Facing my first correction

Tuesday 8 September 2015 22:28
Posted by owq 0 comments
It's been about a year or so since I started punting the stock market. I've heard horror stories about the great financial crisis. Bear markets. Corrections. This is my first test and I'm glad to say that I've passed it. I took the chance to rebalance my portfolio and sell some stocks to see whether I can hit the sell button in a market that's going down. I finally sold the STI ETF, which is a big chunk of my portfolio and one of my maiden acquisitions, to buy UOB which took a big hit and is now almost book value.

I think reading many books about value investing helped. As the stocks fell, the stocks just became so much attractive that it was hard not to buy them. Dividend yields rocketed. The margin of safety became wider. And I wished I had more cash to buy stuff.

There were people on the forums calling a bear market and expecting the fall to continue, extrapolating the down trend. People were asking if they should sell now and buy lower. I was not unaffected, for I decided to sell my Keppel Corp. In the end, it became an anxious game to try to sell it lower that I ended up buying it back at a big of a higher price.

Still, I think I survived. I don't know how I will feel if the market goes down even further, but I think I'll continue to buy.

Recent actions: Silverlake, UOB, Keppel, NeraTel

Tuesday 1 September 2015 12:39
Posted by owq 0 comments
Been trying to market time lately, selling Keppel, NeraTel, Mapletree GCC, Saizen REIT, STI ETF, before the market tanked further. Failed with Keppel and ended up selling low and buying high. I think it's not worth the trouble... It's so much easier to go long. I think I'll focus more on long term speculation rather than trying to predict short term ups and downs.

Silverlake Axis: Due to the short seller report recently, I managed to get this at half price. Don't know who panic sold right after the counter resumed trading. I was so surprised when my lowball offer got through. Anyway, until I see customers fleeing from this company, I'll keep this counter. It's a small position so I think the risk tradeoff is worth it. Some of the points in the short sellers report are a bit suspect, although they seem to make sense at first glance. For example, I really don't believe that they have no version control. Maybe I'll go for an interview and grill them about it if I ever have to job hop.

Datuk Yvonne Chia seems to be a fan of the shares and has been buying them on dips. Goh Peng Ooi's daughter has also recently became a director. There are many positive signs but the related party transactions could still remain a vulnerability.

UOB: I was planning to buy OCBC but the UOB dip made it very attractive as the price is close to book value. NPL could still be a problem, especially in China region, but the exposure is not that big. This is more of a rebalance from the STI ETF. I bought the STI ETF when I first started because of a lack of capital for diversification, but now I can afford to buy the constituents themselves. There are many companies in the STI that I don't feel comfortable holding or are overvalued. For example, commodities companies which have low profit margins. Or SIA. I don't believe in airlines, because the barriers to entry are low and regulation is very strict.

Keppel: I'm mainly buying this for Keppel Land. I don't really like the O&M sector because of high capex and long dated receivables. But I do think their shipyards have a competitive advantage. They are also going to acquire another shipyard in China from Titan (subject to restructuring finalisation). If you can't beat the China shipyards, join them.

NeraTel: I was considering either SingTel or this but I prefer small caps because the growth rate could be higher.