As from April 2013 my Journey in Investing is to create Retirement Income for Life till 80 years old for two over market cycles of Bull and Bear.

Welcome to Ministry of Wealth!

This blog is authored by an old multi-bagger blue chips stock picker uncle from HDB heartland!

"The market is not your mother. It consists of tough men and women who look for ways to take money away from you instead of pouring milk into your mouth." - Dr. Alexander Elder

"For the things we have to learn before we can do them, we learn by doing them." - Aristotle

It is here where I share with you how I did it! FREE Education in stock market wisdom.

Think Investing as Tug of War - Read more? Click and scroll down



Important Notice and Attention: If you are looking for such ideas; here is the wrong blog to visit.

Value Investing
Dividend/Income Investing
Technical Analysis and Charting
Stock Tips

Tuesday, 31 May 2011

Reaching 55 soon - CPF Minimum Sum and MSS Property Pledge

Read? Reaching 55 soon. Another pay cut!

Read? CPF minimum sum to be revised upwards to S$131,000

Which is better?

  1. Leave behind the CPF Minimum SUM.
  2. Do MSS Property Pledge and withdraw 50% of MSS to DIY.

Here is the Maths:


Could anyone confidently do CAGR of at least 5% on  investment for the next 25 years?


What is your advice? Option 1 or 2?



SGX says to reduce securities bid size to cut trading costs

SINGAPORE, May 31 (Reuters) - Singapore Exchange (SGX) , Asia's second-largest listed bourse operator, said on Tuesday it will reduce the minimum bid size for securities on July 4 to lower trading costs for investors.


The move is expected to lead to a tightening of bid-ask spreads by as much as 80 percent, resulting in around S$1.7 billion ($1.4 billion) in annual savings for Singapore, based on 2010 market turnover, SGX said in a statement.

"Tighter spreads will encourage investors to increase their participation in SGX, the best market for accessing fast-growing Asia. This will in turn enhance liquidity here in Singapore," said Chew Sutat, head of securities at SGX.

CPF minimum sum to be revised upwards to S$131,000

SINGAPORE: From July, the prevailing CPF minimum sum (MS) will be revised upwards to S$131,000, up from S$123,000. The CPF Board said the new MS will apply to members who turn 55 from July 1 2011 to June 30 2012.


It was announced in August 2003, that the minimum sum would be raised gradually to reach S$120,000 (in 2003 dollars) in 2013.

CPF Board said the increase in minimum sum, which includes an adjustment for inflation, is to ensure that Singaporeans set aside sufficient savings for their retirement.

Members who can set aside the MS fully in cash can apply to commence their monthly payouts of S$1,170 when they reach their draw down age.

Also from July, the Medisave Minimum Sum (MMS) will be raised to S$36,000 from S$34,500.

Members will be able to withdraw their Medisave savings in excess of the MMS at or after age 55.

The maximum balance a member may have in his Medisave Account, known as the Medisave Contribution Ceiling (MCC), is fixed at S$5,000 above MMS and this would be increased correspondingly to S$41,000, from S$39,500.

Any Medisave contribution in excess of the prevailing MCC will be transferred to the member's Special Account if he is below age 55 or to his Retirement Account if he is above age 55 and has a MS shortfall.

The revisions to MMS and MCC are to ensure that Singaporeans have sufficient savings to meet their healthcare expenses, and have been adjusted for inflation.

-CNA/ac

Following someone investing idea? (2)

Just For Thinking ....


Read? Following someone investing idea?
 
Again. Investing forums, cboxes, and blogs made it so easy to know what your favourite cboxers, forummers and bloggers are doing; and you may want to follow them. Monkeys see. Monkeys do.
 
You may know what they are buying. What to buy is just part of the whole buying equation.
 
Buying = What + When + How

When?

When you see your favourite blogger bought something e.g. a few bunches of banana and that doesn't mean it is a good time for you to buy a few banana too.

Your favourite blogger may be a 800 pounds Gorilla sitting on high level of cash and gobbling up a few bunches of banana here and there is not going to cause any problem.

But, to a small Monkey on low cash level is different. Just eating up one bunch of banana may cause indigestion if got it wrong. In the stock market, small Monkey can't behave like giant Gorilla.

When you are low in cash, you may actually want to be more patient and ask yourself serious questions.

  1. Is the current STI level at 3,XXX giving more bang for your bucks?
  2. Is the Risk/Reward justify exhausting your last few dollars?
How much?
 
When small Monkeys saw a giant Gorilla eating up banana after banana, they may start thinking that probably it is a good time for them to eat some too.  But, small Monkeys may have forgotten that giant Gorilla has big stomach so it is quite normal to see it eating so many time.
 
But can Small Monkey eat like Gorilla?

Monday, 30 May 2011

CapitaLand buys 65% of Vietnam property developer

By ANGELA TAN


CapitaLand Limited said on Monday that it has bought a a 65-per cent stake in Quoc Cuong Sai Gon Company Limited VND121.225 billion (S$7.3 million).

Following the acquisition, QCSG has become a 65-per cent owned subsidiary of CapitaLand. The remaining 35 per cent of QCSG is owned by two parties unrelated to CapitaLand.

CapitaLand's stake will be held by its wholly-owned subsidiary, CVH Sparkle Pte Ltd.

QCSG, a company incorporated in Vietnam, owns a parcel of land in Binh Chanh District, Ho Chi Minh City, Vietnam. QCSG plans to develop the land into about 800 value homes.

The proposed development will be led by CapitaValue Homes Limited (CVH), CapitaLand's new strategic business unit set up to capitalise on the untapped demand for good value homes in Asia.

The proposed development will be the fourth value homes project by CVH.

Propriety trader guilty of price manipulation

SINGAPORE: A proprietary trader pleaded guilty on Monday to manipulating the price of CapitaMall warrants traded on the Singapore Exchange.


Forty-four-year-old Sim Tee Yang, who is from CIMB-GK Securities, admitted to four charges while eight remaining ones will be taken into consideration during sentencing.

Sim, who has been a proprietary trader since 1994, committed the offence between May and August 2005.

