Popular Posts

Wednesday 26 November 2014

The Piotroski Score



The Piotroski Score

The 9 signals were chosen to measure profitability (signals 1, 2, 3 & 4), leverage/liquidity (signals 5, 6 & 7) and operating efficiency (signals 8 & 9).
Signals – score 1 if true
  1. Net Income is positive
  2. Operating cash flow is positive
  3. Return on assets is improving
  4. Operating cash flow exceeds net income
  5. Long term debt to assets ratio is improving
  6. Current ratio is improving
  7. Shares outstanding have not increased
  8. Gross margin is improving
  9. Sales to total assets ratio is improving

High scoring stocks of 8 or 9 points are great business to lead the recovery in stock prices.

Monday 17 November 2014

A Letter from God to Forex Traders

This is an old facebook post but I find it meaningful to add into my Blog.


Have a Good Read!





Saw this interesting letter that I wish to share with my fellow traders.


Title: A Letter from God to Forex Traders

Hello,

I am very delighted and pleased to write to you because you forex traders are among those of my people who call me and pray a lot specially when the market goes against your positions. Please keep in your mind that at the same time that the market goes against your positions and you start praying and asking me to turn around the price to your favorite direction, there are a lot of other people who have taken the right position and are happy with the money the market is making for them. Most of them keep on saying “Thanks God!” and ask me to move the market more and more.

Whom should I listen to? What would you do if you were me? Would you suddenly change the direction of the market to please those who were losing or you would force the market to keep on moving on the same direction to please those who were making money?

I don’t do either. I have created and organized everything with its own rules and regulations. Everything, from the smallest particles in atom’s nucleus to the biggest galaxies and stars are moving and behaving through following the rules and regulations that I placed in their structures and systems at the very first moment I created them. They know what to do because they follow the rules. They use the initial source of energy I gave them. Electrons, planets, stars and… know their own orbit and pathway very well. They don’t ask about their direction and destiny everyday. I have already told them what to do.

When a bird wants to go and find some food and at the same time it starts raining, that bird doesn’t ask me to stop the rain, because he/she knows that it starts raining exactly when it is time to. It is the bird who has to adopt himself to the nature and its rules. Nature and its rules can not be changed just to please a bird.

It is the same with forex market and all other things. If you like to make money through forex trading, you have to learn and follow the forex market rules. Market doesn’t follow you. You have to follow the market. If you took a position and the market went against you, don’t ask me to return it because I don’t listen. Even if Jesus takes a wrong position, I don’t care because it is his own fault. He also has to know the forex trading rules and techniques if he wants to become a forex trader.

If you blew up your account because of your own ignorance and because you didn’t know how much money you would have to put in each trade, don’t blame me and don’t say that I don’t like you and why the others make money but you only lose. It is not my fault. I don’t make any exception. I love everybody. Everybody who follows the rules will be prosperous. Those who try to go against the rules will suffer.

I never forget those days that the market went against you and you prayed for it to be returned and it returned (not because I made it return for you but because it was the right time to return). You recovered your loss and suddenly forgot about me. You forgot that you were begging me to return the price for you. You repeated that if I returned the price just once, you would promise that you would never ever make any more mistake and you would follow the rules. But as soon as the price returned and you recovered your loss, you forgot me and your promise and started repeating the same mistakes over and over. Instead of being like that, just learn the rules and techniques.

Keep in your mind that I am the only one who makes no mistake. Even if you learn all the rules and techniques and you gain several years of experience, you can still make mistake. But it is ok. There is something which is called stop loss. It is one of the most important things in everything. I have placed a lot of different stop losses in nature too. For example your body cells know that when something goes wrong with them and they are not able to control a bad condition, they have to pack all their internal organs and substances and “stop” all activities and biochemical reactions to avoid hurting the other cells. Those cells that ignore this rule become converted to cancerous cells. Of course they ignore it when it is time to ignore and when it is time for you to come here but if you don’t like to lose all the money that you have in your account just because of one mistake, never ever ignore placing a reasonable stop loss and when you made sure that your stop loss is in the right position, never ever move it when you see the price gets close to it.

