed at $0.225.
Some of its core businesses now:
1. Security printing- printing of valuable items such as cheques and parking coupons.
2. Security guarding
3. Homeland security
Moving forward, Secura will be looking at several sources of growth:
1.Build market share in guarding business
2.Expanding homeland security
3.Expanding cyber security segments
Source: Secura Group’s IPO prospectus
Here's what I think about this company:
Profitable segments:
1. Security guarding:
Right now, I only know of CISCO providing trained security guards. It seems that there is growing demand in this area especially when there are so many new condos/commercial properties/industrial properties popping up in Singapore. Looking at the revenue growth of Secura, its security guarding business is doing very well and sees a jump of 68% from FY2013 to FY2014.
My 'concerned' segments:
1.Security printing services:
This was their core business when they started out in 1976. However, the printing industry in general seems to be declining in profitability. Much of printing has been replaced through the advance technology of computerization, internet and digitalization.
It is no wonder why companies like Interplex sees its Imaging and Printing product sector declining by 24% against 1Q2015 due to changing consumer preference for digital media.
Even Fuji Xerox, the world's largest printer company, seeks to earn more by encouraging less printing.
It is a big industry with a lot of business opportunities out there.
However, IT business in Singapore is VERY competitive. Just take a look at Street Directory. A search of 'IT Companies in Singapore' will give you 259 companies.
Majority of these companies are able to provide some form of cyber security solutions.
I have not even talk about the big boys like IBM/HP/Microsoft, which provides more comprehensive cyber security solutions to bigger companies.
Conclusion:
Some of its core businesses now:
1. Security printing- printing of valuable items such as cheques and parking coupons.
2. Security guarding
3. Homeland security
Moving forward, Secura will be looking at several sources of growth:
1.Build market share in guarding business
2.Expanding homeland security
3.Expanding cyber security segments
Here's what I think about this company:
Profitable segments:
1. Security guarding:
Right now, I only know of CISCO providing trained security guards. It seems that there is growing demand in this area especially when there are so many new condos/commercial properties/industrial properties popping up in Singapore. Looking at the revenue growth of Secura, its security guarding business is doing very well and sees a jump of 68% from FY2013 to FY2014.
My 'concerned' segments:
1.Security printing services:
This was their core business when they started out in 1976. However, the printing industry in general seems to be declining in profitability. Much of printing has been replaced through the advance technology of computerization, internet and digitalization.
It is no wonder why companies like Interplex sees its Imaging and Printing product sector declining by 24% against 1Q2015 due to changing consumer preference for digital media.
Even Fuji Xerox, the world's largest printer company, seeks to earn more by encouraging less printing.
2.Cyber Security solutions:
It is a big industry with a lot of business opportunities out there.
However, IT business in Singapore is VERY competitive. Just take a look at Street Directory. A search of 'IT Companies in Singapore' will give you 259 companies.
Majority of these companies are able to provide some form of cyber security solutions.
I have not even talk about the big boys like IBM/HP/Microsoft, which provides more comprehensive cyber security solutions to bigger companies.
I think that a good business is sustainable when entry of competitors to the same business is difficult/capital intensive, or you have a very distinct competitive advantage.
Therefore, I do not think that Secura can yield very good results in its Cyber Security segment, at least not in the next few years.
Conclusion:
At this moment, I will not invest in Secura as I am skeptical of its Security Printing and Cyber Security segments for future growth.
I will wait till it release its first financial result and study how well it manages its Security guarding business first.
Sunday, 24 January 2016
RIP Taiwan's Evergreen Group Chang Yung Fa
Ok I am quite late to post this, but here's my tribute to Chang Yung Fa, a man whom I deeply respect and look up to.
Chang Yung Fa is Taiwan's Evergreen Group founder. The group consist of EVA Air, Evergreen line shipping, Evergreen International Hotels, Evergreen Steel Corp..etc.
He is a great inspiration.
1. Brilliance in business
He started out with only 1 ship in 1968 and was born in humble family. Now, it has about 178 container ships. The evergreen group has about 27,000 employees with more than 220 offices worldwide.
2. Advocator of character values
From Forbes
"Chang Yung-Fa’s mission is nothing less than to “reorganize” social values.
He started a cartoon illustrated magazine, Morals, that seek to uplift people's sense of morality in Taiwan and around the world. “If, for every 10,000 people, one is influenced in a positive way, that’s worth it,” he says"
3. Philanthropist
From Forbes
"Chang started the foundation in 1985; it has spent a cumulative $130 million over the years. Today its staff of 149 spends much of its time on typical charity work, such as awarding scholarships and delivering disaster aid; every year residents of some 9,000 homes hit by natural disasters in Asia receive help. "
Being a billionaire, he has pledged to give away all of his assets to charity.
Wow..
He's some advice from the Billionaire for takeaway:
The most important point to me, translated:
Chang yung Fa is a believer of karma. He says
"One should do good deeds and accumulate good merits when alive."
Totally agree. I always believe that if you can (actually I think if you reading this, most probably you can :p), do spare a penny to the needy. Maybe it can only help one person, but to that person, it means the world to them. Those living in poverty really have very tough and difficult life.. your good deed will make their life much brighter. :)
Chang Yung Fa is Taiwan's Evergreen Group founder. The group consist of EVA Air, Evergreen line shipping, Evergreen International Hotels, Evergreen Steel Corp..etc.