But in December 2005, the Commercial Affairs Department received information that Sim may have manipulated CapitaMall Trust units and CapitaMall warrants.

He had simultaneously traded with them even though he knew that the share price of one would be affected by the other.

The court heard that even though Sim lost nearly S$8,700 on the trading of CapitaMall Trust units, he made more than S$25,000 when he traded with CapitaMall warrants.

He netted a profit of more than S$16,000 in the process.

Sim can be jailed up to seven years for each charge, fined a maximum of S$250,000 or both.

-CNA/wk

Sunday, 29 May 2011

Reaching 55 soon. Another pay cut!



"Life isn't fair. You play with the hands you are dealt with."

Pay Cut when you become another older asset that is losing productive value.

  1. Reaching 50: Cut 4% off Employer contribution rate
  2. Reaching 55: Cut 3% off Employer contribution rate

Soon, I will be taking the second CPF cut from the Employer contribution rate and effectively the total pay cut is 7%. Fortunately, I don't have any oustanding housing loans; otherwise, I will feel the pinch.





Investors, learn to play your cards right

small change, invest, May 29, 2011, thesundaytimes

Just like a good poker player, a good investor must know when to hold and when to fold.

In poker, a player should not be emotionally influenced by the amount he has already put into the pot to determine whether to stay or hold. This can be translated into an investing principle: Avoid recouping your losses from a bad investment by averaging down your costs, that is, buying the same shares at lower prices when the price of the shares begins to fall.

Some Poker's axioms:

  1. "Life isn't fair. You play with the hands you are dealt with."
  2. "A card player should learn that once the money is in the pot, it isn't his any longer."
Similarly to what Createwealth8888 used to advocate ...

  1. All investments by nature are risky. It may cause you to lose some or all your investing capital. So do help yourself and avoid thinking that you are so great and far better at analyzing companies than the Market that you have found some undiscovered "Market Gems".
  2. We don't need to win back in the same manner that we have lost it. When you keep averaging down, you are just trying to win back in the same manner that you have lost it. Is averaging down the only way to win back? Think again and think over it seriously. What have you done to your risk control? Most likely, your company may not fail; but if it does a massive private placement and let you sucking your fingers or "LL".  
When do we buy stock?
 
Unless you are buying stock for short-covering; the only reason that you have bought it is either you think that its stock price will not fall further or it will keep going up. If the market happens to let you average down to buy it cheaper and cheaper; obviously you are wrong with your initial stock analysis - either FA , TA or both. Probably, it is your own ego that keeps you going. In stock investing, it is better to hang your ego at the door before you do any stock analysis.

  1. Read? Investing Made Simple by Uncle8888 (9)
  2. Read? My War Room (4)
  3. Read? Why I Don't Average Down?

Saturday, 28 May 2011

This business of sustaining growth...

Bigger companies here have a better chance at it


By TEH HOOI LING
SENIOR CORRESPONDENT 


MCKINSEY Quarterly had an article recently on the real picture of sustaining top-line growth. 'Many leaders set unrealistic growth targets,' the article noted. 'Often, they don't properly consider how fast their underlying markets are growing and thus how much market share must be grabbed to meet ambitious goals. Or they ignore the likelihood that their competitors are doing many of the same things to grow. They also underestimate the ongoing need to find new products to replace revenue declines from current offerings as they mature.'

A historical look at corporate performance puts the growth challenge into perspective. McKinsey showed the real revenue growth distribution for large non-financial companies from 1997 to 2007. The consultancy ended the analysis in 2007 to avoid distortion resulting from the severity of the recession that began that year.

According to its data, the median revenue growth rate was 5.9 per cent. About one-third of these companies increased their revenues at rates faster than 10 per cent. But that one-third figure probably overestimates organic growth, since it includes the effects of acquisitions, noted the consultancy.
It also presented a second chart which showed real 1965-2008 revenue growth for the 500 largest non-financial companies in the United States.

The median was 5.4 per cent a year. Although the rate fluctuated from one per cent to 9 per cent according to the economy's health, there was no upward or downward trend and thus no rising tide to lift growth over the longer haul, it noted.

During that period between 1965 and 2008, median GDP (gross domestic product) growth in the US was 3.2 per cent, meaningfully lower than the corporate revenue growth rate. The additional growth was a result of globalisation. As at 2008, 48 per cent of US companies' total revenues came from outside the country. That portion of the revenues has been growing much faster than their US revenues.

Many companies are counting on global growth, particularly in emerging markets, to go on driving them forward, noted McKinsey. But a rising number of companies around the world are competing for a share of that momentum, cautioned authors of the report.

Finally, they highlighted that there are a number of casualties of the growth game as well. According to them, beginning in the mid-1970s, a quarter of all the large companies it studied actually shrank in real terms in a given year. 'In fact, many mature companies will get smaller in real terms. In related research, we find that a startling 44 per cent of all companies that grew at rates faster than 15 per cent from 1994 to 1997 were growing at rates lower than 5 per cent ten years later,' it said.
The report made me curious about Singapore companies. How has the growth rate of Singapore companies been like over the long term?

So I downloaded the list of companies as at Dec 31, 1990, and their respective market capitalisations. At that time, there were 18 companies with market cap of $1 billion and above. I grouped them as the tier-one companies.

In this group are SIA, DBS, OCBC, UOB, Keppel, Hongkong Land, Jardine Matheson, SPH, City Developments, Dairy Farm, F&N, Jardine Strategic, Singapore Land, Asia Pacific Breweries (APB), OUE, Sembcorp Marine and Jardine C&C.

I then downloaded these companies' revenue per share, earnings, free cash flow (FCF), and dividend per share from 1991 until 2010. From there, I calculated the annual compounded growth rate of all these measures over 10-year blocks. Chart 2 shows the median growth rates of the various metrics for this group of companies.

As you can see, this crop of companies has done rather well. Their growth rates have accelerated rather sharply in the last five years. As at last year, the median compounded annual growths for their revenues, earnings, FCF and dividend per share were 9.8 per cent, 17 per cent, 20 per cent and 6.5 per cent respectively. That's higher than the numbers reported by the McKinsey study for US companies. But then again, our sample is small.

