This Virtual Fund has caused a bit of controvesy in the investing community. Some forumers feel that it is easy to simulate this kind of virtual thing as it does not involve human emotions; greed and fears. Some friends have asked me if I could develop a similar portfolio for them in real terms.
Personally, I feel that the timing of the launch of this Virtual Fund is crucial to the overall profitability so far. The fund was launched after the major correction subsequent to the sub-prime woes. The rush into China stocks over the last few sessions also contributed significantly to the gains.
If you have been following this blog, you would appreciate what I have done on a day to day basis. It was mentioned at the outset that the fund was created with a specific intent and purpose. For the benefit of people who follow my buy and sell movements, I have also detailed my daily transactions and balances. I hope to be as transparent and accountable in the whole process as this exercise could well be used as a testimonial of my fund management skills in the future.
To be fair, I have treated this fund as if I were managing real money. Personally, I also hold most of the counters in my own portfolio. The dollar value involved of course is no way near the $500,000 war chest. But the investing principle involved is similar.
As you can see, i do actively manage the counters by making timely switches, taking into account the latest market developments and the fundamental of individual stocks. Had I not been keeping myself abrest of the trends, would I have bought into so many China stocks before the current rally to maximise the return?
During the past 2 months, I was fortunate enough to develop a portfolio for a friend with an initial capital of $7,000. The investment has yielded capital gain of close to $2,000 or 28%. Her mother came to know about it and asked me to invest $5,000 for quick return. I turned her down as I never promised quick bucks!
I think there is still a lot of steam left in the China related counters. There will be profit taking here and there but in the medium term you can expect very decent return if you stay invested.
Good luck!
Sunday, 30 September 2007
Friday, 28 September 2007
Review of Virtual Fund Performance for Sep 2007
Sum invested = $540,050
Cash holding = $1,179
Realised profit = $41,229 = 8.25%
Unrealised profit = $91,570 = 18.31%
Shareholdings as at end of Sep 2007:
C&G Ind 50,000 Bought $0.59 Last $0.675 Unrealised Profit $4,250;
ChinaEnergy 20,000 Bought $1.38 Last $1.52 Unrealised Profit $2,800;
ChinaSports 100,000 Bought $1.35 Last $1.67 Unrealised Profit $32,000;
FibreChem 25,000 Bought $1.35 Last $1.57 Unrealised Profit $5,500;
Foreland 50,000 Bought $0.50 Last $0.565 Unrealised Profit $3,250;
Jiutian 250,000 Bought $0.55 Last $0.65 Unrealised Profit $25,000;
Midas 20,000 Bought $1.41 Last $1.73 Unrealised Profit $6,400;
Sihuan 50,000 Bought $0.76 Last $0.845 Unrealised Profit $4,250;
Swiber 20,000 Bought $3.12 Last $3.46 Unrealised Profit $6,800;
Tiong Woon 22,000 Bought $1.05 Last $1.11 Unrealised Profit $1,320
The Virtual Fund has achieved return of 26.56% since inception on 5 Sep 2007. This is half of my expected return of 50% for only 3 weeks!
Cash holding = $1,179
Realised profit = $41,229 = 8.25%
Unrealised profit = $91,570 = 18.31%
Shareholdings as at end of Sep 2007:
C&G Ind 50,000 Bought $0.59 Last $0.675 Unrealised Profit $4,250;
ChinaEnergy 20,000 Bought $1.38 Last $1.52 Unrealised Profit $2,800;
ChinaSports 100,000 Bought $1.35 Last $1.67 Unrealised Profit $32,000;
FibreChem 25,000 Bought $1.35 Last $1.57 Unrealised Profit $5,500;
Foreland 50,000 Bought $0.50 Last $0.565 Unrealised Profit $3,250;
Jiutian 250,000 Bought $0.55 Last $0.65 Unrealised Profit $25,000;
Midas 20,000 Bought $1.41 Last $1.73 Unrealised Profit $6,400;
Sihuan 50,000 Bought $0.76 Last $0.845 Unrealised Profit $4,250;
Swiber 20,000 Bought $3.12 Last $3.46 Unrealised Profit $6,800;
Tiong Woon 22,000 Bought $1.05 Last $1.11 Unrealised Profit $1,320
The Virtual Fund has achieved return of 26.56% since inception on 5 Sep 2007. This is half of my expected return of 50% for only 3 weeks!
Most unrecognised value stock: C&G Industrial
Cai Junyi, 33, CEO of C&G: Key driver of C&G's business, and holds a master's in economics
C&G Industrial has emerged as the stock with the most unrecognized value among SGX-listed companies in a complex analysis by Business Times senior correspondent Teh Hooi Ling.It has a lot of cash - some 40 per cent of its market cap is represented by cash. On top of that, assuming it can maintain its first-half operating profit, the company may rake in $44.8 million in pre-tax profits this year, she wrote.According to Bloomberg, the cost of capital for C&G - a producer of PET chips used to manufacture polyester fibre - is 10.73 per cent.Based on this, that business is worth $335 million, assuming it can maintain that performance in perpetuity.A caveat Hooi Ling had: In the analysis, investors have to decide if they think the respective companies can maintain their current performance for their existing businesses, and that these are not top-of-the-cycle figures.The analysis was based on McKinsey’s three-step approach to disaggregate a company's current market value into its current performance, its return premium, and the value expected from its future growth.
Source: Business Times
C&G Industrial has emerged as the stock with the most unrecognized value among SGX-listed companies in a complex analysis by Business Times senior correspondent Teh Hooi Ling.It has a lot of cash - some 40 per cent of its market cap is represented by cash. On top of that, assuming it can maintain its first-half operating profit, the company may rake in $44.8 million in pre-tax profits this year, she wrote.According to Bloomberg, the cost of capital for C&G - a producer of PET chips used to manufacture polyester fibre - is 10.73 per cent.Based on this, that business is worth $335 million, assuming it can maintain that performance in perpetuity.A caveat Hooi Ling had: In the analysis, investors have to decide if they think the respective companies can maintain their current performance for their existing businesses, and that these are not top-of-the-cycle figures.The analysis was based on McKinsey’s three-step approach to disaggregate a company's current market value into its current performance, its return premium, and the value expected from its future growth.
Source: Business Times
Review of Own Portfolio for Sep 2007
Latest Holdings:
Cash
C&G Industrial +5.5%
China Energy +10.1%
ChinaSports +23.7%
ChinaWheel +2.1%
FibreChem +2.6%
Foreland +8.6%
Hongwei -2.6%
Jiutian Chemical +58.5%
Pine Agritech -8.7%
Sihuan +11.2%
CPF
Asia Enterprise -12.3%
Midas +10.2%
Raffles Education +1.8%
Cash
C&G Industrial +5.5%
China Energy +10.1%
ChinaSports +23.7%
ChinaWheel +2.1%
FibreChem +2.6%
Foreland +8.6%
Hongwei -2.6%
Jiutian Chemical +58.5%
Pine Agritech -8.7%
Sihuan +11.2%
CPF
Asia Enterprise -12.3%
Midas +10.2%
Raffles Education +1.8%
Own transactions
Bought:
Fibrechem
ChinaWheel
C&G Industrial
Partially Sold:
Hongwei
Foreland
Pine
Jiutian
Fibrechem
ChinaWheel
C&G Industrial
Partially Sold:
Hongwei
Foreland
Pine
Jiutian
Which companies hold greatest market value?
By TEH HOOI LING SENIOR CORRESPONDENT
Most investors associate high- PE stocks with high-growth stocks. But as pointed out by consulting firm McKinsey in a couple of its reports, there is another, possibly more important, component which accounts for a stock's high or low earnings multiple.