1. Brilliance in business
He started out with only 1 ship in 1968 and was born in humble family. Now, it has about 178 container ships. The evergreen group has about 27,000 employees with more than 220 offices worldwide.
2. Advocator of character values
From Forbes
"Chang Yung-Fa’s mission is nothing less than to “reorganize” social values.
He started a cartoon illustrated magazine, Morals, that seek to uplift people's sense of morality in Taiwan and around the world. “If, for every 10,000 people, one is influenced in a positive way, that’s worth it,” he says"
3. Philanthropist
From Forbes
"Chang started the foundation in 1985; it has spent a cumulative $130 million over the years. Today its staff of 149 spends much of its time on typical charity work, such as awarding scholarships and delivering disaster aid; every year residents of some 9,000 homes hit by natural disasters in Asia receive help. "
Being a billionaire, he has pledged to give away all of his assets to charity.
Wow..
He's some advice from the Billionaire for takeaway:
Chang yung Fa is a believer of karma. He says
"One should do good deeds and accumulate good merits when alive."
Totally agree. I always believe that if you can (actually I think if you reading this, most probably you can :p), do spare a penny to the needy. Maybe it can only help one person, but to that person, it means the world to them. Those living in poverty really have very tough and difficult life.. your good deed will make their life much brighter. :)
Tuesday, 29 December 2015
I was right about Noble
In my previous post about Noble here , I wrote that Noble is performing badly with a bad ROE and a bad D/E ratio. When these 2 ratios are faring badly, the company is heading for disaster.
But that's not the worse. The worse is- the commodities market is NOT showing any signs of improvement at all. When the industry is not improving, how can Noble's financials start to improve? Not to forget, it needs to continue paying its debt.
Today, Noble shares were cut to junk by Moody's.
"The worsening year-long rout in commodities, which has punished prices of raw materials that Noble handles from oil to copper, has overshadowed cost-cutting plans and will likely hurt access to funding and challenge its profitability, it said."
Noble's share price has now dropped to 0.41.
Please do not think it is 'Cheap'.
Stocks look cheap because the prices have dropped since its high time.
HOWEVER, there are always reasons what caused the price to drop and majority of the time, these reasons are due to valid rational decision thinking by the elite traders and banks.
Only very occasionally, very miraculously, will share price experience a sudden irrational emotionally driven drop in price. That will mean the price is 'undervalued' beyond a reasonable doubt. And yes, it certainly won't last long for such price to continue.
Remember, investment is certainly not a gamble. Much research and hard work is needed.
If you cannot resist the temptation to make money quickly, you are bound to lose a lot in the stock market.
But that's not the worse. The worse is- the commodities market is NOT showing any signs of improvement at all. When the industry is not improving, how can Noble's financials start to improve? Not to forget, it needs to continue paying its debt.
Today, Noble shares were cut to junk by Moody's.
"The worsening year-long rout in commodities, which has punished prices of raw materials that Noble handles from oil to copper, has overshadowed cost-cutting plans and will likely hurt access to funding and challenge its profitability, it said."
Noble's share price has now dropped to 0.41.
Please do not think it is 'Cheap'.
Stocks look cheap because the prices have dropped since its high time.
HOWEVER, there are always reasons what caused the price to drop and majority of the time, these reasons are due to valid rational decision thinking by the elite traders and banks.
Only very occasionally, very miraculously, will share price experience a sudden irrational emotionally driven drop in price. That will mean the price is 'undervalued' beyond a reasonable doubt. And yes, it certainly won't last long for such price to continue.
Remember, investment is certainly not a gamble. Much research and hard work is needed.
If you cannot resist the temptation to make money quickly, you are bound to lose a lot in the stock market.
Wednesday, 23 December 2015
My Christmas Present from Interplex
Hello,
Here's wishing everyone a very Merry Christmas!
Baring fund has announced their plans to buy Interplex at around S$450m with each share price at around $0.82.
This price is definitely a premium over its average share price over the year. The premium is about 62%!
I bought Interplex at $0.68 and that means I will be making some profits for this takeover. Yay! Good news! :D
The year ended with some profits and some losses for my overall portfolio. Although I picked some good buys, I also made some costly mistakes ;(
Ah well, think long term ;)
Good luck, everyone. Hoping all of you have a blessed year ahead. :)
Here's wishing everyone a very Merry Christmas!
Baring fund has announced their plans to buy Interplex at around S$450m with each share price at around $0.82.
This price is definitely a premium over its average share price over the year. The premium is about 62%!
I bought Interplex at $0.68 and that means I will be making some profits for this takeover. Yay! Good news! :D
The year ended with some profits and some losses for my overall portfolio. Although I picked some good buys, I also made some costly mistakes ;(
Ah well, think long term ;)
Good luck, everyone. Hoping all of you have a blessed year ahead. :)
Sunday, 20 December 2015
Recent Actions- Sell/Buy
Hello,
Just thought that I should share some of my recent stock actions.
Summary:
1. Bought Ascendas reit @ $2.22
2. Bought Frasers Centrepoint Trust @ $1.81
3. Bought STI ETF @ $2.86.
4. Bought OCBC @ $8.72
The Fed has increased its interest rates by 0.25% , citing an improvement in the US economy and business confidence.