On the whole, it were the Jardine Group of companies, Keppel Corp, F&N and APB, Singapore Land and Sembcorp Marine which pulled up the averages. Among the banks, OCBC is the best performer with a 5.9 per cent growth in revenues per share and 9.3 per cent a year increase in earnings per share over the last 10 years.

The corresponding number for UOB is 2.7 per cent and 6.9 per cent. DBS is the laggard, with -0.8 per cent and -3.2 per cent decline a year in its revenue and earnings per share, compared with 10 years ago. It fared worse than SPH which has seen its market threatened by the emergence of new media. SPH managed to grow its revenue per share by 4.2 per cent a year in the last 10 years, and its EPS by 3.2 per cent a year.

Roughest patch

Among this group of companies, SIA is the one going through the roughest patch in the last two years. Its EPS has fallen by 4.3 per cent a year compared with 10 years ago.
Meanwhile, Hongkong Land, Jardine Matheson, and Jardine Strategic have the perfect record of chalking up positive FCF every year for the past 19 years. FCF is cash-generated by the business after deducting capital expenditure. As for APB, SPH and Dairy Farm, they only have one negative FCF year since 1991. All took place in the 1990s.

The next batch of stocks had market caps ranging from $166 million to $986.5 million. There were 34 of them back in 1991. In this group are companies such as Natsteel, UIC, Keppel Land, NOL, Hotel Properties, Great Eastern, Cerebos, Wheelock, United Engineers, Metro, Wing Tai, GP Batteries, Kim Eng, GK Goh, Yeo Hiap Seng, Lum Chang and Genting Singapore.

From the names you can guess that this group generally didn't do as well. Chart 3 shows the median sales, earnings, FCF and dividend per share of this group of companies for 10-year blocks since 2001. The performances are more patchy, possibly because there are quite a number of property stocks in there. But their earnings expanded healthily in the last five years, but not so the revenues.
Still the growth for all the metrics pales in comparison to that of the blue-chips companies.

In this group, the most consistent performer is Great Eastern Holdings. But even then, its growth has tapered off somewhat in the last three years. Great Eastern and Cerebos are the only two companies which have a perfect record of positive FCF every year for the last 19 years.
So there you have it. In a globalised world, larger companies - in the Singapore context - have a better chance of sustaining their growth. Although it is highly unlikely that they will repeat their 17 per cent median EPS growth a year for the next 10 years.

Because of their size and stability, this group of companies also generally trade at a premium. The way to get outsized return from them is buying them during a market crisis.
Meanwhile, the second-tier companies are not as expensively priced. If you are able to uncover a company which can hold its own and sustain its growth for a number of years, then you will be very well rewarded.

However, it is no easy task finding these companies. To me, buying blue chips in a crisis is much more straight forward. But always beware of any structural change that may have eroded their competitive edge.

Investing Made Simple by Uncle8888 (15)

Read? Investing Made Simple by Uncle8888 (14)

You can profit from the Power of Market Cycles

I believe you may heard it many times - "You can't time the market!".  I think it is nonsense.

At all times, market cycles exist in the real world. It is either big or small market cycles. Most of the time, you can't precisely time the high and low of each market cycles; but it doesn't mean you can't profit from the cyclical moves.

A good understanding and full acceptance of market cycles in your investing Mind can be an essential tool for those who wish to hold high dividend yield and multi-baggers in your portfolio for long-term (e.g. more than 10 years)

Markets are all about fear and greed.



















During a bull market you are more confident of buying as most people surrounding you are jolly making good money from the stock market and they are often boasting their wins. You just don't want to miss the party.

During a bear market, it will be the opposite. Not many people are willing to talk about their losses. Even three of my favorite bloggers stopped blogging and disappeared from the cyberspace. May be they have taken another cyber name to avoid being identified as failures.

So are you emotionally and financially prepared to profit from STI market cycles?

See it for yourself.

Friday, 27 May 2011

Don't let stock market take you for a ride

Just For Laugh ....


Sometime, we may see netizens shouting happily when they see their stock prices moving up. Why happy when they have no intention of selling at all? It is just another emotional roller-coaster ride in the stock market.

Once there was a man who buried a pot of Gold in his backyard and everyday, he would go to his backyard to take a few minutes look at his buried pot of Gold. He felt very happy when he could obviously see that the pot of Gold was well hidden.

One day, he was shocked to discover that the buried ground was dug up and his pot of Gold was stolen. He was very sad and depressed.

One of his friend had an idea to help him. He buried some rocks at the same spot as the stolen pot of gold and then asked him to visit the same spot everyday and said to him that his pot of Gold was actually found and re-buried. The man became very happy after that.

Why are you so happy when you see your stock prices moving up if you are not selling at all?

Thursday, 26 May 2011

Keppel unit sells stake in Cebu shipyard for $23.7m


Biosensors: FULL YEAR FY2011

  • Total revenue US$156.6 million, up 35% over FY10
  • DES sales up 59% over FY10
  • Licensing revenue US$17.2 million, up 89% over FY10
  • Product gross margins 75% for FY11, compared to 70% in FY10
  • JV non-operating contribution of US$19.3 million; up 29% over FY10
  • Net profits of US$43.3 million, up 35% over FY10
  • Positive cash flows from operations of US$27.8 million

Playing The Game of Leverage (7)

Read? Playing The Game of Leverage (6)

I want to double up my money

Now, you have heard that the simple and fastest way to double up your money is by leveraging 10:1 for 10% returns on your borrowed capital.

But, in the investing world, there is no lunch either. Instead of getting free lunch, you might become the free Lunch for others.

If for whatever reasons that you still want to double your money, so how?

A more difficult and longer way without leverages is to use its cousin : Rule of 72

Read? The Best Secret in Investment and Trading – Compound Interest

Can you double up your money?

Yes, you can!

Just follow your heart and do it your way. No absolutely right or wrong.

Tuesday, 24 May 2011

IndoAgri shares dive to 18-month low

IPO pricing of its Indonesian unit seen as main cause


By FELDA CHAY

THE bloodletting would not stop for Indofood Agri Resources. Yesterday, shares of the Singapore-listed company tumbled 15.7 per cent to an 18-month low, largely in reaction to the palm plantation group's Friday announcement that it had priced the Indonesia initial public offering of subsidiary PT Salim Ivomas Pratama (SIMP) at 1,100 rupiah a share.