That is return on capital. It makes sense. Growth requires investment, and if the investment doesn't yield an adequate return over the cost of capital, then it will not create shareholder value. That means no boost to share price and no increase in the price-earnings multiple.
So a high-PE stock could be one which is generating high growth at a return which slightly exceeds its cost of capital, or one which is chugging along slowly and steadily but earning a return on capital that far exceeds its cost of capital.
McKinsey has proposed a three-step approach to disaggregate a company's current market value into its current performance, its return premium, and the value expected from its future growth. Current performance is derived by estimating the value of a company's current earnings in perpetuity, assuming no growth.
At no growth, it is assumed that depreciation is equal to capital expenditure, and therefore net operational profit less cash taxes is equal to free cash flow for a business that does not grow. So dividing net operational profits after cash taxes by the cost of capital would give us the value of current earnings, with no growth, in perpetuity.
The premise is that companies with the highest ROICs relative to their WACCs are the greatest creators of value for shareholders
Return premium is the value a company delivers by earning superior returns on its growth capital. In order to assess how a company's return on growth capital influences its PE multiple, McKinsey recommends discounting a company's cash flow as if it grew in perpetuity at some normalised rate, such as nominal GDP growth. Through repeated analysis, McKinsey has found that the result is a good proxy for the premium a company enjoys in the capital markets because of its high returns on future growth capital.
And finally, value from growth represents how much a company delivers by growing over and above nominal GDP growth. It can be calculated as that portion of the company's current market value that is not captured in current performance or the return premium. For a company that grows more slowly than the GDP, this value will be negative.
I've decided to use this three-step approach on some Singapore-listed companies.
Three-step method
First I downloaded from Bloomberg the entire list of stocks traded on the Singapore Exchange with attributes like return on invested capital (ROIC), market capitalisation, their weighted average cost of capital (WACC), and so forth.
I then calculated the difference between the ROICs and the WACCs, and ranked them from the highest to the lowest. The premise is that companies with the highest ROICs relative to their WACCs are the greatest creators of value for shareholders.
From the top 50 companies, I randomly picked 13 and went through their latest results one by one so as to calculate their pre-tax operating margin, their asset turnover, and their ROIC (excluding and including cash held in banks). Finally, I attempted to attribute how much of the stocks' current market value is from its current performance under a no-growth scenario, how much of it is from return premium, and how much is from expected future growth. The results are pretty interesting.
The formula I used to calculate ROIC is net operating earnings before interest and amortisation charges, but after cash taxes divided by total assets, net of excess cash, and non-interest-bearing current liabilities.
Almost all the companies on the list have strong ROIC. A company can arrive at a high ROIC by either having a high profit margin, or more efficiently utilising its assets to increase sales. The former is measured by operating profit margin, and the latter by asset turnover.
As can be seen from the table, most of the companies are high-margin, low-volume businesses. The three exceptions are Hersing Corp, Apex-Pal and Olam, which are low-margin, high-volume businesses.
Meanwhile, a lot of these companies also have a lot of cash. With the exception of MobileOne and StarHub, all have more than 5 per cent of their market capitalisation represented by cash in the bank. The most extreme was C&G Industrial, which according to its June 30, 2007 balance sheet, has 557 million yuan in the bank. That's about $112.5 million, or about 40 per cent of its current market cap of $274 million.
I then tried to calculate the value for these companies based on their existing businesses under a no-growth scenario. As suggested by McKinsey, I divided net operational profits after cash taxes by the cost of capital (obtained from Bloomberg) to arrive at that number.
So companies whose existing business, under a no-growth scenario, has a higher value than their current enterprise value are presumably undervalued. Enterprise value is market cap plus debts minus cash.
From the list, you can see that C&G Industrial tops my list of companies which has the most unrecognised value.
As mentioned, it has a lot of cash - some 40 per cent of its market cap is represented by cash. On top of that, assuming it can maintain its first-half operating profit, the company may rake in $44.8 million in pre-tax profits this year. According to Bloomberg, the cost of capital for C&G - a producer of PET chips used to manufacture polyester fibre - is 10.73 per cent. Based on this, that business is worth $335 million, assuming it can maintain that performance in perpetuity.
Raising its cost of capital to 15 per cent would reduce the current business worth to $240 million. Add in the company's return premium and the stock still looks undervalued. Other stocks which appear undervalued based on the above screening include Courage Marine, Hersing, MobileOne and Micro Mechanics.
In all the above analysis, investors have to decide if they think the respective companies can maintain their current performance for their existing businesses, and that these are not top-of-the-cycle figures. Another factor to consider is the WACC, whether they think it is too low and hence not representative of the risks faced by the companies.
For example, Courage Marine is enjoying the very high dry-bulk freight rates now. Can this be sustained? Perhaps the current valuation of its business is high enough, relative to its enterprise value, to allow for the easing of freight rates going forward.
As for MobileOne, its high valuation has much to do with its relatively low WACC. Is that justified?
Meanwhile, among all the stocks I looked at, Olam has the highest imputed growth value and return premium based on its current enterprise value. The value of its existing business - under a no-growth scenario - only makes up about 19 per cent of its enterprise value today.
Most investors associate high- PE stocks with high-growth stocks. But as pointed out by consulting firm McKinsey in a couple of its reports, there is another, possibly more important, component which accounts for a stock's high or low earnings multiple.
That is return on capital. It makes sense. Growth requires investment, and if the investment doesn't yield an adequate return over the cost of capital, then it will not create shareholder value. That means no boost to share price and no increase in the price-earnings multiple.
So a high-PE stock could be one which is generating high growth at a return which slightly exceeds its cost of capital, or one which is chugging along slowly and steadily but earning a return on capital that far exceeds its cost of capital.
McKinsey has proposed a three-step approach to disaggregate a company's current market value into its current performance, its return premium, and the value expected from its future growth. Current performance is derived by estimating the value of a company's current earnings in perpetuity, assuming no growth.
At no growth, it is assumed that depreciation is equal to capital expenditure, and therefore net operational profit less cash taxes is equal to free cash flow for a business that does not grow. So dividing net operational profits after cash taxes by the cost of capital would give us the value of current earnings, with no growth, in perpetuity.
The premise is that companies with the highest ROICs relative to their WACCs are the greatest creators of value for shareholders
Return premium is the value a company delivers by earning superior returns on its growth capital. In order to assess how a company's return on growth capital influences its PE multiple, McKinsey recommends discounting a company's cash flow as if it grew in perpetuity at some normalised rate, such as nominal GDP growth. Through repeated analysis, McKinsey has found that the result is a good proxy for the premium a company enjoys in the capital markets because of its high returns on future growth capital.
And finally, value from growth represents how much a company delivers by growing over and above nominal GDP growth. It can be calculated as that portion of the company's current market value that is not captured in current performance or the return premium. For a company that grows more slowly than the GDP, this value will be negative.
I've decided to use this three-step approach on some Singapore-listed companies.
Three-step method
First I downloaded from Bloomberg the entire list of stocks traded on the Singapore Exchange with attributes like return on invested capital (ROIC), market capitalisation, their weighted average cost of capital (WACC), and so forth.
I then calculated the difference between the ROICs and the WACCs, and ranked them from the highest to the lowest. The premise is that companies with the highest ROICs relative to their WACCs are the greatest creators of value for shareholders.
From the top 50 companies, I randomly picked 13 and went through their latest results one by one so as to calculate their pre-tax operating margin, their asset turnover, and their ROIC (excluding and including cash held in banks). Finally, I attempted to attribute how much of the stocks' current market value is from its current performance under a no-growth scenario, how much of it is from return premium, and how much is from expected future growth. The results are pretty interesting.
The formula I used to calculate ROIC is net operating earnings before interest and amortisation charges, but after cash taxes divided by total assets, net of excess cash, and non-interest-bearing current liabilities.