Lastly, if you succeeded to make money through forex trading or any other kind of businesses, try to spend a portion of your income for charitable purposes every month. Don’t say “I pay tax.”. Most of the tax that you pay are spent to make deathful weapons to kill innocent people around the world. Or it is spent to make some crooks richer. Most of those who really need to be supported and paid have never been paid and supported through the tax that you pay. I know it is not your fault but it is still your responsibility to take care of those who need your help. Although I don’t listen to you when you ask me to return the price to your favorite direction when it goes against you, if you help poor people with the money that you make, I help you to become a good forex trader who knows and follows the forex trading rules as soon as possible. I never forget those who don’t forget me and I help those who help the others for the sake of me. Take care of the others and I take care of you. I assure you that if you help the others I don’t let you down and I will be there for you at the moment that no one can help you but me.

Very truly yours,
God

via Tan Peng Huat (TP Huat)

Thursday 13 November 2014

What happen when there is no Will?



This post is a follow up from the previous post. Hope it can help people.


BEFORE I start, i must said we cannot blame anyone for this situation.

It is almost not correct to ask a person to prepare a will when they are old, they might take the request as a wrong understanding and a possibility of their ascend as looking forward to.

One must educate their love ones by sharing facts around them. Let them decide whether to prepare a will as a form of respect.
-----------------------------------------------------------------------------------------

What happen when there are no will?

This will be more complicated then one can think and it will be a long long drag if one choose to handle it alone.

For starters one can read this:

Apply for Death Extract (with or without will)

http://www.ica.gov.sg/page.aspx?pageid=147&secid=143

You must note that a death certificate can only be applied for, what a third party pass to you be it doctor or investigator, is the Certificate of Cause of Death.

-----------------------------------------------------------------------------------------------------------------------

Once you received the death certificate. One can move on with the following concurrently (if any):

1. Contact a Lawyer to help with procedure (if one choose to)

Grant of Letters of Administration $2,000/= range

Grant of Probate $1,500/= range

---------------------------------------------------------------------------------------------------------------------

2. If one choose not to engage a lawyer and there is no Will, the person to administer his estate is known as an administrator.

To be recognized legally as the executor/administrator, one should:

Apply to the High Court or Subordinate Courts to obtain a Grant of Probate/Letters of Administration. You can also consult a lawyer from any private law firm or Legal Aid Bureau to apply for the Grant of Probate / Letters of Administration.

File the Schedule of Assets with the Courts.
The executor will extract the Grant of Probate and distribute the assets according to the deceased's Will. If the deceased did not make a Will, the administrator will extract the Grant of Letters of Administration and distribute the assets according to the Intestate Succession Act.

Supreme Court Stamp fees for Probate/Letters of Administration

Originating Summons and supporting affidavit : S$1,000.00

Administration Oath :

a. S$20.00 (where the value of the estate is up to S$1 million)

b. S$50.00 (where the value of the estate is more than S$1 million)

c. Certificate of Result of Caveat Search : Free

---------------------------------------------------------------------------------------------------------------------

Point 3 and below legal administrator must have these proper documents:

i. Death Certificate of deceased
ii. Marriage Certificate or Certificate of Making the Decree Nisi Absolute (i.e. Divorce Certificate), where applicable
iii. Birth certificate(s) of the deceased person’s child(ren)
iv. Singapore identity card or other identification documents
v. Nominees' bank passbooks or bank statements
vi. Nominees' statement of account with the Central Depository Pte Ltd (CDP) if the
Special Discounted Shares due to the nominee is to be transferred to his or her individual CDP account.