The offer price per share is at the lower end of the 1,060-1,700 rupiah indicative price range. Since announcing palm oil producer SIMP's listing on Feb 18 this year, IndoAgri's shares have plunged from $2.46 to yesterday's $1.72.

Yesterday alone saw a 32-cent dive after about 83 million shares changed hands, making it the third-most actively traded stock. Not helping the situation was the regional market fall, which in Singapore saw the Straits Times Index dropping by 1.8 per cent.

According to JP Morgan, its calculations show that 'the PT SIMP IPO is valuing IndoAgri at just $1.41 per share', a 30.9 per cent discount to its Thursday close before factoring in any upcoming mergers and acquisitions, and any holding company discount. Trading of IndoAgri's shares was halted on Friday.

The US$408 million in proceeds that will be raised from the offering would just be sufficient for SIMP's planned debt repayment of US$200 million, and capital expenditure of around US$200 million, said JP Morgan.

After the IPO, IndoAgri's stake in SIMP will decline to 72 per cent from 90 per cent.

In a report, Goldman Sachs noted that 'the IPO could pose downside risks to our IFAR (IndoAgri) earnings estimates through potential EPS (earnings per share) dilution, as well as possible holding company discount once its main operating asset is listed separately'.

It believes that IndoAgri's 2011 earnings per share could be diluted by 12 per cent.

Last month, IndoAgri said that net profit for its first quarter rose to 514.3 billion rupiah (S$73.6 million) - 66 per cent higher than the 309.8 billion rupiah it earned a year ago.

The rise, which came on the back of higher selling prices and sales volumes for palm products, took earnings per share for the three months ended March 31 to 5.1 cents, up from 3.1 cents a year earlier.

Revenue was up 38.6 per cent to 2.93 trillion rupiah, from 2.1 trillion rupiah last year.
------------------

Createwealth8888: Panic selling by BBs

Noble Group launches US$2.25b loan facility

SINGAPORE - Singapore-listed commodity firm Noble Group said on Tuesday it has launched the syndication of its US$2.25 billion revolving loan facility.

The facilities comprise a US$675 million 364-day committed and a US$1.6 billion three-year committed unsecured revolving loan facility, the company said.

Noble has appointed ABN Amro Bank NV, Banco do Brasil SA, Bank of America, The Bank of Tokyo-Mitsubishi UFJ, Citigroup, Commerzbank AG, Rabobank International, DBS Bank, Goldman Sachs, the Hongkong and Shanghai Banking Corporation, ING Bank, JPMorgan Chase, Natixis, the Royal Bank of Scotland Societe Generale and Standard Chartered as the bookrunner mandated lead arrangers. -- REUTERS

Monday, 23 May 2011

Keppel secures B Class jackup rig order from Dynamic Offshore Group

Keppel FELS Limited (Keppel FELS) has secured a contract with Vision Drilling Pte Ltd (Vision Drilling), a wholly-owned subsidiary of Dynamic Offshore Drilling Limited (Dynamic Offshore Drilling), to build its first KFELS B Class jackup drilling rig for US$180 million.


Slated for delivery in 1Q2013, the rig will be able to operate in water depths of 350 feet with a drilling depth of 30,000 feet and accommodate 120 men.

Dynamic Offshore Drilling has the option to build an additional rig to be exercised before 3Q2011.

Mr Naresh Kumar, Chairman of Dynamic Offshore Drilling, said, "While this is Dynamic Offshore's first collaboration with Keppel FELS, we are no strangers to its excellent project execution and dedication to safe, on-time and within-budget deliveries. My team and I have previously worked very closely with the Keppel FELS team on two KFELS B Class jackup rigs which have been deployed under long term contracts with strong day rates with a Fortune 500 National Oil Company.

"After the Gulf of Mexico oil spill, oil companies around the world prefer newbuild premium rigs with enhanced safety features and equipment reliability. With over 60% of the current Jack up fleet over 25 years old, it is an impetus for us as experienced drilling contractors to invest in premium high quality jackups with the world's leading shipyard. We are looking forward to build a number of rigs with the strong partnership of Keppel FELS in the years to come".

Mr Wong Kok Seng, Managing Director of Keppel FELS, added, "We are glad to be working with familiar partners. Mr. Kumar is highly respected in the industry and Dynamic Offshore Drilling is backed by a recognised team of professionals.

Customers come to us because of our award winning products, excellent execution of projects and our commitment and ability to deliver rigs of the highest standards. In building their first rig to our KFELS B Class design, we are pleased to be able to support them in meeting the market requirements of newer rigs with superior technical and safety capabilities."

With 33 such units delivered worldwide, the KFELS B Class design continues to be the preferred jackup choice for drilling operators.

John Gellert, President of Seacor Marine LLC ("Seacor") and Board Member of Dynamic Offshore Drilling said, "Seacor is pleased to be a part of the project as an investor and joint venture partner in Dynamic Offshore Drilling. With the long term rising demand for premium jackups, we are looking forward to the development of the company (Dynamic Offshore Drilling)."

Dynamic Offshore Drilling's rig is equipped with enhanced features to expand the operational coverage of the rig. Provisions have been made for the rig to work in high pressure high temperature (HPHT) environments and have Offline Stand Building capabilities.

Developed by Keppel's technology arm, Offshore Technology Development, the KFELS B Class jackup design provides maximum uptime with reduced emissions and discharges. Its environmental-friendly features won the KFELS B Class design the prestigious Engineering Achievement Award from Institution of Engineers Singapore in 2009.

The above contract is not expected to have a material impact on the net tangible assets or earnings per share of Keppel Corporation Limited for the current financial year.

Sunday, 22 May 2011

Playing The Game of Leverage (6)

Read? Playing The Game of Leverage (5)

Unexpectedly, you may become poorer in the next Bear when you fail to leave the party before Mid-night clock strikes at 12.