Stock prices are the NPV (net present value) of its future free cash flow, a higher interest rate will mean a higher discount rate and that translates to lower NPV (lower stock price). This is the reason why stock market in SG went a nosedive last week.
Although business borrowing costs would increase due to a higher interest rate and that translates to possibly lower returns for Reits, I still went ahead to purchase Ascendas Reit @$2.22 and Frasers Centrepoint Trust @ $1.81.
These 2 Reits have a strong rental occupancy portfolio.
A-Reit has a well diversified portfolio, with 5 main property segments and situated at well located areas. It has a stable portfolio with 89.8% of portfolio revenue committed for FY15/16 and a portfolio average lease to expiry of about 3.6 years. They have also acquired One@Changi business park recently.
Frasers Centrepoint Trust has very well located shopping malls in the heartlands such as Causeway point and it enjoys consistent high occupancy rate.
I also bought STI ETF at $2.86
What I observed was that before a major announcement is to occur, Singapore's stock would experience a major fall on the day before. I grabbed STI ETF at $2.86 on 15.12.2015, the day before FED announced its IR decision. (Considering US time zone)
Lastly, I bought OCBC at $8.72
Well, I am not some finance economy expert but my observation is that bank stocks do generally better in a higher ir environment, possibly due to a myriad of many many factors. (Business confidence, better IR spreads to profit from)
In 2007, when the US ir was a crazy 5%+, OCBC stocks were at its highest (then) of $8+. When the financial crisis came about and ir suddenly took a nose dive to 0.2%, OCBC stock went tumbling down to $4+. Of course, there are many other reasons accounting for this so my addition of OCBC is more of a hedge to my portfolio.
Although the US has cited sustainable business growth, better economic performance and more jobs in the US, Singapore's economy does not look promising at the moment.
Economists have trimmed Singapore's growth forecast to 1.9% with the manufacturing sector faring the worst.
With that, I say, hold up your war chest and acquire some good business or ETF along the way :)
Just thought that I should share some of my recent stock actions.
Summary:
1. Bought Ascendas reit @ $2.22
2. Bought Frasers Centrepoint Trust @ $1.81
3. Bought STI ETF @ $2.86.
4. Bought OCBC @ $8.72
The Fed has increased its interest rates by 0.25% , citing an improvement in the US economy and business confidence.
Stock prices are the NPV (net present value) of its future free cash flow, a higher interest rate will mean a higher discount rate and that translates to lower NPV (lower stock price). This is the reason why stock market in SG went a nosedive last week.
Although business borrowing costs would increase due to a higher interest rate and that translates to possibly lower returns for Reits, I still went ahead to purchase Ascendas Reit @$2.22 and Frasers Centrepoint Trust @ $1.81.
These 2 Reits have a strong rental occupancy portfolio.
A-Reit has a well diversified portfolio, with 5 main property segments and situated at well located areas. It has a stable portfolio with 89.8% of portfolio revenue committed for FY15/16 and a portfolio average lease to expiry of about 3.6 years. They have also acquired One@Changi business park recently.
Frasers Centrepoint Trust has very well located shopping malls in the heartlands such as Causeway point and it enjoys consistent high occupancy rate.
I also bought STI ETF at $2.86
What I observed was that before a major announcement is to occur, Singapore's stock would experience a major fall on the day before. I grabbed STI ETF at $2.86 on 15.12.2015, the day before FED announced its IR decision. (Considering US time zone)
Lastly, I bought OCBC at $8.72
Well, I am not some finance economy expert but my observation is that bank stocks do generally better in a higher ir environment, possibly due to a myriad of many many factors. (Business confidence, better IR spreads to profit from)
In 2007, when the US ir was a crazy 5%+, OCBC stocks were at its highest (then) of $8+. When the financial crisis came about and ir suddenly took a nose dive to 0.2%, OCBC stock went tumbling down to $4+. Of course, there are many other reasons accounting for this so my addition of OCBC is more of a hedge to my portfolio.
Although the US has cited sustainable business growth, better economic performance and more jobs in the US, Singapore's economy does not look promising at the moment.
Economists have trimmed Singapore's growth forecast to 1.9% with the manufacturing sector faring the worst.
With that, I say, hold up your war chest and acquire some good business or ETF along the way :)
Monday, 23 November 2015
What is one astonishing fact about Warren Buffet?
99% of Buffett’s wealth was earned after his 50th birthday
Warren buffet started investing at age 11.
From 11 to 50 years, he spent 39 years in his investing career but only made the bulk of his wealth after age 50!
No, his 39 years won't wasted. This is the Magic of Compounding.
His investment returns are a whooping 15% and he is able to beat the SNP500 index of approx. 8% returns.
Warren Buffet understood this concept which few were able to, and with his prowess in investing, he is able to earn much much more (Billions and Billions)!
I have written a post about the magic of compounding here previously- how an average person at age 25 can earn $1m by age 55 through investing at 4.5% returns. I still think that it is achievable.
That said, investment requires hard work- prudent investment decisions, a tad of luck, discipline and perhaps many other factors. If you are not able to read financial statements consistently, my honest advice will be to put your savings into OCBC 360 account.... its interest is good given the risk involved.
Warren buffet started investing at age 11.
From 11 to 50 years, he spent 39 years in his investing career but only made the bulk of his wealth after age 50!
No, his 39 years won't wasted. This is the Magic of Compounding.
