Weekly Report - September 24, 2010

I was out for almost a week because my wife was hospitalized. I just got a few minutes to peek into the market and do some quick trades. This week, I bought nothing but properties. Here's the composition of my portfolio as of September 14, 2010. I will be posting this report every weekend. Obviously, I have high hopes on property stocks in the mid to long term and a bit extra cautious on mining stocks.

Note:
Average price is including all the buy AND sell charges. Example, I bought TEL here at 2,385.
If you want a copy of my spreadsheet, just send me a mail at tubero.ramon@gmail.com.

Back to Properties

Last Friday, we made several trades that put the majority of our portfolio back to properties. I read somewhere that it is highly probable that interest rates will be lowered in the months to come so I guess there's still some juice to be squeezed out of them. I got several SLIs and VLLs at 2.26 and 3.32, respectively.

On my wife's recommendation, I also bought some DMCs at 26.30. Why? Because she likes its graph, qualitatively (another woman's intuition).

We are now 76% invested with a 46.2% effective annual return.

It's the "In"

The past two days, I'm in a scenario where all works at site were urgent and I'm limited to 3 MB of data per day at home (this 3MB is equivalent to a 15-minute access on Citisec and a couple of blogs). My application for a fibre optic connection is pending for almost a month now. Well, combine that with a non-cooperative office and knowing that the market is still bullish while having 70% cash on hand with something inside me that I should buy something and not to be left by the rapidly rising market, I bought some stocks at pure speculation. Sumabay lang sa uso..  :-)   My first mining stocks, PX and AT, were both bought at 13 something while I got DGTL at 1.57. I shouldn't have been a kuripot when I tried buying this stock when it was around 1.39 to 1.42 (it's really difficult to be a true emotionless ninja in stock trading). If EDC, FGEN, and MPI corrects further tomorrow, I would probably buy back some.

I still got 41% cash to spare.

My effective annual return lowered to 48%.

Missed Bargains

When I woke up at 6:25am (10:25am Phil time), the market was down for around 20 points. I noticed in the intraday chart that after crossing the 4,000 mark, the market was sharply going down. Expecting that the market will correct further, I decided to delay my buying and do it before the closing in my site office. Unluckily, we got through a minor road accident. The police arrived in our scene after 40 minutes and another 40 minutes for them to investigate and do their accident report. When I reached the site, it was already 8:30. I immediately checked the market, and to my surprise, the market just went sideways and closed 0.11% lower. In short, I missed some bargains. I was supposed to buy back BPI, MBT, and more ALI. Well, I hope that that accident is a blessing in disguise for me to buy them cheaper tomorrow.  :-)

Unstoppable!

Wheeww! PSEi at 3,972.60!

In spite of being over bought last week, it continues to be "over" overbought. Happy with my profits, I reduced some of my positions again, thus reducing my holdings to 35% (and still waiting for a major correction). I sold most of my EDCs at 5.40 and bought some ALIs at 18.34 when I left home only to find out that they closed at 5.50 and 18.14, respectively, when I reached the office. Well, there are no regrets as I'm satisfied with my profits and it's one of my main rule to be mechanical and not emotional on any of my trade decisions.  :-)  My profits are now at 51.6% effective annual rate.

For those who are playing DoTA, I guess all will agree that our market is simply UNSTOPPABLE.

Will it reach the GODLIKE state at 5,000 level? I'm keeping my fingers crossed...   :-)

Eid Mubarak!

It's a long weekend here in the middle east because of the ending of the holy month of Ramadan. The weather is still uncomfortable, yet it's still nice to go out on the beach and relax for a bit...of course, with a little time to ponder about our stocks...  :-)

DOW has been up for 75 points since PSE's last trading day. I wonder if our market will decouple and finally enter a healthy correction OR it will continue its strength and break the 4,000 psychological resistance... Either way, being 45% invested only, I will be fine on both outcomes. If the market continues its uptrend, I will sell if I achieve my target profit, and if it's down, I'll hunt the bargains. Well, I still believe our market is still bullish in the mid to long term so I won't mind being 100% invested again.  :-)

Where's the Bargain?