Almost all the companies on the list have strong ROIC. A company can arrive at a high ROIC by either having a high profit margin, or more efficiently utilising its assets to increase sales. The former is measured by operating profit margin, and the latter by asset turnover.
As can be seen from the table, most of the companies are high-margin, low-volume businesses. The three exceptions are Hersing Corp, Apex-Pal and Olam, which are low-margin, high-volume businesses.
Meanwhile, a lot of these companies also have a lot of cash. With the exception of MobileOne and StarHub, all have more than 5 per cent of their market capitalisation represented by cash in the bank. The most extreme was C&G Industrial, which according to its June 30, 2007 balance sheet, has 557 million yuan in the bank. That's about $112.5 million, or about 40 per cent of its current market cap of $274 million.
I then tried to calculate the value for these companies based on their existing businesses under a no-growth scenario. As suggested by McKinsey, I divided net operational profits after cash taxes by the cost of capital (obtained from Bloomberg) to arrive at that number.
So companies whose existing business, under a no-growth scenario, has a higher value than their current enterprise value are presumably undervalued. Enterprise value is market cap plus debts minus cash.
From the list, you can see that C&G Industrial tops my list of companies which has the most unrecognised value.
As mentioned, it has a lot of cash - some 40 per cent of its market cap is represented by cash. On top of that, assuming it can maintain its first-half operating profit, the company may rake in $44.8 million in pre-tax profits this year. According to Bloomberg, the cost of capital for C&G - a producer of PET chips used to manufacture polyester fibre - is 10.73 per cent. Based on this, that business is worth $335 million, assuming it can maintain that performance in perpetuity.
Raising its cost of capital to 15 per cent would reduce the current business worth to $240 million. Add in the company's return premium and the stock still looks undervalued. Other stocks which appear undervalued based on the above screening include Courage Marine, Hersing, MobileOne and Micro Mechanics.
In all the above analysis, investors have to decide if they think the respective companies can maintain their current performance for their existing businesses, and that these are not top-of-the-cycle figures. Another factor to consider is the WACC, whether they think it is too low and hence not representative of the risks faced by the companies.
For example, Courage Marine is enjoying the very high dry-bulk freight rates now. Can this be sustained? Perhaps the current valuation of its business is high enough, relative to its enterprise value, to allow for the easing of freight rates going forward.
As for MobileOne, its high valuation has much to do with its relatively low WACC. Is that justified?
Meanwhile, among all the stocks I looked at, Olam has the highest imputed growth value and return premium based on its current enterprise value. The value of its existing business - under a no-growth scenario - only makes up about 19 per cent of its enterprise value today.
Thursday, 27 September 2007
Virtual Fund Performance
Sum invested = $540,050
Cash holding = $1,179
Realised profit = $41,229 = 8.25%
Unrealised profit = $55,880 = 11.17%
Cash holding = $1,179
Realised profit = $41,229 = 8.25%
Unrealised profit = $55,880 = 11.17%
Wednesday, 26 September 2007
Virtual Fund Transactions
Sold:
50,000 BH Global Marine @$0.755 = $37,750
10,000 Labroy Marine @$2.47 = $24,700
Realised Profit = $300
Bought:
20,000 ChinaEnergy @$1.38 = $27,600
25,000 FibreChem @$1.35 = $33,750
Sum invested = $540,050
Cash holding = $1,179
Realised profit = $41,229 = 8.25%
Unrealised profit = $57,450 = 11.49%
I feel that such a strategic switching of counters is necessary as I anticipate the China counters to continue surging ahead.
50,000 BH Global Marine @$0.755 = $37,750
10,000 Labroy Marine @$2.47 = $24,700
Realised Profit = $300
Bought:
20,000 ChinaEnergy @$1.38 = $27,600
25,000 FibreChem @$1.35 = $33,750
Sum invested = $540,050
Cash holding = $1,179
Realised profit = $41,229 = 8.25%
Unrealised profit = $57,450 = 11.49%
I feel that such a strategic switching of counters is necessary as I anticipate the China counters to continue surging ahead.
Virtual Fund Performance on this day Torres scored his first hat-trick for Liverpool
Sum invested = $540,850
Cash holding = $79
Realised profit = $40,929 = 8.18%
Unrealised profit = $57,750 = 11.55%
The unrealised profit jumps some $20,000 in line with the powering ahead of china related counters today.
Cash holding = $79
Realised profit = $40,929 = 8.18%
Unrealised profit = $57,750 = 11.55%
The unrealised profit jumps some $20,000 in line with the powering ahead of china related counters today.
Tuesday, 25 September 2007
Virtual Fund Performance
Sum invested = $540,850
Cash holding = $79
Realised profit = $40,929 = 8.18%
Unrealised profit = $36,900 = 7.38%
ChinaSports and Swiber continue the uptrends which contributed to the increase in unrealised profit for today.
Have a Happy and Fruitful Mid Autumn Festival!
Cash holding = $79
Realised profit = $40,929 = 8.18%
Unrealised profit = $36,900 = 7.38%
ChinaSports and Swiber continue the uptrends which contributed to the increase in unrealised profit for today.
Have a Happy and Fruitful Mid Autumn Festival!
Monday, 24 September 2007
Own transactions
Sold 1,000 EZRA
The share price of EZRA has weakened for the past week since it announced the S$162.4 Million Order for a Multi-Functional Support Vessel. I feel that it is not wise to go against the general downtrend at the moment so decided to lock in the small profit.
The immediate concerns for investors would be how the Company fund this sophisticated equipment. It could use the proceeds from the partial disposal of EOC, alternatively, it could raise fund by share placement and lastly combining internal funds plus borrowings.
In any case, the market does not seem to appreciate this latest move. The huge capital outlay would leave shareholders who are expecting some kind of cash distribution from EOC listing disappointed. To do share placement would dilute the earnings further. Lastly the borrowings would increase the gearing of the Company and investors would need to price in some credit risk premium.
The share price of EZRA has weakened for the past week since it announced the S$162.4 Million Order for a Multi-Functional Support Vessel. I feel that it is not wise to go against the general downtrend at the moment so decided to lock in the small profit.
The immediate concerns for investors would be how the Company fund this sophisticated equipment. It could use the proceeds from the partial disposal of EOC, alternatively, it could raise fund by share placement and lastly combining internal funds plus borrowings.
In any case, the market does not seem to appreciate this latest move. The huge capital outlay would leave shareholders who are expecting some kind of cash distribution from EOC listing disappointed. To do share placement would dilute the earnings further. Lastly the borrowings would increase the gearing of the Company and investors would need to price in some credit risk premium.
Virtual Fund Performance
Sum invested = $540,850
Cash holding = $79
Realised profit = $40,929 = 8.18%
Unrealised profit = $31,410 = 6.28%
The contributor for the significant improvement in the portfolio today is Jiutian. It jumped 21 cents or 7.4%.
Cash holding = $79
Realised profit = $40,929 = 8.18%
Unrealised profit = $31,410 = 6.28%
The contributor for the significant improvement in the portfolio today is Jiutian. It jumped 21 cents or 7.4%.
