February 2009 Portfolio Summary and Review

February 2009 can be summarized as a month in which the entire world’s economy deteriorated further, and one can read juice bad news in the papers on an almost daily basis (hourly, if you subscribe to “Breaking News” service by Straits Times). So for those with a morbid fascination for pessimism and depressing news, just tune in every hour to either Bloomberg, CNN or CNBC for the latest bad news. … [Read more...]

In my opinion – GIC’s decision to convert its CitiGroup preference shares into ordinary shares now, is a mistake

I read on the front page of the Straits Times on February 28 that GIC had decided to convert its US$6.88bn (S$10.6bn) in CitiGroup preference shares into ordinary shares at a price of US$3.25 per share instead of the original conversion price of US$26.35.  According to the article, GIC's conversion at this time would pare its losses from 80% to 24%.  As a result of the lower price, GIC's stake in … [Read more...]

US markets remain volatile as Geithner stress tests its banks…..Singapore Q4-2008 GDP growth falls 4.2% yoy and 16.4% qoq

The flow of negative news in the US and Singapore continues.....this is not unexpected but tells us that the market has probably some way to its bottom.....as we need to at least some signs of the negative news flow either being expected or at least plateauing out before a bottom can be formed. The strong rally in the US markets the day before could not be sustained with the Dow opening sharply … [Read more...]

Is there a lesson to be learned from Ferro China, China Print & Dyeing and now FibreChem?

Who should take responsibility for these problems? I was disappointed to learn about the problems at FibreChem yesterday but am glad that the independent directors have taken decisive action such as the appointment of N-Tan to investigate the matter.   But these are events are after the fact......I think the authorities/regulators should look at these three companies and see if there is a … [Read more...]

China Fishery – FY 2008 Analysis and Comments

China Fishery (CFG) had released their FY 2008 financials some time back, and I had the chance to do a detailed review of the Company's financials. Suffice to say that I was not entirely happy with the numbers that I saw, and a few aspects of the financials caused me a considerable degree of worry and consternation. However, my fears were assuaged due to the fact that a lot of the debt in CFG's … [Read more...]

Tat Hong featured in The Edge Singapore

The Edge has a 2-page article on Tat Hong and Mr. Roland Ng. I shall not reproduce the full article here due to copyright issues, but I will do a summary as follows. For more details get a copy of The Edge at $3.80. Tat hong faces weaker demand and currency volatility, analyst opinion divided 1) Roland Ng says Tat Hong has "the right business model", and he believes the pace of building … [Read more...]

What did Dr Doom (Marc Faber) and Dr V Nageswaran (Dr Doom 2 of Bank Julius Baer) say at their seminar last Friday?

...how does it compare to my thoughts... Last Friday, I was invited to Business Times dialogue with Dr Marc Faber - The Financial Crisis - where we are now and where we are headed.  Also presenting was Dr V Nageswaran from Bank Julieu Baer. The Ritz Carlton Ball room was packed. We had the pleasure of two Dr Dooms and rather than go through what they said - I will just summarise what I think … [Read more...]

Property prices, how much lower can it get?

I read with interest an article published today on Sunday Times, 22nd February 2009, Keen to cash in on mortgage sales? Quoting from the article, ... potential buyers are "coming in floods", asking to be on her company's list or calling about properties on offer. ... but it is very difficult for us to strike a deal because the buyers are putting in very low offers. They want to go only for a … [Read more...]

Art of Survival

The art of war teaches us to rely not on the likelihood of the enemy's not coming, but on our own readiness to receive him; not on the chance of his not attacking, but rather on the fact that we have made our position unassailable." - Sun Tzu, The Art of War The art of survival teaches us to rely not on the likelihood of the LOSSES's not coming, but on our own readiness to receive him; not on … [Read more...]

Searching for the next “BIG” one for 2009

Every crisis brings with it opportunities to make a lot of money if you pick a winner.  A seasoned fund manager and I were having lunch recently and he mentioned that the "BIG" one in the 1997/98 financial crisis was Tan Chong International......Big to him meant that the stock went up at least 15 times.  The chart below shows what he meant. The stock went from a low of S$0.13 to a high of … [Read more...]

Stock picking is part science, part art, part luck, part tuition, and always uncertain – “not precisely knowing.”

A while ago I could have been convinced that if I put in a lots of effort into FA , TA and watching the market closely to gain knowledge, skills, market view, and a lots of experience, and with intelligence would produce some good returns from the stock market. But, while the intelligence and experience will help me avoid unnecessary risks, apply money management, reduce day-to-day emotional … [Read more...]

Gambling Vs Investment

I remembered reading “Secrets of the Millionaire Mind” by T.Harv Eker sometimes back about how rich people believe in creating their lives and poor people believes that life happens to them. Rich people work towards their wealth and poor people blame everyone for the predicament they are in. Rich people put most of their money to invest and grow their passive income and poor people put a large … [Read more...]

Financial Institutions are Your Friends – Some ramblings about Structured Warrants

We stumbled upon this advertisement in Singapore from a financial institution and thought what great marketing material it was. What they wrote seem to imply that their hedging strategies are perfect ( second paragraph) and any gain to the warrant holders are taken from the losses of the warrant issuers' counter party whom they entered into positions with to hedge their warrant positions. Its … [Read more...]

Technical Analysis- A somewhat scientific look

I like reading the Review segment of the Straits Times because there are occasionally interesting analysis, and Andy Ho sometimes has interesting articles. This guy writes extensively on a variety of topics ranging from health to science to philosophy to political systems to economics ... all of which interest me (save maybe for health). Saturday's article in ST is the inspiration for this latest … [Read more...]

Negative Equity – Can you can survive out of it?

Your brokers love you most if you use leverages and margins for trading. Why? The rules are there to protect them but definitely not you. If you got it wrong, you are wiped out due to your own greediness. Your brokers WILL NEVER LOSE. Your BROKERS ARE NOT YOUR FATHER OR MOTHER!. They exist to make money for themselves, but they always seem to be there to HELP you to make money. They also appear to … [Read more...]

Stocks vs Futures

Although trading stock index futures are considered higher risk and more sophisticated than trading individual shares, and will require more time & effort to master, there are many advantages to trading futures compared to shares. No need to cherry pick - How many times have you bought Share A, but Share B went up or the share price fell even when the STI or Dow Jones rallied. With stock … [Read more...]

DBS reports 40% fall in Q4-08 profit while full year FY08 net profit declines by 15%…..

DBS reported a 40% decline in Q4-2008 net profit to S$295mn while full year FY2008 net profit fell 15% toS$1.92bn.  Allowances for credit and other items rose 48% in Q4 and 82% for FY08 while one off item rose 31% in Q4 and declined 39% for the full year.   NPLs rose to 1.5% from 1.1% while Total Capital Adequacy was 14.0% up from 13.4%.   I am not our bank analyst and my views may differ from … [Read more...]

Getting Whipsawed!

Whipsaw is a wonderful description of a trade. Specifically you buy some stock, it goes down 20% and you sold out, intending to preserve whatever capital you have left. And the next thing you know, the stock goes but 100%! Shiok right! Actually the fear of getting whipsawed is so great that it causes a lot of investors to make silly mistakes. But if you think about it, even if you really get … [Read more...]

How Much is Enough?

In case you were wondering that the title implied that this post will be about money, you're not too far off. But for this case, it's meant to ask how much money is required to "flood the system" to enable the USA to lift itself out of this persistent downturn. Just yesterday, the US$838 billion "Financial Stability Plan" was approved by the Senate and it was prepared by the new Obama … [Read more...]