Seems like I'm wrong with my hunch. I ended up selling more of my holdings. I am only 44% invested now. My return is now 49% so I almost ended up selling all my stocks. Actually, I posted all of them at their peaks but only a few of them were executed. I sold my MEG, MBT, and FPH with 11.5, 9.9, & 9.7% net profits, respectively. I'm now left with four stocks, EDC, FGEN, TEL, and MPI. I believe the three of these (with the exception of TEL) will perform more in the weeks to come so I didn't force to sell them today.
I'm still waiting for that healthy correction!

Another Forced Close?

Another roller coaster day for the market, opening up weak in the opening ending up strong at the end. I dunno if this is still done by foreign investors forcing the market to end strong or just a coincidence happening two days in a row.

As usual, I'm a bear when everyone else is a bull. I'm also expecting a correction tomorrow because the market peaked again and there is another long weekend ahead. I happily sold my PNB at 47.80 with a net return of 15.6% and my BPI at 54 with 11.28%. I held these two stocks for around 2 weeks only. My stocks are now returning 42.7% effective annually with 35% cash on hand. 

I'm planning to buy back some blue chips tomorrow if a significant bargain is there, or sell all my stocks anytime when my target of 50% effective annual return is achieved.  :-)

Who's the Witch?

I wonder who bought a bunch of ALI's at 18.00. Is it another broker error? Man, this stock might have a curse... Anyone who have bought this stock at 14.00 two weeks ago due to an ATR Kim-Eng broker error and sold it today at 18 is one lucky fellow (or probably the witch who made the curse).   :-)

Our Motivation

Even before I started investing, I am already an active saver. Or probably let’s just say that I don’t really fancy a lot of stuff and buy unnecessary things. My wife and I log all our monthly expenses not only for budget purposes but also to highlight the major expenses that we have paid for. We save more than 20% of our income per month. However, we know that merely saving is not enough to achieve our financial stability sooner.

Then came the recession that made a direct impact in the UAE where a lot of construction-related companies went bankrupt. What happened was like the survival of the fittest. Weak and newly established companies either closed or merged with stronger allies. Other companies restructured by laying-off staff or cutting expenditures by lowering salaries. We were just married then and my wife was one of those who were terminated because of company closure. The first thing we did was to pay off the remaining balance of her car loan with her separation pay. (Cutting off outstanding liabilities)

As she spent her time looking for a new job, she also got in touch with her former college friends who got to share with her their investments. She also motivated me to read books like Robert Kiyosaki’s Rich Dad Poor Dad and Bo Sanchez’ Secrets of the Truly Rich. We also tried FX trading by opening a sample account just for learning purposes. At the end of the day, we usually discuss investment strategies, business ideas, insurance, retirement and other new things that we have uncovered. We accepted certain realization that inspired us to take a step towards exploring the world of investing and securing our future.

Here is the list that became our motivation: 

1.  In the future lies many uncertainties. It is either you accept this fact or face the consequences by being ignorant. If you don’t plan well you might end up just wishful thinking.

2. We don’t want to end up like the other OFWs who retire without any investments or probably with some savings that would only last for a year or two.

3. We don’t want to be trapped in the rat race forever.  We want to retire early and spend more time with the family while having a stable source of income to last our lifetime. 

4. Speaking of “lasting our lifetime”, we don’t want to be a burden to our future children when we get old. Our goal on financial stability doesn’t end when our kids graduate from college. We intend to have our retirement plan to last our lifetime, literally. 

5. Putting all your savings in the bank is like giving full charity to the bank. 

6. Risk more while you are young. The greater the reward, the greater the risk. Risk wisely.

7. Avoid buying pseudo “assets”. It is only accumulating liabilities, not assets. Know the difference between “needs” and “wants.”

8. Multiply your blessings. Share whatever you can whenever you have the opportunity to share. However, there is always a boundary between giving a man a fish and teaching him how to fish.

Well, that’s how everything begins, having the motivation and proper mind set.