TheFinance.sg » Market Uncle

Happy New Year!!!

Market Uncle — Sat, 31 Dec 2011 16:10:00 +0000

Though I can’t really find the time to blog anymore (at least in the near future), I can still squeeze a few minutes to wish all a very happy new year. May 2012 be a better year for all! Huat ah!

2 predictions I’ll like to voice out (just for fun, for serious readers, please stop reading):

#1. The worst should be over for Euro-zone, its just too big to fail, sounds familiar?…

Can Feng Shui predict the stock market?

Awaiting my 2nd buddle of joy

Market Uncle — Sun, 08 May 2011 02:55:00 +0000

Almost exactly two years after my 1st bundle of joy turn into a cheeky toddler, ‘terrible two’ that many called one, I’m expecting another one to join us to make this a noiser and messier home. I find balancing my limited time amongst family, work, investing, blogging and photography a very difficult task, especially when I need to dedicate much more time amongst the first 3. I am aware of my priorities, as much as I need to make tangible investments from the resouces generated from my work, I also need to make intangible investment of my time in my family. Thus blogging and photography (the only ‘brainless’ hobby that I can indulge in to let my brain rest) will have to take a back seat. If opportunities arose, I will still write an article or two. Otherwise, it will be a long while before I can return to serious …

Watch out for the Intangibles!

Market Uncle — Sat, 05 Mar 2011 05:41:00 +0000

Motivation

A friend recently approached me to help him take a look at Healthway Medical. Once of the most glaring thing that struck me when I thumbed through its latest financial statement was the huge intangibles on its balance sheet. After I explained to him my concerns, I thought I might as well highlight it on my blog too.

Risk of high intangibles

Intangibles on the balance sheet arose primarily from when a firm acquires another business and pay a price higher than its the net tangible assets. This translates into goodwill that the acquiring company reports. Another common intangibles can be copyrights or patents that royalties can be collected. Whichever it is, intangibles have to be revalued periodically and amortized (write down) accordingly if necessary. Basically, intangibles are valued by how much revenue it can generate, forecast into the future, and discounted to present value. Thus should any estimated …

STI vs SGS bond yield

Market Uncle — Sat, 15 Jan 2011 07:59:00 +0000

Just being curious

One of the common finance wisdom states when the economy is booming, funds shift from bonds to stock market for better returns (surging stock market and rising yields in bond market). During a recession, the opposite occurs where money exits stock market to seek refuge in the bond market, further depressing the meager yields.

Thus I was curious to find out whether this relationship actually holds true over a long run. If so, will there be a relatively reliable yield to serve as an indicator to enter or exit the market? i.e. going into the stock market when bond yields drop below a certain threshold and exiting when yield surge beyond another value? Even before I look further, I already knew things shouldn’t be so simple, so its more for fun rather than a serious exercise to change my current investment strategy which already worked well …

Portfolio update for Q4 2010

Market Uncle — Sat, 18 Dec 2010 05:51:00 +0000

The past 3 to 4 months is a rather rewarding period for me. I had been busy restructuring portfolio and at times, havesting the sweet returns from the seedlings planted during the recent global financial crisis.

Switched from Food Junction to Food Empire on 16 August 2010

While Food Junction continue to struggle in its food court and F&B segments (~2% drop in revenue and 20+% drop in profit), Food Empire’s business surprisingly rebounded with a spectular recovery of 60% increase in revenue and nearly 70 fold increase in profits. Fortunately, food junction is very thinly traded all these while that I’ve invested so that I didn’t really suffer material loss on the sale. Even more furtunate that no one seemingly cared how well Food Empire recovered so that I can buy more of its shares cheaply. If I can trust their opinions about their business outlook, I’d rather bet …

Subprime Crisis, Singapore’s version?

Market Uncle — Fri, 26 Nov 2010 14:59:00 +0000

The Year 2006

A few years ago, my wife and I are the ‘fortunate’ few to buy left over HDB flats under the walk-in scheme. As the flat came in standard condition, i.e. totally bare, we visited a few condominium showflat for renovation ideas. My wife was tasked to absorb as many ideas as possible while I entertain the agents as a prospective buyer. That was when I started to pay attention to the loan, interest rate etc.

Most mass market private property then was going around $600,000 for a 3 bedder of equivalent size to a 5 room HDB. Based on our combined income, the maximum loan the bank would grant us is sufficient to service the maximum 90% valuation of the property, as allowed then.

The Year 2010

With the economy out of recession with an expected double digit GDP growth for the full year, demand for …

Subprime Crisis, Singapore’s version?

Market Uncle — Fri, 26 Nov 2010 14:59:00 +0000

The Year 2006

The Year 2010

With the economy out of recession with an expected double digit GDP growth for the full year, demand for …

The yearn for financial independence

Market Uncle — Sun, 31 Oct 2010 13:15:50 +0000

Photo by circo de invierno

Have you heard from Robert Kiyosaki, the author of Rich Dad Poor Dad?

