Thursday, May 26, 2016

Personal Money Management Tips

Investing your money is obviously something that you will need to take very seriously. Failure to do the proper amount of research regarding what you invest in and what company is handling your money could result in you suffering a major financial disaster. This is why you really need to pay close attention to every investment you make. The financial world can be very confusing to people who are not familiar with the various terms that are used. You would be wise to learn this terminology in order to help you understand certain investing strategies. Here are some personal money management tips that might be beneficial to you.

1. Talk to many investment companies

Do not simply hand your money over to the first money management company you find. You owe it to yourself to look at many different companies to see how they can help you to reach your personal financial goals. You will find that money management companies have very different strategies when it comes to investing. Some have a very conservative philosophy. Other companies can be much more aggressive. This means that you should only do business with a company that has an investing philosophy that you are comfortable with. Do not be in a hurry to invest your money. Rushing things could cause you to make foolish decisions which could result in you losing money.

2. Set a limit for your investments

You should never invest more money that you can afford to lose. You must always make your investments with the idea that everything will go wrong. In other words, would you still be able to support yourself financially if all of your investments fell through and you lost all of that money? You have invested too much money if the answer to that question is no. Take a close look at your finances and be very careful not to get carried away with your investing when you are just starting out. Set a monetary limit on your investing. This will prevent you from suffering a crushing financial loss that you can't recover from.

3. Be patient

It is normal for people who are investing for the first time to want to make money right away. You need to realize that patience is the key to successful investing. This is something that all reputable money management firms like Fisher Investments will tell you. It is possible for you to make money quickly on certain investments. However, you should not count on this to happen. You would be better off putting your money in a long-term investment that has shown a reasonable amount of growth in the past.

4. Make sure your money manager is experienced

Your money is much too important to your livelihood to allow an inexperienced person to invest it for you. You should only work with a money manager or financial advisor who has no less than a decade's worth of investment experience. Many of the people who work for FI have this level of experience. You do not want your investments to be determined by a kid who is fresh out of college and has no real experience when it comes to investing. You should only settle for someone who has outstanding credentials. Keep looking until you find a financial advisor and money manager who has a proven track record of success.

Sunday, May 22, 2016

Financial Bloggers Unite - Bonding Time

Two years plus ago when I started this blog (in 2014), the main purpose is to share my shares investing journey and along the way hope to get to know some like-minded peer retail investors. But what I didn't see it coming is managed to strike some great friendship with a small group of fellow retail investors. Some of them are quite well established many moons before me... Even though I am the most senior (in terms of age) among the group. 

Yesterday, a bunch of us have a great gathering at the place of one financial blogger. Even though it is just a few hours, we totally immersed ourselves with the food and chit-chatting (and swimming for one, which I will not disclose the name ;-)). Mind you, we don't always talk shares or investment, the topics are widely spread, ranging from property to airbnb to tuition to dancing and even the speedo swimming trunk (last one is a classic) lol

This being the second round of our bigger group gathering and hope more such "AGM" sessions will be held soon...Financial Bloggers Unite!!!

Such bonding will stay with me for a very long while....

Cheers!

Saturday, May 21, 2016

My Share portfolio - The Simplified Tracking

Vesak Day 2016
First, Happy Vesak Day to you and your loved ones! 

It has been a while since I last updated My Portfolio page. With some recent activities on Accordia Golf Trust and Soilbuild Business Trust (latest small inclusion, will write about this at a later date), thought of revamping my portfolio tracking to make it simpler to track. 

Going forward, I am looking at making a quarterly update of my portfolio to track the performance. As at now, it is sitting at a double-digit loss (26% if exclude Dividend or 20% if include Dividend) ;-) 

Investopenly Share portfolio

Cheers!

Friday, May 20, 2016

5 Inexpensive Ways To Promote A Product Launch (Guest Post)


So, you're convinced your brand new product is the best thing since sliced bread. A word of caution. Even if it is, promoting it successfully through to product launch is never easy. Simply making current and potential customers aware of the existence of your new offering is tricky enough, let alone getting them to try it!
If you want your product launch to achieve the results you know it deserves, a thorough and detailed marketing strategy is a must. Of course, you'll have a budget. And it probably won't be as large as you'd ideally like.
Thankfully, there are ways even the smallest of businesses can get noticed via their promotional activity, without breaking the bank.
Check out these five inexpensive, effective and creative ways you can make your product promotional campaign as strong as possible:

1. Check Out Crowdfunding

Crowdfunding sites like Kickstarter or Indiegogo are a great way to get your product noticed prior to launch. A crowdfunding campaign, when run well, can also attract generous financial support to further aid product development. Before running a crowdfunding campaign, you should survey customers to ascertain whether they are open to the new platform. Typically, once a campaign is up and running, supporters can pledge differing amounts of cash in exchange for either the product you are launching itself, or for token items, which is where a selection of well-thought out promotional products in line with your brand can be of great benefit. Offer your customers something fun and useful with your logo printed on it; this could be just about anything from BBQ tools to a shopping bag, cool keyring or coffee thermos.

