Monday, 27 October 2014

360 review - SRS, CPF and Saxos

I have recently completed my 360 review on what I want to do with my various investment accounts and this will be my final post on this topic. 

The various 360 topics are:

Today's will be a bumper edition of topics on CPF, SRS and SAXOs. 

360 review - CPF accounts

After reviewing the cash balances in both our CPF accounts and the various restrictions imposed on using it for investments, such as the 35% limit on what you can use to invest in stocks and shares, I decided not to touch them. Given that it is risk free and earns a 2.5% interest, I have decided to keep CPF as a buffer for my home's "mortgage" emergency fund. 



In the unfortunate event that if I loses my job or decided to take a sabbatical, the cash in the CPF accounts will be used for our monthly mortgages. Based on my computation, this emergency fund can support my home mortgages for about 4.4 years.  

One important action item resulting from the CPF review was that I decided to speed up the mortgage repayment even though the all-in cost of borrowing of 1.5% is lower than the 2.5% interest which I can earn in the CPF account. At the end of the day, a debt is still a debt. I think I would rather owe money to my CPF account then to owe money to a bank.  

While I acknowledge that housing is a good inflation hedge, my aim is to pay off my remaining mortgage by 55 years old. I intend to do that by either increasing my monthly repayment or do a lump sum payment and reduce the "CPF buffer" to around 18-24 months instead of the current 52 months. 

360 review - SRS accounts 

I recently top up the SRS accounts for me and wifey. The combined balance has now reached $160,000.  In addition to the tax savings and squirrelling some savings year by year, the good thing is that I finally decided what I should be doing with these accounts and hopefully I have the discipline to stick to the strategies. In case you wonder why Post Office Savings Bank uses a squirrel as well, the nature's answer is here.


I have decided to use the SRS accounts for long term strategies, for dividend or rental income and hopefully with no cut loss levels. I hope I can pass on that portfolio to the next generation. With the breaking down of minimum board lots from 1,000 shares to 100 shares, it will become easier to build up a portfolio of blue chips from January next year. What do I hope to see in that portfolio? 
  • Iconic blue chips. I want to build up a portfolio of iconic Singapore blue chip portfolio that has a strong Singapore Inc flavour and still likely to grow for the next 20-30 years. In that regard, following the weakness in the market, I have recently added Keppel Corporation to my SRS account. I will probably add some banks and telcos but will avoid airline stocks for now.  
  • Strong local brands.  It's hard to describe to you what such stocks are but to give you a flavor of what i am thinking about, it will be stocks such as Osim and Breadtalk. 
  • REITs, Business Trusts and Dividend-paying businesses. I will start adding REITs with good office and retail locations to the SRS portfolio. I want to start thinking of myself as landlords collecting rental every 3-6 months. I may add business trusts if the business model has sustainable and recurring earnings. I would consider toll road operators such as China Merchant Holdings or education provider Overseas Education in this category
360 review - Saxos

I have classified all my other accounts under the topic Saxos. This will include Futures and CFDs as well. I have decided to start focusing more attention on US markets as well given the breadth and depth of the markets there. With the advance of technology, I no longer need to limit myself to the Singapore market that really "cannot make it" 

I will use the Saxos account for a few purposes:
  • Investing and/or trading in global iconic stocks such as Alibaba, Google and Apple. 
  • Use local CFDs and Futures to hedge my positions in SRS in the event of a major crash.
I would like to build up a portfolio of global iconic stocks over time as well. 

360 review - Time 


My time is limited. This will be my last post on 360 review and you can see that it is a long post as i want to save time and squeeze everything into one post. hahaha 

Given my heavy work load, frequent travels and the retirement plans, I find it difficult to blog too frequently. As such, I will not be able to update my investments and trades on a real time basis. However, rest assured, I will continue to review all the IPO companies here and give you my chilli ratings. :) 

Before i sign off, have you watched the video from NTUC Income recently. I thought it was rather thought provoking. While i am not a fan of insurance products, it might serve to remind you to do your own retirement planning and the future you will thank you for that

Here is the video below for your enjoyment. ~ Mr. IPO


Sunday, 26 October 2014

360 review - Pre IPO investments

I spent a while thinking what the subject header should read like. Should it be a sensational one or just a boring 360 review....zzzzz... make sure you read till the end of the post....



What are pre IPO investments?

You can find the definition here. In lay man terms, it is to invest in a company just before it goes for listing, usually 6-12 months prior to listing. For early stage investing, it will be called venture investing, so don't confuse a VC investing, with growth investing with pre-ipo investing. They are all different and has different risk reward profiles. The strategies are very different as well. You can have a quick comparison between the various strategies i mentioned above here in terms of risk profiles and returns.


Is Pre-IPO investing a high risk game?

Is pre IPO investing risky? Of course! In fact it is so risky that SEC actually has some advisory on it. The link is here.


If the Company fails to be listed or fold up, you will lose the invested capital. 

Have i invested in pre IPO company before?

