CDP
| Security | # shares | Price S$ | % |
|---|---|---|---|
| DBS | 300 | 35.83 | 4.44 |
| OCBC Bank | 700 | 12.38 | 3.58 |
| SGX | 1,200 | 9.97 | 4.95 |
| SATS | 3,900 | 4.34 | 7.00 |
| ST Engineering | 4,100 | 4.12 | 6.98 |
| Micro-Mechanics | 1,300 | 3.20 | 1.72 |
| Powermatic Data | 5,000 | 2.99 | 6.18 |
| Singtel | 6,100 | 2.64 | 6.66 |
| TheHourGlass | 5,000 | 2.33 | 4.82 |
| Sheng Siong | 13,000 | 1.52 | 8.17 |
| ComfortDelGro | 11,200 | 1.49 | 6.90 |
| Genting Singapore | 11,700 | 0.815 | 3.94 |
| HRnetGroup | 21,900 | 0.77 | 6.97 |
| HC Surgical | 35,500 | 0.49 | 7.19 |
| China Sunsine | 41,800 | 0.465 | 8.04 |
| Kimly | 27,000 | 0.395 | 4.41 |
| Silverlake Axis | 60,800 | 0.32 | 8.04 |
Trade Actions
- Sold 10,400 shares of The Hour Glass.
- Sold 2,700 shares of ST Engineering.
- Sold 2,700 shares of CapitaLand Investment Management.
- Sold 3,400 shares of CapitaLand Integrated Comm. Trust.
SRS
| Security | # shares | Price S$ | % |
|---|---|---|---|
| OCBC Bank | 900 | 12.38 | 11.41 |
| SGX | 1,300 | 9.97 | 13.27 |
| SATS | 2,200 | 4.34 | 9.78 |
| ST Engineering | 3,000 | 4.12 | 12.65 |
| Singtel | 2,000 | 2.64 | 5.41 |
| Sheng Siong | 8,700 | 1.52 | 13.54 |
| ComfortDelGro | 6,900 | 1.49 | 10.53 |
| HC Surgical | 19,500 | 0.49 | 9.78 |
| China Sunsine | 10,800 | 0.465 | 5.14 |
| TalkMed Group | 3,700 | 0.40 | 1.52 |
| Silverlake Axis | 21,300 | 0.32 | 6.98 |
Trade Actions
- Bought 3,700 shares of TalkMed Group.
Commentary:
Even while the Russia-Ukraine war is ongoing and economists are worried about "stagflation", there is a positive vibe in the air. That is because the government has relaxed its COVID-19 safe management measures.
Overseas visitors will no longer need to be quarantined or tested on arrival. F&B outlets can serve up to 10 fully vaccinated patrons in a group. Live music events and alcohol consumption after 10.30pm can resume.
In short, life is almost back to normal.
This bodes well for aviation and tourism-related stocks like Singapore Airlines, SATS and Genting Singapore. Like a rising tide lifting all boats, the prices of other mega cap stocks such as ST Engineering, Comfortdelgro and Singtel also received a boost.
I grabbed the chance to sell into the rally as a few of my holdings crossed their 52-week high. I squared off my entire position in CapitaLand Investment Management (CLI) as well as CapitaLand Integrated Commercial Trust (CICT). CLI saw its stock price rocketed recently. I have no idea why investors are so bullish on the company, but I decided to take my profit and move on. CICT was my last Reit holding, and with this sale, my CDP portfolio is completely cleared of Reits. No regret though, as my investment focus has changed.
At the same time, I nibbled on TalkMed Group for my SRS portfolio. TalkMed provides medical oncology and palliative care services to patients in Singapore. The company has been well covered by other bloggers (see [here] and [here]), so I won't elaborate further on why I like the stock. The company received SGX approval to transfer its listing from the Catalist board to the Mainboard [news]. One risk though, is the lack of liquidity, which makes it challenging to get out of this counter at a good price. Nonetheless, my SRS portfolio has a long-term horizon, so this isn't an immediate concern. I would love to add this counter to my CDP portfolio when an attractive opportunity appears.
I recently read a book written by the founder of Pheim Asset Management (PAM), Dr. Tan Chong Koay. PAM has been successful in generating consistent alpha from trading small and medium-cap stocks in Southeast Asia. Their investment philosophy is unique - while PAM looks for undervalued stocks, they operate on the basis to "never be fully vested at all times". This means during exuberant times when valuations are overstretched, PAM is always ready to sell the stocks in its portfolio and go all cash.
In regional bourses, volatility is rampant. Prices rise and fall depending on which stocks are the flavour of the day. The small market capitalization and lack of analyst coverage mean many companies go unnoticed on the secondary board. While certain counters remain unloved by the market for years, a majority of them get traded up once their strong fundamentals are recognized. By buying low ahead of others and selling on the way up, PAM was able to profit handsomely.
Now, this sounds a lot like market timing, but PAM never claimed to be able to time the market. This also deviates from the buy-and-hold-forever mindset of Buffett devotees. That said, PAM's principled approach has its merits - human nature means long-only investors are susceptible to endowment effect and confirmation bias. By being disciplined to sell when valuation dictates so, there is less emotional attachment and the excess cash can be re-deployed to capture other opportunities.