2. Social Media Teaser

You'd be stupid not to get your product launch some traction via social media. Facebook and Instagram are great places to start. A 'teaser' campaign doesn't require you to have all product details finalised from the get go, simply utilize the campaign to provide your social audience with creative and fun updates as you go through the development process. Remember, image and video updates are key. You can also run giveaways or competitions, where people who share or 'like' the page can win prizes, such as branded promotional products.

3. Find Cheap Creative Talent Online

Advertising is awesome, but creating ads can be very, very expensive if you go down the traditional route. If you're on a tight budget it's well worth considering hiring creative talent online. Online freelancers can produce ads that are excellent value for money. Try sites like Fiverr.com, on which you can search for freelancers with excellent feedback, willing to complete an ad for you for as little as... a fiver!

4. Get Influencers To Talk And Share

If you can get the backing of someone in your field who's considered a “digital influencer”, your promotional campaign will gain a whole lot of strength and credibility. Influencers are well-respected figures within your target market with a significant online following. Get them to endorse or recommend your product, and you'll find their fans or subscribers will get behind it, too.

5. Be loud, and proud

Don't just rely on your salespeople to talk up the new product. Brief ALL staff, and encourage them to tell everyone they know about the new launch. Get them to talk it up via their own social media networks. Create a press release and send it to appropriate on and offline media in good time, following it up with phone calls to each media outlet. Make use of your customer database to send emails about the promotion to your regular customer base. And offer them rewards, such as free promotional products, for referrals.
Tips offered by Customgear.com.au, leading suppliers of promotional products.

Wednesday, May 18, 2016

Accordia Golf Trust - New Inclusion to my portfolio

I've been queueing for Accordia Golf Trust (ADQU) for a few weeks and finally hit the target today @ 62 cents (for 5,000 shares only). So, it is a new inclusion to my minion size portfolio.

Accordia Golf Trust is a business trust specializing in investments in golf courses, driving ranges, and golf course related assets in Japan. Accordia Golf Trust is based in Singapore, Singapore.

There area couple of reasons why I added this counter :

1. To expand my REITs portfolio (after Lippo Malls Trust, Cache Log Trust) for income play. I know business trust different from REITs but for my income playbook, I treat them the same.  

2. Accordia is currently trading at a discount of 30% with its NAV of SGD 89 cents (as at Q3 FY 2015/16). Am aware that it could be a value trap but nobody can predict the future.  

3. While pending for the full year financial result, expected to be released next week, so far the Q3 2015/16 performance is quite promising. 

4. Full year Dividend Yield of Accordia for FY 2015/16 is expected to be over 10%. 

5. Accordia is Number 1 Golf operator in Japan

6. Positive Japanese economy outlook due to :
a. Abenomics. 
b. 2020 Tokyo Olympics 

The potential risks that I have taken into consideration are :

1. The unpredictable weather or natural disasters that might impact the operation of the golf course(s) and hence the business. 

2. FX (foreign exchange) risk

Are you vested in Accordia? What is your view on this counter?

Cheers! 

Monday, May 16, 2016

Buying and Selling Bullion: Beginners Guide (Guest Post)

Buying and selling gold or silver bullion is a fairly simple process, however there are several factors beginners should keep in mind prior to investing and offloading precious metals. Remember, gold bullion refers to either gold coins or bars (ingots) of at least 99.95% purity. Bear in mind that when you buy bullion, you take physical possession of it, so storage is a key factor. 

Read on to find out how to successfully buy and sell bullion.

1. Know your goals and risk profile before jumping into the market. Like any investment, you need to consider important matters such as whether you plan to be in it for the shorter or longer term, how much you can afford to invest safely and how your bullion purchase will complement the other sectors of your portfolio.

2. Learn about the historical performance and role of gold in financial markets. Many investors and financial analysts alike recommend holding gold or other precious metals over the longer term as, better than any other asset, they help protect the portfolio from a range of potential so-called “black swan” economic crises, such as hyperinflation, deflation, runaway stagflation or chronic disinflation. Make sure you understand the “safe haven” role gold has historically played as a hedge protecting against all these negative economic events.

3. While there are many ways you can invest in gold, including gold funds, ETF's and by speculative mining stocks, if you want to harness the metal's intrinsic and potentially rising value, then trading in bullion should be your primary concern. It offers a simple and effective exposure to the metal.

4. Choose a provider. If you want to hang on to your gold investment for at least five years - as is recommended by most financial advisers – make sure to select an established company. Remember, smaller bullion providers are not as stable as bigger companies and may not last the distance.

5. Ensure you have storage covered. Another benefit of choosing a larger, more established bullion company is that they generally have contracts with trusted vaults for storage of your gold. Therefore, the risk of something happening to your gold is incredibly slight.