In case you are wondering, my first pre IPO company was in a Chinese S chip in 2008. I have to say that I was quite lucky to get out unscathed despite the financial crisis due to a personal put option we had against the founder and we opted for cash instead of shares when the company was listed. The share price tanked post IPO (See chart below) but luckily the returns was locked in at around 1.66x with high teens IRR (based on my recollection) after 4 years. The share is still listed today but is languishing below its IPO price due to lack of investors' appreciation for Chinese stocks. It was a small investment which i co-invested with my ex colleagues.


How you make money in a pre-IPO investment?


This is a pictorial view in an "ideal" world where you invest at a lower valuation before the IPO and the Company's business plans progressed as planned and managed to list at a higher valuation 6-12 months later. Hopefully, the Company can continue to grow its earnings using the proceeds from the IPO.

You might ask why the Company even want to have Pre-Ipo investors in the first place. There are a few reasons for this.

1.The picture always look clearer with hindsight

At the point of investing for Pre IPO investors, the Company may be at an inflexion point where success or failure is a binary outcome. As such, pre IPO investors are assuming quite a bit of risk in return of a higher return. If things are so clear, investors would have piled into Alibaba, Google or Facebook way before they became 'big'.  Even the so called experts can missed it. I will just share with you some interesting articles in case you are interested in this private equity world.


2. The Company does not want to get diluted too early

By having a pre-ipo round at a lower valuation, the Company can issue less shares to tide their finances till the next big sale or milestone. This is less dilutive than having a full blown IPO. If the business plans did materialize as planned, the Company can sell its shares for a higher valuation in an IPO later.

3. The Company may want to have some 'quality names'

The Company might open a pre-ipo round to investors who can bring 'prestige' to the IPO later. For example in QT Vascular, the Company managed to get EDB and JnJ into the pre-IPO round.

The pre-IPO round can also be one way to 'incentivized' the 'who's who' to support the actual IPO later given that they would have a lower cost base. It can help to ensure a good IPO debut later. 

Some pre-IPO investors can also add value by helping to open doors and create new business opportunities for the Company.

What are the things a small pre-IPO investor should look out for?

This will be the things which i will look out for prior to investing.
  1. A sustainable business model in an attractive sector.
  2. A good story line at IPO and post IPO. 
  3. Reputable co-investors. Obviously i don't belong to this category but if i am investing alongside reputable companies and co-investors, it will be more assuring for me.
  4. Downside protection. There must be adequate downside protection to ensure the Company is able to redeem my shares in the event it can't be listed. 
  5. Upside. There must be adequate upside with formula crafted into the agreement on the conversion formula. In Singapore, it is usually based on a discount to the IPO valuation that ranges from 25% to 50%. 
  6. Lock up. There will always be at least 6 to 12 month lock up requirement. This is inevitable and usually unavoidable. One way to mitigate this risk is to sell some shares at IPO price and be subject to lock up for the remaining shares. In other cases, you just have to keep your fingers crossed that liquidity and valuation will continue for the next 6-12 months and allow you to exit from the investment safely.
Rubbing shoulders with the who's and who

Here comes to the crux of my post today if you bother to read till here. :-P 

Recently I invested in a pre IPO company alongside the who's who in the local investment scene. Those type of names who I know them but they don't know me. Haha. It's quite a key "milestone" for me to invest along side A.Wang, T.Goh and some other familiar names. Of course I ranked at the rock bottom of the list of investors in terms of the amount put in and has to practically "beg" my way in. I will not embarrass myself with the quantum here but in terms of milestone, I will regard this investment as my first official investment into the pre-IPO world. Wish me luck! :)

Mr. IPO is going to be famous !?

If the company is successfully listed next year and my name appears in the prospectus as a pre IPO investor, I am going to frame up the prospectus and hang it in my study room or create a tombstone from it hahaha. In case you are wondering, a tombstone looks like this....




Happy pre IPOing

Sunday, 12 October 2014

SRS Portfolio - 30 Sep 2014


Here is the portfolio summary as of 30 Sep 2014. 

There is only one portfolio company remaining and that is CM Pacific. I have also sold off Overseas Education when the 90c support level gave way. It was executed by my broker when I was travelling. 

I am back to almost 100% in cash and it is sitting at $116,620. 

If you have followed my blog for a while, you will know that I never hesitate to cut loss when the positions turned against me. I would rather preserve the capital than to sit through the unrealised losses. I will also set protective stops that let me get out at a profit then to see it turn into a loss as what you have seen my japfa position. My only "regret" is i should have sold it at 96c. :-P

This is just an extension of my character and personality. I don't like to hold on to losing positions and hope for the best. There is no "hope" in my investment or trading portfolio.  I wouldn't be happy if I am still holding to Japfa or QT Vascular now. You will have to find a style that suits your personality. Protecting the downside is important to me. 

360 - SRS Account

I am still thinking hard on how my investment strategy for SRS account should be. I haven't got a "landing" yet. Should it be focused on passive income or should it be for more aggressive growth stocks? Every time I think about it, I get a "headache". 

The reason why it is difficult is because I am a risk taker and to invest for dividend or for distribution income just don't sound right but at the same time I also recognize that having a steady stream of passive income is important towards achieving "financial freedom".