“Have you heard from Robert Kiyosaki, the author of Rich Dad Poor Dad?..” I heard this many times and this has ALWAYS been the starting line to introduce some MLM (Mulit-level marketing), land banking or other ‘alternative’ paths to financial independence quickly. I get to hear this again just a few days ago. My wife’s friend offer to share with us, over breakfast, a business scheme that will bring us to financial Independence in 2-5 years. Her only prerequisite for participants who want to benefit from this business is to sacrifice several hours a week. My alarm bell went off immediately when she mention 2-5 years and rang even louder at the weekly effort required to succeed in the business. Anyway, it didn’t take long before she got to the point, being a sales agent for Amway… and of course, nothing fruitful emerge at the end. Anyway, tt seems to me that my wife had an affinity with acquaintances, friends or colleagues dealing with MLM business. Recently, while accompanying my wife to meet up with her piano blog reader on a premise for some discussion (she thought it has to do with piano or music in general) that turn out to be a presentation on e-spring water filter system, which also happen to be another product from, yes Amway again. Read more…

The yearn for financial independence

Market Uncle — Sun, 31 Oct 2010 03:11:00 +0000

Have you heard from Robert Kiyosaki, the author of Rich Dad Poor Dad?

“Have you heard from Robert Kiyosaki, the author of Rich Dad Poor Dad?..” I heard this many times and this has ALWAYS been the starting line to introduce some MLM (Multi-level marketing), land banking or other ‘alternative’ paths to financial independence quickly. I get to hear this again just a few days ago. My wife’s friend offer to share with us, over breakfast, a business scheme that will bring us to financial Independence in 2-5 years. Her only prerequisite for participants who want to benefit from this business is to sacrifice several hours a week. My alarm bell went off immediately when she mention 2-5 years and rang even louder at the weekly effort required to succeed in the business. Anyway, it didn’t take long before she got to the point, being a sales agent for …

Financial magazine review(s)

Market Uncle — Tue, 28 Sep 2010 10:00:05 +0000

Photo by ir0cko

Motivation

I have been faithfully subscribing and reading the Economist and the Edge for the past few years (ever since I started investing) until I decide to stop the latter. Instead of just saying why am I dissatisfied with The Edge, I might as well write a simple review of the three finance or business magazine I deemed useful for my interest.

The Economist, my main workhorse of info after the newspapers

Besides the news on papers or over the Internet, I get the most useful geopolitical, macroeconomic information from The Economist. Though I might not agree with all the articles, some are actually biased collection of facts to shape reader views, most articles are nicely written and well argued, especially the articles in the ‘Business’ and ‘Finance and economics’ sections. I like it most whenever there are ‘special’ coverage of a particular topic, e.g. the economy of a particular country, her strengths and weakness, her challenges and opportunities. Price-wise, it really depends on how good a deal one can squeeze from the distributing agent. I always bargain for a 2-year subscription (at quite a steep discount to newsstand price) at the World Book Fair and get the agent to throw in 1-year subscription of any magazine for free (that’s how I got The Edge). Anyone with an even cheaper but timely alternative (other then reading from the library free) please let me know. Thanks!

The Edge, thanks but no thanks
Read more…

Financial magazine review(s)

Market Uncle — Sat, 25 Sep 2010 01:50:00 +0000

The Economist, my main workhorse of info after the newspapers

Investing is similar to gambling?

Market Uncle — Tue, 21 Sep 2010 10:00:16 +0000

Photo by conorwithonen

Motivation

I read with interest an article published on Asiaone “Casino not so different to stock investment“:

In the article, Kwon Oh-nam, CEO of Grand Korea Leisure, South Korea’s leading foreigner-only casino was quoted as saying:

“… Some people get so obsessed with stock investment that they sit in front of the computer monitor to check Dow Jones all night long. Even if they do, some lose big money, but such cases are not criticized as much as gambling…”.

src: http://news.asiaone.com/News/Latest%2BNews/Asia/Story/A1Story20100916-237501.html

This is something I totally disagree. Hey, that’s not investing, that’s stock speculation! And yes, to all things in life, there are plenty of opportunities to speculate, not just in stocks and casino, but in properties, commodities, currencies etc.

Stock investing vs Gambling

I’ve been to a casino once only, the one in Genting Highlands with my wife. We changed RM$50, yes one single $50 note, to chips and played at the “big-small” game table. Our chips are too few to warrant a seat, so we just stand around. We played till we are left with with $10 chips and en-cashed them back to cash, to ‘complete’ the ‘process’ of ‘gaming’ experience at Genting. I’d say the experience is thrilling and fun… at one point we almost doubled that $50 we started with and that occurred in less than 30 minutes of play. Such quick and solid returns can only occur in a gambling environment. Read more…

Investing is similar to gambling?