Friday, 21 September 2007
2nd Batch Virtual Fund Transactions
Further Bought:
50,000 BH Global Marine @$0.755 = $37,750
50,000 C&G Industrial @$0.59 = $29,500
50,000 Foreland @$0.50 = $25,000
10,000 Labroy Marine @$2.44 = $24,400
20,000 Midas @$1.41 = $28,200
50,000 Sihuan @$0.76 = $38,000
20,000 Swiber @$3.12 = $62,400
22,000 Tiong Woon @$1.05 = $23,100
Sum invested = $540,850
Cash holding = $79
Realised profit = $40,929 = 8.18%
Unrealised profit = $15,000 = 3%
50,000 BH Global Marine @$0.755 = $37,750
50,000 C&G Industrial @$0.59 = $29,500
50,000 Foreland @$0.50 = $25,000
10,000 Labroy Marine @$2.44 = $24,400
20,000 Midas @$1.41 = $28,200
50,000 Sihuan @$0.76 = $38,000
20,000 Swiber @$3.12 = $62,400
22,000 Tiong Woon @$1.05 = $23,100
Sum invested = $540,850
Cash holding = $79
Realised profit = $40,929 = 8.18%
Unrealised profit = $15,000 = 3%
Virtual Fund Transactions
Bought:
50,000 Jiutian Chemical @$2.75 = $137,500
Sold:
500,000 CapitalandDBeCW80121 @$0.17 = $85,000
500,000 CoscoCorpBNPeCW080204 @$0.085 = $42,500
Sum invested = $272,500
Cash holding = $268,429
Realised profit to-date = $40,929 = 8.18%
50,000 Jiutian Chemical @$2.75 = $137,500
Sold:
500,000 CapitalandDBeCW80121 @$0.17 = $85,000
500,000 CoscoCorpBNPeCW080204 @$0.085 = $42,500
Sum invested = $272,500
Cash holding = $268,429
Realised profit to-date = $40,929 = 8.18%
Forbes Top 200 Companies in Asia Pacific
The following Singapore companies made it to the list:
- Asia Enterprises (vested)
- ASL Marine
- Best World
- BH Global Marine
- China Sun Bio-Chem
- CSE Global
- EZRA (vested)
- Food Empire
- Hongguo International
- Inter-Roller
- Jiutian Chemical (vested)
- Labroy Marine
- Midas (vested)
- Midsouth
- Multi-chem
- Raffles Education (vested)
- Raffles Medical
- Rotary Engineering
- Tat Hong
- Unisteel technology
I have invested in 5 of the above companies. Many were previously in my portfolio.
- Asia Enterprises (vested)
- ASL Marine
- Best World
- BH Global Marine
- China Sun Bio-Chem
- CSE Global
- EZRA (vested)
- Food Empire
- Hongguo International
- Inter-Roller
- Jiutian Chemical (vested)
- Labroy Marine
- Midas (vested)
- Midsouth
- Multi-chem
- Raffles Education (vested)
- Raffles Medical
- Rotary Engineering
- Tat Hong
- Unisteel technology
I have invested in 5 of the above companies. Many were previously in my portfolio.
Thursday, 20 September 2007
Virtual Fund Transactions
Bought:
100,000 ChinaSports @$1.35 = $135,000
500,000 CapitalandDBeCW80121 @$0.17 = $85,000
500,000 CoscoCorpBNPeCW080204 @$0.095 = $47,500
Sum invested = $267,500
Cash holding = $278,429
Realised profit to-date = $45,929 = 9.18%
100,000 ChinaSports @$1.35 = $135,000
500,000 CapitalandDBeCW80121 @$0.17 = $85,000
500,000 CoscoCorpBNPeCW080204 @$0.095 = $47,500
Sum invested = $267,500
Cash holding = $278,429
Realised profit to-date = $45,929 = 9.18%
Own Portfolio
Latest Football News
Thu, 20th Sep 2007
Chelsea Football Club and José Mourinho have agreed to part company today (Thursday) by mutual consent.
http://www.channelnewsasia.com/stories/afp_sports/view/300933/1/.html
Chelsea Football Club and José Mourinho have agreed to part company today (Thursday) by mutual consent.
http://www.channelnewsasia.com/stories/afp_sports/view/300933/1/.html
Tuesday, 18 September 2007
Happy Birthday to Me
No transactions to report for the day. I will have an early night cos I need to catch Liverpool match tomorrow at 2.30am. The new season of Champion League begins tonight. For those who stay up for the Fed decision, please take care. My personal view is that, whatever the outcome, the market is bound to fall eventually. Lets wait and see...
Monday, 17 September 2007
Today's Virtual Fund Transactions:
Disposed of all Put Warrants:
STI3500BNPePW070927: 500,000 @$0.13 Profit = $17,500
HSI21800BNPePW070927: 1,000,000 @$0.045 Profit = $5,000
DBS DBePW071001: 500,000 @$0.045, No Gain No Loss
Total Realised Profit to-date= $45,929 =9.18%
Sum invested = $0
Latest Cash Holding = $545,929
The decision to dispose of the entire equity porfolio proved timely. The STI was down by 60 points and therefore the put warrant made the most.
Tomorrow, market should be firmer ahead of the FOMC meeting. I have decided to clear all my position as the market could swing one way or another depending what Uncle Ben has to say.
Stay tuned for my next move.
Disposed of all Put Warrants:
STI3500BNPePW070927: 500,000 @$0.13 Profit = $17,500
HSI21800BNPePW070927: 1,000,000 @$0.045 Profit = $5,000
DBS DBePW071001: 500,000 @$0.045, No Gain No Loss
Total Realised Profit to-date= $45,929 =9.18%
Sum invested = $0
Latest Cash Holding = $545,929
The decision to dispose of the entire equity porfolio proved timely. The STI was down by 60 points and therefore the put warrant made the most.
Tomorrow, market should be firmer ahead of the FOMC meeting. I have decided to clear all my position as the market could swing one way or another depending what Uncle Ben has to say.
Stay tuned for my next move.
Saturday, 15 September 2007
Contradicting Singaporeans
Funny truth....
1. Nite - Sleep with air-con; Day - Bathe with heater on.
2. Day - Cannot Wake up; Nite - Cannot Sleep.
3. Translation is needed between Singaporean Chinese and Mainland Chinese.
4. Smell Of rubbish besides letterboxes; Rubbish inside Letterbox.
5. Spore Chinese use different languages other then Chinese to communicate.
6. Sporean never likes to vote, but like to complain.
7. There are quite a number of rich/poor in spore - They have Car, Credit Card, CPF but no Cash and are liable to lots of loans
8. Education - Teach Less Learn More.
9. There are quite a few high-tech barbaric Singaporeans -they know how to use state-of-the art equipment, 3g mobile phone and powerful computers but they don’t know how to use a simple dustbin or a toilet.
10. Half Sporeans rushed to buy Hello kitty, but the other half busy killing stray cats.
11. Chewing Gum - Can Chew, Cannot buy?? (Restricted to buying).
12. Cigarettes - Convenient to buy; not convenient to smoke.
13. Private Cars - Cheaper and Cheaper to buy, harder and harder to Maintain.
14. Public Bus - Half the Crowd squeeze in front section of the Bus, Second section is for Carrying Ghost.
1. Nite - Sleep with air-con; Day - Bathe with heater on.
2. Day - Cannot Wake up; Nite - Cannot Sleep.
3. Translation is needed between Singaporean Chinese and Mainland Chinese.
4. Smell Of rubbish besides letterboxes; Rubbish inside Letterbox.
5. Spore Chinese use different languages other then Chinese to communicate.
6. Sporean never likes to vote, but like to complain.
7. There are quite a number of rich/poor in spore - They have Car, Credit Card, CPF but no Cash and are liable to lots of loans
8. Education - Teach Less Learn More.
9. There are quite a few high-tech barbaric Singaporeans -they know how to use state-of-the art equipment, 3g mobile phone and powerful computers but they don’t know how to use a simple dustbin or a toilet.
10. Half Sporeans rushed to buy Hello kitty, but the other half busy killing stray cats.
11. Chewing Gum - Can Chew, Cannot buy?? (Restricted to buying).
12. Cigarettes - Convenient to buy; not convenient to smoke.
13. Private Cars - Cheaper and Cheaper to buy, harder and harder to Maintain.
14. Public Bus - Half the Crowd squeeze in front section of the Bus, Second section is for Carrying Ghost.
Friday, 14 September 2007
Disposed of Entire Virtual Share Fund and bought put warrants ahead of volatile week
3 Key events in US next week could make or break the recovery of global share markets:
(1) Fed meeting on 18 Sep - The billion dollars question: Will Fed cut interest rate? How much? What to expect next?