Let me give a further thoughts and see if I can get a landing. I will also share what I invested recently in a separate post.  

December is approaching soon. It's time to think about squirrelling some cash into the SRS account...

Till then. Happy SRSing.

Thursday, 11 September 2014

SRS portfolio 31 Aug 2014


The positions as of 31 Aug 2014 for reference. There are no dividends this month. 

I have liquidated JAPFA in my earlier blog post when the share price weakens. Similarly I did the same to QT Vacular this morning.  Having such volatile stocks in my SRS portfolio that is fundamentally not "value-oriented" and yet doesn't allow me to be "flexible" enough to take profit or cut loss doesn't seem right for the SRS strategy I am pursuing. 

SRS strategy

I am still trying to figure out what should be the most appropriate SRS strategy in relation to the 360 review which I have been doing for both myself and wifey. 

I will be spending the next few days thinking about it while gorging on the street food in Bangkok hoping not to get any stomach ache in the process. ^_^

Happy SRSing. 

Monday, 8 September 2014

JAPFA



This JAPFA has been a frustrating investment.

I first bought 50 lots at 85 cents on 19 August. The post is here.

The stock rose all the way to 96 cents. I have to admit that i was seriously contemplating selling it when it broke the interim uptrend line at 93c but given this is supposedly an investment account, i decided to hold on for the "long term".

However, i hate seeing a winning position turned into a losing one, as such i decided to close it off when the 90c support broke today. Sigh...

Happy SRSing ^_^

Sunday, 7 September 2014

360 review - Cash

I have shared with you in my previous post the importance of your career. Today I am going to cover another topic - Cash. 

Cash is king!

Cash is cash. What is there to talk about? Well, you must have heard of the cliche Cash is King! 

When I first started out like you, my starting pay was only $1,850. As such, I am literally "cashless". All my salary is used to fund my daily life and starting my family at a young age is not helping but it help instil a sense of responsibility and gives me a purpose in life. It is also the reasons and motivation in the pursuit for financial freedom. 

However, I worked hard in my career and the pay steadily increases over the years. 

Me and my wife are good savers, or in our initial years at least. Haha. We saved regularly and take only short trips to the region like China and Thailand for vacations. No such thing as flying to Europe. We always spend within our means. 

Credit cards are bad 

I have seen real life examples of people who spent beyond their means and abuse the credit cards. In that process, they have dug for themselves very deep holes. They go for fine dining and luxury vacations, pay the minimal sum each month and roll over the balance. If you think loan sharks are evil, credit cards companies are the Great White Sharks. The printed interest rate is only 2% per month. That translate into a nominal rate of 24% a year and I have not even included the effective interest rate if you roll over your balance. That will be interest on interest and the bank is making compounded returns from you!

If you can't control your credit card spending and always pay the minimum sum, my friendly suggestion is to cut off your cards immediately and plan to pay off the credit card debts before you even think about investing. Get your house in order. 

It's not how much you earn but how much you save!



I want to stress again and again that it is not how much you earn but how much you save. Earning more means that you can shorten the number of years that you need to save but it doesn't take away the need to save up. You can make $10,000 each month but if you spend $15,000 each month, you are worse off than a person who makes $5,000 and saves $2,000. 

Unless you are born with a silver spoon, you need to save up. You need to accumulate a sum of money for rainy days but more critically, be your seed capital. Without your seed capital, you can't break out of the rat race. The capital can then be deployed into investments such as stocks and properties. 

To purchase a property, you should have saved up for at least a 20% downpayment to avoid over leveraging. We will talk about 360 review on property another day.

Holding cash is a position

I am never fully invested. In other words, I always hold some cash. I hold cash in anticipation of both opportunities and crisis. It also serves for rainy days in emergency. 

What do I mean by opportunity? For example I am currently evaluating another opportunity to invest in a pre-IPO company. I have blog about such opportunities way back in 2008, how time flies! That investment turned out to be a good one despite the GFC. I will blog about it another day. 

Such opportunities come by every now and then and if I like the company, I can then deploy the cash. If I have no cash, having such opportunities will be meaningless as I can't take advantage of it.  I will be investing in the next pre-ipo company, i will blog more about pre-ipo companies in 360 - Investments next time.

What do i mean by crisis? During the global financial crisis, you will have to opportunity to invest in properties and shares. There will be at least a few "global financial crisis" in your life time, remember to make full use of it and you can get out of the rat race much faster than anyone else. However, if you have no cash to deploy, the crisis will further add to your misery as you watch the opportunities slipped by.

Isn't holding cash means losing money everyday?

I have shared with you previously that your cash is losing money every day. The post is here

So while saving is important, knowing how to utilize the cash to get a higher return while waiting for the opportunities and crisis is even more important. This is the reason why i trade the markets and punt the IPO market with my "war chest cash". I also recognize that investing for dividends and passive income is important, hence I invest for the longer term using my SRSKnowing your own time frame is also very important. I will blog about 360 - SRS funds in my future posts. 