Source: http://www.nea.gov.sg/passesaway/notice.htm#Ins

Do note that There is no estate duty payable for deaths on and after 15 Feb 2008.
-------------------------------------------------------------------------------------------------------------------------

3. The legal administrator should Notify the Banks (The account will be frozen) Provided no one go draw out the money before notifying.

4. The legal administrator/Beneficiaries should Notify the Insurance Companies for claims, usually with the help of Financial Planner

-----------------------------------------------------------------------------------------------------------------------

5. The legal administrator/nominated beneficiaries should Notify the Central Provident Fund (CPF)

Take Note:

If a nomination is made under the CPF Act, your nominee shall be entitled to the funds in your CPF account regardless of what is stated in your Will.

If one have not made a nomination, the funds will be distributed under the law in accordance with the Intestate Succession Act.

If one get married after making a nomination, the nomination made before marriage is automatically cancelled. Therefore, one ought to make a new nomination after marrying

-------------------------------------------------------------------------------------------------------------------------

6. The legal administrator must issue a notice to The Central Depository Pte Ltd with the below form (weblink)http://statutes.agc.gov.sg/aol/search/display/view.w3p;page=0;query=Id%3A%2257e1ce26-231b-4d58-918e-52288238360f%22%20Status%3Ainforce;rec=0#Sc-.

To read more on Companies (Central Depository System) Regulations:

http://statutes.agc.gov.sg/aol/search/display/view.w3p;page=0;query=CompId%3A90beb880-4177-40b2-b42d-c7a58656713d%20ValidTime%3A20140726000000%20TransactionTime%3A20140726000000;rec=0#pr12-he-.

-------------------------------------------------------------------------------------------------------------------------

Lastly, one should know how one estate is distributed without a will.

http://singaporelegaladvice.com/in-the-absence-of-a-will-how-is-the-deceased-estate-distributed/

_____________________________________________________________________

This post might not have covered all that are needed to know but it act as a starter.

I sincerely hope this post can help anyone in anyway.

It is still recommend to get a lawyer to have a peace of mind.

Live a proper life everyone. Life is not just about trading and investing.

Another Good Deed Done!

Wednesday 12 November 2014

The Importance of a Will.



Not so sure we should talk about this but then again we should try to help people who are lost and had lost their loves one.

One should prepare a will so that their loves one will not have difficulty in getting their estates.

You can prepare your own will without a lawyer but with 2 witnesses who go through the will preparation. Sign with date on the will.

The 2 witness must not be the beneficiary.

------------------------------------------------------------------------------------------------------------------

In the absence of a will,

If one does not have surviving spouses and issues, read Rule number 9.

Rule 9
In default of distribution under rules 1 to 8, the Government shall be entitled to the whole of the estate.

http://statutes.agc.gov.sg/aol/search/display/view.w3p;page=0;query=DocId%3A9ce463a4-f756-40c3-8503-9de6a25884c0%20%20Status%3Ainforce%20Depth%3A0;rec=0

-----------------------------------------------------------------------------------------------------------------------

I would recommend anyone to prepare the will with a lawyer because they will advice you on the proper format and what a "will" won't cover.

Example:

Property you hold in joint tenancy with someone else (or in "tenancy by the entirety" or "community property with right of survivor ship " with your spouse). 

At your death, your share will automatically belong to the surviving co-owner. 

A will provision leaving your share would have no effect unless all co-owners died simultaneously.

An exception is possible when the property was purchased under "tenants in common".

-------------------------------------------------------------------------------------------------------------------------


This post is to show some importance in preparing a will for your loves one.

There is more to find out about what "will" can do and can't do for you.

Is always best to get a lawyer to prepare. 

My advice is to get legal quotation before you proceed.

Another Good Deed Done.

Monday 10 November 2014



What is an investment or trading plan?


A plan come with a logical believe. 

You can choose to not use logic but this will not be me.

When logic tells me we are at all time high and there is no clear direction, I told myself to change my strategy.