You may heard it many times that Leverage is a double-edged sword and it can kill! But, may be it is not leverage that kills. It is Deleveraging that actually kills.

Deleveraging is an attempt to decrease or pay off debts or loans. If people or instituitions are unable to pay off their debts quick enough; they will be at risks of defaulting or become bankrupt.

When the Bear market endures, more and more peoples and instuitions will become unable to loan back and refinance. Soon, they will be forced into more deleveraging at higher losses and coupled with more mass redemptions coming from the retail investors. As a result the market will collapse. When market collapses, it will become the "Mother of All Margin Calls" and Market Crash happens!

When you have not deleverged quick enough when Market Crash, you may become poorer!

BYO Wines

Just For Laugh ....

Read? Punggol Promenade is a 5-kilometre long public waterfront promenade

Yesterday, at my regular weekend evening jog from Hougang to Lorong Halus Wetland along Punngol Promenade and a bridge from the Punggol Promenade side that will bring you across Serangoon River to the Lorong Halus Wetland.

Yesterday, I saw something really different. I saw two men in their late 40s or early 50s chatting and drinking chilled Red wine at the middle of this bridge overlooking Serangoon River. There was a cooler bag to keep the wine bottle chill too.

Good life men! An inexpensive way to share good wines and pass time.

Saturday, 21 May 2011

Playing The Game of Leverage (5)

Read? Playing The Game of Leverage (4)

Do you want to become rich in investing?

If you really want to become rich in investing; then you have to do leverages to speed it up. With leverages, investors can make huge amounts of money if they get it right.

For example, let say an investor has $100K and wants to double his money to $200K. Practically by using his own money for investing, it will be very difficult for him to find an investment that will return 100%.

But, if he does 10:1 leverage by borrowing $1M to invest . Thing can be different as it may not be that difficult to find an investment that returns 10+% and grows his investment to $1.1M+. He then returns $1M + interests and made $100K. Now he has doubled his money to $200K.

If he can do few more rounds of 10:1 leverages successfully, he will become rich in investing soon.

Simple right? If you want to become rich in investing, you have to take bigger risks and leverage it up.

Don't let stock dividends become your long-term pain killer.

Just For Thinking ....

Read? Analysts' views on hefty dividend payouts

Excited over the hefty special dividends payout and looked like a good opportunity to get some passive income?

Sometime, we have to keep reminding ourselves that Mr. Market is pretty good at attracting premiums and giving discounts. Don't let stock dividends become your long-term pain killer when you see your stock prices fallen and stay there for a long time.

Analysts' views on hefty dividend payouts

SINGAPORE : Singapore blue-chip companies have been giving out hefty dividend payouts recently.


SingTel and Singapore Airlines are among those that paid record dividends despite recording declines in their fourth-quarter net profits.

Analysts said there is likely to be a trend of larger dividend payouts from Singapore-listed firms as recent volatility in the stock market may prompt investors to go for such safe haven stocks.

SingTel declared a record annual dividend of 25.8 cents per share for the financial year ended March 31.

This is a yield of 8 per cent based on its recent share price of S$3.21.

Similarly, Singapore Airlines said it will be paying out annual dividend of S$1.40 per share.

This is a yield of 9.7 per cent based on its stock, which is trading at S$14.42.

Analysts believe these firms are rewarding investors after having pulled through some rough times.

In addition, they said higher dividends are also used to boost trade volumes and share prices.

This is because the dividend yields are much higher than returns from bonds and fixed deposit savings and investors may switch to hold such stocks in their portfolio.

Kenneth Ng, Head of Singapore Research at CIMB, said: "Generally, dividend yield is one of the pillars of support for valuation of shares, and having a bigger-than-expected dividend is always welcome, and is always a boost in share price."

Analysts said dividend payouts are a good indication of the firm's financial health. It also highlights the firm's confidence in the market.

Roger Tan, vice president of SIAS Research, said: "Paying dividends is a good signal to the investors that companies will not hold too much financial slack within the company. They are ready to give the money back, knowing that given the way they have run the company, as and when they need the funds to expand again, they can always go back to the market to raise new funds."

On the flipside, high-dividend-paying companies could be seen as defensive and lacking in investment opportunities.

Mr Tan said: "On the factual basis, when you return money back to the investors, you do have less money to grow. That is one. There is another question of, by giving back money, are you telling the investors at the same time that you have run out of growth plans."

Still, some analysts believe that while the Singapore market is well developed, companies are never short of ideas and investment opportunities to grow the company.

They said many blue chip companies have been looking overseas for growth opportunities and this trend will continue going forward.

- CNA/ms

Createwealth8888 is thinking ....

Why are these companies giving out hefty special dividend payouts and also recently issuing more debts instruments?





Friday, 20 May 2011

The Billion Dollar Mistake

If you believe in learning from other investors' mistakes. You may like to read this book. This book is about big, expensive mistake made by legendary investors  - a.k.a.very rich smart people. They are all either professional investment managers or billionaire entrepreneurs.

"The Billion Dollar Mistake." by Stepehen L. Weiss

Thursday, 19 May 2011

NOL makes first investment in China terminal

SINGAPORE - Singapore's Neptune Orient Lines (NOL), the world's seventh largest container shipping firm, announced on Thursday its first investment in a China terminal.
NOL will invest US$25.8 million in a joint venture with Chinese shipping logistics firm SITC International Holdings and Qingdao Qianwan United Container Terminal to operate a two-berth container terminal at the port of Qingdao.

The terminal will add 1.5 million twenty-foot equivalent units (TEUs) of annual capacity at Qingdao, which is China's fifth-largest container port and the largest in northern region, NOL said. -- REUTERS

Wednesday, 18 May 2011

CapitaLand sells Shanghai property for S$152.6m

SINGAPORE - Southeast Asia's largest property developer CapitaLand said on Wednesday, its unit CapitaLand China Holdings, sold a residential site in Shanghai, China, for about S$152.6 million (US$122.5 million).

CapitaLand expects to recognise a gain of approximately S$82 million from the transaction. -- REUTERS

Monday, 16 May 2011

Australia's Gloucester to acquire Donaldson from Noble in $618 mln deal

May 16 (Reuters) - Australian coal miner Gloucester Coal said it has agreed to acquire unlisted Donaldson Coal Pty Ltd from Hong Kong-based commodities firm Noble Group for A$585 million ($618.5 million) including debt.