6. Decide how much to invest in gold. When setting up your gold savings account, you may wish to begin with a small investment, then save as much as you feel to be necessary over time. Remember, gold should make up a key part of any investment portfolio, however you should not over allocate in gold. If you don't know how much to invest in gold, speak to a qualified financial adviser.

7. Ensure you pay the lowest fees possible. Gold bars come in metric sizes and are available to purchase at the prevailing gold price for that day, however a premium is added to every purchase. When you buy a smaller amount of gold, you will pay a higher relative premium.

Remember: gold bars are relatively easy to trade, so you should always be able to find buyers and sellers in the market, which is not the case when it comes to some gold coins.

As with any form of investing, it is always better to take a longer term view in order to try and establish how you might want to invest in gold.

Saturday, May 14, 2016

What Has Weather Got To Do With Your Investing Or Life Journey?

Yesterday, went for a full-day management workshop revolving around the theme of Integration and Change. Besides going through some self-discovery on our individual thinking and behavioral preferences (nothing new to me as I've been quite a number of similar "tests" and the result is kind of consistent), we also went through some fun role plays by "acting" with our least preferred behavioral preference. Fun aside, the role play game is also meant to illustrate a few key points :

1. It's harder (but not impossible) to behave the ways with our least preferred behavioral preference (for example, if you are scoring low in expressiveness and suddenly asked you to express your mind openly to the crowd, uncomfortable set in and you are stretching yourself). The key is to consciously stretching your least preferred behavioral preference.  

2. There is no right or wrong behavioral preferences or which one is better than the other, every preferences have its pros and cons. The key is trying to develop and strengthen all 4 spectrum (Analytical, Structural, Social and Conceptual) so as to better equip ourselves to embrace the changes (which is constant) in our work or life.

3. One of the many quotes shared by the facilitator is worth sharing : "We cannot control the weather, but we always have the choice to bring an umbrella". Regardless of your type of behavioral preference, there are bounds to be uncontrollable situation we need to deal with.

So, now you roughly know why the weather has everything to do with our investing journey or life as a whole! Just like in investing, you cannot control what will happens next after you've locked in your capital, but you always have the choice of doing what you can control i.e. :

1. Sell the stocks with a profit/gain as you've done with this stock
2. Keeping the stocks for long term investment
3. Buy more to accumulate as you might view that the price is still a bargain
4. Completely withdraw from the stock investment as you deemed that investing in stocks is too time consuming or you've other better investing alternatives. 

There is no right or wrong answer/decision (at least at that moment when you made the decision), as long as you are still in the market, regardless of whether your current overall realized paper profits/loss is positive or negative, it is too early to pop the champagne or call it quit as the game is still ON! Your next one could be a big flop or big gem that could turn it around!

In short, the learning point is : Try not to overly stressed with what you cannot control (i.e. the weather and the stock price movement) and focus on what you can control (i.e. to bring umbrella and to buy or sell etc.).

Investing is just like life, you can't be right 100% of the time (if you are a married man, you might not be right most of the time ;-))

Cheers!

Tuesday, May 10, 2016

From Thinking To Unthinking - What Do You Think?

Recently, has been busier with work and hence my blog post frequency is getting affected too. Having said that, I am still targeting to get out at least 2 blog posts per week. Today, thinking of writing something outside the theme of my blog i.e. non investment related, so decided to write something about "thinking".

Personally, I usually do quite a fair bit of thinking before taking any action (and sometimes inaction, as a result). At times, I am guilty of over-thinking and hence becomes less "aggressive" in what I am supposed to do (that explains why I started late in the investing journey as well as not that active in trading). 

Of course, thinking alone will bring us nowhere but for me, I rather spend more time in the thinking process rather than regretting at the later stage. In short, I am a T.P.A person:

Think ---> Plan --> Action   

Coincidentally, I am currently reading a book called Unthinking - The surprising forces behind what we buy by Harry Beckwith. It is not a personal finance book, it is more related to selling or marketing. Basically, it try to pinpoint some of the major influences that shape out unconscious decision (knowingly or unknowingly). For example, how the marketers/advertisers are cleverly making use of play (or gamification), surprises and stories to influence the consumers and most of the time, we took the bait. 

So, the next question worth pondering : Is unthinking process important? By unthinking I meant following your subconscious mind a.k.a follow your heart. For me, the answer is YES, especially when come to the relationship matter. 

To close off this thinking/unthinking chapter, let me share with you a meaningful quotes/photo: 
"Follow your heart but take your brain with you"
What do you think?

Cheers!  

Saturday, May 7, 2016

Sim Lian Group - My CNAV Analysis

Recently, when I did a stock screening on the stocks with dividend yield higher that 6 % (plus other criteria), Sim Lian Group (S05) is one of the non-REITS stock came in the top few. Of course, as constantly reminded by peer financial blogger friends, we should not focus too much on the dividend yield alone (which I totally agree). Hence, this post when I dig in further...

