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. 
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