Portfolio update - closed positions (2017 Aug - 2017 Oct)
The first thing I realize in these few months of investing journey is: Market is often not efficient, that's why we can gain. Below is the update of my closed positions during the period. All prices and P&L+Div% has taken brokerage fees into account.
As the amount for each transaction is less than 5k, the brokerage fees is actually quite substantial (1-2% of transaction value). My broker friend asked me why I chose to invest in many stocks with small amounts, instead of focusing on one or two stocks. My answer is that I want to grow faster by having more investment experience, so I don't mind small gain (no loss please) at the start of my journey.
01: Hi-P
Buy: Went in for bumper dividend of 0.19c.
Sell: Price gone up to level equals to dividend gain. Satisfied with such a gain within short period, I quickly cashed out.
Aftermath: Price of Hi-P gone through few stages:
02: Valuetronics
Buy: Quick punt, thought BB was going to push this up
Sell: Price went downtrend instead, quickly sold off.
Lessons learnt: BB buy doesn't mean BB will push, buying purely based on BB's move is a dangerous speculative play. Somemore, they are always buying and selling.
03: Sincap
Buy: Shocked by 1000% increase in gross profit, went in unconsciously
Sell: Price stayed stagnant for few days, managed to sold at the same price with brokerage fees loss.
Aftermath: Price slipped all the way to 0.15, seriously.
Lessons learnt: Never buy a stock without studying its background, doing so is worse than gambling. I should count myself super lucky didn't get burn for buying this penny without thinking.
04: Chuan Hup
As the amount for each transaction is less than 5k, the brokerage fees is actually quite substantial (1-2% of transaction value). My broker friend asked me why I chose to invest in many stocks with small amounts, instead of focusing on one or two stocks. My answer is that I want to grow faster by having more investment experience, so I don't mind small gain (no loss please) at the start of my journey.
01: Hi-P
Buy: Went in for bumper dividend of 0.19c.
Sell: Price gone up to level equals to dividend gain. Satisfied with such a gain within short period, I quickly cashed out.
Aftermath: Price of Hi-P gone through few stages:
- After XD, the price shooted up to pre XD price, which was crazy. As company gave too much dividends, people were speculating that company could be buyout.
- Then, the company clarified the rumour, and the priced gone down, but still higher than XD price.
- Went on super charging bull after profit guidance issued and amidst tech bull sentiment.
Lessons learnt:
- Some says it's zero sum game to go in when company announces dividends, as price drop after XD will cancel out dividend gains (Market efficiency). This is obviously wrong given how the events unfolded for Hi-P. Bumper dividends in this case illustrates financial strength of the company and boost investors' sentiment towards the company, and lead the price higher.
- It's both lucky and unlucky for me to have bought Hi-P as my first stock. Lucky being that I earn quick profits and boost my risk appetite (as in I can buy other stocks with more confidence knowing that the worst scenario is that I give up my gain on Hi-P). Unlucky being that by selling this, I have set my sights on other stocks and did not study into it further and miss out perhaps the strongest bull in these 3 months.
- Next time when company issue bumper dividends, I am more inclined to think that the company is doing good and have a bright outlook, and I should hold on to the stock. Because if the company is not confident about business outlook, why would it deplete substantial amount of cash just to reward shareholders?
Buy: Quick punt, thought BB was going to push this up
Sell: Price went downtrend instead, quickly sold off.
Lessons learnt: BB buy doesn't mean BB will push, buying purely based on BB's move is a dangerous speculative play. Somemore, they are always buying and selling.
03: Sincap
Buy: Shocked by 1000% increase in gross profit, went in unconsciously
Sell: Price stayed stagnant for few days, managed to sold at the same price with brokerage fees loss.
Aftermath: Price slipped all the way to 0.15, seriously.
Lessons learnt: Never buy a stock without studying its background, doing so is worse than gambling. I should count myself super lucky didn't get burn for buying this penny without thinking.
04: Chuan Hup
Buy: Fundamental solid company, expecting good results and good dividends, a major holding of good investor (TUB). Results: 3 cent dividend, which is almost 10% yield to my EP $0.28.
Sell: Sell at 8% gain (after brokerage fees, 6%), to recycle capital into another stocks.
