TheFinance.sg » AK71

China Hongxing: Breakout.

AK71 — Sun, 25 Jul 2010 03:28:12 +0000

The last time I wrote about China Hongxing was on 3 July. At that time, there were still mixed signals.

On Thursday, two sessions ago, there was a buy signal on the MACD histogram and the MFI broke out of its downtrend. Volume expanded 10 times in the last session as price hit a high of 14.5c. Read more…

Saizen REIT: An update.

AK71 — Wed, 14 Jul 2010 15:59:35 +0000

Saizen REIT has seemingly gone into hibernation. For more than a month, its price has fluctuated between 16c and 16.5c. The daily MAs have all flatlined. Some may wonder if I am still interested in this REIT. Well, I am still very much interested in this REIT. It remains one of my top three investments in the stock market. Regular readers of my blog would know that I believe it to be a very good investment with more than a fair bit of potential to deliver an attractive yield and possibly an even more attractive capital appreciation.

Today, the technicals are rather interesting. Of course, with volume so thin, it could just be a mirage but let us do this just for fun, if nothing else. Read more…

FSL Trust: The skies are clearing up.

AK71 — Sun, 11 Jul 2010 14:45:39 +0000

Price stayed above the 20dMA in the last three sessions. The 20dMA, currently at 38.5c, is now resistance turned support. I decided to look at the 20dEMA as well. The EMA gives greater weightage to recent prices and could sometime explain why price could not move past a certain point in the short term. The 20dEMA is at 39.5c and seeing the price closed at 40c in the last two sessions is comforting. However, the volumes were very low and the durability of the recent appreciation in price is questionable. In fact, since a spike in volume on 18 Jun when the MACD made a bullish crossover with the signal line, volume has been reducing.

Let us look at some other technical indicators to gain more insights. Read more…

CapitaMalls Asia: Weakening technicals

AK71 — Mon, 28 Jun 2010 14:07:44 +0000

CapitaMalls Asia broke out of its symmetrical triangle on 16 Jun on higher volume. It then went on to break resistance provided by the declining 100dMA which coincided with the trendline resistrance on 21 Jun. It was not able to advance much further and I suggested looking at the 100dEMA which made it clear why it was so.

In the last session, support was provided by the rising 20dMA and a short white candle was formed. The 20dMA in recent sessions has merged with the trendline support and, theoretically, should be a strong support. This is the third time this trendline support has been tested. If a trader had bought some shares of CapitaMalls Asia each time its price tested this trendline support, he would have made some nice gains. So, is it time to buy again? Read more…

Charts in brief: 16 Jun 2010.

AK71 — Thu, 17 Jun 2010 01:00:11 +0000

Golden Agriculture: Price rose and met resistance at 55c as expected. The falling 50dMA and 100dMA both approximate 55c which makes this a strong resistance. If this could be taken out, we could likely see a target of 57.5c which is where we find the 138.2% Fibo line. This is also a gap resistance.

AIMS AMP Capital Industrial REIT: The fourth gravestone doji in seven sessions. 21.5c is being tested vigorously as the immediate support. MACD has dipped into negative territory while the MFI and OBV have flattened. The loss in buying momentum is obvious. Read more…

FSL Trust: A crisis or an opportunity?

AK71 — Mon, 14 Jun 2010 13:15:59 +0000

I still have units of FSL Trust which were bought at an average price of S$1.00 per unit. By any stretch of imagination, I cannot foresee FSL Trust trading at S$1.00 per unit in the next few years, if ever. I have kept these units in a frozen portfolio together with a few other stocks to remind myself of the mistakes I made.

As FSL Trust enjoyed a recovery in unit price and was trading at an average of 60c for about a year till the first few days of May 2010, reaching a high of 69.5c in July 2009, I advised potential investors that it is still a risky investment. The primary reason why I consider FSL Trust to be a risky investment is its indebtedness.

