Shares & Derivatives
November 2009 Portfolio Summary and Review
By Musicwhiz  •  December 2, 2009
[caption id="attachment_3887" align="alignright" width="150" caption="Musicwhiz Portfolio - Nov 30, 2009"]Musicwhiz Portfolio - Nov 30, 2009[/caption] November 2009 was an interesting month – not for the stock market but for news coming out regarding the economy, inflation and jobs. There was a lot of debate as to the strength of the recovery and whether it would be able to carry the economy to a weak, but fragile rebound. Everyone from top economists and analysts rushed to give their views, and the result is a rather tangled mish-mash of half-baked opinions on the strength of the economic recovery. I personally think one could not find a more motley crew of people commenting about something in the future they could not possibly know about; but then lots of people get paid top dollar this way, so who am I to complain? Foremost on the list is that USA’s economy has rebounded and it definitely on the mend, even as unemployment rate continues to creep up and housing starts continue to drop. Lagging indicators are often used to determine if the recovery is truly under way, and if an investor is trying to pre-empt the recovery by watching out for such news in order to determine when to purchase shares, he will feel left out and sorely disappointed. As we have witnessed, both USA and Singapore had exited the recession in 3Q 2009; but the stock market rebound occurred in May 2009 and was sharp and sudden; hence the idea of properly timing the market as to when to enter is again rendered moot and futile. Nevertheless, I do know of friends and peers who continue trying, and I wish them luck in finding the “Holy Grail” in market timing. In Singapore, it was reported that sales of private residential properties hit just 811 units for October 2009, down from 1,143 units in September and 1,805 units in August. While market watchers agree that October is usually a slow period, I cannot help but wonder if the recent measures taken by the Government to cool the market by increasing supply had anything to do with it. It is also in my interest to see prices for HDB resale move downwards as I have friends and relatives who are searching for an affordable HDB to buy but are being priced out of the market by the high COV levels. Higher private residential property prices also means that buyers who purchase such units have to take up higher leverage and financing, which may lead to problems 5-10 years down the road should interest rates rise. An article in the Sunday Times November 22, 2009 highlights this issue of affordability and prudence in purchasing a home, which many young and excited couples may not have planned or considered before-hand. Just to comment on cars, COE prices have remained super-high (in my opinion at least), with cars up to 1,600 cc ending at S$17,189 and for cars above 1,600 cc ending at S$18,389. This makes it quite impossible for me to even consider a buying a car as the prices are simply amazingly high. I recently read about the newly launched and heavily promoted Volkswagon Polo, which is a 1.4L car and selling for a hefty S$63,000+. It seems Singapore continues to hold the record for being one of the most expensive countries to own a car. In line with my strategy to watch my cash flows, I am unable to reconcile (to myself) how I can own such cars as the cash flow drain would be enormous. Read more...
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By Musicwhiz
Musicwhiz who is in his 30s is educated in accounting and works in the investment line (but not in a bank, financial institution, brokerage or fund house). He has a have a full-time job and investing is his side-line as well as passion. Musicwhiz is a value investor and his technique is derived from the teachings of Warren Buffett, Benjamin Graham and Phil Fisher. He incorporate all aspects of their investing style, and modify his value investing style to the Singapore market.
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