Author: (The) Boring Investor

A Look-Back at My Blog for 2016

2016 is drawing to a close and it is an opportune time for me to reflect on my blog for this year. Regular readers of my blog would know that my blog posts this year have tilted towards understanding the business of the industry/ company. This is most clearly manifested in the series of 14 Oil & Gas posts and a couple of sporadic posts in banks and Global Logistic Properties (GLP). This tilt towards business analysis is also reflected in my investments, with selective positioning along the O&G industry chain and a big investment in GLP. This shift...

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Why Is Protectionism A Concern For Singapore?

After the election of Donald Trump as US President, it has been said that his protectionist stance is bad for open, trade-reliant economies like Singapore. But what is trade? My idea of trade has stagnated since the secondary school days, when we learnt that Singapore had a thriving entrepot business due to its strategic location at the southern tip of the Straits of Malacca. Thus, if it is just the port business that is affected by protectionism, then it is not a very big deal, isn’t it?   However, on further thoughts, trade is not just about the port...

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Making America Great Again and Its Impact to Asia

  I delayed writing about the impact of Trump’s victory in the US presidential election, primarily because I wanted more time to observe his policies. However, since US Fed is meeting this week to discuss interest rate rise, I will pen down my current thoughts. Things will change, as Trump might adjust his policies after he becomes president.   Since Trump’s surprise victory, stock markets have rallied strongly. Part of the reasons has to do with some of the positive policies proposed by him, such as infrastructure spending, tax cuts, reduced regulations on banks, etc. If enacted, these policies...

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Being A Co-Owner of GLP

It is often said that buying shares in a company means becoming a co-owner of the company. However, what does it really mean to be a co-owner? After my large investment in Global Logistic Properties (GLP), I finally understood what it means. Usually, for any investment, if the company is not doing well, I could simply sell and walk away. But when I initiated the 15% to 20% concentration in GLP, I told myself that there shall be no exits. If GLP sinks, I sink as well. Hence, I have to understand the business very well and monitor the...

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My Roller Coaster Ride with GLP

There is a Chinese saying for relationships: “You come together because of misunderstanding, and you separate because of understanding”. When it comes to stock investments, I find that this saying applies as well, at least for me. When I am thinking of buying a stock, the stock would tend to look attractive, even though I would study its financial statements carefully before buying. As the saying goes, the grass is always greener on the other side. However, after I have bought the stock, I would follow its announcements closely and realise that I have not understood the stock well...

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The GLP Story

It has been about a year since I started to build a large position in Global Logistic Properties (GLP). The company initially caught my attention when it bought back a large chunk of its shares. For the Financial Year ended Mar 2016, it spent about SGD222 million in share buybacks. If a company could spend so much money in share buybacks, it must be doing something right. That set me to investigate and understand the company further. GLP is a logistic property developer. However, it is not solely a property developer; it is also a REIT and a REIT...

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The Minions (Millions) Mentality

Last week, I blogged about the minions in my portfolio, i.e. small, speculative positions in loss-making companies with reasonable chance of turning around. Although small, they have the potential to become multi-baggers. I also mentioned the advantages of minions, which are: (1) they serve as incubators for further investment should further evidence of the company turning around emerges and (2) “risk-free” positions to counter the high risks involved in investing in some companies and industries, such as the Oil & Gas industry. You can refer to Meet The Minions for more info. However, the minion strategy goes beyond these...

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Meet The Minions

I have a bunch of speculative shares which I affectionately call “the minions”. The characteristics of the minions are: small speculative positions in loss-making companies with reasonable chance of turning around. The idea behind the minions came about from a realisation that one source of multi-baggers is loss-making companies that manage to turn around. You can refer to How to Get a Multi-Bagger? for more info. The turnaround multi-bagger I had was Magnecomp, now known as Innotek. It was a chance occurrence because I usually avoid loss-making companies. However, one of the main problems with value investors is that...

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SSB Interest Rate Estimates – A Year On

Some readers might know that I run a parallel blog at (The) Boring Investor’s Statistics that shows some of the investment statistics that I monitor on a regular basis. One of these statistics is a forecast of the interest rates of the Singapore Savings Bonds (SSBs) to be announced in the upcoming month. The interest rates for the SSB to be announced in the following month is based on the average yield (i.e. interest rates) of the Singapore Government Securities (SGS) benchmark bonds in the current month. As an example, the SSB to be announced in Nov (and issued...

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Singapore Savings Bonds – A Year On

It has been a year since the launch of the first Singapore Savings Bonds (SSB) in Oct 2015. How have the interest rates of SSBs changed in this 1 year and how have they performed relative to the more conventional government bonds, namely, the Singapore Government Securities (SGS)? Fig. 1 below shows the 10-year interest rates of SSBs (red line). The interest rates are computed as the average of the benchmark 10-Year SGS interest rates (blue line) over the previous month. (Note: There is always a confusion over the “month” of the SSB. The SSB announced in Oct is...

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What is My Target Price?

A reader asked me what was my target price for a particular stock in one of my blog posts. I was stumped for a while, and realised that I do not really have a target price for my stocks! I do have valuation limits on what price I could buy or sell a stock, but they are not the same as target prices. Let me elaborate further on the buy side and sell side separately. Buy Side Having a target buy price suggests that there is a particular stock that you like to buy but is waiting for the...

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How Should I Defend Against the Next Market Crash?

Barely 2 weeks after I wrote The Exit Might Be Narrower Than Expected, both British Pound (GBP) and Gold demonstrated what I have been worrying about. In a space of 1 week, GBP dropped by 3.8% while Gold dropped by 4.4%. GBP dropped after the British Prime Minister announced a timeline for starting Brexit talks with the European Union while Gold dropped on renewed fears of US Federal Reserve raising interest rates on the back of an improving economy. In particular, on Fri, GBP dropped 6.1% within 2 minutes. The sudden drop was rumoured to be caused by a...

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What is Holding Up US Share Prices?

If you had read my previous post on What Have We Got After 8 Years of Easy Money?, you would know that the US equity market has gone on an 8-year bull run even though many industries (at least those in Singapore) are facing poor business and/or low margins. Fig. 1 below shows the performance of S&P500 index since 2012, which is mostly on a straight upward trendline. Fig. 1: S&P500 Index Since 2012 Yet, when you look at the earnings of S&P500 companies over the same period, they have been relatively flat. See Fig. 2 below (source: Cash...

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The Exit Might Be Narrower Than Expected

As expected, but disappointingly, US Federal Reserve did not raise interest rates on Wed. The reasons for my pessimism for the current economic conditions are explained in What Have We Got After 8 Years of Easy Money? Unless we see evidence of coordinated fiscal stimulus from governments around the world to increase aggregate demand, more liquidity via easy monetary conditions will only lead to more value destruction as we have seen so far. Given the precarious investing environment, I have been gradually taking money off the table and building up my defences, before everyone else starts to rush for...

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What Have We Got After 8 Years of Easy Money?

2 unusual events happened in July. The first was the Brexit referendum, in which Britons unexpectedly voted to leave the European Union, but the stock markets, equally unexpectedly, did not crash. Within 4 trading days, the Straits Times Index was back to where it was before the vote. It turned out that the markets had correctly predicted that central banks around the world would rush to loosen monetary conditions further to avoid a market crisis from developing because of Brexit. The second was the yields on 10-year Singapore Government Securities dipped below the interest rate of a 1-year fixed...

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