As of 31 March 2010, it had bank loans of US$484.6m. This has been reduced to US$ 477.1m after another loan payment was made in April 2010. FSL Trust makes quarterly loan payments. About half of the loans will mature in April 2012 and the rest are maturing in March 2014. Although its vessels are valued at US$826m, it only has US$56m in cash and cash equivalents as of 31 March 2010. Read more…

Create more passive income with limited capital

AK71 — Mon, 31 May 2010 01:00:28 +0000

Photo by Refracted Moments™

I have blogged about how Warren Buffet is a “know something” investor whereas I started out as a “know nothing” investor to being a “know a bit more” investor and, now, a “know a bit more than a bit” investor. Warren Buffet buys a lot of something which he thinks is a winner whereas for the rest of us it seems that diversification is the way to go. See: Excuse me, are you an investor?

Obviously, as is seen in my blog’s header, I am more interested in building a reliable passive income stream than anything else. So, yield is a big thing for me and REITs naturally have a role to play in my strategy.

The meltdown in the global stock markets after the Lehman Brothers crisis shocked me out of complacency and into action, action which saw me beefing up my FA and picking up TA. I refused to be beaten and I was furiously reading and updating my knowledge, reviewing my past mistakes and planning for the future.

REITs are a big part of my portfolio and they gave me much angst during the crisis. I also blogged about the lessons learnt. See: High yields: Successes, failures and the in betweens.

I went on to accumulate more units in REITs which met my selection criteria and currently the top three holdings in my portfolio are REITs. They are Saizen REIT, AIMS AMP Capital Industrial REIT and LMIR. These are all trading at big discounts to their respective NAVs, they have low gearing (or in Saizen REIT’s case, lowered gearing) and high yields (or in Saizen REIT’s case, potential high yield).

I was not a unitholder of Saizen REIT when they recapitalised. I do not have any historical baggage. I only looked at the numbers in mid 2009 and decided that there was immense value and that there was potential for a very high yield when income distributions resume. Today, the fundamentals have improved and my opinion has not changed. Persistent insider buying suggests a high level of confidence that the REIT is undervalued and that income distribution will resume as promised. I also like the fact that Credit Suisse is now a major unitholder of the REIT. See: Saizen REIT: 3Q FY2010 results. Read more…

Do not fear the selldown

AK71 — Mon, 24 May 2010 06:00:30 +0000

Photo by Look Into My Eyes

It is safe to say that there is a lot of fear in the air. Palpable? Almost. What are we to do? Well, I am sure everyone has his or her own opinion as to the best strategy in such a situation. Maybe, I shouldn’t be so sure. So, what do I think? Well, I have been sharing my thoughts in this blog and what I now think is largely the same as before.

For a stock which is clearly in a downtrend, sell into strength at resistance. It might be a lower high but it is still a high. We don’t want to sell at a low. Then, wait patiently for it to form a base or to rebound and form a higher low. It would be safer to take up a long position then.

Not all stocks are in a downtrend. For stocks of businesses with strong fundamentals with their uptrends still intact, buying at supports is still the way to go. Look to the technicals for possible negative divergence as a warning sign. Certain stocks might be rangebound and if the businesses have strong fundamentals, buying at the support of the trading range is what I would do. Read more…

STI at 2,425 points?

AK71 — Tue, 18 May 2010 01:00:55 +0000

What we have is a sea of red. Sentiments have not been so bearish in a long time as the HSI sank below 20,000 points. I continue to believe that any rebound that comes along in the near future should be an opportunity to reduce exposure in the stock market. This is more so for stocks which are clearly in a downtrend. Having said that, the STI is holding up rather well under all the selling pressure.

As the index retreats, the OBV declines. This is an obvious sign of distribution. The MFI has been forming lower highs and lower lows. Positive buying momentum is lacking. In the near term, the 2,780 level or so should be an important support. This is confirmed by Fibo lines, the rising 200dMA as well as candlesticks. Read more…

Saizen REIT: 3Q FY2010 Results.

AK71 — Sat, 15 May 2010 06:00:25 +0000

Photo by Hythe Eye

A good set of numbers overall for Saizen REIT. The only thorn in its side remains the CMBS for YK Shintoku which it defaulted on late last year.

Key points for me:

1. Saizen REIT’s properties are all Freehold and not Leasehold. So, there is no “depreciation” which some investors might be concerned about.

2. Occupancy rates have been consistently above 90% even through the financial crisis which reinforces the idea that demand is relatively inelastic for Saizen REIT’s properties. Read more…