His investment returns are a whooping 15% and he is able to beat the SNP500 index of approx. 8% returns.
Warren Buffet understood this concept which few were able to, and with his prowess in investing, he is able to earn much much more (Billions and Billions)!
I have written a post about the magic of compounding here previously- how an average person at age 25 can earn $1m by age 55 through investing at 4.5% returns. I still think that it is achievable.
That said, investment requires hard work- prudent investment decisions, a tad of luck, discipline and perhaps many other factors. If you are not able to read financial statements consistently, my honest advice will be to put your savings into OCBC 360 account.... its interest is good given the risk involved.
Thursday, 12 November 2015
Why is Noble a bad buy even at $0.47
I know there are many Noble fans in Singapore. Sorry, but I really cannot super cannot understand why are people still buying Noble in this market?
Before I study its financial statements released yesterday, let's look at how Iron ore prices importing from China have dropped since last year. I relate to Iron ore since Noble group has a major business unit in metals and mining.
From a high of US$160+ in 2013 to the current $40+ now, the Iron ore prices have dropped so much. When iron ore drops, metals/mining/scrap all others drop too.
In fact, the commodities market has sucked so badly this year and it is of no surprise that companies dealing in this sector will face a drop in profits. When your revenue drops but your fixed costs remain, it just means that the profit will drop a lot more.
But here's the thing:
Sorry to say, metal prices show NO signs of recovering as of now.
This is because I work in the frontline of metal commodity prices so I do have some knowledge on the prices.
So if it's still not recovering, can I safely say that next quarter's financial results will still be as disappointing? Which means stock price may drop even more?
Now, let's go on to Noble's financial results:
1. ROE (Return on Equity) Based on info provided by Noble: 5%+
A healthy, growing company should have an ROE of >15%. 5% is not even 1/3 of that omg..
2. D/E ratio is 2.80+ approx.
This is like super high. A healthy company should be looking at <1
3.When ROE sucks and D/E also sucks, the company show signs that it is heading for Disaster.
If you have a high ROE and a good D/E, it is a very good growing company. If your ROE is low but D/E is also low , it implies that the company is surviving but nothing fantastic.
But if your ROE sucks and your D/E also sucks, then likely it is heading for a disaster.
4. Profits dropped 83%,
Not a surprise when commodity prices drop so much. However, cash flow is now positive and it seems that Noble has done a good job in cutting costs.
I can't determine what is a good price to buy given that the earnings are really volatile in this terrible market.
Conclusion:
Will only consider to buy when the commodity market in general show signs of picking up.
Before I study its financial statements released yesterday, let's look at how Iron ore prices importing from China have dropped since last year. I relate to Iron ore since Noble group has a major business unit in metals and mining.
From a high of US$160+ in 2013 to the current $40+ now, the Iron ore prices have dropped so much. When iron ore drops, metals/mining/scrap all others drop too.
In fact, the commodities market has sucked so badly this year and it is of no surprise that companies dealing in this sector will face a drop in profits. When your revenue drops but your fixed costs remain, it just means that the profit will drop a lot more.
But here's the thing:
Sorry to say, metal prices show NO signs of recovering as of now.
This is because I work in the frontline of metal commodity prices so I do have some knowledge on the prices.
So if it's still not recovering, can I safely say that next quarter's financial results will still be as disappointing? Which means stock price may drop even more?
Now, let's go on to Noble's financial results:
1. ROE (Return on Equity) Based on info provided by Noble: 5%+
A healthy, growing company should have an ROE of >15%. 5% is not even 1/3 of that omg..
2. D/E ratio is 2.80+ approx.
This is like super high. A healthy company should be looking at <1
3.When ROE sucks and D/E also sucks, the company show signs that it is heading for Disaster.
If you have a high ROE and a good D/E, it is a very good growing company. If your ROE is low but D/E is also low , it implies that the company is surviving but nothing fantastic.
But if your ROE sucks and your D/E also sucks, then likely it is heading for a disaster.
4. Profits dropped 83%,
Not a surprise when commodity prices drop so much. However, cash flow is now positive and it seems that Noble has done a good job in cutting costs.
I can't determine what is a good price to buy given that the earnings are really volatile in this terrible market.
Conclusion:
Will only consider to buy when the commodity market in general show signs of picking up.
Wednesday, 11 November 2015
Can you resist the temptation to make money quickly? & Some quotes from Warren.Buffet
STI went up last week when US jobs data are good.
Then STI went down this week rapidly when China's economic data is bad.
These few months, the stock market has been very volatile and I spotted some speculative stocks like Noble and Ezra trading at highs and lows.
It seems that it is really quite tempting to make money quickly by buying such speculative stocks but I am strongly against such techniques as you can get your hands burnt badly.
Let's revisit some quotes from my super idol Warren Buffet:
1."Never attempt to make quick money on the stock market."
Sound investing can make you very wealthy if you are not in too big a hurry. Buy on the assumption that they close the market the next day and not re-open it for 5 years.
2."Buy Businesses, Not stocks"
All there is to investing is picking good companies at the right times and staying with them as long as they remain good companies. Businesses you are willing to own forever.
3."Invest in great companies"
It’s better to buy wonderful company at a fair price than a fair company at a wonderful price.
My targeted actions during this volatile period:
1. Be Patient.
Mentality of an owner, not speculator. Long term investment horizon please.