Gloucester said in a statement on Monday it planned to raise A$230 million at A$9.00 per share to partly fund the deal.

Noble Group has been expected to sell its 100 percent-owned Donaldson Coal Pty Ltd, which has coal mines in the Hunter Valley in New South Wales state, to Gloucester, according to sources and local media reports.

Noble owns a 65.3 percent stake in Gloucester.

Sunday, 15 May 2011

Keppel to build 4 repeat jackup rigs worth US$772 million for Standard Drilling

Latest contracts boost value of new orders secured year-to-date to over S$6.4 billion.


Keppel FELS Limited's (Keppel FELS) returning customer, Oslo-listed S.D. Standard Drilling Plc (Standard Drilling), has ordered four repeat KFELS B Class rigs worth US$772 million. Successive deliveries of these units are scheduled between 2H2013 and 1H2014.

Standard Drilling ordered its first jackup rig from Keppel FELS in November 2010 with two options. In addition, it acquired two jackups under construction as well as two option rigs from Clearwater Capital Partners LLC (Clearwater), another Keppel FELS customer, in a transaction where Clearwater became the largest shareholder of Standard Drilling. Standard Drilling now has a combined fleet of seven KFELS B Class rigs, all being built exclusively at Keppel FELS.

The four new orders from Standard Drilling have also brought the total value of contracts secured by Keppel Offshore & Marine for the year-to-date to more than S$6.4 billion.

Mr Wong Kok Seng, Managing Director of Keppel FELS, said, "With a strong operating track record in various parts of the world, the KFELS B Class has become the industry's benchmark solution and features strongly in the fleets of today's leading offshore drillers.

"In a span of less than six months, we have secured new orders for 19 KFELS B Class series rigs, including these latest contracts. In ordering four repeat rigs at once, Standard Drilling has demonstrated its industry foresight, as well as reaffirmed the market's confidence in our proprietary design and quality execution."

Mr Rob Petty, Managing Partner of Clearwater Capital Partners and Director of Standard Drilling, said, "We are proud to announce this exciting transaction that combines the Clearwater rigs into Standard Drilling and creates a pure play jackup company with seven KFELS B Class rigs. We have great confidence in Keppel FELS and their ability to deliver these next generation rigs on time and on budget.

"Clearwater is committed to Standard Drilling, where the board has come together to form the largest single portfolio of newly built jack up rigs so vital to the burgeoning market demand for new rigs with high specifications. With our fellow Directors and shareholders we are focused on establishing Standard Drilling as a best in class operator and building a top tier management team to complement the premium assets we are creating at Keppel FELS.

"We see a unique opportunity to grow an Asian centric industrial drilling operator given the high levels of drilling activity in South East Asia, the Middle East and West Africa which continues to anchor and build strong demand for premium jackup rigs. We are committed to furthering the growth of Standard Drilling."

Mr Espen Lundaas, CFO of Standard Drilling, said, "The newbuild activity that we see in today's market is driven by a need for a global fleet renewal, which is expected to increase in the future. As long as there are rigs available in the market, the high-end units will be preferred over the older and second rated ones.

"This provides strong impetus for us to fast track fleet expansion, in catering to higher levels of drilling activity in the Middle East, the Mediterranean, South East Asia and West Africa.

"Our view that Keppel FELS is the best shipyard partner for Standard Drilling is reinforced by the fact that they have delivered majority of the KFELS B Class units ordered within budget, and either on time or early."

Keppel FELS and its offshore yards have delivered 33 KFELS B Class series rigs for operations in various parts of the world to date. Developed by Keppel's technology arm, Offshore Technology Development, the KFELS B Class jackup is designed to provide maximum uptime with reduced emissions and discharges. For its environmental-friendly features, the KFELS B Class design was bestowed the Prestigious Engineering Achievement Award from Institution of Engineers Singapore in 2009.

Readily upgradable to higher performance capabilities, the KFELS B Class rig incorporates Keppel's advanced and fully-automated high capacity rack and pinion elevating system, and Self-Positioning Fixation System. When completed, Standard Drilling's rigs will be able to operate in water depths of 400 feet, drilling depth of 30,000 feet and accommodate 120 men.

"We thank Standard Drilling for entrusting Keppel FELS with the construction of its premium fleet of seven KFELS B Class jackup rigs. We seek to entrench this win-win partnership by delivering the rigs to our customer's highest satisfaction," Mr Wong added.

The above contracts are not expected to have material impact on the net tangible assets or earnings per share of Keppel Corporation Limited for the current financial year.

Following someone investing idea?

Just For Thinking ....

Investing forums, cboxes, and blogs made it so easy to read about other people's investing ideas and strategy.

But, does it make good sense to rely on others for such investing ideas without actually knowing the other retail investors' investing goals and perspectives.

One thing is for sure, each retail investor has his/her own investing goals, different risks profile, and differences in the size of investing capital can be vast. Size of capital does matter in investing.

If you find yourself following your favourite investors into their investment ideas without knowing that the investment ideas may represent a small faction of their portfolio. They can afford to lose it; but the question you should ask yourself: Can you?

Saturday, 14 May 2011

Idling pile of Cash and Debt

Just For Thinking ....

Are you still sitting on a pile of loans and at the same time having a pile of cash idling in the bank?

You are still waiting for the right market to invest and the right market to invest never come and not even at Mar 2009 low.

Pay off loans is hard. Investing over and above your loans is even harder.

Thursday, 12 May 2011

Noble

Olam Q3 net up 43% on increased sales, margins

SINGAPORE - Olam International, a Singapore commodities firm, said on Thursday third quarter net profit rose 43 per cent year-on-year, helped by higher sales and margins across its various businesses.

Olam, whose products range from edible nuts to confectionery and beverage ingredients, earned S$127.3 million (US$103 million) in the three months ended March 31, up from S$89.3 million in January-March 2010.

Its revenue rose 75 per cent to S$4.7 billion from S$2.7 billion.

