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Buy & Hold (Guest Post)

Buy & Hold (Guest Post)

I been holding the current 9 stocks since 2016.
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This post was originally posted here. The writer, theintelligentinvestor is a veteran community member on InvestingNote, with username known as TII and 1100+ followers.

While there were some stocks that I have bought and sold off, most were done during 2016. There were hardly any position taken after 2017 so we can assume my portfolio as the aggregate of the 9 stocks and also it can be considered it as a buy & hold strategy with the holding period of 3.5 years.

Stocks.cafe provides the daily data of the portfolio time-weighted returns vs the STI ETF or ES3 which can be downloaded to Excel. I have plotted 2 graphs, the top is the my portfolio TII (in green) vs STI ETF (in Blue); the bottom is the difference between the 2 top lines.

The top graph first. The STI, since 2016, has moved within a window of -10% to +32%. The 2016 was quite flat; 2017 was a good year up 20%; 2018 was poor down -7%; and 2019 YTD is up 9%. The first point I want to make is if you are trying to trade during these 3.5 years which quite a lot of world events had happened. Well, you can try to hop in Feb 2016, enjoy the 2 years ride and get off in Mar 2018 and wait patiently for 9 months and get in back again around Dec 2018. Sounds simple but many will know it is not easy. When to get in, when to get out, how long to wait during in and out periods? There are just too many variables and moving parts to make sense of.

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TTI’s Portfolio Performance – May 2019 + Avenue Therapeutics Updates (Guest Post)

TTI’s Portfolio Performance – May 2019 + Avenue Therapeutics Updates (Guest Post)

May 2019’s a tough month, and no, there’s no new “Best. May. Ever” series… (Continuation of these:)

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This post was originally posted here. The writer, ThumbTackInvestor is a veteran community member and blogger on InvestingNote, with username known as ThumbTackInvestor and 2400+ followers.

Best. January. Ever.

Best. February. Ever.

Best. Mar……….. You Know The Drill!

TT Portfolio Performance & Review

Like most of everyone else, TTI’s portfolio ROI declined in May, alongside the volatility and market uncertainties from the trade wars.

SG Markets

Total portfolio value in SG markets is SGD 357,660.

Again, not much activity here, took profit on a tiny itsy bit of Geo Energy to redeploy into US markets, otherwise, holdings remain the same. I’m also not really spending much time looking in these waters.

Bonds

Again, nothing much to talk about here,the bond portfolio is approximately SGD 550,000.The intention is to leave all coupons to compound, with next to zero activity here.

US / Global Markets

ROI has declined from April 2019’s 40.61%, to the current 37.19% YTD.

Net Quantum investment gains YTD (excluding any capital injections/withdrawals) is thus USD 164,707.26

Current top/large winners include Wirecard, Avenue Therapeutics, Tesla shorts, JD.com shorts and a small position in the volatility derivative VXX.

The 2 biggest/most irritating losers are Centurylink (CTL) and Chesapeake Energy (CHK). I remain fairly optimistic about CTL, I just think the management needs to show a single quarter of revenue gain or even, just stabilization, and the share price would pop through the roof. In the meantime, I’m collecting like a 8% yield after the witholding taxes.

CHK on the other hand, is dead in the water. While Lawler has done a fantastic job deleveraging over the past couple of years, this may be too mammoth a task for him. Or he may need several years more. There’s hardly any difference in both scenarios.

Overall, I’m pretty pleased with how things are turning out for my US portfolio. Despite a drop of around 5% due to the trade wars in May, the gap between my ROI and the passive benchmarks is increasing, and the 3 indices I compare against are all at the 9-10% mark, and that puts my ROI this year at 3x that of mere mortals.

Alongside the huge volatility in May, the USD-SGD pairing also showed massive movements.

I’ve always said I’m no forex expert.

I don’t even think there’s such a thing.

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Trade Tariffs Hit Asian and US Stock Markets Badly

Trade Tariffs Hit Asian and US Stock Markets Badly

But first, what are trade tariffs?

A tariff is basically a tax paid on imports and exports of goods and services.

An imposing tax on an imported product would cause its price to increase, which results in a decrease in demand for imported goods. In relation, the price of local products becomes lower to the consumer.

The US Total Imports vs Dutiable Imports from 1821 to 2016 can be seen below:

The current US deficit as of 2017 is $500 billion. The US imports from China about four times as much as it sells to that country in goods as services, leaving Washington more room than Beijing to tax a greater share of bilateral trade. The U.S. trade deficit with China was $375 billion in 2017. The trade deficit exists because U.S. exports to China were only $130 billion while imports from China were $506 billion. The United States imports consumer electronics, clothing, and machinery from China. A lot of the imports are from U.S. manufacturers that send raw materials to China for low-cost assembly. Once shipped back to the United States, they are considered imports.

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How Corporate Actions Affect Stock Prices More Than Anything Else

How Corporate Actions Affect Stock Prices More Than Anything Else

But first, what exactly is a corporate action? And why does it matter?

According to Investopedia,

A corporate action is any activity that brings material change to an organization and impacts its stakeholders, including shareholders, both common and preferred, as well as bondholders.

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Corporate actions includes:

  • Stock Split and reverse split (consolidation)
  • Spin-Offs
  • Dividend Payouts
  • Mergers and Acquisitions
  • Bonus Issue
  • Rights Issue
  • Share buybacks
  • IPO

Corporate actions are important source of indicators for the retail investors to monitor the company’s direction and effectively, the share price. There are some rules that investors and traders have to take note of, according to Li Guang Sheng (a top tier remisier and veteran community member):

  • Officers and employees of the Company two weeks before the announcement of the Company’s financial results for the first three quarters and one month prior to the announcement of the full year results (“Black-out Period”). Usually there will be internal memo to notify and remind all Directors, officers and employees of the Company on compliance with the best practices on dealing in securities pursuant to Listing Rule 1207(19)(c), in not dealing with the Company’s securities during the Black-out Period. The Company, its Directors and officers should be aware that the Company should not deal in its own securities (including undertaking any share repurchases) during the Black-out Period. Therefore, the Company would wish to complied with the Listing Rule 1207(19)(c) and not run foul with SGX.
  • If the players of the company shares belong to insiders, then during this period there may be less buyers and harder for you to run or sell your shares. Also if the company is undergoing share buyback and supporting the share prices through daily share buy back, the price may tank during the 2 weeks of no buying from the company or 4 weeks if it is the full year listing result period. So for those who trade heavy, be prepared to reduce your position 2 weeks prior to quarter result announcement due to less liquidity.
  • Also take note on listed company share buy back rules,
    • a) on-market purchases should not exceed 5% above the average closing market prices of the share over the last five market days;
    • b) details of purchases to be released to the SGX-ST, if it is non-market purchases, by 9am on the next market day, or, if an off-market acquisition, by 9am on the second market day after the close of acceptance.

Watch this quick video of Guang Sheng where he explains why corporate actions are so important:

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