2.Read and read financial reports.
Investigate and find out Why, Why , Why and read the competitors financial reports to see where is the industry heading.
I am telling myself to spend more time on reports than Facebook.
3. Before I buy and sell, think carefully of the risks and opportunity cost first.
I made some horrible careless investment mistakes in the past and I am learning from it. Hopefully, I am much wiser now.
Good luck to all other investors there!
Then STI went down this week rapidly when China's economic data is bad.
These few months, the stock market has been very volatile and I spotted some speculative stocks like Noble and Ezra trading at highs and lows.
It seems that it is really quite tempting to make money quickly by buying such speculative stocks but I am strongly against such techniques as you can get your hands burnt badly.
Let's revisit some quotes from my super idol Warren Buffet:
1."Never attempt to make quick money on the stock market."
Sound investing can make you very wealthy if you are not in too big a hurry. Buy on the assumption that they close the market the next day and not re-open it for 5 years.
2."Buy Businesses, Not stocks"
All there is to investing is picking good companies at the right times and staying with them as long as they remain good companies. Businesses you are willing to own forever.
3."Invest in great companies"
It’s better to buy wonderful company at a fair price than a fair company at a wonderful price.
My targeted actions during this volatile period:
1. Be Patient.
Mentality of an owner, not speculator. Long term investment horizon please.
2.Read and read financial reports.
Investigate and find out Why, Why , Why and read the competitors financial reports to see where is the industry heading.
I am telling myself to spend more time on reports than Facebook.
3. Before I buy and sell, think carefully of the risks and opportunity cost first.
I made some horrible careless investment mistakes in the past and I am learning from it. Hopefully, I am much wiser now.
Good luck to all other investors there!
Tuesday, 27 October 2015
Oxley retail bonds review (5%)
There has been much hype on this Oxley retail 5% bond, spanning over 4 years maturity. However, it is unrated and that means I can't rely on any Moody's analysis to discern whether it is a good deal a not.
I have to analyse on my own then. After studying its financial report and ripping it apart, below are my takeaways and humble thoughts.
Before I go to the financial jargon, I need to express that this is only my opinion and may not bear any truth at all. Analysis and thoughts are of personal opinions only. For every statement I make here, I will put 'I think'. (but it is up to you to discern what I say correct anot ;P)
FY 2014: $377,367m
FY 2015: $142,705m
Oxley holdings has achieved very impressive profits in Year 2013 and 2012, when the property market in Singapore was booming.
However, after the cooling property measures were implemented, many developers are facing a lackluster response in its properties. It is no surprise that Oxley was badly affected by it too.
Oxley has plans to expand overseas aggressively instead but looking at its financials, I do not find them promising. (to explain later)
A. Your marketing strategies CMI. (cannot make it)
B. You are not getting the response that you want, i.e, demand is not that good.
I think that it is option B because Oxley's marketing agents are mostly from Huttons and Huttons really produce impressive results in other properties previously. When you spend so much more on marketing yet get poor results, it just shows that your products are not as good.
Debt ratio (Total liabilities/Total assets) = 0.85 approx
The industry encourages standard of about (0.3~0.6) only.
Debt/equity ratio (Debt/equity)= 5.807 approx.
Other companies are <1.......
I think Oxley has too much leverage and it is risky.This means that if their business fail, I think I will be in queue 1,000,000 to get back my money lor omg. (Just joking, queue no. is a fake anyhow say number)
Look at its fixed notes it previously issued:
I think those that were issued in Year 2013 were for its projects in Y2013/Y2014 which did receive resounding success. Oxley should be able to pay them.
But for notes issued now, the money I think will be used for its overseas projects venture moving on but this leads me to the next point.
Forget its FY2015 poor performance. I think future plans are very important and the strategies form the crux of whether the company is a good investment a not.
Looking at this table, I really do not think Oxley overseas projects are promising.
A. Projects in Cambodia
I go to Cambodia- Phnom Penh every single year (I'm not a Cambodian btw) and I have some close friends there. There is an association there which I am committed too and has a close relationship with. As such, I think I have some knowledge to really say how Phnom Penh is like. And this is what majority of Phnom Penh is:
1. Mud & uneven roads
2. Slums
3.Corruption
4. Poverty
5. Main language of the people is Khmer
6. More well off people work as factory garment workers
7. Less well off people open shops infront of their living area and sell the same stuffs that other shops sell too.
8. Children not wearing underwear and running around
9. many many other scenario depicting a 3rd world country
Phnom Penh has a very very long way to go for foreign investments. And to build high rise condominiums and to attract expats to stay there, well, I think, more likely they will become AirBnb.
I do not think that Oxely's property developments in Phnom Penh are promising although their first project there did receive a good response.
B. Projects in Malaysia
Exchange rate of those people who bought properties in Malaysia during year 2013 when the market is booming there: SGD 1: MYR 2.65
The exchange rate now: SGD 1: MYR 3.05
Exchange rate in future: ????
With a very questionable government, weak currency, poor security, I think the property market there is certainly not as attractive as in year 2013. As such, I do not think that projects there will receive good response.
Also, Setia Berhad, the leading property developer there, has much more competitive advantage in its home land as compared to Oxley.
Given that Singapore's developers are facing a weakening demand here, and Oxley's prime focus is shifting to overseas with such projects in such countries, I do not have the confidence in their ventures.
