Thursday, October 01, 2009

Monthly Review - September 2009

September was yet another positive month for my investments.

With the exception of a very small decrease in my commodity positions, all other mark to market asset classes appreciated during the month. Gains were compounded by favourable currency movements and supplemented by option premiums and positive cash flows from my investment properties.

Income from my job was good and expenses were low.

Here are the details: actively managed funds were very up. I liquidated all of these investments towards the end of the month;

2. my index tracking funds were up. I currently have exposure to Hong Kong, India, Taiwan and Russia;

3. my equity portfolio rose. I currently have meaningful investments in 19 companies listed in either Australia (3) or Hong Kong (16). I took a material loss on a position in Amvig after a disappointing results announcement and an inexplicable asset sale and share buy back proposal;

4. my commodity investments declined very slightly;

5. my ELDs produced positive returns for the month. I had no outstanding CLDs this month;

6. all my properties are all fully rented and the tenants are paying the rent on time. I have both a positive cash flow and a surplus of income over expenses (which represents an increase in net worth);

7. currency movements were positive as the US$ declined.

I sold shares in Amvig (cutting a loss) and my actively managed funds (to pay for a property purchase completing next month). I entered into two OTC option contracts writing a put options against Hutchison Whampoa and China Construction Bank.

Income was strong (it will be erratic under the new job) and contributed to the gain for the month. My spending was low due to an absence of major items.

October and November will be lean months as I use all my available cash (and possibly a short term loan from my wife) to complete a property purchase in early October, pay for the closing costs and the renovation costs and cover the mortgage payments during the renovation period (and likely a gap beyond that until I can find a tenant).

For the month, my net worth increased by 4.8%. The gains came from the combined effect of increased investment values, a weaker US$, positive rental income from properties and a high savings rate. The year to date increase is 63.1%.

Even allowing for the payout arising from changing jobs, it has been fantastic progress this year. The possibility of retiring at the end of 2011 is, once again, very real.

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