A Private Portfolio

If I was just utilising cash, then I would absolut...

2012-05-18T12:13:09.348+08:00

If I was just utilising cash, then I would absolutely prefer to buy good property stocks rather than property at today's prices.

In this case, I am looking at using borrowed money. While I am sure I could get a credit facility against the unmortgaged flat, I would not be able to borrow as much and (last time I checked) would have to pay a higher interest rate than if I purchased two properties and could offer them both as security.

Isn't it better to buy a property stock with g...

2012-05-18T11:22:34.260+08:00

Isn't it better to buy a property stock with good portfolio selling at big discount than going all the trouble to buy a flat?

Perhaps it’s my natural pessimism, but it seems th...

2012-05-14T19:02:16.377+08:00

Perhaps it’s my natural pessimism, but it seems that an awfully large part of travel these days is to see things while you still can.

It's not so much a move away from small caps,a...

2012-05-13T20:36:50.541+08:00

It's not so much a move away from small caps,as above to simplify the portfolio. Almost by definition, if I want to have fewer stocks in the portfolio, I need to have more invested in each stock and that pushes me to investing in stocks which are generally quite liquid which tend to be large or mid caps.

Cheers
S
Traineeinvestor

Would it be fair to say that you are in the proces...

2012-05-11T14:02:24.397+08:00

Would it be fair to say that you are in the process of moving away from small/mid cap china pays to larger companies?

Unfortunately it is correct :-( The post was a wr...

2012-05-11T11:43:11.948+08:00

Unfortunately it is correct :-(

The post was a wrap up of small purchases over a couple of days.

The price of 303 may not be correct, please check....

2012-05-09T10:45:46.570+08:00

The price of 303 may not be correct, please check.

Hi Thanks for the comment. I did look at these s...

2012-04-24T16:19:13.915+08:00

Hi

Thanks for the comment.

I did look at these some time ago and was put off by the low yield and concerns about the impact of rising interest rates (unlike a directly held short term bond I don't get the option of holding 2-3 years until maturity). As things stand, that was a bad call on my part.

I suppose the question is whether it is worth revisiting the decision. All other things being equal, I'd rather hold the bonds directly but there aren't that many choices available.

Cheers
traineeinvestor

Hi Thanks for the comment. The numbers given are...

2012-04-24T16:16:01.276+08:00

Hi

Thanks for the comment.

The numbers given are the rough guesses for where I would cross into negative cash flow territory if the market turned down today. The situation improves as each mortgage is paid off. Mid 2013 is the when the first one goes and it makes quite a bit of difference to the cash flow having at least one property with no mortgage at all. Also each month that goes buy sees the total principal balance reduce - even if there is no effect on cash flow until a mortgage is paid off, the amount needed to discharge the mortgage falls.

You are of course correct about how far the market could drop - if I had to halve my rents at a time when interest rates were soaring, cash would be walking out the door pretty rapidly a that point and I would be making early repayments as quickly as possible.

Cheers
traineeinvestor

Very interesting - thanks for this. Personally I ...

2012-04-24T14:43:03.254+08:00

Very interesting - thanks for this.

Personally I think your stress test conditions are a little weak. In 1996 I rented a flat in DB for 12,000. A few months later similar flats were going for 14,000 but that was the peak. At the low several years later, there were many vacancies in the block and some were rented for around 5,000.

That's a lot more than a 12 percent drop...

Have you considered either of the ABF bond ETFs (2...

2012-04-24T14:36:23.144+08:00

Have you considered either of the ABF bond ETFs (2819, 2821) as a substitute for some of your cash?

Hi Thanks for the detailed comments. You are abso...

2012-04-19T06:34:17.377+08:00

Hi

Thanks for the detailed comments. You are absolutely right in that I am largely focused on the reward part of the equation and am assuming more risk by keeping the mortgages. The points you raise merit a more detailed response, so I'll do a further post or two on this subject.

Cheers
traineeinvestor

Part 2... I know you are not even remotely close ...

2012-04-18T18:33:00.892+08:00

Part 2...

I know you are not even remotely close to being this daft but when people are told to invest rather than paying off capital things like this tend to happen.

http://www.dailymail.co.uk/news/article-2131192/Interest-mortgages-How-million-Britons-sitting-time-bomb.html

I don't particularly disagree with you but som...

2012-04-18T18:12:45.934+08:00

I don't particularly disagree with you but sometimes it is good to consider from a different perspective so I will argue!

You are looking at it from a reward point of view but the real case for paying down your loans would be to reduce future risk.

When you retire, your main financial risks will be inflation, medical bills, divorce, crash in portfolio value, and inability to service your debts. Some of these may be very unlikely but who knows.

Take medical bills, you try to reduce this risk by buying medical insurance. This is money used to reduce risk. It is not expected to give you a positive return.

