Posted on June 1, 2009 - by musicwhiz

May 2009 Portfolio Summary and Review

Musicwhiz portfolio (May-31-2009)

If April 2009 was the “Month of Reflection”, then perhaps May 2009 can be aptly described as the “Month of Green Shoots” ! The start of the month saw a sudden improvement in business sentiment and the theory was put forward that “green shoots” were being observed which slowed the pace of decline in the real economy. Other horticultural terms were being flung around as well, with some saying that there were equal amounts of “brown weeds” and that a recovery was not clear at all despite signs that some areas of the US Economy were bottoming out. The situation was echoed back here in Singapore as well, with prominent MPs giving divided and conflicting views over the economic situation.

The result of the sudden burst of optimism was the biggest one week jump in global stock market indices I had seen so far in my limited years of investing. It was just back in March 2009 when STI hit a low of 1,456, and as of this writing, the STI is close to the psychological resistance point of 2,300. That’s almost a 58% jump in the Index within just two short months, and does illustrate the point that when valuations revert to the mean, they can do so suddenly, sharply and without prior warning. Suffice to say almost all the people I spoke to were taken completely by surprise, and many are somehow convinced that this is a bear market rally and not the “real” recovery. Whether this is so will only be known on hindsight.

My divestment of Pacific Andes this month has returned some capital back to me to be recycled to other worthy investment opportunities. Suffice to say I am devoting some time to research and studying some potential companies right now, and admit I was rather slack and lazy over the past few months and thus was only comfortable in adding to my existing positions (back in October 2008 and March 2009). It would be splendid indeed if I could find another value investment when conditions have not totally improved, and sentiment continues to be depressed. Once valuations revert fully back to the mean, it may prove difficult to find sufficient margin of safety.

With the FY 2009 reports for Boustead and Tat Hong released on May 28, 2009, I shall be busy in the coming weeks doing some in-depth analysis for each company and its prospects, and will post these up separately when they are available.

For May 2009, corporate updates and result announcements for my companies are as follow:- Read more…

Related posts:

1. June 2009 Portfolio Summary and Review
2. March 2009 Portfolio Summary and Review
3. August 2009 Portfolio Summary and Review