Bonds for retail investors

It's good that MAS is finally relaxing the rules on retail investors investing in bonds. You will have more opportunities to invest into higher yielding and relatively safer instruments. However, I am personally not into bonds. The spreads are currently too low. The best time to invest in bonds is actually during the GFC where the bond like instruments are giving equity like returns and yet "safer" than equity given it's protection and liquidation priority over equity. The complacency since the 2008 crisis has set in again with borrowing rates and spreads at record low. 

Will history repeat itself? 

Frankly, I wouldn't be surprised, so get your war chest ready. A black Monday (or black swan) event will just hit the markets when you least expected it. I am expecting one to occur within the next18 months but I may be wrong of course. 

How much to save for war chest?

It really depends on what you are looking for. If you are investing in stocks, you need at least $100,000 as war chest to deploy into 3-4 positions for a return on investment of 2x. 

If you are investing in properties (not buying a home to stay), you will need between $250,000 to $500,000 to invest in a decent size property. The reasons why I favour properties over stocks because of cheaper financing, leverage effect and passive income while you patiently wait for market to recover. 

Are you ready if a black swan appears today?

If you are prepared, you will rub your hands with glee instead of panicking when history repeats itself. 

Save up today and you will thank me when the black swan appears. 

Happy saving up ^_^

Sunday, 31 August 2014

360 Review - Career

As promised, I will briefly run through the 360 review I did. This will be a series of posts whereby I share my thoughts and views on what I believe are important to achieve my personal financial freedom. Career, Cash, CPF, Properties, Trading, Investments and Travel. Each plan is unique so you will have to devise your own plans that is tailored towards your own circumstances.

I will not blog in any particular sequence but whatever that "inspire" me. Today I will blog about the first topic 360 Review - Career. 

Career

I have shared with you previously two posts on the topic.

Post 1: Your Career is very important
Post 2: Don't treat your career marathon like a sprint

If you are not doing your own business, then this will be the main source of income from which you can utilize wisely to fund your retirement. 

From young, I have been brained washed not to "job hop". My dad and mum both had their one and only job till they retire. Unbelievable but true for their generation. They used to frown very heavily upon job hoppers but have since changed their perception.

Job hopping is no longer a taboo

Job hopping is no longer a taboo and probably the younger ones don't really care anyway. However, you cannot be hoping from one job to another every 6 months. You need to build up some track record and experience and then try to get headhunted to the next role. Each role should give you give you a new experience (if you are changing industry) or higher pay (if you are moving vertically upwards) or better title (if you are moving from one competitor to another). If you can achieve a better pay with a better title in a better company, that will be the most ideal situation. However, make sure you are culturally able to adapt. Having worked through quite a few firms with very different cultures and bosses, i have to say i am pretty adaptable except that as i aged, with all due respect to ladies, i find it more difficult to work for female bosses.

How to get a higher paying job with better prospects?

To achieve a higher pay with a better title and prospects, the best way to do it is through the headhunters. As you progressed upwards, the compensation for headhunters are not aligned with the employers. They are on the same side as you because their final fees depends on a % of the annual package you receive.  A lot of jobs are never advertised in the papers. The job description reached the headhunters, who then run through their databases and then they will start profiling suitable candidates to be shortlisted for interviews. So if you have never send your CVs to headhunters before, start doing so and keep them updated as you gained new experience.  Always make it a point to send the CVs to the reputable headhunters in your industry even when you are not actively searching for a new role so that you are "always in their mind".

Headhunters have different specialization as well. Some are more well connected in the financial industry, others are more proficient in the manufacturing industry, etc. So find out the one that is specialized in your field of competence. 

One good website to hunt for finance-related jobs will be efinancialcareers. I think many headhunting firms in the finance space uses this portal to advertise their roles.

Is there secret formula to a successful career?

If you want a magical formula from me, i can give you one. It's the 3R.  

RIGHT TIME 天时
RIGHT PLACE 地利
RIGHT SKILLSETS 人和

There is no other formula i can give you. haha. No use being the most talented person in your firm when your boss is blocking your path and has no intention to change job. I have also seen many instances where the bosses left and someone then stepped "up" to be the new head. 

Right place and right time - probably you need some divine guidance but right skillsets, which includes EQ, can be learned. 

360 review on Mr IPO's career

Every now and then, i will take a step back and review my own career. Things i ask myself will be
  • Do i still enjoy what i am doing? Am i learning new things?
  • Am i given new roles and responsibilities or am I already stagnant in my role?
  • What are the pull factors? (pay, work-life balance, meaningful role and responsibilities, etc)
  • What are the push factors? (long hours, lousy bosses, bad culture, no flexibility, etc)
  • Is my pay pegged to the market and whether I have reached the "peak" of my potential. 
In my view, the best time to negotiate a package is when you have no push factors. This is where you will really weigh your options very carefully and not be blinded by the offer on the table.

In my life and line of work, i meet many talented and successful people. I have mentioned in my facebook page to work on your "Emotional Quotient". The people at the top have the right connection, right friends and right aptitude. 

Another area to work on will be your personal network. Treasure the friends, colleagues and acquaintances you make in your field of work. 