In housing, there is a risk (probably low but non-zero) that rents will plummet and interest rates will soar causing you cash flow problems. Early repayment could be considered as a way to reduce this risk.

Hi Carmen Good question - and one that I ask myse...

2012-04-17T14:57:02.218+08:00

Hi Carmen

Good question - and one that I ask myself from time to time. I will do a separate post on this issue.

Cheers
traineeinvestor

Hi JD Apologies for the delay - I just got back f...

2012-04-17T14:28:10.100+08:00

Hi JD

Apologies for the delay - I just got back from holiday.

I'll do a separate post on the ETF's inclduing the synthetic issue.

Cheers
traineeinvestor

As of now, the HIBOR (Hong Kong Inter-bank Offered...

2012-04-12T04:20:45.160+08:00

As of now, the HIBOR (Hong Kong Inter-bank Offered Rate) has increased to 0.4-mark (for 3-month maturity period) compared to 0.28 last October, and that's according to HK Assoc. of Banks. So how much increase do you need before you change your mind and pay off the mortgage?

What do you make of the synthetic Vs Physical ETF ...

2012-04-09T22:32:52.214+08:00

What do you make of the synthetic Vs Physical ETF issue? Is this of any concern to you? eg your vietname ETF.

Also ETF do you currently hold at the moment apart from the DB vietname ETF?

Im am speaking about exchange traded funds and clo...

2012-03-23T06:22:09.914+08:00

Im am speaking about exchange traded funds and closed end funds from the perspective of being a citizen of the united states. The following may not apply to investors worldwide. Their are now over fifty single country funds available and maybe over 100 narrow sectors like airlines steel solar so why the concern for the nasdaq or the standard and poor five hunderd each one of these countries and sectors is a index of and by itself The solar exchange traded fund {TAN} is now down 90% from its high in 2007. If I were a investor or trader I would simply look for any exchange traded fund or closed end fund that does not use any leverage in their porfolios and start buying in the ratio of 0.50 percent of your cash on hand in my account after their is a 75% decline from its all time high and than buy twice as much in the ratio of 1.00 percent of your cash on hand in my account if that exchange traded fund or closed end fund declines another five percent an 80% decline from its all time high buy twice as much in the ratio of 2.00 percent of your cash on hand in my account at a 85% decline from its all time high buy twice as much in the ratio of 4.00 percent of your cash on hand in my account at a 90% decline from its all time high and finally buy twice as much in the ratio of 8.00 percent of your cash on hand in my account at a 95% decline from its all time high. Now I know that some of these funds will not decline 90% from their all time highs. Another thing that you might be wondering about I would run out of money. If I followed that method right wrong example take one hundred thousand dollars. Example Buy 500 dollars of xyz fund at 25 dollars off 75% from its all time high of 100 dollars buy 1000 dollars of xyz at 20 dollars off 80% from its all time high of 100 dollars. Buy 2000 dollars of xyz at 15 dollars off 85% from its all time high of 100 dollars Buy 4000 dollars of xyz at 10 dollars off 90% from its all time high and finally Buy 8000 dollars of xyz at 5 dollars off 95% from its all time high This way you will have your biggest positions in the funds that have declined the most and the smallest positions in the funds that have declined the least. Also keep in mind when you buy an exchange traded fund you are buying a basket of stocks so the fund connot go to zero unlike a stock. Than when any fund has regained three quarter of its value that would be 75 dollars in the case of eyz use a 10% trailing stop loss to protect your gains. Who knows you may sell out of the stock within 90% of its all time high.

And their you have it a very simple but brilliant strategy for exchange fund and closed end fund investing.

I noticed that some of the chinese stocks are real...

2012-03-23T06:17:09.720+08:00

I noticed that some of the chinese stocks are really cheap.

thanks!

2012-03-21T13:26:43.543+08:00

thanks!

Hi JD Sure. I'll put up a top 10 list in a ne...

2012-03-21T10:11:01.597+08:00

Hi JD

Sure. I'll put up a top 10 list in a new post.

Cheers
traineeinvestor

Hi, Would you be curious to know what your share ...

2012-03-21T01:58:04.091+08:00

Hi,

Would you be curious to know what your share portofolio - which and % of portofolio .

@ JD Thanks for the suggestion. The numbers did lo...

2012-03-19T14:24:14.957+08:00

@ JD Thanks for the suggestion. The numbers did look good - lots of operating cash flow, no borrowings etc but I was somewhat put off by the change in the auditors - in spite of the reason given
cheers
traineeinvestor

"a major beneficiary of China's growing d...

2012-03-16T17:37:02.415+08:00

"a major beneficiary of China's growing demand for air travel"

Why not buy TravelSky Tech 696 then? Numbers look fine and good prospect I think.