Sim Lian Group engages in the property investment and development, and building construction activities in Singapore. It also develops residential, industrial, and commercial projects; and leases investment properties. In addition, the company trades in industrial and marine lubricants; and leases, services, and maintains construction and industrial equipment and parts, as well as mobile sanitation facilities. Further, it engages in the design, consultancy, installation, maintenance, and related import and export sales of offshore module; and investment, development, operation, and management of real estate and real estate related assets. The company was founded in 1976.

The Key Quantitative Indicators of CNAV Strategy (Basing on the Dec 2015 Result in Yahoo Finance):

Net Asset Value (NAV) = $1.1257
Conservative Net Asset Value (CNAV2) = $0.4431
Current Price = $0.79
Discount For CNAV2 = -78%

Conclusion : From the price's perspective, it is traded above the CNAV2 but at a discount when compared it with NAV. 

The P.O.F Scores of CNAV Strategy:

Profitability Score = 1 (With the PE ratio of 4.4)
Operational Efficiency = 1 (with three consecutive years of positive operating cashflow)
Financial Efficiency = 1 (Debt To Equity Ratio of 52%)

Conclusion : A perfect POF indicators.

Other information:
1. The company has a strong Balance Sheet.
2. A stable stream of dividend yield throughout the years, especially in 2012 and 2015:

3. As at 30/06/2015, the Group's outstanding order book is approximately $566.6 millions.
4. Top 5 shareholders of the company are:
5. One area to take note is that the trading volume of the counter is quite low on most of the days.  

Click here for the pdf copy of Sim Lian Group's 2015 Annual Report!

Sim Lian Group is not a CNAV stock but still worth a second look for potential INCOME play. 

Are you vested on this counter? What is your take?

Cheers!

Note : Do You Own Due Diligence!

P/S:
I've learnt this not-difficult-to-do calculation from the Value Investing Mastery Course (Big Fat Purse) last year. Immediately after the one day course, I am on my own to calculate the CNAV myself. With the help of the idiot-proof spreadsheet (provided free after the course), it makes calculating the CNAV a breeze.

Oh, by the way, they are still conducting the one-full-day Value Investing Master Course at $98, which is unbelievable. From what I know, most of their classes, which usually happen on the weekend, are fully booked. So, if you are interested to learn more about Value Investing and how to calculate the CNAV, you should find out more from the horse's mouth!

Monday, May 2, 2016

Interview With the "Giraffe" of Giraffe Value

Move over the "bear" and "bull", here comes the "giraffe"!

Of course, I am not talking about the real giraffe here, I am referring to the owner of local financial blog, Giraffe Value (since he like to remained anonymous for the time being, let's call him Giraffe then ;-)). I first chanced upon Giraffe's blog a couple of months ago and noticed that most of his posts are very informative and easy to digest (suitable for newbies). 

Subsequently met him once in one of the financial bloggers gathering at BigFatPurse premise and chat with him for a while. Found that he is a very hardworking and humble young chap with ambitions and dare to dream big. 

Without further a do, let's start the interview proper and read on.... (I believed this is the longest post in my interview with bloggers series) :

Q1 : Can you give us an introduction about yourself?
A1 : I'm GV, not a real name. I'll show my real identity some day in the future as I'm still going to workshops and seminars and I don't wish anyone to recognise me. It’s funny because I heard instances where organizers stop bloggers from sitting in their workshop.

My career has been quite complex so far. A little back story here, I dropped out of ITE, made it to part-time private diploma while I was in NS. Worked as a debt collector right after and then made it to ACCA.

After graduated, I realized the golden age of accounting is over. And I was lucky to land a job in Apple as a payment specialist in their online store. Then I jumped to a prop trading firm as a day trader, it didn’t turn out well. I wasn’t making any money as it was based on P&L. There was no basic, so I left, and joined an AU listed metal trading company as a trainee trader. It was a Chinese family-style management culture, I didn’t learn much during that period, and I felt I was simply just collecting salary and wasting time.

So instead of looking for another job which I felt it was a risk that may lead to another time wasting job. And I thought maybe I can do something on my own. Because I would not want my success and life to depend on others or chance, but myself. So I knew I had to quit and I did.

After about six months of hustle, I was cash-strapped and with insurance expenses looming. So I took up a job in a financial education firm. So here is where I am now. Really lucky that I am now in an environment where I have the exposure of business and investment. And most important of all I have the time it needs to achieve what I set up to do.

The result of my effort has paid off quite well on my past two creations. That’s an interesting thing about the world. It doesn’t care what you do, how you do and how passionate you are. It just cares one thing: you get it right and you get the right result. I have not seen money’s result(yet). But I think I’m not too far off. Some ideas have to be validated first before knowing that I’m on the right track. So we shall see...