(2) Major Bank Earnings - Morgan Stanley to report on Wed and Goldman Sachs and Bear Sterns on Thurs.
(3) Expiring of Option and Futures Contracts (This is very "chim" to explain). The impact will probably not as big as the other 2.
The above factors could swing the global market in a big way. The rate cut has been priced in the recent market recovery. If Uncle Ben decides to do otherwise, investors will be done for. Bank earnings have also been widely estimated. What remains is negative surprises.
Due to all these uncertainties, I decided to unload my entire virtual share portfolio. I bought some put warrants in anticipation of a selldown.
Total realised profit = $23,429 = 4.69%
Warrants bought:
STI3500BNPePW070927: 500,000 @$0.095 = $47,500
HSI21800BNPePW070927: 1,000,000 @$0.04 = $40,000
DBS DBePW071001: 500,000 @$0.045=$22,500
Sum invested = $110,000
Cash Holding = $413,429
(1) Fed meeting on 18 Sep - The billion dollars question: Will Fed cut interest rate? How much? What to expect next?
(2) Major Bank Earnings - Morgan Stanley to report on Wed and Goldman Sachs and Bear Sterns on Thurs.
(3) Expiring of Option and Futures Contracts (This is very "chim" to explain). The impact will probably not as big as the other 2.
The above factors could swing the global market in a big way. The rate cut has been priced in the recent market recovery. If Uncle Ben decides to do otherwise, investors will be done for. Bank earnings have also been widely estimated. What remains is negative surprises.
Due to all these uncertainties, I decided to unload my entire virtual share portfolio. I bought some put warrants in anticipation of a selldown.
Total realised profit = $23,429 = 4.69%
Warrants bought:
STI3500BNPePW070927: 500,000 @$0.095 = $47,500
HSI21800BNPePW070927: 1,000,000 @$0.04 = $40,000
DBS DBePW071001: 500,000 @$0.045=$22,500
Sum invested = $110,000
Cash Holding = $413,429
Thursday, 13 September 2007
Noble Group - The Best Performing Blue Chip in SGX
For the second straight year, Noble Group has been named to the Forbes Fabulous 50, Forbes third annual compilation of Asia's best public companies.
To assemble the list, Forbes studied long-term profitability, sales and earnings growth, stock price appreciation and projected earnings for every company in the region with revenues or market capitalisation reaching $5 billion and above.
Noble is joined by new entrants Neptune Orient Lines and SembCorp Industries as the only three companies to appear listed on the Singapore Exchange. The Fabulous 50 List appears in the Sept 17 issue of Forbes Asia.
Indeed, Noble's share price has appreciated more than 800% if you had held the share since its IPO in 1997. It is still the best performing share within its market capitalisation category. During this period, Singtel appreciated a mere 20%, Capitaland 70% and even the bigger DBS +200%.
To assemble the list, Forbes studied long-term profitability, sales and earnings growth, stock price appreciation and projected earnings for every company in the region with revenues or market capitalisation reaching $5 billion and above.
Noble is joined by new entrants Neptune Orient Lines and SembCorp Industries as the only three companies to appear listed on the Singapore Exchange. The Fabulous 50 List appears in the Sept 17 issue of Forbes Asia.
Indeed, Noble's share price has appreciated more than 800% if you had held the share since its IPO in 1997. It is still the best performing share within its market capitalisation category. During this period, Singtel appreciated a mere 20%, Capitaland 70% and even the bigger DBS +200%.
Wednesday, 12 September 2007
Performance of Virtual Fund
Total sum invested $500,221
Cash Holding $579
Realised Gains = $800
Unrealised Gains = $20,429 = 4.09%
Cash Holding $579
Realised Gains = $800
Unrealised Gains = $20,429 = 4.09%
Tuesday, 11 September 2007
Why does CFO resign?
Jiutian announces resignation of its Chief Financial Officer:
http://info.sgx.com/webcorannc.nsf/ef3ba6cb188613ea482571b2003641d3/9343cc1eb0229f384825735200344249?OpenDocument
What I have to say below is not specifically directed to this particular announcement but my personal opinion of how people react to the announcement of this nature.
Whenever CFO or any key personnel in any organisations resigns, it always raises a few eyebrows. You need not look far. Recently there were rumours that Labroy Marine's Technical Director was leaving and the share price plummeted more than 10% on the day.
There are 2 school of thoughts to this kind of announcement:
1. Positive: The CFO leaves on his own accord to pursue his own interests (usually quoted as such)
2. Negative: The CFO is "forced" to resign because he knows something that the profession requires him to quit.
The first one is more straight forward. People do resign because they need to take a break to pursue other interests or careers. The current position maybe too stressful or he is not well rewarded. Other undisclosed reasons include the capability of the CFO to discharge the duties required of him. Maybe he refuses to travel or cannot cope with different culture and languages in a foreign country. Whatever it might be, this is good for shareholders because we all do not want a CFO who cant do the job and that it would only be bad for the company to keep him.
The second one is more tricky. It can sometime send the company's share price tumbling because the public perceives the management is up to no good and the CFO is compelled to leave. No kidding. We accountants are taught to leave a job, however well paid a job maybe, if we discover something or when we find ourselves in a situation where our professional ethics might be compromised.
In this modern world, CFO is the right-hand man of the CEO. Usually he is the first to know if anything is not proper. Because of the privileges we accountants enjoy, we also carry the same weight of responsibilities as those of a company director. Its not hard to find cases where CFOs or Finance Directors of commercial and charitable organisations convicted on criminal charges together with the number one man at the helm.
Maybe SGX should consider making the CFO to disclose the "real" reason for leaving the company, just like what is going to be required by directors soon. That would make the announcement more transparent and it could minimise the damage that it might cause to the company.
China and India are reported to be short of qualified accountants. Indeed, qualified accountants with technical and good soft skills are hard to come by. Good accountants are not just good at interpreting accounting standards or reading financial statements. What is equally important is his ability to understand the business operations and be able to deal and connect to different group of people and personnel in the organisations. This is what I call the soft skills.
Accountants are generally not good at expressing themselves, myself included. I have been to AGMs and I have seen how accountants are grilled by shareholders and the CEO or directors have to shield him from further embarrassment due to the lack of understanding of the business the company is in or the general knowledge of the industry.
As an accountant, I make no excuse for myself. Ever since I quit my audit profession to join the commercial world, i have to constantly remind myself to learn the business skills as much as keeping myself abreast with the latest corporate developments. I always force myself to understand the various aspects of the business operations. My boss always get me involved in key decision making as he feels that I am in the best position to evaluate any course of action. At the end of the day, the management decision must take into account dollars and sense because that's how the management is being measured by shareholders.
For those accountant wannabe, please ensure you acquire the relevant technical skills, after that the soft skills will get you far. Good luck!
http://info.sgx.com/webcorannc.nsf/ef3ba6cb188613ea482571b2003641d3/9343cc1eb0229f384825735200344249?OpenDocument
What I have to say below is not specifically directed to this particular announcement but my personal opinion of how people react to the announcement of this nature.
Whenever CFO or any key personnel in any organisations resigns, it always raises a few eyebrows. You need not look far. Recently there were rumours that Labroy Marine's Technical Director was leaving and the share price plummeted more than 10% on the day.