Market Uncle — Fri, 17 Sep 2010 14:48:00 +0000

Motivation

I read with interest an article published on Asiaone “Casino not so different to stock investment“:

In the article, Kwon Oh-nam, CEO of Grand Korea Leisure, South Korea’s leading foreigner-only casino was quoted as saying:

src: http://news.asiaone.com/News/Latest%2BNews/Asia/Story/A1Story20100916-237501.html

Stock investing vs Gambling

I’ve been to a casino once only, the one in Genting Highlands with my wife. We changed RM$50, yes one …

Stubborn HDB Property Bubble?

Market Uncle — Mon, 30 Aug 2010 10:00:14 +0000

Some of my friends painfully resisted buying a flat for the past few years, hoping that the property bubble will pop when the global recession erupted. But to their disbelief, the prices and cash over value (COV) continue to defy gravity and broke new highs. This prompted me to take a closer look at this bubble, why is it so stubborn!?

Demand

Looking at the past prices (available data from 04 to present):
src: http://www.hdb.gov.sg/fi10/fi10321p.nsf/w/BuyResaleFlatResaleIndex?OpenDocument

it can be seen HDB resale prices hit the bottom and remained there after ’97 Asia Financial Crisis to late 2006. Though this period included the dot com bust (2000 to 2002) and SARS crisis (2003), there is still generally good economic and population growth (local + foreign). Thus it is quite unthinkable that demand for flats will remain stagnant for nearly 10 years! Read more…

Stubborn HDB Property Bubble?

Market Uncle — Sat, 28 Aug 2010 01:33:00 +0000

Demand

Looking at the past prices (available data from 04 to present):
src: http://www.hdb.gov.sg/fi10/fi10321p.nsf/w/BuyResaleFlatResaleIndex?OpenDocument

Supply

From HDB FAQ, it can …

Portfolio restructuring over the last 4 months

Market Uncle — Tue, 17 Aug 2010 01:00:09 +0000

Photo by jared

Partially divested First Ship Lease Trust(FSLT) into Pacific Shipping Trust(PST) on 29 June 2010

I can count myself ‘unlucky’ that FSLT had 2 of its ships returned prematurely and took a big hit to its total outstanding contractual revenue and just blame this on the ‘business’ risk. But looking further into the business to understand that the risk is actually much higher than I thought actually attributes more blame to myself. The high yield comes at a price that I sadly have to pay. Most of the contracts are made when shipping rates are over inflated and ships overvalued. When all things come crashing down, the odds are basically heavily stacked against FSLT. It is already fortunate that only 2 ships are returned. The only good news in this midst of this gloom is that the worse for shipping seems over. Though the global economy is still not on firm footing for full sustained recovery, at least the chance of another big recession is quite slim.

I have a habit of raising funds from one sector and putting them back there. Though this make no investment sense, but nonetheless, its just my preference. I decided to divest part of my FSLT into PST. PST also have simiar structure like FSLT but with a more sustainable distribution payout policy and loan repayment scheme. Its recent distribution accretive acquisition is the main factor that entice me to cross over. Though I’m aware that they do not yet have the funds to acquire them and most probably will require equity raising in late 2010 or early 2011, I believe the yield will still be higher post capital raising.

To put things in perspective. There are two deep cyclical sectors I’m vested, Shipping and Oil & Gas (O&G) Support. Both are still going through pretty bad storms (poor demand and oversupply of vessels) and no one can tell when the storm will blow over. But I’m pretty sure when the sunlight burst through the clouds, the returns will be good. No better time to invest other than bad times. Read more…

Portfolio restructuring over the last 4 months

Market Uncle — Sat, 14 Aug 2010 01:39:00 +0000

Partially divested First Ship Lease Trust(FSLT) into Pacific Shipping Trust(PST) on 29 June 2010

Shopping vs Investing, behaviour peculiarity

Market Uncle — Tue, 10 Aug 2010 10:00:27 +0000

Photo by erix!

Sale!!!

Whenever there is some genuine sale giving ‘huge’ discounts, e.g. 50%, 70% off original price. There’ll always be enthusiastic crowds grabbing the items as if things are going for free. I recently encountered one for branded handbags near my working area. Most shoppers are predominantly ladies who seems to have a mental database of each item and their prices. They knew their ‘true’ worth and face no problem telling which are the real bargains. Thus seldom do I see them regret their purchases.

Stock market sale

While Great Singapore, Christmas sale happens regularly once a year and some sales never seem to end (e.g. Courts), sales in the stock market occur much more unpredictable and sporadic. In contrast to sales in Orchard Road that drew crowds, sales in the stock market scare away people. The greater the discount, the thinner the trading volume. Read more…