Aftermath: Price slowly climbed up to 0.35 now (25% gain of $0.28)
Lessons learnt:
Buy: Ok this was the first stock that I picked using FA: growing business, good ROA and ROE (>10%), good net profit margin (>20%), reasonable PE (<15), decent dividend yield (3%), small moat (patented logistics hub).
Sell: Sell at 8% gain (after brokerage fees, 6%), to recycle capital into another stocks.
Aftermath: Price slowly climbed up to 0.35 now (25% gain of $0.28)
Lessons learnt:
- I have actually bought AEM expecting on good results prior to buying this, however price of AEM dropped instead. (Will write it on another article as the position is still open). So before buying Chuan Hup, I checked that there was no price movement, so not many people are expecting good results.
- I really should have hold on to this, after learning from Hi-P experience, but I was too impulsive to buy into another stocks (YZJ with private placement, will also write this on another article) which I thought was a bargain. As I was not willing to commit more savings into equities market at that time, I was actually quite happy with 6% gain, given that I lost $ on previous two transactions.
- Again, zero sum of buying into dividend announcement myth busted. Ok, maybe this could be zero sum game in bear market or bear stock, but definitely not in this bull market.
Buy: Ok this was the first stock that I picked using FA: growing business, good ROA and ROE (>10%), good net profit margin (>20%), reasonable PE (<15), decent dividend yield (3%), small moat (patented logistics hub).
Sell: After XD, price started to run all the way to $0.99, without any news (As usual, people want to find a reason, so they suspects market suddenly realized the value of this coy after privatization of its industrial peers Poh Tiong Choon logistics at much higher PE; which I don't really buy it). The last surge to $0.99 was especially dubious, it was done within minutes. The buyers are definitely not in for long term. As I worried rally may not sustain, and distribution may follow; I took profit the next day and bought Chip Eng Seng. This must be one of my luckiest transaction :)
Aftermath: Price steadied at $0.96 region. May re-enter into this coy once I do a deeper FA and have a better idea on its fair value range.
Aftermath: Price steadied at $0.96 region. May re-enter into this coy once I do a deeper FA and have a better idea on its fair value range.
06: China Aviation Oil (CAO)
Buy: My first buy on dip. FA solid company, special moat business, was waiting for a chance to go in and decided to pull the trigger on 6-month low.
Sell: Locking in profit before the results. I suspect earnings will be decent, with additional currency gain; but not spectacular enough to support price run-up. May re-enter if results beat estimates.
Aftermath: (Updated at 11 Nov). Results were not decent and missed estimates greatly due to pathetic margin in trading business. The drop in margin was due to backwardation in oil prices, and supply disruption in some China's area. This is interesting as it provides another perspective to predict results of CAO, which also leads to another question: was this backwardation issue for the last quarter not known before release of results?
07: Capitaland Commercial Trust (CCT)
Sell: Locking in profit before the results. I suspect earnings will be decent, with additional currency gain; but not spectacular enough to support price run-up. May re-enter if results beat estimates.
Aftermath: (Updated at 11 Nov). Results were not decent and missed estimates greatly due to pathetic margin in trading business. The drop in margin was due to backwardation in oil prices, and supply disruption in some China's area. This is interesting as it provides another perspective to predict results of CAO, which also leads to another question: was this backwardation issue for the last quarter not known before release of results?
07: Capitaland Commercial Trust (CCT)
Buy: Try out on right issue play, thanks to BullytheBear's sharing in IN.
Aftermath: (Updated on 11 Nov). This selling turned out to be a real bad call since price continued to rise to 1.8x. Firstly, with possible risk only coming in Dec, why did I rush to sell? Secondly, even as I doubt there would be additional buying spree, it has not turned bearish, why did I need to sell? This should serve as an important lesson for me on timing and logic of selling.
- 1000 shares @ $1.67
- Entitled + excess rights of 400 @ 1.363
- Average price for 1400 shares @ 1.583
Aftermath: (Updated on 11 Nov). This selling turned out to be a real bad call since price continued to rise to 1.8x. Firstly, with possible risk only coming in Dec, why did I rush to sell? Secondly, even as I doubt there would be additional buying spree, it has not turned bearish, why did I need to sell? This should serve as an important lesson for me on timing and logic of selling.
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