EQ + solid working experience + strong personal network = Well sought after professionals

I have been through 4 different jobs with 4 different cultures. I started work in 1997 and my starting pay was $1,850. I was headhunted 3x in my life so far. The first time was in 2000 (pay rise of 81%), second time 2008 (28%), third time 2010 (36%). I had wanted to start my own fund management company back in 2008 but on hindsight that will be probably be derailed by the GFC. 

Just to give you some ball park figures, the increment in pay from each change should range from 25% to 50%. 

How did Mr IPO fare?

I wouldn't say that I have done extremely well but I will say that I manage to grab some of the opportunities that come my way be it in my career or personal investing. The pay has also risen to a decent level where the family can be comfortable.

Although i have been "headhunted" a few times, please don't have the wrong idea that I have done very well. I am still far from it. 


What's next?

I think I have a few more years to go in my current role as there are still things to learn, fun stuff to do and talented people to know better. 


Learn to fish for yourself

While I mentioned that your career is important, I also stress that a skill set outside of work is important too. I would encourage you to pursue something that you are passionate about. Many second career are started from hobbies and passions. If I am retrenched one day, I can trade for a living, I can start my own fund management company, I can start a financial education company. I can start my own business. You will have to find a relevant skillset that you are passionate about. That is also probably the time where I will no longer need to use a stage name or be a Batman and do a Mr. AK from ASSI. Lol.

Happy being hunted

That is all for today. I will cover other 360 topics like Cash, Investing, Trading, Properties and Travel in separate posts.

Wednesday, 20 August 2014

Have you 360 recently?

It's interesting that banks are coming up with the 360 relationship concept. This concept was not really that new but has became more popular in recent months. 

If i am not mistaken, Standard Chartered first pioneered this concept to reward you on a overall relationship such that you received reward points if you have a housing loan, investment account, credit cards with them. 

OCBC and DBS then offered something along those lines where they give you a higher tiered interest if you met some or all of the conditions, including if your salary is credited into their bank account etc. 

Do you do a 360 account of your own life?

I am not sure if you regularly do a pulse check on your own goals and retirement plans. It's like doing an annual health screening to see whether you are still on the right path towards financial freedom or have veered off the road. 

A 360 review means achieving the ultimate objective is not the only goal. It includes other goals along the way. I have shared with you previously that attaining the goal is one thing but the way in which you achieve it is equally important. No point achieving financial freedom early but you have no friends or family to share the moment with. Cherish your loved ones. Get the picture?

A 360 review of your own life can cover many different aspects including but not limited to the following:
  • Personal - Career, Personal Development, Health, Happiness, Mid-life Crisis, etc
  • Family - Kids education, housing, well-being, vacation plans, etc
  • Retirement plans - Net worth, passive income plans, investments, taxation, etc.
Each aspect is independent but yet intriguingly intertwined with each other and the toughest part is always to strike a balance. Let me give you a simple illustration. You want to reduce your monthly expenses to build up your net worth now but that involves cutting down on your wine and dine. An alternative to cutting down your expenses is to get a pay raise but having that pay rise may lead to long hours being spent in office which makes the family unhappy as they don't get to see you at home so often. Neglected kids then fail their studies which then affect your mental well being and that affects your work quality.

Do a 360 today

I am in the midst of doing a 360 review for myself as well as my family. I will share more thoughts on what insights i gained in future but it was actually tougher than i thought. I am still stuck on how the retirement plan for Mrs IPO should look like given the capital comes from me :-P.

I will share more about Mrs IPO next time as well as my 360 review on my career, CPF,  investments, property, trading, goals, holidays, etc.

Happy 360ing.

Tuesday, 19 August 2014

JAPFA & QT Vascular

JAPFA

Today i had a frustrating day. I was queuing for JAPFA at 83 cents since morning and the order wasn't filled.

Eventually i bought 50 lots at 85 cents. I have shared with you my analysis here. I am taking a view that it should head towards its fair value of 91c-110c and probably in the course of the next few months, more research coverage will be initiated given it is a decent market cap stock.


QT Vascular


The final closing today is fairly disappointing. I added another 50 lots of QTV at 47.5 cents today. Let's see how my decision to invest a bigger chuck of capital in fewer stocks pan out. Two reports in this link for your consumption.

Happy SRSing

Saturday, 16 August 2014

What does KFC has to do with Mr. IPO?

KFC 

Every now and then, I would have a craving for KFC and after I ate it, it will be months before I touch it again. Today, it was my son who craved for the unhealthy junk food.

There was an advertisement on the glass panel. "Make good mornings great". I couldn't help but remember one guy who became their "food ambassador". Can you remember who?

KF Seetoh

If it is Mr. IPO who asked you to eat KFC breakfast, it's perfectly fine.











Unfortunately, i do have a little issue with KF Seetoh asking me to eat breakfast at KFC. This is because of what he represents. He is the "godfather" of hawker food champion and was the strongest advocate of our local delights before any other bloggers became famous. 

It's like someone who has crossed to the "dark side" and "betrayed" his principles to introduce "junk food" because of money. Maybe I am too extreme. 

Unbiased views or super biased views?

Why do people visit my blog ? Is it for my super unbiased views or for my super biased views? You tell me. ^_^

Recently a website that carry my articles became more "selective" in publishing my IPO articles.  In fact, they started to write their own articles on the IPO aspirants. 