There are 2 school of thoughts to this kind of announcement:
1. Positive: The CFO leaves on his own accord to pursue his own interests (usually quoted as such)
2. Negative: The CFO is "forced" to resign because he knows something that the profession requires him to quit.
The first one is more straight forward. People do resign because they need to take a break to pursue other interests or careers. The current position maybe too stressful or he is not well rewarded. Other undisclosed reasons include the capability of the CFO to discharge the duties required of him. Maybe he refuses to travel or cannot cope with different culture and languages in a foreign country. Whatever it might be, this is good for shareholders because we all do not want a CFO who cant do the job and that it would only be bad for the company to keep him.
The second one is more tricky. It can sometime send the company's share price tumbling because the public perceives the management is up to no good and the CFO is compelled to leave. No kidding. We accountants are taught to leave a job, however well paid a job maybe, if we discover something or when we find ourselves in a situation where our professional ethics might be compromised.
In this modern world, CFO is the right-hand man of the CEO. Usually he is the first to know if anything is not proper. Because of the privileges we accountants enjoy, we also carry the same weight of responsibilities as those of a company director. Its not hard to find cases where CFOs or Finance Directors of commercial and charitable organisations convicted on criminal charges together with the number one man at the helm.
Maybe SGX should consider making the CFO to disclose the "real" reason for leaving the company, just like what is going to be required by directors soon. That would make the announcement more transparent and it could minimise the damage that it might cause to the company.
China and India are reported to be short of qualified accountants. Indeed, qualified accountants with technical and good soft skills are hard to come by. Good accountants are not just good at interpreting accounting standards or reading financial statements. What is equally important is his ability to understand the business operations and be able to deal and connect to different group of people and personnel in the organisations. This is what I call the soft skills.
Accountants are generally not good at expressing themselves, myself included. I have been to AGMs and I have seen how accountants are grilled by shareholders and the CEO or directors have to shield him from further embarrassment due to the lack of understanding of the business the company is in or the general knowledge of the industry.
As an accountant, I make no excuse for myself. Ever since I quit my audit profession to join the commercial world, i have to constantly remind myself to learn the business skills as much as keeping myself abreast with the latest corporate developments. I always force myself to understand the various aspects of the business operations. My boss always get me involved in key decision making as he feels that I am in the best position to evaluate any course of action. At the end of the day, the management decision must take into account dollars and sense because that's how the management is being measured by shareholders.
For those accountant wannabe, please ensure you acquire the relevant technical skills, after that the soft skills will get you far. Good luck!
Performance of virtual fund on 6th Anniversary of 9-11
Unrealised Gains = $13,760
Realised Gains = $800
Total Gains to-date= $14,560 = 2.91%
On this day 6 years ago, I lost around $20,000 and it took me 3 months to recover the amount.
It was a bad day for the global financial markets but it was a good personal experience learnt.
Realised Gains = $800
Total Gains to-date= $14,560 = 2.91%
On this day 6 years ago, I lost around $20,000 and it took me 3 months to recover the amount.
It was a bad day for the global financial markets but it was a good personal experience learnt.
Ezra to sell 40% of EOC before Oslo Listing
Ezra to sell 40% of unit headed for Oslo mainboard listing MARINE group Ezra Holdings is selling a 40 per cent stake in EOC Ltd for up to 1.068 billion Norwegian kroner ($282 million), a move that will make its production and construction unit the first Singapore company to list on the mainboard of the Oslo Stock Exchange. Mr Lee: EOC's listing in Oslo will also enable the company to tap new sources of funding Ezra, which owns 88 per cent of EOC, said yesterday that it is selling up to about 44.5 million EOC shares through private placement to institutional and professional investors at an indicative price range of 22-24 Norwegian kroner per share. EOC currently trades on the over-the-counter (OTC) of the Oslo exchange. This is expected to raise gross proceeds of S$258-282 million and pare Ezra's stake in EOC to 48 per cent. The actual pricing will be determined through a book-building process by Pareto Securities ASA that will run from Sept 10 to 19. 'The sale is in line with our asset-light strategy,' Ezra's managing director Lionel Lee said. 'EOC's separate mainboard listing in Oslo will also enable the company to tap new and diversified sources of funding to accelerate its growth in line with the buoyant demand for offshore construction and production support vessels.' Mr Lee noted that the placement of EOC shares to investors in Norway and internationally will ensure a sound investor support. EOC's European listing is also strategic for the group as it will enhance its overall position in the North Sea, South America and West Africa markets. One of the conditions for the Oslo mainboard listing is that EOC must have a free float of at least 25 per cent of the shares admitted to listing. Ezra said members of EOC's board and management will be pre-allocated a maximum of 4.5 million shares. 'The placement will facilitate EOC's upgrade to the mainboard and will enable the group to raise its profile among investors as a high-growth company in the construction and FPSO (floating production storage and offloading) segment of the offshore oil and gas industry,' said EOC's managing director KK Lim. EOC's mainboard status wiill allow it to tap on a wider range of funding possibilities to finance its future growth plans as it carves out a niche in the medium to deepwater projects, he added. EOC, which provides offshore fabrication, commissioning and transportation services to the oil and gas industry, currently manages two heavy lift accommodation crane barges and recently took delivery of a pipe-lay and accommodation vessel called the Lewek Champion. Ezra manages 25 vessels comprising anchor handling tug supply vessels (AHTS), anchor handling tugs (AHTs), crewboats, barges and a pipelaying vessel.
Courtesy of CNA Forumer
Courtesy of CNA Forumer
Monday, 10 September 2007
Transactions for Virtual Portfolio 10/09/07
Sunday, 9 September 2007
Sharing with you the following posts in one of the share forums:
People always worry
On weekend, they worry about monday.
On monday, they worry about tuesday..
On tuesday, they worry about wedsnesday..
2 Years ago, they worried about inflation.
Year ago, they worried about oil price.
Today they worry about subprime and credit.
tomorrow, they are going to worry abt something... but Market goes on.
Even filthy rich also has worry. Buffet worries he can get a good successor. Others worry they dont have a son to take over their wealth. The bears worry that they will be caged for their biles.
Story of " 杞人忧天“ 。。。 - long long ago in china, a person from qi keep worry that the sky will fall.
1997 : - Hongkong returned back to china mainland, people say hongkong going to finish. Now ?
1999 : - lots of dooms day tellers say 1999 end of the world, bible predicted it. Now?
2001 : - US WTC kena attacked, many say world war III coming , now ?
People always worry
On weekend, they worry about monday.
On monday, they worry about tuesday..
On tuesday, they worry about wedsnesday..
2 Years ago, they worried about inflation.
Year ago, they worried about oil price.
Today they worry about subprime and credit.
tomorrow, they are going to worry abt something... but Market goes on.
Even filthy rich also has worry. Buffet worries he can get a good successor. Others worry they dont have a son to take over their wealth. The bears worry that they will be caged for their biles.
Story of " 杞人忧天“ 。。。 - long long ago in china, a person from qi keep worry that the sky will fall.
1997 : - Hongkong returned back to china mainland, people say hongkong going to finish. Now ?
1999 : - lots of dooms day tellers say 1999 end of the world, bible predicted it. Now?
2001 : - US WTC kena attacked, many say world war III coming , now ?
Buying a blender
My wife bought a multi function blender at a departmental store this afternoon. The blender is made in Japan. The usual price is $120 but today special promotion at only $69 with free filter.
The promoter was pretty good with the demo and was surrounded by a big group of housewives and some uncles like myself. She diligently tried out one method after another and she had about 10 different types of food items to do the demo.
I was convinced by the functionality of the machine so I asked my wife to get one. I feel that the price was cheap as I had seen it selling at more than $100 before. I thought many would follow suit and buy. To my surprise, out of the group of about 30 onlookers, only my wife bought it.
Interestingly, after my wife stepped aside to check the machine, 3 women came after her and asked her questions like: what is the price? is it really useful? is it really selling at bargain? does it really come with free gift etc?
