Friday, September 19, 2014

Random thoughts: reflections on buy sell decisions

SMOL ask me if I have a plan. I think he is trying to tell me to find my own style and footing in investing.

The weird thing is: I realised many of the little voices guiding my decisions are in one way of another shared by someone.
Nicknames are mentioned as a mark of respect and acknowledgement of originality of idea. If any of the readers are the people mentioned, just chill if I interpret it differently. In the end, it is my interpretation of what was said

I look at ST and Acendas, and ask myself, If they will be around with similar payout in a decade. Of course, my answer is affirmative. Paullow's advice on  Looking for long term for perpetual dividend payers.

I really like both companies, both in certain ways, are bell-weathers of Singapore economy. Both are not trading at low valuation or attractive valuation. The thoughts ringing in my mind is: better to buy a great company at fair price than a fair company at great price. ( Warren Wisdom)

Ascendas fulfilled my internal set target of a sustainable 6% return annually in terms of dividends. But I will be kind of stretched and I want a small war chest to nibble at stock. Warchest wisdom is common knowledge but emphasized by AK.

So I decided to do some switching. A concept I heard from City Farmer of valuebuddies. He do not practice warchest approach but simply switch counters that has already performed to its potential or underperforming to the alternative that is more undervalued. Parkson has given me a good ride and the gestation period will take a year more, although I have no idea if the price will go north or south during the gestation period for future growth. Then Freedom's words from valuebuddies ring: you can never be wrong taking profits off table, don't expect to take the maximum profits all the time.

When I am researching and doing my homework, I read through all the announcements of ascendas REIT and look for milestones and important events,  a method shared by Nick from Valuebuddies. It is then I saw a very clear pattern of placement of shares to fund acquisitions and keep gearing at manageable level. With the exception of 2009, we all know what happen at that year, the placement while causing short term dilution is actually offset by longer term increase in DPU. The constant refinancing to spread out the loans to ensure no more than 20 % of its loans are due to in a particular year is diligently carried out, and the almost 2 acquisitions per year is made possible by the very strong sponsor. The acquisitions pattern is only broken in 2010. With the sponsor possibly merged to become an even bigger entity, the pipeline of acquisitions should remain available for a considerable period of time.

So, at the end of the day, do I have my own style? Hmm...

I think I do. Shameless copying of whatever is useful and connecting the dots. I think I need more dots to be connected before I can find my real style. 

But then again, I am more interested in making money than finding my style. Shameless right? LoL

Before I build up my core portfolio, I think I can have a smaller warchest in the meantime. I do I have a plan afterall. Confused? 


  1. Hi Mike,

    Seems like i miss your "House Warming" in blog spot. Hahaha. I almost thought you stopped blogging after i can't locate your word press.

    I work in a building manage by Ascendas Reits. They have a unique moat in that all nearby industrial buildings in the regions are managed by them. As along as one is in the industry/trade, they somehow have to lease from Ascendas Reit.

    Don't say my location and industry out loud even if you have guessed them correctly haha.

    1. Hi solace!

      Thanks for dropping by, no problem, i evergreen... Anytime ready for a party.

      Thank you for your heads up on Ascendas.. There might be a better time for accumulation with further supply of industrial space, but since it fulfilled my criteria. Think it will just buy and hold.

      Hmm... I can zero in on 2 places, not sure which one is it. Yours pure industry or got office and HQ??? LOl

  2. WIth ST engineering, i too have initiated an small position at $3.62 couple of days ago. Will also accumulate more if prices declines more in the future at key junctions.

    I am also looking at Semb Corp Marine. They have been bleeding lightly for a while now, they are facing mounting challenges. My preliminary ressearch tells me that the economic and structural moats are still intact.

    I am still calculating if they are being oversold and if they have reached their fair value. Down Trend still intact. You have any insight for this counter. Also a bell-weather in its industry.

    1. Solace, you lucky guy, u got it at the day low. I have not read up on Semb Marine.

      Thank you for the hot tip. LOL. I was reading Keppel for comparison with ST marine. Will share more if I find anything interesting with Sem marine

  3. I reckon you have used a harsh word on yourself, "shameless".

    To you it is shameless copying but the original owners will be proud of you. One very valid and stand out reason being that even though you copy but you do not simply paste them into you stocks holdings blindly.

    You have done all the necessary and required due diligence. Now, tell me why would not the original owner of the investing style be happy with you?

    Those who copy others stocks holdings blindly and pasting them into their own stocks holdings are the ones who should be shameless of their act.

    Well done Mike!

    1. Money honey,

      Thank you for your kind words and your encouragement!

      I realised shameless trigger quite strong a reaction even when used myself.

      I know there are better words to describe it but I think the word is more of a strength than a weakness. Too many a times I see people not doing something or worry about something after doing it because they are afraid of a scolding. I always think what is the big deal in getting a scolding if I know what I am doing and the impact of my deed. Words shouldn't hurt so much unless it is from a loved one or has impact on our livehood, isn't it.

      Guess the word is just not my soft weakness spot although also have my 死穴death acupuncture point that will triggered strong emotions. Shameless? Ya I am, bring it on LOL

  4. Sillyinvestor,

    I face-palm.

    I asked: "Who are you?"

    You replied: "I am Legion. For we are many..."


    But then, if you have replied: "I am the One", I would have ran away screaming!

    LOL! I guess I've watched too many demonic horror movies...

  5. SMOL,

    That's a nice analogy! Thumbs Up.

    1. Solace,

      Thanks! Hee, hee.

      Sillyinvestor is a jolly good fellow isn't he?

  6. LoL,

    Solace, if SMOL ask me again:

    I would say: I am water, I have no shape I take shape from my surroundings, only during very extreme or harsh conditions would I flourish, when it is cold, I hold ground and refused to move anymore, when it is too hot, I go into air and disappear!

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