5. You can get 5% yield elsewhere too
5% yield capital guaranteed by AAA credit rating from Moody's is a must grab.
But when it is unrated and it has poor future strategies, then I think it will be better if you put your money into blue chip stocks or diversified reits- Probably 6% over 7 years horizon, your money is safer.
I have to analyse on my own then. After studying its financial report and ripping it apart, below are my takeaways and humble thoughts.
Before I go to the financial jargon, I need to express that this is only my opinion and may not bear any truth at all. Analysis and thoughts are of personal opinions only. For every statement I make here, I will put 'I think'. (but it is up to you to discern what I say correct anot ;P)
1.Profit before tax dropped from FY14 to FY15 by a whopping approx. 62%
 |
FY 2014: $377,367m
FY 2015: $142,705m
Oxley holdings has achieved very impressive profits in Year 2013 and 2012, when the property market in Singapore was booming.
However, after the cooling property measures were implemented, many developers are facing a lackluster response in its properties. It is no surprise that Oxley was badly affected by it too.
Oxley has plans to expand overseas aggressively instead but looking at its financials, I do not find them promising. (to explain later)
2. Marketing expense increased 99%
I think when you increase your marketing expenses by 99% but then your results decrease by 62%, it means:A. Your marketing strategies CMI. (cannot make it)
B. You are not getting the response that you want, i.e, demand is not that good.
I think that it is option B because Oxley's marketing agents are mostly from Huttons and Huttons really produce impressive results in other properties previously. When you spend so much more on marketing yet get poor results, it just shows that your products are not as good.
3. Debt ratio and D/E ratio is high
I think it is high.Debt ratio (Total liabilities/Total assets) = 0.85 approx
The industry encourages standard of about (0.3~0.6) only.
Debt/equity ratio (Debt/equity)= 5.807 approx.
Other companies are <1.......
I think Oxley has too much leverage and it is risky.This means that if their business fail, I think I will be in queue 1,000,000 to get back my money lor omg. (Just joking, queue no. is a fake anyhow say number)
Look at its fixed notes it previously issued:
I think those that were issued in Year 2013 were for its projects in Y2013/Y2014 which did receive resounding success. Oxley should be able to pay them.
But for notes issued now, the money I think will be used for its overseas projects venture moving on but this leads me to the next point.
4.No confidence in Oxley's overseas projects venture
Look at this:
Forget its FY2015 poor performance. I think future plans are very important and the strategies form the crux of whether the company is a good investment a not.
Looking at this table, I really do not think Oxley overseas projects are promising.
A. Projects in Cambodia
I go to Cambodia- Phnom Penh every single year (I'm not a Cambodian btw) and I have some close friends there. There is an association there which I am committed too and has a close relationship with. As such, I think I have some knowledge to really say how Phnom Penh is like. And this is what majority of Phnom Penh is:
1. Mud & uneven roads
2. Slums
3.Corruption
4. Poverty
5. Main language of the people is Khmer
6. More well off people work as factory garment workers
7. Less well off people open shops infront of their living area and sell the same stuffs that other shops sell too.
8. Children not wearing underwear and running around
9. many many other scenario depicting a 3rd world country
Phnom Penh has a very very long way to go for foreign investments. And to build high rise condominiums and to attract expats to stay there, well, I think, more likely they will become AirBnb.
I do not think that Oxely's property developments in Phnom Penh are promising although their first project there did receive a good response.
B. Projects in Malaysia
Exchange rate of those people who bought properties in Malaysia during year 2013 when the market is booming there: SGD 1: MYR 2.65
The exchange rate now: SGD 1: MYR 3.05
Exchange rate in future: ????
With a very questionable government, weak currency, poor security, I think the property market there is certainly not as attractive as in year 2013. As such, I do not think that projects there will receive good response.
Also, Setia Berhad, the leading property developer there, has much more competitive advantage in its home land as compared to Oxley.
Given that Singapore's developers are facing a weakening demand here, and Oxley's prime focus is shifting to overseas with such projects in such countries, I do not have the confidence in their ventures.
5. You can get 5% yield elsewhere too
5% yield capital guaranteed by AAA credit rating from Moody's is a must grab.
But when it is unrated and it has poor future strategies, then I think it will be better if you put your money into blue chip stocks or diversified reits- Probably 6% over 7 years horizon, your money is safer.
Conclusion
I will not buy Oxley's retail 5% bonds because the risk does not justify the returns.Monday, 26 October 2015
Recent Action- Sold Capitamall Trust
I sold CapitaMall Trust today and as such, I will not be entitled to its dividends.(ex- dividend date 28.10.15) After factoring this opportunity cost, I still think that at $2.06, it has reached its potential. I shall reap my profits now and gain entry again perhaps next year.
Looking at its 3Qtr 2015 financial report, below are my takeaways:
1. Net property income dropped.
Net property Income has dropped again, consecutively since 2Qtr 2015. The drop is about 0.7%. I expect that it will continue to drop until the 3 malls which are not faring well now brushes up in its rentals.
2. 3 main properties facing a drop in rental income:
IMM
Rental was affected due to renovation works but a link bridge to Devan Nair Institute is completed. Only after all renovation works done and the mall is fully operating then the property income will increase.
JCube
This is a headache.. seriously.
