Thursday, January 06, 2011
Tai Sang Land purchased #2
Yesterday I made a small additional purchase of Tai Sang Land (HK:89), paying HK$3.45 per share. Like a number of the small local property companies, Tai Sang sells at a substantial discount to its NAV and my investment is being made on the basis that I expect part of that valuation gap to narrow over time. Unfortunately the stock is very thinly traded and I was not able to buy as many shares as I wished before the price ran away from me yesterday afternoon and today.
China Metal Recycling purchased (2)
This morning I added some more shares in China Metal Recycling (HK:773) to the private portfolio, paying HK$8.90 per share. This follows Tuesday's purchase at HK$8.75.
One of the reasons for increasing my weighting is that the number of shares in the portfolio has now reached the stage were I feel I have sufficient company specific diversification (which I appreciate is a very debatable subject). Since (i) I am still in the accumulation stage and (ii) I feel I have that additional comfort of holding a sufficiently large number of companies and (iii) I need to monitor each company to at least some extent, I have concluded that it is reasonable for me to increase the amount I invest in each company. While I am not planning on setting any target, maximum or minimum number of investments, I do need to remind myself that each investment needs to be watched and the amount of time available to do so is limited by factors such as my job, my family and sleep.
One of my tasks over the next few weeks (work permitting) is to review some of the other stocks in the portfolio and consider whether I should be adding to my positions.
One of the reasons for increasing my weighting is that the number of shares in the portfolio has now reached the stage were I feel I have sufficient company specific diversification (which I appreciate is a very debatable subject). Since (i) I am still in the accumulation stage and (ii) I feel I have that additional comfort of holding a sufficiently large number of companies and (iii) I need to monitor each company to at least some extent, I have concluded that it is reasonable for me to increase the amount I invest in each company. While I am not planning on setting any target, maximum or minimum number of investments, I do need to remind myself that each investment needs to be watched and the amount of time available to do so is limited by factors such as my job, my family and sleep.
One of my tasks over the next few weeks (work permitting) is to review some of the other stocks in the portfolio and consider whether I should be adding to my positions.
Wednesday, January 05, 2011
NZD/HKD FX contract entered into
In December 2009, I ended up with some NZD after an option I had written was exercised against me. After sitting on the side lines for a few days, I entered into a short term (14 day) contract at a strike price of NZD1.00 = HKD5.954. If the NZD remains at or below 5.954, I will keep the NZD and earn more interest than I would putting the money on deposit. If the NZD rises above 5.954, I will receive HKD and the total amount received will be larger than my original investment last year. In the latter case the annualised return will be about 7.7% (ignoring compounding).
Since I am happy holding either NZD or HKD longer term, I do not view these contracts as unduly risky and am not overly concerned about the "fat tail" issue associated with writing options.
Since I am happy holding either NZD or HKD longer term, I do not view these contracts as unduly risky and am not overly concerned about the "fat tail" issue associated with writing options.
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