Tuesday, September 27, 2011

AUD/HKD FX contract

Yesterday I entered into an AUD/HKD FX contract - essentially writing a put option on the AUD.

Here are the details:

Prevailing spot rate: 7.5578
Strike price: 7.5578
Settlement date: 26 October
Fixing Date: 25 October
Implied annualised interest rate: 24.5775%
Break even if the option is in the money: 7.40815
Absolute return if the option is out of the money: 2.02%

Wednesday, September 21, 2011

China VTM Purchased

This morning I added some more shares in China VTM (HK:893) to the portfolio. With a trailing PE of less than 5x and a trailing dividend of above 4% the current share price offers attractive fundamentals which are expected to improve further. The balance sheet is sound with a net cash position (although that is likely to change as further investment is made). The fact China VTM supplies raw materials which are of strategic importance to the PRC and in respect of which three global mining companies are industry dominant is an added attraction.

I paid HK$1.52 for the additional shares.

Jiangsu Expressway purchased

This morning I added some more share in Jiangsu Expressway (HK:177) to the portfolio. With a trailing PE of around 9.2x and a yield of more than 7.5% the company offers sound value. While the toll road sector has been something of a victim of the PRC government's anti-inflation measures (i.e. reduced tolls), the net profit attributable to shareholders still rose slightly in the last interim reporting period. Gearing is moderate.

I paid HK$5.52 per share.

Friday, September 16, 2011

Hang Seng Bank purchased

This morning I made a small additional purchase of shares in Hang Seng Bank (HK:11). At current prices it offers a trailing yield of around 4.9%. I paid HK$106 for the additional shares.

Wednesday, September 07, 2011

Sinopec purchased

This morning I added a few more Sinopec (HK:386) to the portfolio paying HK$7.60 per share. The business is still growing, the company is selling for only slightly more than book value and I expect vulnerability to being squeezed between high crude prices and domestic PRC inflation controlling policies to decline.

Tuesday, September 06, 2011

CNOOC purchased

This morning I purchased additional shares in CNOOC (HK:883). The up-stream ail company has been sold off heavily in response to a combination of falling oil prices and the effect of a shut down at the Penglai 19-3 oilfield. This is largely an exercise in hoping that the sell off is over done.

I paid HK$13.40 for the additional shares.

Thursday, September 01, 2011

Tontine Wines - partial sale

This morning I sold a small part of my investment in Tontine Wines (HK389) for HK$0.97 per share. This compares with the average purchase price of HK$0.85 (including costs).

There was no particular reason behind the sale other than a desire to realise a partial profit.

Hong Kong Resorts purchased

This morning I made a small investment in Hong Kong Resorts (HK:480) paying an average of HK$3.85 per share.

At current prices, the shares are trading at less than 40% of book value and offer a trailing dividend yield of 4.6%. The company's balance sheet looks quite good with net gearing at around 8%. Even if the revaluation gains which inflated the last annual result are not repeated (or even go into reverse), the company offers an acceptable level of safety.

While there are other small listed property developers/investors which sell at a higher discount to NAV, the ones I have looked at have very little liquidity.

Tontine Wines purchased #2

Yesterday, I added some additional shares in Tontine Wines (HK:389) to the portfolio, paying HK$0.92 per share.