With three shopping malls at Jurong East, west siders are spoilt for choice. Jcube is also very out of the way for shoppers and most of the time, I do not make any effort to go there at all as it is really inconvenient. Furthermore, the toilets stink. The most disgusting toilets are awarded to Jcube, like seriously. Lol.
Anyway, recently there is a revamp at Level 2- a mini Bugis street look alike. I find that appealing since there are many clothes to shop and it really belongs to a league of its own- teenagers. The ice skating rink is a good attraction too.
Clark Quay
After the liquor laws kick in, Clark Quay has become much quieter than before. Previous tenants like MOF are no longer operating. Some clubs are finding it tough to survive too.
Good news is that Zouk will be renting a place here but that will only start in June 2016.
I expect that the rental incomes of these 3 properties will only start to improve in 2016 onwards which translate to weaker income for 4th Qtr 2015 and 1st Qtr 2016. Before I see this stock price dropping, let me sell it first.
3. I expect Finance cost to increase.
Finance costs for YTD Sept 2015 was lower due to low interest rates in Aug 2014, Nov 2014 and Feb 2015. However, moving on to the next Qtr, I believe that the interest rates have risen quite a bit and that will translate to higher finance costs.
4. Good move to buy Bedok Mall
Bedok Mall's business is buoyant and there is high human traffic. However, I do not think that this mall alone will be able to salvage the other three dropping incomes.
5. Better opportunities for my $
Frasers Centre Point trust is certainly doing much better. Almost all of the surb-urban malls enjoy good human traffic. The recent financials are good too.
I will accumulate my war chest by cashing out CMT and divest to other better performing stocks now.
As for CMT, let it sort out the ailing 3 mallsand I will make an entry again probably next year.
Looking at its 3Qtr 2015 financial report, below are my takeaways:
1. Net property income dropped.
Net property Income has dropped again, consecutively since 2Qtr 2015. The drop is about 0.7%. I expect that it will continue to drop until the 3 malls which are not faring well now brushes up in its rentals.
2. 3 main properties facing a drop in rental income:
IMM
Rental was affected due to renovation works but a link bridge to Devan Nair Institute is completed. Only after all renovation works done and the mall is fully operating then the property income will increase.
JCube
This is a headache.. seriously.
With three shopping malls at Jurong East, west siders are spoilt for choice. Jcube is also very out of the way for shoppers and most of the time, I do not make any effort to go there at all as it is really inconvenient. Furthermore, the toilets stink. The most disgusting toilets are awarded to Jcube, like seriously. Lol.
Anyway, recently there is a revamp at Level 2- a mini Bugis street look alike. I find that appealing since there are many clothes to shop and it really belongs to a league of its own- teenagers. The ice skating rink is a good attraction too.
Clark Quay
After the liquor laws kick in, Clark Quay has become much quieter than before. Previous tenants like MOF are no longer operating. Some clubs are finding it tough to survive too.
Good news is that Zouk will be renting a place here but that will only start in June 2016.
I expect that the rental incomes of these 3 properties will only start to improve in 2016 onwards which translate to weaker income for 4th Qtr 2015 and 1st Qtr 2016. Before I see this stock price dropping, let me sell it first.
3. I expect Finance cost to increase.
Finance costs for YTD Sept 2015 was lower due to low interest rates in Aug 2014, Nov 2014 and Feb 2015. However, moving on to the next Qtr, I believe that the interest rates have risen quite a bit and that will translate to higher finance costs.
4. Good move to buy Bedok Mall
Bedok Mall's business is buoyant and there is high human traffic. However, I do not think that this mall alone will be able to salvage the other three dropping incomes.
5. Better opportunities for my $
Frasers Centre Point trust is certainly doing much better. Almost all of the surb-urban malls enjoy good human traffic. The recent financials are good too.
I will accumulate my war chest by cashing out CMT and divest to other better performing stocks now.
As for CMT, let it sort out the ailing 3 mallsand I will make an entry again probably next year.
Monday, 28 September 2015
Will I buy stocks now?
Just a very quick Q&A..
1. Why did the STI drop so much this week?
The main reason was due to China' slowdown in economy with China's manufacturing activity falling to the lowest level in 6 years.
2. Are there any signs that China's economy is improving?
No. As someone working in the Metal commodity industry, I have first hand knowledge of China's metal prices such as in Iron Ore, finished products and scraps. The prices are dropping so much that it is really rather depressing. It is still dropping now and then.. I am afraid that this quarter's performance may even be more dismal.
Chinese construction market is slowing and it has an obvious effect on its metal prices. Working backwards, I can only believe that China is facing a negative demand brought about by a slowing economy. I can see the correlation in China's metal prices and China's economy and China's stock prices and Singapore's economy and Singapore's stock prices..(You get it).
3. Will I buy stocks now?
The short answer is No. I believe that prices have yet to hit rock bottom and metal commodity prices are not showing any sign of improvement.
4. Will I sell my stocks now?
No. Warren Buffet says 'If you can't hold a stock for 10 years, then do not think of holding it for 10 minutes"
My stocks are for long term and I still firmly believe in the companies that I have chosen.
And really, there is no reason why I should be selling at a loss!!
These are really my humble thoughts. Feel free to leave a comment. Thank you!
1. Why did the STI drop so much this week?
The main reason was due to China' slowdown in economy with China's manufacturing activity falling to the lowest level in 6 years.