'This is one of the strongest periods of growth in net contribution per tonne that we have achieved in the last five years,' CFO Krishnan Ravikumar said in a statement.

Looking ahead, Olam said it is in discussions with various parties on possible acquisitions and joint ventures but did not elaborate.

The firm said the floods in Australia and the current political problems in the Ivory Coast had minimal impact on its businesses, and it continues to be positive about prospects for the remainder of the current financial year which ends in June. -- REUTERS

DOW

12,630.03-130.33-1.02%


Stocks tumbled 1 percent after three days of gains as a hike in oil and gas inventories triggered a selloff in commodities amid worries of a slowdown in global growth.

Wednesday, 11 May 2011

Noble Q1 net profit soars 77% as revenue hits record high

SINGAPORE - Singapore-listed commodities trading firm Noble Group reported a 77 per cent rise in its first quarter net profit on Wednesday, helped by strong volume growth and higher commodity prices.

The company, which has interests ranging from Brazilian sugar to Australian coal, reported a net profit of US$203 million compared to US$115 million a year ago.

Revenue of the Hong Kong-based company soared 76 per cent to a record US$20 billion. It is the only major global commodity trading house with a public listing.

'Group quarterly volume of 50.1 million metric tonnes, up 17 per cent compared to the first quarter of 2010. Record Group quarterly revenue resulted from the combination of higher commodity prices and higher volume,' the firm said in a statement.

Noble said last week South Korean sovereign wealth fund Korea Investment Corp (KIC) had acquired slightly over one per cent in the company through a purchase from a vehicle associated with Noble founder and chairman Richard Elman. -- REUTERS

Sembcorp Industries Q1 net profit flat, sees sustainable growth

SINGAPORE - Sembcorp Industries said on Wednesday first quarter net profit rose 0.7 per cent from the year-ago period as marginal gains in its utilities and marine businesses were offset by lower profits from industrial parks.
It earned S$159.9 million (US$129.8 million) in the three months ended March 31, up from S$158.8 million in Jan-March 2010. Turnover fell 17 per cent to S$2.0 billion from S$2.4 billion.

Looking ahead, the firm said it expects its marine arm to secure additional orders while its utilities and industrial park businesses should report steady performances.

Sembcorp's marine business, held through listed Sembcorp Marine, has a current net order book of S$5.2 billion due for completion in first quarter 2014, including S$1.5 billion in orders secured year-to-date.

'At the same time, we are developing new sizeable energy and water projects in Singapore, India and Oman,' CEO Tang Kin Fei said in a statement.

'With a total project value of S$4 billion, these investments will provide the impetus for Sembcorp to achieve sustainable growth,' he added. -- REUTERS

Keppel Corp wins US$393 mln Qatar rig order

SINGAPORE - Keppel Corp, the world's biggest builder of oil rigs, said on Wednesday it has secured contracts to build two high-specification jack-up rigs from Qatar's Gulf Drilling International worth about US$393 million in total.

The orders are Gulf Drilling's first in six years and will increase the Qatar-based company's jack-up fleet count to seven, Keppel said in a statement.

The rigs are scheduled for delivery in the third quarters of 2013 and 2014. -- REUTERS

Tuesday, 10 May 2011

Benchmarking your investing performance

Just For Thinking ....

Why benchmark your investing performance against STI?

Is this really relevant to your time and effort spent in your investing?

We should be benchmarking our investing performance against our earned income e.g. XX% of our annual gross salary.

Monday, 9 May 2011

SGX to boost volume by attracting High Frequency Traders

SINGAPORE : In a move to stay competitive, the Singapore Exchange (SGX) has unveiled several strategies to attract more traders and raise trading volumes.


This follows its recent failed bid to merge with the Australian Stock Exchange.

One of these will be to woo High Frequency Traders.

High Frequency Trading (HFT) is a type of computer-programmed trading which involves no human interaction.

It currently accounts for 30 per cent of the derivatives trading volume on the Singapore Exchange.

And SGX said it hopes to raise that level higher but declined to provide any targets.

Chew Sutat, Executive Vice President, SGX, said: "To grow the capital markets in Singapore, to support the capital markets in Singapore, growing liquidity is first and foremost.

As we know, listed companies need to find cheaper cost of capital in raising new money, and investors also want to have freedom of entry and exit into the market.

HFT potentially could support growing liquidity, making it more accessible for new capital and for investors to participate in the market."

Other initiatives to improve the bourse's competitiveness include reducing tick sizes, and increasing its product range to include metal futures.

A tick size is the smallest increment by which an exchange-traded instrument can move.

The smaller the tick size, the more accessible it is to investors. This in turn increases trading volume.

Chew Sutat said: "Obviously improving the efficiency of the market is a key objective that we have, and this includes reducing the cost of trading, for example through reducing the tick sizes of the spreads of the market, as well as continuous trading."

In addition, SGX will be the first Asian market to introduce pre-execution checks at the exchange level for the derivatives markets.

These are pre-trade risk controls, and can include the setting of risk limits in advance so that members can safeguard their trading activities.

This will take place in the second half of this year.

All these underscore the exchange's ambition to play a bigger role in the global financial system.

Magnus Bocker, CEO, SGX, said: "We need to go from that average market, that average financial market...to be one of the leading markets in the world. To go from being a good number 15 or number 10 to be number one, two, three or four."

Come mid-August, SGX will launch Reach, which cost S$250 million and is the world's fastest trading engine.

- CNA/ch

Biosensors - A new 52W High @ $1.41

Noble nears deal with Gloucester on coal asset sale

SYDNEY - Hong Kong-based commodities firm Noble Group is nearing a deal to sell stakes in some Australian coal assets to its majority-owned Australian coal miner Gloucester Coal , sources said on Monday.

'There have been some pretty tough negotiations (between Noble and Gloucester),' a source familiar with the transaction said, confirming a deal was close but declining to give details.

A second source said one of the expected transactions involved Donaldson Coal Pty Ltd.

Gloucester shares were placed in a trading halt earlier on Monday ahead of an announcement about two acquisitions and a capital raising.