You know there are often times when people talk about life it often goes like this: study hard, get a good job, save some money, watch descendants of the sun after work, get married some day, then perhaps invest some money. Retire where you are finally financially independent, that sort of thing. It’s like there’s a life’s travelator built for you to stand still so that it gets to where it was built for. All advices you get are usually revolved around these areas. People will tell you this is how the way it is, so just stand still and don't try to hop out of that moving walkway otherwise you will get left behind.

If that is what life is about. Then that is a very limited life. Life can be so much broader than that. The so call life is made up by people who are either not better than you or have their head stuck in schoolbag since they were young. The truth is we are limited by our beliefs more than what the actual present circumstances are.

The world is not a static place where you can’t do anything or anything you do nothing would change. It may not be easy, but there's one simple undeniable fact: that is you can smash things, you can change things, you can create things or influence things mean you can jump out of that so call “life” and create your own life. And many things when it started out often look like a bad idea or to some extend may even look silly to attempt. But that's because one is looking at it in a very narrowed len. Zooming out would let ones see the grand scheme of things and how a small attempt can go a long way. The moment you understand this you can never look life the way as before. But first one has to take his head out of the schoolbag.

Q2 : Are you a full-time or part-time investor at the moment?
A2 : I am a part time investor. No intention of being a full time, anyway it's too early to say that. But, I think even if I have the capital. My time and energy would still better be spent on doing work that makes an impact to myself and others.

Q3 : When (at what age) did you start investing in shares and who has influenced you the most?
A3 : Around 24 I think, but shortly afterward I sold off my stocks as I got accepted in a prop trading firm. The ones that influenced me the most are probably: Benjamin Graham, Tweedy, Browne report on What Has Worked In Investing, Eric Kong’s video on Scientific Approach, Teh Hooi Ling on book $how Me the Money, Tobias from Greedbackd, Howard Mark’s memo on contrarian thinking, Wesley Gray from Alpha Architect, lots of gem. And another recent one is an interview’s video with Cliff Asness from AQR, very insightful discussion on value and momentum investing.

Q4 : Do you view yourself as long-term (holding shares in years), short-term investor (holding shares in days/months) or mixture?
A4 : Long term for sure, I see investing as part of a capital allocation rather than money making activity. It's an ongoing process. The question would probably be what’s the allocation percentage rather time horizon as I would not go all-in neither would I exit completely.

Q5 : What is your basis of selecting the shares to invest (e.g. basing on fundamental analysis, technical analysis or other methods/sources [share a little bit more details if it is the latter])?
A5 : Ah, I think this is the most exciting part of the whole interview. For my current stocks portfolio, I use solely on fundamental analysis. Actually it is based on basic price to fundamental and not much on analysis.

The way I approach my stock investing can be explained by the way how STI works: Simple criteria, portfolio approach and portfolio rebalancing. My approach is based on two big investment hypotheses:

I. Value, the attractiveness of a stock depends on the gap between price and value. The value I define here is solely based on present assets value. No consideration is placed on earnings, management or business. So be it whatever metrics you use to define value. The lower generally yield better performance than the higher. And value stocks as a group tends to outperform the market over long term i.e typical timeframe for outperformance is around 3-5 years.

II. Model outperforms discretionary. A simple and fixed rule like picking a group of low value metrics stocks and periodically portfolio rebalancing would do better than cherry picking and discretionary approach i.e analyzing business, management and etc. Using a systematic approach would prevent investors emotional biases from making sub-optimal investment decision. I do think that discretionary approach would value add to the investment process but it would take decades after decades of temperamental practice. So for the average investors value destroying is the likely outcome.

These two are the two big notions. Maybe I can share 3 more factors:

III. Size. Stocks performance in general. Small cap. tend to outperform big cap. Institutions often shy away from small cap. because of its perceived business risk and may present an investable issue. Media and analysts also tend to cover stocks that appeal most to readers than stocks with investment merit. These result in insufficient or if any media’s coverage on the small cap. The lack of public interest and big players in the small cap mean prices are less efficient. Market efficiency is the key reason why it is hard to achieve above market returns i.e you need to be more right than the big boys. Hence to achieve market beating returns investors should build a portfolio around small cap.

IV. Portfolio rebalancing. The hardest part of stock investing is to know when to sell. Buying is often easy when you have a clear set of criteria. But selling is less straightforward. It seems that selling as a negative connotation attached to it. When the investment value drops below your purchase price, selling means realizing investor’s loss. But when the share price surges. Selling suggests price would not go higher. Selling also means that you are out of the “game.” The common trait of rookie investor is to bluff himself believing that is a trader when prices go up and investor when prices go down. Periodical rebalancing would solve that selling problem.