I wrote to the publisher to understand the situation better. To paraphrase what he said, "we are still interested to publish your articles if we are not paid by the companies to carry an advertorial on their IPOs". 

Here you go, the very reason why readers search out for unbiased views from biased people like me. I am not paid to write good things about the IPO and you have my assurance that I won't "cross to the dark side". But if I do, I will definitely make sure you get to know it first. :-P











Advertisements

Google has been very kind to me (all thanks to my regular readers of course) in sending me a cheque every other month. However, I have to support our local brand too and Nuffnang has been very credible in sending me a cheque once it hits $100. While not as lucrative as the global giant, it is definitely more credible than Adverlets who defaulted on me. This is the second cheque from Nuffnang. I have previously wrote an article about passive income from blogging so my old article for your reference and part 2 of it.











I am very selective in my advertisements. Some has approached me to advertise about opening option trading account and I can get a cut from the size of the account they opened. However, a quick google check throw up some complaints about customers being unable to withdraw their monies. I rather not place those dubious advertisements on my blog but if KFC wants pay Mr. IPO to blog about his breakfast, I will definitely accept it. :-P

Happy KFCing and welcome to Mr IPO's blog. Biased views written in an unbiased manner. With all good intents and purposes, Mr. IPO eats ("buys") what he cooks ("blogs"). Have a good weekend. :)

Sunday, 10 August 2014

SRS portfolio - 31 July 2014


It was a pretty interesting month where i divested UMS holdings on 1 July and bought 50 lots of QT Vascular at 46.5 cents on 21 July. While on my business trip, it went all the way up to 52.5c, translating into a "unrealized" profit of $3,000 in 3 days only to see it turn into a loss this August as it closed at 44 cents last Friday. hahaha

Let's see how it goes as it was my intention to build up a slightly bigger position but the current technical picture certainly don't look enticing enough for me to add on to those positions. Do note that my SRS account is meant for investing in stocks for the longer term and they must have some promising growth elements. 

Starburst

I always like to give my account a re-look every now and then and I am currently in the midst of refreshing my thoughts. Seems like i have missed out adding to some of the counters that i wanted to, such as Starburst Holdings for the longer term.

IPO and you

I hope that by now you would have realized that everything is inter-related. I analyzed IPO for shorter term punts and longer term investing. That was how Overseas Education came into SRS account more than one year back.

I hope you also realise by now that IPO is a very dangerous place :-P and sometimes people can talk up an IPO to lure you to subscribe only to dump the shares on you. Most stocks cannot make it one, so you have to be very discerning if you are investing for the longer term and longer term prospect is very important. 

In addition, you should also move on from just playing the IPO market. You should start investing in stocks and shares rather than just punting the IPO market. 

Happy investing. I will share more thoughts when i have time ^_^

Monday, 14 July 2014

SRS Portfolio - 30 June 2014

For the month of June, the SRS portfolio received a dividend of $255 from China Merchant and an interest of $4.07

The position in UMS was divested in July. The divestment post is here.

As of 14 July, I am holding a record $111,484 in cash waiting to deploy in bigger quantum into new positions. As i have shared with you previously, this SRS portfolio is going to focus on more concentrated positions with a stronger focus on growing the net worth than generating passive income. 

I will deploy the passive income strategy on my wife's SRS account which i have been contributing on her behalf.

What is my performance so far? According to my post on 1 July 2013, the MOIC (Mulitple over Invested Capital) or ROI (Return on Investment) was standing at 1.22x. This year, i did the same analysis and added a new IRR figure which is estimated as i didn't track the exact ins and outs of the cashflows. So please take it with a pinch of salt. The ROI now stands at 1.32x and the IRR at 7%.

Happy SRSing

Tuesday, 1 July 2014

UMS Holdings Ltd



UMS hit my cut loss point today. I would have cut it earlier had i been more vigilant in monitoring the stock but i was busy travelling for work in May and holidays in June. The major shareholders and CEO has sold a fair bit last month so perhaps it is time to say goodbye.

UMS has treated me very well. It has given me $1,050 in dividends since i first bought it in 9 March 2012. My capital gains is about 62% above my cost price but as i mentioned in earlier posts, i should put in larger quantum and not the meager sum.

So long for now.

Happy UMSing 



Thursday, 12 June 2014

SRS portfolio - 31 May 2014

Seemed like a good month for my SRS portfolio as it received dividends from Overseas Education and UMS Holdings


QT Vascular also performed spectacularly but I have since sold it in June as it has gone beyond my "understanding" only to see it moved even higher.... (the sale was mentioned in my Facebook page). 

Anyway it was a good return for me generating more than 35% in one month.  

UMS holdings suffered from a double whammy in June where Applied Materials and also the CEO sold down their shares significantly. I haven't had time to analyze their moves but definitely it doesn't bode well for the Company when insiders are cashing out. I will decide if I want to sell the shares after my holidays :-P

Happy SRSing 

Monday, 2 June 2014

QT Vascular ("QTV")

I first evaluated the above Company in my IPO blog. The post is here.