I was thinking at one side. We were all there listening and witnessed the demo for 20 mins. Surely we heard and saw the same thing. Why these people want to get 2nd opinion? Maybe it has to do with the kiasu and kiasi mentality in general.
I recall my experience of recommending some shares to one of my ex colleagues. This lady in her 50s I suppose was quite loaded. I recommended some good companies like Midas and Raffles Education to her. At that time Midas was trading at below $0.30 and I myself bought more than 100 lots. No matter how hard I tried to convince her, she would not bite. She always had excuses such as China businesses are risky bla bla bla .. and I put that to her kiasi attitude.
More than 1 year gone by and Midas shot to $2 and Raffles Edu also had doubled in price. I met her on the street one day. She regretted not to heed my advice at that time or she would have made good money investing in Midas and Raffles Edu.
Recently I happened to talk to her on the phone. She asked me whether can buy Midas and Raffles Edu as both had corrected significantly prior to the recent market melt down as they were hit hard by untrue articles and rumuors.
So I tried to convince her to pick up some if she can afford to hold for medium term. She was sceptical and did not buy any at first. Last week she phoned me to say that she had finally picked up some Midas. However at that time, Midas had been hitting recent high, so much higher than the price I asked her to buy at around $1.23. She told me she did not want to regret again as she saw the price jumped from $1.20 to $1.45.
Go back to the blender story. I am sure some aunties will go back to check the price tomorrow to confirm whether it was really selling at 40% discount. And I am sure they would be kicking themselves and say "I should have bought it yesterday as it was so much cheaper"! Why cant people be more simple minded at times and take things at their face value. In Singapore, if you sell things too cheaply, people think it must be a junk.
It happens everywhere and everytime. Thats just human nature: Fear and Greed. As long as humans live, this will not die. Tomorrow market should trend downwards again and many people would panic and sell low again. Before they recovered from their shock, big boys would come and push up the prices and they would then start to chase again by paying even more for the shares as they do not want to miss the boat.
Now that Mr Chew has been accumulating Midas at the cheap, maybe its time we follow the big boys and see what it brings. Good luck!
The promoter was pretty good with the demo and was surrounded by a big group of housewives and some uncles like myself. She diligently tried out one method after another and she had about 10 different types of food items to do the demo.
I was convinced by the functionality of the machine so I asked my wife to get one. I feel that the price was cheap as I had seen it selling at more than $100 before. I thought many would follow suit and buy. To my surprise, out of the group of about 30 onlookers, only my wife bought it.
Interestingly, after my wife stepped aside to check the machine, 3 women came after her and asked her questions like: what is the price? is it really useful? is it really selling at bargain? does it really come with free gift etc?
I was thinking at one side. We were all there listening and witnessed the demo for 20 mins. Surely we heard and saw the same thing. Why these people want to get 2nd opinion? Maybe it has to do with the kiasu and kiasi mentality in general.
I recall my experience of recommending some shares to one of my ex colleagues. This lady in her 50s I suppose was quite loaded. I recommended some good companies like Midas and Raffles Education to her. At that time Midas was trading at below $0.30 and I myself bought more than 100 lots. No matter how hard I tried to convince her, she would not bite. She always had excuses such as China businesses are risky bla bla bla .. and I put that to her kiasi attitude.
More than 1 year gone by and Midas shot to $2 and Raffles Edu also had doubled in price. I met her on the street one day. She regretted not to heed my advice at that time or she would have made good money investing in Midas and Raffles Edu.
Recently I happened to talk to her on the phone. She asked me whether can buy Midas and Raffles Edu as both had corrected significantly prior to the recent market melt down as they were hit hard by untrue articles and rumuors.
So I tried to convince her to pick up some if she can afford to hold for medium term. She was sceptical and did not buy any at first. Last week she phoned me to say that she had finally picked up some Midas. However at that time, Midas had been hitting recent high, so much higher than the price I asked her to buy at around $1.23. She told me she did not want to regret again as she saw the price jumped from $1.20 to $1.45.
Go back to the blender story. I am sure some aunties will go back to check the price tomorrow to confirm whether it was really selling at 40% discount. And I am sure they would be kicking themselves and say "I should have bought it yesterday as it was so much cheaper"! Why cant people be more simple minded at times and take things at their face value. In Singapore, if you sell things too cheaply, people think it must be a junk.
It happens everywhere and everytime. Thats just human nature: Fear and Greed. As long as humans live, this will not die. Tomorrow market should trend downwards again and many people would panic and sell low again. Before they recovered from their shock, big boys would come and push up the prices and they would then start to chase again by paying even more for the shares as they do not want to miss the boat.
Now that Mr Chew has been accumulating Midas at the cheap, maybe its time we follow the big boys and see what it brings. Good luck!
Friday, 7 September 2007
Virtual Portfolio Performance Day 2
Total unrealised gains = $19,400 or 3.88%.
Foreland continues to climb by 11.1% from $0.45 to $0.50. It has recovered more than 20% in just 2 days. This gem was badly sold down due to its thin volume. There are many high profile investors behind this company and they can easily buy up the price in no time. As the demand for functional fabrics set to rise in tandem with explosive consumer spending in China, this counter can offer huge upside potential in time to come.
Jiutian has gained $3,600 being the top gainer in absolute value. It should continue to charge ahead towards $4 with the share split and bonus warrants in the pipeline. The warrant exercise price is set at $0.80. That implies that the mother share will have to be worth that value after split for the exercise to be meaningful. The future growth prospects seem so promising with 5 times increase in production capacity expected and it set to become one of the largest DMF producers in the world.
Foreland continues to climb by 11.1% from $0.45 to $0.50. It has recovered more than 20% in just 2 days. This gem was badly sold down due to its thin volume. There are many high profile investors behind this company and they can easily buy up the price in no time. As the demand for functional fabrics set to rise in tandem with explosive consumer spending in China, this counter can offer huge upside potential in time to come.
Jiutian has gained $3,600 being the top gainer in absolute value. It should continue to charge ahead towards $4 with the share split and bonus warrants in the pipeline. The warrant exercise price is set at $0.80. That implies that the mother share will have to be worth that value after split for the exercise to be meaningful. The future growth prospects seem so promising with 5 times increase in production capacity expected and it set to become one of the largest DMF producers in the world.
Own transactions 7 Sep 2007
Bought:
5,000 Sihuan @ $0.76
10,000 ChinaWheel @$0.94
Why buy Sihuan?
I have been impressed by the high ROE and profitability of this company. Its hospital distribution network is set to double in the next few years. The key drug Kelinao has been selling like hot cake. It takes a lot of patience to realise its full valuation. There are few high profile investors who got the placement shares at the IPO.
Why buy ChinaWheel?
The production capacity may triple by 2010 from the current 3.6m wheels p.a. making it one of the largest producer of aluminium alloy wheels in China. It gives investors a direct exposure to the fast growing auto sector. Current valuation is still cheap with forward PE of less than 10.
5,000 Sihuan @ $0.76
10,000 ChinaWheel @$0.94
Why buy Sihuan?
I have been impressed by the high ROE and profitability of this company. Its hospital distribution network is set to double in the next few years. The key drug Kelinao has been selling like hot cake. It takes a lot of patience to realise its full valuation. There are few high profile investors who got the placement shares at the IPO.
Why buy ChinaWheel?
The production capacity may triple by 2010 from the current 3.6m wheels p.a. making it one of the largest producer of aluminium alloy wheels in China. It gives investors a direct exposure to the fast growing auto sector. Current valuation is still cheap with forward PE of less than 10.
Thursday, 6 September 2007
Virtual Portfolio Performance After Day 1
After 1st day of launching, the overall portfolio registered unrealised gains of $10,150 or 2.03% thanks to the bargain hunting in the SGX.
