Tuesday, June 30, 2009

June 2009 Portfolio Summary and Review

June 2009 could possibly go down on record as one of the most boring months in terms of corporate activity, as well as stock market activity. There were hardly any updates with regards to the companies I own, the entire economy is still lurching around in a listless, zombie-like state, and the searing heat in Singapore just made everything all seem even more surreal.

Despite the sporadic news on the “green shoots” theory interspersed with news on the various aspects of the Singaporean and USA economy, the general sentiment was one of indifference and sluggishness, if those words could be used to describe reactions to news. I believe the general mood can be more aptly described as “corpulent”, which makes one just feel like wilting in front of the TV or computer amid the incessant and sometimes incoherent babbling from the newscaster as he regurgitates facts and figures in an equally tired voice. It could be argued that the most “sensational” news to come out this month was not on the economy or the stock market, but on Michael Jackson’s sudden death last Thursday; may he Rest In Peace (I was not a fan, but I liked his choreographed dance moves and his slick and well-directed music videos).

As mentioned above, no juicy opportunities presented themselves for me to average down on my holdings, and I am still in the midst of researching companies for potential investments. The rally has paused for a good cause of course, as guarded optimism now replaces the previous (irrational) exuberance. This can be seen as a positive thing because investors who wish to accumulate slowly can do so, despite the low volumes and high bid-ask spreads sometimes observed. However, there is a very slim chance of valuations going back to distressed levels as seen from October 2008 till April 2009, as most would agree that the worst of the economic crisis is now behind us. Right now, the issue is one of the slow and painful recovery from the sharpest recession to hit us since the Great Depression. Most analysts and economists are of the view that the recovery will be long and tedious, and years of excesses will give way to years of de-leveraging before we can work the kinks out of the system.

With most of my time spent analyzing Tat Hong and Boustead this month, I did not devote much time to updating readers on value investing principles or posting other investing-related content. However, I can happily say that I had spent most of June 2009 reading up more on Singapore’s property news and monitoring the property market, as well as brushing up on some aspects of personal finance and money management.


For June 2009, corporate updates and result announcements for my companies are as follow:-

1) Ezra Holdings Limited – There was no significant news from the Company this month. I would be expecting their 3Q 2009 financials to be released some time in the middle of July 2009.

2) Boustead Holdings Limited – There was no news from the Company during June 2009.

3) Swiber Holdings Limited – On June 17, 2009, Swiber announced a re-structuring of the Board of Directors and senior Management positions, in order to grow the Company to the next step. On June 19, 2009, it made a quiet announcement on the disposal of shares in an associated company (in which they hold 20% of). The associated company in question is Perfect Motive Sdn Bhd and is 20% owned by Swiber’s wholly-owned subsidiary Swiber Marine (Malaysia) Sdn Bhd. Based on the book value of RM 324,000 and the sales proceed of RM 200,000, this meant that there was a loss incurred of RM 124,000. It was not disclosed as to the rationale for this divestment, but judging from recent corporate activities, the Company seems to be building up its cash reserves. Thus far, there is still no news of any contract wins or significant LOI secured year-to-date, which is a very disappointing development. I remain optimistic that the recent re-shuffling of personnel is a sign of better things to come and that the Company may be working on securing some new contracts to boost their oder book for FY 2009 and beyond.

4) Suntec REIT – There was no news from the REIT during June 2009.

5) China Fishery Group Limited – There was no significant news from the Company during June 2009.

6) First Ship Lease Trust – There was no significant news from the Company during June 2009. Results and distribution announcement for 2Q 2009 should be made in late July 2009.

7) Tat Hong Holdings Limited – There was no significant news from the Company during June 2009.

Portfolio Comments – June 2009

June 2009’s portfolio value saw a decline compared to May 2009. It has fallen from a total gain of 25.6% to a total gain of 11.3%. Someone did suggest using the XIRR function in MS Excel to compute my CAGR gain adjusted for additions and subtractions of capital, but unfortunately I do not have this XIRR Function within my Excel (probably mine is a little outdated ?). So I admit there is a better way to judge my real return rather than what I've put up, but please bear with me until I can find a way to compute using XIRR Function.

There is nothing much to comment for this month except to say that I am still sticking to my policy of building up more cash reserves should I see a need to deploy my capital into the stock market, and I remain committed to achieving a savings rate of about 40% of net take-home salary. In the meantime, in the absence of significant news, I shall read up even more on property to understand it and also to brush up on more personal finance concepts.

My next portfolio review will be on Friday, July 31, 2009.

8 comments:

Mike Dirnt said...

i did a Guide on using Excel XIRR long time ago. you just need to do some additional steps to bring up the XIRR tool :;

you can try it to compute returns with individual stocks. as a whole portfolio, its abit tough. i tried but the result is invalid as there are too many transactions for me

simon said...

don't mind if you could put in the cost weightings of each stock as a % of the total portfolio cost? just for us to get a clearer picture of your portfolio allocation.

professorv said...

A stock for your consideration.

Telechoice.

It came up on my stock screener. Have examined it thoroughly, the only reason for me to not buy it is because it does not fit my style.

I am quite sure you will like this one.

Jeremy Ow Tai Pang said...

Dear professorv,
Can you share more about what this company 'Telechoice' does? What do you think are the strong reasons for investing in this stock? Thanks.

professorv said...

The URL is below :-http://www.telechoice.com.sg

musicwhiz said...

Hello Mike,

Thanks yes I was introduced to that page by someone else and read up on the XIRR function there, but now I cannot find my Excel CD to install the function ! Anyhow, thanks for the link, I will bookmark it.

Cheers,
Musicwhiz

musicwhiz said...

Hi Simon,

I do not wish to be too explicit as putting down the % for each company may allow people to compute the number of shares I have, and that is something I'd rather keep confidential.

Let's just say my stake in Suntec REIT is very small (about 2%), Ezra is below 10% while the remainder is roughly spread out among the other 5 companies.

Regards,
Musicwhiz

musicwhiz said...

Hi ProfessorV,

Haha thanks for the "tip". You so sure I will like this company ? I do recall it used to pay a high dividend yield. I will check it out, no worries. But as I am quite busy these days I may not immediately conclude anything about the Company until I get all my facts and figures straight.

Cheers,
Musicwhiz