2. Are there any signs that China's economy is improving?
No. As someone working in the Metal commodity industry, I have first hand knowledge of China's metal prices such as in Iron Ore, finished products and scraps. The prices are dropping so much that it is really rather depressing. It is still dropping now and then.. I am afraid that this quarter's performance may even be more dismal.
Chinese construction market is slowing and it has an obvious effect on its metal prices. Working backwards, I can only believe that China is facing a negative demand brought about by a slowing economy. I can see the correlation in China's metal prices and China's economy and China's stock prices and Singapore's economy and Singapore's stock prices..(You get it).
3. Will I buy stocks now?
The short answer is No. I believe that prices have yet to hit rock bottom and metal commodity prices are not showing any sign of improvement.
4. Will I sell my stocks now?
No. Warren Buffet says 'If you can't hold a stock for 10 years, then do not think of holding it for 10 minutes"
My stocks are for long term and I still firmly believe in the companies that I have chosen.
And really, there is no reason why I should be selling at a loss!!
These are really my humble thoughts. Feel free to leave a comment. Thank you!
Thursday, 20 August 2015
My actions in this bear market
Here's what I have strategized during this horrible bear market.
1. Console myself that STI annual returns was about 8-9% throughout the past 28 years.
Here's the chart:
From year 1987 to Aug 2015 now, the returns was 265.62%, over 28 years annualize as 9.48%.
STI has fluctuated many many times but the general trend is upward. One should treat stock investments as a long term serious commitment, and have the patience to ride out the rocky waves from time to time. My investment horizon is 10 years at least, not 10 months or 10 days.
This brings out to my next point:
2. Be patient, hold my stocks.
I read somewhere about the psychology of most investors and why majority lose money in stocks. Credits to the rightful owner of this picture (which I do not have the source).
Are you selling your stocks now? are you selling it at a loss?
Why are you selling it at a loss when you should be selling it at a profit?
Is it because your stocks are junk? wait, if you stocks are junk, why have you bought them??
This brings about to the next point again.
3. Look at the fundamentals
Although one should treat investment as a long term horizon, it is also very important to look at the financial statements of the company periodically. I have great interest and excitement whenever I look at the company's financials!
Is the company doing reasonably well and having a decent growth rate? how is the industry doing? how is the management? what have they conveyed as their growth strategies?
If the company does not seem to be doing well either because the company is lacking in groove, lacking in management leadership or generally because the industry has slowed down and show no signs of improving, then yes, it is time to cut your losses.
Other than that, if the company has strong fundamentals, it is best to HOLD and not sell at FEAR. pls omg.
4. Dollar cost averaging
'Dollar cost averaging' is an investment term used to describe the purchase of unit trusts. However, the principle can be applied when buying stocks.
It generally means that one can buy stocks gradually, inching bit by bit when stock prices changes.
Meaning:
500 lots at STI ETF $3.02
500 lots at STI ETF $2.80 ( if it really goes this low)
and then buy again when it drops further till when it finally starts going up.
This will mitigate the loss as the stock price is averaged out. Eventually (perhaps years later) when the stocks go up again, that's where the profits can be seen.
That being said, I am going to buy STI. I do have other blue chip stocks in mind that I think are really undervalued but I will not be sharing it here.
Till then, I will also not be logging into POEMS to check my portfolio. x.x
1. Console myself that STI annual returns was about 8-9% throughout the past 28 years.
Here's the chart:
From year 1987 to Aug 2015 now, the returns was 265.62%, over 28 years annualize as 9.48%.
STI has fluctuated many many times but the general trend is upward. One should treat stock investments as a long term serious commitment, and have the patience to ride out the rocky waves from time to time. My investment horizon is 10 years at least, not 10 months or 10 days.
This brings out to my next point:
2. Be patient, hold my stocks.
I read somewhere about the psychology of most investors and why majority lose money in stocks. Credits to the rightful owner of this picture (which I do not have the source).
Why are you selling it at a loss when you should be selling it at a profit?
Is it because your stocks are junk? wait, if you stocks are junk, why have you bought them??
This brings about to the next point again.
3. Look at the fundamentals
Although one should treat investment as a long term horizon, it is also very important to look at the financial statements of the company periodically. I have great interest and excitement whenever I look at the company's financials!
Is the company doing reasonably well and having a decent growth rate? how is the industry doing? how is the management? what have they conveyed as their growth strategies?
If the company does not seem to be doing well either because the company is lacking in groove, lacking in management leadership or generally because the industry has slowed down and show no signs of improving, then yes, it is time to cut your losses.
Other than that, if the company has strong fundamentals, it is best to HOLD and not sell at FEAR. pls omg.
4. Dollar cost averaging
'Dollar cost averaging' is an investment term used to describe the purchase of unit trusts. However, the principle can be applied when buying stocks.
It generally means that one can buy stocks gradually, inching bit by bit when stock prices changes.
Meaning:
500 lots at STI ETF $3.02
500 lots at STI ETF $2.80 ( if it really goes this low)
and then buy again when it drops further till when it finally starts going up.
This will mitigate the loss as the stock price is averaged out. Eventually (perhaps years later) when the stocks go up again, that's where the profits can be seen.
That being said, I am going to buy STI. I do have other blue chip stocks in mind that I think are really undervalued but I will not be sharing it here.
Till then, I will also not be logging into POEMS to check my portfolio. x.x
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