Best Performer: Foreland +12.5%
Worst Performer: ChinaMilk -2.5%
Best Performer: Foreland +12.5%
Worst Performer: ChinaMilk -2.5%
Today's own transactions
Sold some Jiutian and Asia Enterprise.
Bought EZRA
Why buy EZRA?
The current uncertainties surrounding its EOC listing at Oslo bourse might be the reason for its lackluster share price performance for the past few months. How the Company would distribute the proceeds from its successful listing of EOC is anybody's guess. It could be in the form of special cash dividend, distribution in specie, ie shareholders given shares of EOC or the combination of both. The outcome of this will probably be annouced in conjunction with the release of full year result in October.
Meanwhile the 1 for 1 bonus issue might be big enough carrot for investors to hang on. I respect the management in that it has been rewarding shareholders well all these years. If not mistaken, the Company has given out 2 rounds of 1 for 5 bonus issues prior to the current one. If you had invested in the Company since IPO at below $0.50 per share, your investment would have grown to $9,000 or 18 times!
Investing in EZRA also offers investors indirect interest in Ezion (f.n.a. Nylect) which I believe the Company bought at dirt cheap price. The Nylect story has been a myth and miracle put together by Mr Chew where millions of dollars were created out of nothing. It has been by far one of the best performing stocks after Raffles Education in the recent Singapore Exchange history.
Bought EZRA
Why buy EZRA?
The current uncertainties surrounding its EOC listing at Oslo bourse might be the reason for its lackluster share price performance for the past few months. How the Company would distribute the proceeds from its successful listing of EOC is anybody's guess. It could be in the form of special cash dividend, distribution in specie, ie shareholders given shares of EOC or the combination of both. The outcome of this will probably be annouced in conjunction with the release of full year result in October.
Meanwhile the 1 for 1 bonus issue might be big enough carrot for investors to hang on. I respect the management in that it has been rewarding shareholders well all these years. If not mistaken, the Company has given out 2 rounds of 1 for 5 bonus issues prior to the current one. If you had invested in the Company since IPO at below $0.50 per share, your investment would have grown to $9,000 or 18 times!
Investing in EZRA also offers investors indirect interest in Ezion (f.n.a. Nylect) which I believe the Company bought at dirt cheap price. The Nylect story has been a myth and miracle put together by Mr Chew where millions of dollars were created out of nothing. It has been by far one of the best performing stocks after Raffles Education in the recent Singapore Exchange history.
Wednesday, 5 September 2007
My Virtual Portfolio as at 5 Sep 2007
I have been entrusted to manage $500,000 worth of virtual stock portfolio. These counters have been chosen by me based on my own research and share market experience. If this portfolio yields capital gain of more than 50% by end of 2008, I may get to manage part of my company's real share portfolio with market valuation in excess of $10 million! My fund management journey begins here. I will update the valuation of my virtual portfolio at every month end. Stay tuned!
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DBS Vickers Cuts Midas TP to S$1.84
DJ MARKET TALK: 0050 GMT [Dow Jones] STOCK CALL: DBS Vickers cuts Midas (5EN.SG) target price to S$1.84 from S$2.30, based on 24X FY08 earnings, after lowering FY08 net profit forecast 9.5% to reflect absence of contributions from company's now-scuttled JV with Northeast Light Alloy. Midas confirms Dow Jones report JV didn't get regulatory approval from China. But brokerage remains positive on core business, separate JV with Nanjing Puzhen, which has been actively securing rail projects. Tips earnings CAGR of 50% over next 3 years as China's demand for trains, related products continues to accelerate. Keeps Buy call. Stock down 7.5% at S$1.36 yesterday.
Virtual JF Portfolio Performance YTD
I came across JF Assets Management as it has been actively acquiring certain shares in the local scene. I have done some research and realised that it is actually based in Hong Kong. Their funds performance, in particular the China related ones, have been very impressive. So I try to compile some of the shares that they invest in and come up with this virtual JF portfolio to see how they really fare.
For hyperthetical illustration, I bought 1 lot for evry counter at the beginning of 2007. The prices were based on the real prices on that day, adjusting for bonus issues and share splits for certain counters. The YTD cumulative return is 25%, which I would say is fairly good as the market has corrected quite sigificantly last month.
Tuesday, 4 September 2007
Midas share price dropped by 7.5% today
Midas shrs fall as Chinalco buys into China alloy firm, Sept 4 (Reuters) - Aluminum Corp of China, or Chinalco, has paid 1.2 billion yuan ($159.1 million) for a 75 percent stake in Northeast Light Alloy Co Ltd, state media and company officials said on Tuesday, apparently beating out a Singaporean firm. The news caused a 9.5 percent drop in shares of Singapore-listed Midas Holdings , which last year had announced its intention to form a joint venture to run NELA, China's largest manufacturer of aluminium and magnesium alloy. "We have not received any official notification. We are checking with the relevant authorities and will make the necessary announcements when we have an update," a Midas spokeswoman told Reuters when asked about the Chinalco deal and the status of the proposed joint venture. Midas said last September it would form a joint venture with three local government investment arms and state-owned nickel firm Jinchuan Group Ltd. that would "leverage on the production facilities, market presence and production capabilities of the existing Northeast Light Alloy Co. Ltd." "Midas had a plan to form a joint venture but it never materialized. The decision (to sell to Chalco) was taken by the assets supervision commission and the Harbin government," an official surnamed Rong at NELA's board office told Reuters. Midas planned to inject 300 million yuan for a 30 percent stake. The venture would construct a new plant to manufacture super large special aluminium plates and sheets, Midas said in a press release on Sept. 12, 2006. Founded in the 1950s, NELA had 1.089 billion yuan in sales in the first half of 2007, but only 51 million yuan in net profit. It makes aluminium and magnesium alloy for military and civilian use, as well as processing machinery. "(The news) indicates that the Chinese government wishes to keep NELA solely in domestic hands (as NELA supplies significantly to the military) and that they are not prepared for foreign participation in NELA," DBS Vickers Securities analyst Paul Yong wrote in a research note on Tuesday. The failure of the joint venture would cut Midas's forecast earnings per share for fiscal year 2008 by 10 percent, Yong said. He maintained his 'buy' rating but reduced his target price for the stock to S$1.84-$2.06 a share. Midas shares ended down 8.7 percent on Tuesday at S$1.37 a share, after falling 9.5 percent to S$1.33 a share during the day. Following the sale to Chinalco, the remainder of the company's 1.6 billion yuan of assets is held by an arm of the government of Harbin, in China's far northeast, the China Daily reported on Tuesday. State-owned Chinalco is China's largest aluminium producer and the parent of Aluminum Corp of China Ltd, or Chalco <2600.hk><601600.ss>. Midas supplies aluminium alloy extrusion production to infrastructure firms in China, and has a joint venture in Nanjing.
Monday, 3 September 2007
Midas secures RMB37.5million contract
News Release: Midas secures RMB37.5million contract to supply 24 train sets for the Nanjing Metro Line 2 project.
http://info.sgx.com/webcorannc.nsf/ef3ba6cb188613ea482571b2003641d3/1e297c10124493fd4825734b00175a5e?OpenDocument
http://info.sgx.com/webcorannc.nsf/ef3ba6cb188613ea482571b2003641d3/1e297c10124493fd4825734b00175a5e?OpenDocument
Sunday, 2 September 2007
Share Portfolio as at 31 Aug 2007
Share Portfolio 31 Aug 2007:
Adv SCT W -3.6%;
Foreland -23.1%;
Hongwei -7.7%;
Pine Agritech -22.3%;
Jiutian +18%;
Asia Ent. -19.2%
Adv SCT W -3.6%;
Foreland -23.1%;
Hongwei -7.7%;
Pine Agritech -22.3%;
Jiutian +18%;
Asia Ent. -19.2%
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