V. Portfolio approach. The reason of this approach is to reduce the individual business risk at the portfolio level. So the portfolio would have little business exposure (what you don't want) and maintain exposure in value. So you are effectively investing in mispriced assets rather the expectation that the business will grow. For the evidence that I have, on average, investing in mispriced stocks beat winner’s stocks.

So that’s all. The objective is to spend as little time as possible but still achieve market beating returns. By the way, in case you wonder I didn’t make that up. It’s not something I pulled out of thin air. I’m going to reveal this secret: Google “factor investing” if you are interested to read more about it. There’s a report by MSCI.

Q6 : What is your targeted and achieved annual rate of returns (%) so far?
A6 : I started my value stocks portfolio since last year January. Based on XIRR is now sitting at 1.35%. I don't have a target rate of return in mind as I don’t believe in going after a percentage of returns. Investment returns are unpredictable. But there is an objective, which is to achieve market beating returns with minimum effort. If I can't do that I would probably just park my money in STI ETF. And I'm glad it has been doing quite well given how little hours I put in.

Q7 : What is your most recommended online investing resource (site or blog) to share with our readers?
A7 : The investor podcast is good, the above in point 3. Local financial blogging community in Thefinance.sg, Net-net hunter has a lot of meaty article on Graham style investing, ValueBuddies forums, fool.sg plenty of short-and-sweet write-ups and valueinvestasia.com for more in-depth stock posts. And if you are interested in REITs you can read my REITs Singapore Beginner's guide over here.

But ones have to be mindful about the material you read. As I find that there are plenty of self-reinforcing rhetoric and promotional propaganda in the community. When the market goes on to their favour you’ll see a ton of cheering articles. But when it collapsed, like the end of 2015. Lots of self-reinforcing articles started to appear.

At times it can be informative and encouraging especially when investors’ returns are under the water. But ones have to strike the balance between reading information that is important and those that make you feel good but has no utility.

Q8 : Besides shares, what other investment are you involved in (e.g. Real Estates, Bonds or REITs etc)?
A8 : All are on shares. Other than that I invest quite a lot on knowledge about $100-200 per month on books.

Q9 : What is your Portfolio Distribution like?
A9 : 30% on stocks and 70% in cash.

Q10 : If the readers what to get in touch with you, how to get hold of you? (Sharing of your website/blog/social media profile etc..)
A10 : Oh yea, so you can find me at GiraffeValue.com or connect me at my Facebook page GiraffeValue. My writing is quite infrequent. At the current rate is about 1 post at every two months. If readers would not want to miss any of my posts then do head over to my blog and subscribe it via Email.

Other than that feel free to leave your comment below and I'm happy to answer.

Last but not least, if you are a retail investor and would like to be featured in my "Interview With The Fellow Investors" blog series, please feel free to email me at investopenly@gmail.com.

Also, for the complete list of my interviewees and their posts, check it out here.

Cheers!

Thursday, April 28, 2016

BATTLE : Aims Amp Capital Reit vs SoilBuild Reit

At the moment, the most talked about movie is Captain America - Civil War (by the way, if you are watching the movie, which you should, do take note that there are 2 after credit scenes!). The theme of this sequel is on the war between two superhero teams (Ironman vs Captain America). 

So what is this blockbuster movie got to do with this post?

Recently, there are two industry/business REITS constantly  pop-up in the group chat with a couple of my financial blogger friends (actually, these are the "KT" [Kang Tao], aka lobang in Hokkien, shared by them) : Aims Amp Capital Industrial REIT vs Soilbuild REIT. On first glance, it seems that both of them are equally promising (from dividend yield perspective), however, if you can only choose one to invest, which one would you choose? With this question in mind, it inspired me to come out with a Civil War style comparison. 

I've hand-picked 10 parameters that I personally interested to evaluate and put them side by side to FACE OFF. 

The result is as per following :

So, who is the winner? Team AA (Iron Man) or Team SoilBuild (Captain America)? 

Going by the above comparison, it seems that Team SoilBuild (Captain America) has an upper hand!

Cheers!

DYODD (Do Your Own Due Diligent)

Thursday, April 21, 2016

ISOTeam - My CNAV Analysis

Recently, one small cap company keep popping up in my private group chat with a few of the like-minded financial bloggers. Hence, decided to do a quick CNAV (Conservative Net Asset Value) Analysis.

The company in question is ISOTeam Ltd (5WF.SI). In fact, it happens to be one of the RHB's top 25 small cap picks for 2016 (whatever it means to you).  

ISOTeam Ltd. operates as a building maintenance and estate upgrading company in Singapore. It operates through Repair and Redecoration (R&R), Addition and Alteration (A&A), and Others segments. It primarily serves town councils, government bodies, and building owners. ISOTeam Ltd. was founded in 1998 and listed in SGX on 12 Jul 2013 (IPO Price : $0.11).