Speaking of cash, my dry powder has grown considerably and is over 40 percent of my total portfolio value. I would love to deploy it generously, albeit not at current market prices. My view is that the recent optimistic outlook is only fleeting. However, inflation is real and climbing throughout the world. From ultra-loose monetary policies to supply chain bottlenecks to post-pandemic ramped up consumer demand, all these contributed to the inflationary environment today. Already, we are feeling the heat from the spike in food and fuel prices. Companies will see increased costs eat into their bottom line. If they are not able to pass on the increment to their customers, those companies will face margin squeeze over the next few quarters#. Lower investor expectations should moderate the stock prices accordingly.
By the way, if you have ten minutes to spare, I recommend you to watch this interview video with billionaire investor Ray Dalio of Bridgewater Associates [here]. Bridgewater is a very successful hedge fund and is currently the largest in the world (with US$150 billion AUM). Ray shared how the signs of recent times reminded him of the Depression era situation of the 1930s, and warned investors to be cautious. My favourite takeaway from the video is this quote:
Overseas visitors will no longer need to be quarantined or tested on arrival. F&B outlets can serve up to 10 fully vaccinated patrons in a group. Live music events and alcohol consumption after 10.30pm can resume.
In short, life is almost back to normal.
This bodes well for aviation and tourism-related stocks like Singapore Airlines, SATS and Genting Singapore. Like a rising tide lifting all boats, the prices of other mega cap stocks such as ST Engineering, Comfortdelgro and Singtel also received a boost.
I grabbed the chance to sell into the rally as a few of my holdings crossed their 52-week high. I squared off my entire position in CapitaLand Investment Management (CLI) as well as CapitaLand Integrated Commercial Trust (CICT). CLI saw its stock price rocketed recently. I have no idea why investors are so bullish on the company, but I decided to take my profit and move on. CICT was my last Reit holding, and with this sale, my CDP portfolio is completely cleared of Reits. No regret though, as my investment focus has changed.
At the same time, I nibbled on TalkMed Group for my SRS portfolio. TalkMed provides medical oncology and palliative care services to patients in Singapore. The company has been well covered by other bloggers (see [here] and [here]), so I won't elaborate further on why I like the stock. The company received SGX approval to transfer its listing from the Catalist board to the Mainboard [news]. One risk though, is the lack of liquidity, which makes it challenging to get out of this counter at a good price. Nonetheless, my SRS portfolio has a long-term horizon, so this isn't an immediate concern. I would love to add this counter to my CDP portfolio when an attractive opportunity appears.
I recently read a book written by the founder of Pheim Asset Management (PAM), Dr. Tan Chong Koay. PAM has been successful in generating consistent alpha from trading small and medium-cap stocks in Southeast Asia. Their investment philosophy is unique - while PAM looks for undervalued stocks, they operate on the basis to "never be fully vested at all times". This means during exuberant times when valuations are overstretched, PAM is always ready to sell the stocks in its portfolio and go all cash.
In regional bourses, volatility is rampant. Prices rise and fall depending on which stocks are the flavour of the day. The small market capitalization and lack of analyst coverage mean many companies go unnoticed on the secondary board. While certain counters remain unloved by the market for years, a majority of them get traded up once their strong fundamentals are recognized. By buying low ahead of others and selling on the way up, PAM was able to profit handsomely.
Now, this sounds a lot like market timing, but PAM never claimed to be able to time the market. This also deviates from the buy-and-hold-forever mindset of Buffett devotees. That said, PAM's principled approach has its merits - human nature means long-only investors are susceptible to endowment effect and confirmation bias. By being disciplined to sell when valuation dictates so, there is less emotional attachment and the excess cash can be re-deployed to capture other opportunities.
Speaking of cash, my dry powder has grown considerably and is over 40 percent of my total portfolio value. I would love to deploy it generously, albeit not at current market prices. My view is that the recent optimistic outlook is only fleeting. However, inflation is real and climbing throughout the world. From ultra-loose monetary policies to supply chain bottlenecks to post-pandemic ramped up consumer demand, all these contributed to the inflationary environment today. Already, we are feeling the heat from the spike in food and fuel prices. Companies will see increased costs eat into their bottom line. If they are not able to pass on the increment to their customers, those companies will face margin squeeze over the next few quarters#. Lower investor expectations should moderate the stock prices accordingly.
By the way, if you have ten minutes to spare, I recommend you to watch this interview video with billionaire investor Ray Dalio of Bridgewater Associates [here]. Bridgewater is a very successful hedge fund and is currently the largest in the world (with US$150 billion AUM). Ray shared how the signs of recent times reminded him of the Depression era situation of the 1930s, and warned investors to be cautious. My favourite takeaway from the video is this quote:
When everyone starts to extrapolate the past (uptrend), the past will not perform up to expectations, and that is the time to sell.
Ray Dalio
# This also makes the point why it is important to choose companies with healthy profit margin (preferably double-digit) in the first place.
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