I have since added 50 lots of QTV to my SRS account. The post is here

My original intention was to accumulate slowly but somehow the intention was never realised. The share price has gone through the roof after 2 reports came out.

UOBKH issued a original and updated report with a target price of $0.51. The report courtesy of SG Market News.

CIMB then initiate coverage with an even more aggressive target price of $0.64! The report is here  courtesy of SG Market News.


The counter has risen 37% since my entry once month ago... if only all my investments perform as such ah...  ^_*

Happy SRSing

Saturday, 10 May 2014

SRS Portfolio - 30 April 2014

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I received my SRS statement for April. My small positions in Overseas Education and UMS holdings continued to do very well. They have almost doubled the original cost.

UMS Holdings


UMS has done extremely well, defying all my original expectation and it just announced a set of quarterly profits that was 63% better than the quarter one year before! 


As mentioned to you in my previous post, I will need to invest a substantial amount in such good company in order to retire early and not the meagre 10,000 shares. On the other hand, i wonder if precisely of the small position, that is why i am extremely patient with them and allowed them to run for the long term (since it is not going to move a needle).  haha ^_^ 

This stock pays a dividend of 1 cents per quarter! So probably the learning point will be to keep adding on this position over time, which I didn't.

Overseas Education


Another nice looking counter since my entry point. Probably i can have the same key takeaway, that is to keep investing in good companies over time (rather than trying to keep searching for new companies to invest in).

QT Vascular


Recorded my first purchase of 50 lots at 33 cents. I will probably add on to this position slowly but this is a higher risk bet which i am taking given that it is still in development phase. This company is loss making and not paying any dividends, so i would definitely not classify this as a fundamentally sound stock. Not for the "value-investors" as well.

That is all for now. Happy SRSing

Tuesday, 6 May 2014

The path to millionaire portfolio ?


It was the May Day public holiday. My deal maker friend just parked his shining Lambo sports car. It was a far cry when I  first knew him 8 years ago. He has since risen to be one of the top deal makers in Singapore and now stays in a big bungalow with a swimming pool. 

He shared with me some of his thoughts behind his success, which I further distill it here for easy understanding. 

Is the "secret" of his success applicable assuming you are just destined to be a normal investor like me? I gave it a long and hard thought and felt that it can be distilled into a few lines. 

1. Focus on your core area of competence. 
2. Once you have done your due diligence on your target, put all your eggs  in it. 
3. Let go of the target when the growth story is no longer there. 
4. Repeat point 1 and 2 again a few times.

Let me give you a simple illustration for better understanding of how I should apply it to my SRS portfolio in "theory". 

Assuming I have done my homework and identified Breadtalk or Riverstone or UMS as a stock that I like very much because of sound fundamental reasons. I will build up a lot of that position (say $100k) in my SRS account rather than a small tiny position of $5k which bears no significance even if it rises 100%. 

Assuming I am right, the stock doubled in value to $200k and I identified another good counter. I will then reinvest that $200k into the next counter. Again, assuming I am right, the counter will double to $400k. From a start up capital of $100k I repeat this process 4x over 10 years and I will become a millionaire. Obviously I am using an extreme example of puting one egg in the basket but hope you get the idea behind it. 

Is the methodology simple? Yes. 
Is it tough to implement ? Yes
Is this strategy for everyone? No. It should be for someone who has a higher risk profile and tolerance and who knows exactly what he is doing. 
Should I do it? Why not. To risk $100k and get back $1m at the end sounds absolutely fantastic. (Assuming no new capital injection)

What stock should I buy now? One honest answer is that I don't know. Many of my old favorites have run up spectacularly. Even overseas education and UMS are doing really well but as I said, having a $5k position in both that stock is not going to make me rich. 

I am currently accumulating QT Vascular for a long term play. (Say at least 6 months to one year). Just bought my first tranche of 50 lots at 33c for my SRS account on last Friday. My second buy order of 50 lots at 30c was not filled on Monday. 

This strategy and this stock is not for everyone and it definitely don't qualify as a fundamentally sound stock so I hesitated a lot not knowing if I should share the name of the Company. 

However, I know some of the shareholders who have done a lot of DD into this company. They are very long term players and it does hold certain promise if the product roadmap is approved by FDA as planned. 

We shall see how this strategy pans out in the coming year. I will share more on my thoughts next time. I am currently overwhelmed with work...(what's new?). 

As for you (if you have been reading from the first paragraph till now), find a few stocks that you believe in and buy it big! And hopefully, it will be a good retirement story for your grandchildren next time!

Happy SRSing. 

Saturday, 12 April 2014

SRS portfolio - 31 March 2014

It has been a while since i post on my blogs. Hope all of you are doing fine but i have been neglecting my retirement plan and totally out of touch with the market.


This is the status report as of 31 March 2014 where i reported the loss from the sale of China Environment. The loss was a heavy one given the larger exposure but however, it was probably a good "cut". 


I received the 3 annual reports for my SRS portfolio in April. Here are my initial thoughts without going through the annual reports. I will be reading the reports when i have time... (which unfortunately have been very evasive). 