The Key Quantitative Indicators of CNAV Strategy (Basing on the 2015 Annual Report):

Net Asset Value (NAV) = $0.163
Conservative Net Asset Value (CNAV2) = $0.044
Current Price = $0.32
Discount For CNAV2 = -209%

Conclusion : From the price's perspective, it is traded above the CNAV2 as well as NAV. 

The P.O.F Scores of CNAV Strategy:

Profitability Score = 1 (With the PE ratio of 11.2)
Operational Efficiency = 1 (with three consecutive years of positive operating cashflow)
Financial Efficiency = 1 (Debt To Equity Ratio of 63%)

Conclusion : A perfect POF indicators.

Other information:
1. The company has a record year in 2015 with a strong Balance Sheet.
2. In Year 2015, the company declared 1.15 cents of dividend (Dividend Yield of 3.6% basing on the current price)
3. In Feb 2016, the company declared 1-For-1 Bonus.
4. Top 5 shareholders of the company are:

Click here for the pdf copy of ISOTeam's 2015 Annual Report!

ISOTeam is not a CNAV stock but still worth a second look for potential GROWTH play. 

Are you vested on this counter? What is your take?

Cheers!

Note : Do You Own Due Diligence!

P/S:
I've learnt this not-difficult-to-do calculation from the Value Investing Mastery Course (Big Fat Purse) last year. Immediately after the one day course, I am on my own to calculate the CNAV myself. With the help of the idiot-proof spreadsheet (provided free after the course), it makes calculating the CNAV a breeze.

Oh, by the way, they are still conducting the one-full-day Value Investing Master Course at $98, which is unbelievable. From what I know, most of their classes, which usually happen on the weekend, are fully booked. So, if you are interested to learn more about Value Investing and how to calculate the CNAV, you should find out more from the horse's mouth!

Sunday, April 17, 2016

Tai Sin Electric - My CNAV Analysis

Just recently, a friend of mine text me and share with me a "Kang Tao" (Hokkien for opportunity) counter, a small cap company called Tai Sin Electric Ltd (500.SI). Of course, the first thing I do is to do my due diligent and dig in further. 

Hence this post on Tai Sin Electronics' CNAV analysis.

Tai Sin Electric is an investment holding company, manufactures, trades in, and distributes cable and wire products. The company operates in Cable & Wire, Switchboard, Electrical Material Distribution, Test & Inspection, and Others segments. It primarily operates in Singapore, Malaysia, Brunei, Vietnam, and Indonesia. The company was founded in 1980, listed in SESDAQ in 1998 and subsequently transferred to the SGX Main Board in 2015.

The Key Quantitative Indicators of CNAV Strategy (Basing on the 2015 Annual Report):

Net Asset Value (NAV) = $0.35
Conservative Net Asset Value (CNAV2) = $0.137
Current Price = $0.32
Discount For CNAV2 = -132%

Conclusion : From the price's perspective, it is traded above the CNAV2 but is marginally below the NAV. 

The P.O.F Scores of CNAV Strategy:
Profitability Score = 1 (With the PE ratio of 8)

Operational Efficiency = 1 (with three consecutive years of positive operating cashflow)

Financial Efficiency = 1 (Debt To Equity Ratio of 36%)

Conclusion : A perfect POF indicators.

Other information:
1. The company has a strong Balance Sheet with positive Free Cash Flow of about $22 mil.
2. For the past 3 years, the company has a consistent dividend yield of about 6.9%.
3. For FY2015, the Group’s turnover for the year declined by 5.66% to $289.96 million from $307.35 million for the previous financial year.
4. For FY2015, the Group’s gross profit was $54.43 million, a drop of 13.52%, compared to the previous financial year. Profit before tax declined 22.08% to $20.43 million. Earnings per share was 3.92 cents as compared to 4.96 cents in the previous financial year.

Click here for the pdf copy of Tai Sin Electronics' 2015 Annual Report!

Tai Sin Electric is not a CNAV stock but worth a second look for potential income play. 

Are you vested on this counter? What is your take?

Cheers!

Note : Do You Own Due Diligence!

P/S:
I've learnt this not-difficult-to-do calculation from the Value Investing Mastery Course (Big Fat Purse) last year. Immediately after the one day course, I am on my own to calculate the CNAV myself. With the help of the idiot-proof spreadsheet (provided free after the course), it makes calculating the CNAV a breeze.

Oh, by the way, they are still conducting the one-full-day Value Investing Master Course at $98, which is unbelievable. From what I know, most of their classes, which usually happen on the weekend, are fully booked. So, if you are interested to learn more about Value Investing and how to calculate the CNAV, you should find out more from the horse's mouth! 

Tuesday, April 12, 2016

3 Smart Investments to Spend Your First Salary On (Guest Post)

If you’ve just gotten your first pay cheque, it’s tempting to spend it all. But if you want to have that dream vacation to Europe, or be the sort who buys a house at 25, you’d best think about savings and investments instead.