Noble Group has been widely expected to sell its 100 per cent-owned Donaldson Coal Pty Ltd, which has coal mines in the Hunter Valley in New South Wales state, to Gloucester.

A Noble spokesman declined to comment. -- REUTERS

Olam to set up almond processing facility in Australia

SINGAPORE - Commodities firm Olam said on Monday it plans to set up its own almond processing facility in Victoria, Australia, with a capacity to hull or shell as well as process 40,000 tonnes of almond kernels for up to A$55 million (US$58.8 million). -- REUTERS

Monetize your private time - Be a part-time Taxi Driver

Just For Laugh ....

That day, the taxi driver asked me: " Got taxi driving licence bo?"

He said that I must get myself a taxi driving as standby to earn extra money when it becomes necessary as it is one of the rare vacations that FTs cannot apply one.

Taxi driving vocational licence is only given to Singaporeans. Free from competition from FTs.

BTW, I am just too lazy to monetize my private time.

Friday, 6 May 2011

No 11th Thing You Cannot Do With Intention

Ten Things You Cannot Do With Intention

Let CreateWealth8888 adds in No 11th Thing that you as politicians or charity instituitions cannot do with Intention.

11. Nobody is left behind in the society.

Thursday, 5 May 2011

Are home affordable?

Just For Thinking ....

This is true hor!

Things are so expensive and wages are so low!
My late father thought that I couldn't afford to buy a house (HDB) since he could only afford to rent 1-Room flat in Toa Payoh. Sometime, I still think like my late father that my kids cannot afford theirs.

Rotary Q1 profit down 62% to S$5.3m

SINGAPORE - Singapore oil services firm Rotary Engineering said on Thursday its first quarter net profit fell 62 per cent to S$5.3 million from a year earlier, hit by the progressive completion of a big project, as well as fewer and lower-margin projects in Singapore. -- REUTERS

Hyflux Q1 net profit up 15% on higher margins

SINGAPORE - Singapore water treatment company Hyflux said on Thursday its first quarter net profit rose 15 per cent from a year ago due to better cost management that contributed to higher margins.

It earned S$7.4 million (US$6 million) in the three months ended March 31, up from S$6.4 million in Jan-March 2010.

Revenue, however, fell 14 per cent to S$86.8 million.

Looking ahead, Hyflux said it expected future growth to come from Singapore and China, where a total of S$850 million worth of contracts were secured during the quarter under review.

'China's multi-pronged approach to tackle its water security issues will translate into opportunities for Hyflux,' group CEO Olivia Lum said in a statement. -- REUTERS

Wednesday, 4 May 2011

Qatar firm signs letter of intent to buy two Keppel rigs

SINGAPORE - Qatari firm Gulf Drilling International has signed a letter of intent (LOI) to buy two jackup rigs from Singapore's Keppel Corp in a deal that could be worth US$400 million.

The news was published on Gulf Drilling's website. A Keppel spokeswoman said the firm did not announce deals when they are still at the LOI stage.

DMG & Partners, a Singapore brokerage, estimated the deal to be worth around US$400 million. -- REUTERS

Monday, 2 May 2011

KOREA'S SOVEREIGN WEALTH FUND TAKES STAKE IN NOBLE GROUP

Noble Group (SGX: N21), a global supply chain manager of agricultural and energy products, metals and minerals, is pleased to announce that the sovereign wealth fund, Korea Investment Corporation (KIC), has acquired a significant and strategic stake in the Company.


The shareholding was arranged through the purchase of 59,283,851 shares from Noble Holdings Limited (NHL), a vehicle associated with Noble founder and Chairman, Richard Elman. Post the sale to KIC, NHL will retain a 21.34% interest in the Group.

Noble and KIC intend to establish an ongoing co-operative business and strategic partnership for the purposes of jointly investing in infrastructure assets and supply chain management activities.

Commenting on the transaction, Mr. Elman said "We are delighted to welcome such an important shareholder as a strategic partner, and we look forward in our usual Noble spirit to a long and mutually beneficial alliance with KIC." The CEO of KIC, Mr. Young Wook Chin, added “KIC is happy to form a strategic alliance with Noble Group, a firm with a rich and successful history across a wide spectrum of natural resource businesses. We look forward to working with Richard Elman and the talented team at Noble.”

KIC joins China's sovereign wealth fund, China Investment Corporation (CIC), who became
a Noble shareholder in September 2009.

SCI - Overbought, does it mean a potential candidate for shorting?


Some one asked me: "SCI - Overbought, does it mean a potential candidate for shorting?"

Are you a fan of overbought and oversold indicator? I am not. You leh?

One Guru said that you must align a few indicators for the job, and
he may use up to 7 indicators to confirm it. So cheem ah!



Sunday, 1 May 2011

Sell in May and Go away

One of the Market axioms: Sell in May and Go Away

Fact or Fallacy?

This time in May 2011, we have both this axiom and the pending Singapore GE 2011 result on 7 May 2011 playing out at the same time. Next week, it will be interesting to see how BBs/Market Sharks playing out their hands in this Game - Market Axiom and GE 2011?

Investing Made Simple by Uncle8888 (14)

Read? Investing Made Simple by Uncle8888 (13)

Read? Stock Market Is War - Part 4 (Re-visit)

"Bull markets are born on pessimism, grow on skepticism, mature  on optimism, and die on euphoria. The time of maximum pessimism is the the best time to buy, and the time of maximum optimism is the best time to sell." - Sir John Templeton

Uncle8888 believe most retail investors know that "Crisis = Good opportunity to do bargain hunting"; but few of them are mentally prepared to take advantage of the good opportunities presented to them when it really happens.

Advance Planning

One way is to anticipate it and do advance planning to mentally prepare our mind to look forward to such scenario and more importantly to overcome fear and to take advantage of the good buying opportunities when it really happens.

How many retail investors are doing advance planning in the stock market when they see heavy dark clouds coming? To a fisherman, heavy dark clouds mean heavy rain is coming and it is time to start packing up and covering up to avoid getting wet. It doesn't really matter whether will it rain or not.

Advance planning is to take deliberate actions to prepare for it and it is not the same as passive waiting for it to happen. Know their difference!
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