UMS

I have to tell you this is one of my most pleasant experience investing in a tech stock. I first invested in UMS on 6 Sep 2012. It has been more than 2.5 years! I have received dividends 6x of about $700 and the share price as of 12 April has more than doubled my initial entry price. ^_^ This will probably teach me to be "less biased" towards tech companies :-P

Overseas Education

I bought Overseas Education on 6 March 2013 and it has just passed the first anniversary. I have received dividend once amounting to $275. It is a pretty stable business and should continue to show promise once the school site in Pasir Ris is up and running.

CM Pacific

I first bought CM Pacific on 12 April 2013 and have since received dividends of about $330. It has been a under performer so far (in my standard) but hopefully, we can see increased revenue as the middle class in China becomes more affluent, buy more cars and travel more.

As of 12 April, the SRS portfolio for existing listed portfolio alone is up around 48% but unfortunately, I am sitting on a big cash pile of $98.7k to be deployed.

I will see if i have more things to report after i run through the annual report, thus in the mean time, Happy SRSing!

Sunday, 9 March 2014

SRS Portfolio - 28 Feb 2014


Nothing much to write again... Except that I read about the recent results of Riverstone and its continued good performance caused me much anguish. Hahaha. Why did I let go of it?!?

UMS continued to be a pleasant surprise with increased divideds and prospects. Probably that was a good decision on hindsight. 

I think dividend investing in good companies should continue to be a strategy which I should pursue for this SRS account. 

Sitting on much cash with nothing to do. Will a crisis ever come in 2014? Better start working hard on my retirement plans once my working hours resumed to its normal pace...

Happy SRSing

Wednesday, 5 March 2014

China Environment

I think i have no "luck" with S-Chip and i should avoid them.... haha the first time i recorded the S-Chip in this blog was China Fishery.

I shared with you my position in China Environment earlier, and the next thing i know, it broke the "cut-loss" support which i have in mind of 49c and i cut my position at 48.5 cents today.



I don't like the look of the chart so probably, insiders are selling out. Time will tell if my decision is right or wrong but if you have followed me long enough, you will know that i don't like to hold on to a losing position. The first loss is probably the best loss for me.

Happy SRSing and i will need to think for a long time before getting any S-shit. :-(


Tuesday, 25 February 2014

Second Chance Properties Ltd

I first entered this position in March 2013. The entry post was here.

Over this period, i received $340 worth of dividends.

The Company announced on 6 Feb that it is going to dispose the majority of its properties.

The announcement is here.

Since the main investment thesis of mine was to achieve a yield of 7%-8%, the divestment means that the original thesis is no longer valid as the Company will not be able to receive a stable income. There is also uncertainty in how the sale proceeds will be divested.

In this regard, i sold my position in Second Chance today. The return (including the yield) in IRR terms is around 18%.

Happy SRSing.

Sunday, 16 February 2014

SRS Portfolio - 31 Jan 2014


Nothing much to report for Jan except the investment in China Environment which I have shared with you earlier. 

Received $170 dividend from 2nd Chance properties but i haven't had the time to analyze its latest decision to sell the majority of its portfolio of properties. That made my initial investment thesis no longer valid. I may divest this once I had a chance to read through its announcements. 

Happy SRSing. ^_^

Saturday, 1 February 2014

China Environment



I mentioned about a S-Chip stock few weeks back. You know my dislike for S-Chip stocks including my previous misadventure in China Fishery Group.

Anyway, i decided to give this S-Chip another chance. ^_^

I went to Beijing early part of this week and i can tell you that you never appreciate good air quality until you don't have it. This is the view from Shangri-la overlooking the CCTV HQ from my hotel room and you can see the air is heavily polluted. I don't even dare to "breathe" heavily when i am walking outside.


The government of China has to clean up its act in the next 30 years as the air quality is really bad. As such, there present much opportunity in the environmental space to ensure clean air and water. 


Follow the smart money?

There are 2 companies in this space, United Envirotech and HanKore and both experienced strong upward price movement after the smart money came in.



China Environment

China Environment raised $17m from Havenport Asset Management at $0.55 per share back in Nov.

Havenport Asset Management was spun out from Legg Mason (i.e. the individuals were previously managing money for Legg Mason) and Legg Mason continues to engage Havenport to invest money on their behalf. I believe Havenport is to seek alpha from this investment and not to "churn" the investment.

Latest Quarterly Results

The Company released a strong set of Q3 results where net profit surged by 370%.


I believe the increase in profitability is sustainable as they have increased their capacity by 400%.

The outlook continue to be positive from this sector as pollution is increasingly a very serious issue and the government now has the funds in its coffers to tackle this problem head on.


Some of the SGX announcements for your reference:
2. Corporate Presentation Slides File 1 and 2

SRS portfolio


I bought 20 lots for my SRS account at $0.57 per share and saw it surged to $0.62 before dropping to the current price of $0.54 again. I believe 50c-55c is a strong support given that Havenport bought around 55c.

 I am hoping to see a 25% increase in share price in 1 year from now and 50% in 2 years. Let's see how the Q4 results pan out and the company is off to a good start in 2014.


Happy Greening
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