You don’t need $50,000 for a big trading portfolio either. Here’s how you can start simple but still see results:


  1. Join a Bank’s Blue Chip Investment Programme

Both DBS and OCBC now have a blue chip investment programme. This allows you to purchase shares in blue chip companies, without having to buy in lots.

A blue chip company refers to one of the 30 biggest companies (in terms of market capitalisation) on the Straits Times Index. These are companies such as DBS, Singtel, and Comfort DelGro - they are large and well established, and are make for low risk investments. Usually, buying shares in these companies can be costly, as you need to purchase in lots of 100 or 1,000 shares (e.g. DBS shares are around $15 at the time of writing, so buying a single lot of 1000 shares would cost around $15,000.)

Under the banks’ blue chip investment programmes however, you do not need to buy in lots. Instead, you set aside an amount you can afford each month (minimum of just $100), and the bank will acquire as many shares for you as possible.

So if you set aside $200 and pick DBS for example, the bank would acquire around 13 shares of DBS for you at $15 per share. If the price were to fall to $10 per share next month, you would get 20 shares, and so on.

This is a good way to start investing in reliable companies, even on a small pay cheque.

Regarding your returns, speak with the banker about the dividend pay-outs for the various blue chip companies. This typically happens every six months. You get your returns from both the dividend pay-outs of the companies, as well as money from when you sell the acquired shares.

2. Buy the Straits Times Index Fund

It can be a headache to pick which company to invest in. Even if you are financially savvy enough to read annual reports, and understand P/E and D/E ratios, you may not have the time to do it. A simple way around this is to pick a passive index fund, such as the Straits Times Index.

You can purchase ST Index funds through blue chip investment programmes as well (see point 1). When your purchase units in this fund, you are spreading your money across all 30 blue chip companies, instead of picking specific companies. This provides a degree of diversification - your assets will not be impacted by the underperformance of one specific company or industry*.

(*This being said, do note that the bulk of the ST Index Fund is tied to banks, so movements in the financial sector may carry slightly more weight than movements in sectors like healthcare, transport, etc.)

As of 2014, the ST Index fund generated annualised returns of over eight per cent per annum. This is high in comparison to many financial products, which will deliver returns of about five per cent per annum. However, note that there are no guarantees with regard to your returns, so speak to a wealth manager before making decisions.

3. Buy an Insurance Policy

It’s best to buy your insurance policy while you are still young. Premiums go up with age, and as you develop medical conditions. There are two ways you can do this. The first is to buy insurance for protection only, such as term insurance. This has a low cost and no payout, but will cover most of your medical needs.

The second is to use an insurance policy as a form of investment. Endowment policies, as well as Investment Linked Policies (ILPs), will invest your money in a fund for you. Returns are typically three to five per cent for endowment policies, and seven to nine per cent for ILPs (but these are not guaranteed.) Note, however, that the returns may be diminished by the fees charged - this can be found as the distribution cost, or Effect of Deduction, on an insurance policy.

It is generally more expensive to get an insurer to invest for you, as opposed to doing it yourself. However, if you have no interest or inclination toward finance, using a Financial Advisor is still better than leaving your money in the bank.

Seek Expert Advice Before You Buy

Seek advice from wealth managers or financial advisors before you buy. However, note that this does not mean you must buy from the person you consult. Get opinions from different qualified experts before choosing where to put your money.

As a rule of thumb, you should aim to get returns of at least five per cent, if you are aiming to build a retirement fund. This outpaces Singapore’s rate of inflation, which is historically around three per cent.


By Ryan Ong 
Ryan has been writing about finance for the last 10 years. He currently helps people save time and money at SingSaver.com.sg.

Saturday, April 9, 2016

What Is Your Reaction Towards Investment Setback?

As the saying goes "Life is 10% what happens to you AND 90% how you react to it". Same thing applies to your investment journey too. 

If you can still remember your investment journey, especially during the initial phase, I am sure you have made some "silly" or bad trade that turned into a loss or two (if you are an exceptional one i.e. never made any losses at all, probably you will never come to my site anyway). I guess we all been through that and might still making such losses in the future, the key is not whether it will happens or not, but how we react to it? 

Fundamentally, there are three broad reaction that we can make after such investment "setback" :

1. Treat it as a blip and move on. Of course, if there is/are lessons to be learnt, we should learn from our mistakes. 

2. Shift approach. There are many road lead to Rome and we might be attuned to certain style of investment, find your "holly grail" and stick to it after that. One of my friend learnt that Value Investing is not for him and hence switch it to trading, he has since doing pretty well till now. 

3. Give up! Since you are no longer in the game, you will naturally shift focus to other aspect of your life. Might be a good thing as investment might not be your cup of tea in the first place. 

There is no right or wrong answer in whatever reaction you are making. The key is not to let such temporary "set back" affect your daily life, emotionally! Keep going and keep smiling ;-) 

Personally, I am more towards type 1 of people, what about you?

Cheers!

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