My current strategy is to harvest business that are ripe with low margin of safety.

Why?

a) If the market starts to correct, I can wait for a good price to re-enter, at my first entry price or lower.

Do I have to cash out on all my position?

No. You do not need to cash out a position if you have Good Margin of Safety and give you Good Dividend Yield?

Why?

b) If the market choose to stay bullish, we have capital appreciation plus good dividend along the upside.

Now come the Million Dollar Question.

With a few counter showing upside at this moment, if I don't enter the market, I would lose the chance of making money.

This is the time to give yourself some thoughts.

1) Are you sure we are at a low price for the buy low and sell high concept? Do note, i don't mean you are not able to buy high and sell higher.

2) If your logic tells you the market might going into correction,

(i) and the market goes higher, you have nothing to gain but you have nothing to lose too.

(ii) and you choose to enter, the market did go into correction, you will be facing a decision to stay vested or cut loss according to your plan.

What i just mentioned is very general but the concept is there.

If you have a Good Plan and stick to it, you can definitely increase your winning vs loss position to make decent profit.

If you are confuse, why take the risk?

I hope this post will stop any heart ache in missing any ride up or falling any side down.

Invest and Trade Safely Everyone!

Another Good Deed Done!

Sunday 9 November 2014

A little slice of pie on planning for Financial Freedom


I received a few private messages on how to plan for Financial Freedom.

I would like to share a slice of pie with my humble opinion here.

1. Think Big. Start Small.

a) Invest Gradually within your means.

b) Accept Delay Gratification.

c) Focus on multiple portfolio that can be realized in time range of 10 years, 20 years, 30 years to your projected life span.

d) Realised Portfolio should be planned in a way to cover later date investment expenses if you have retired without employment income.

f) Unrealised Portfolio should be able to generate income for your living expenses when you retired.

g) Last but not least, Cash is King.

Thursday 6 November 2014

Even the Greatest Investor Have more Money in the Bank then in any Investment. Do you know why?


Tricky part can be define as the part that is tough or critical to achieve for the goal to materialize.
1. Money in the Bank can be categories into Short, Mid, and Long Term Deposit and should be easily attained for any purposes.
2. Always invest within your means so no investment have to be cash out in poor market condition other then sour investment.
3. All investment Sold will become Money for the next investment or expenses plan like retirement.
4. To achieve more Money in the bank, one will require Consistent Incoming Cash Flow.
5. Passive Income in investment ONLY comes from funds that are locked in.
So the Greatest Investors knows how to make sure his money in the bank is more then his investment because that is the Best way to have more Quality Investment when the Opportunity knocks.

Wednesday 5 November 2014

How is Valuetronic performing after the blog post on Wednesday, 24 September 2014

This blog is a follow up on the blog post dated  24 September 2014. You can refer to the link below.

http://kenjifundmanagement.blogspot.sg/2014/09/do-you-see-value-in-valuetronic.html



http://research.maybank-ib.com/pdf/document/Valuetronics_IC_131014a_6716.pdf

The above report send the price action of Valuetronic to Gap Down and dropped 12% in a day. You can refer to the chart below dated 14 October 2014.





DBS Vickers and Lim & Tan Securities came to the rescue dated 15 Oct 2014. The red shade and the red arrow in the below chart.

http://www.nextinsight.net/index.php/story-archive-mainmenu-60/924-2014/9141-valuetronics-overly-pessismistic-call-by-maybank-concerns-overblown



After looking at all the report, we should look at the present chart and Valuetronic Half Yearly Result from the link below.

http://infopub.sgx.com/FileOpen/VHL-Q2FY2015%20Media%20Release.ashx?App=Announcement&FileID=321941

Which Analyst did you think given a better analyse of Valuetronic?

At the current price of 0.345, Valuetronic price action is near to  NAV of 0.325 and the Dividend Yield, if all remain equal, is value at 7.4%.

IS this the right time of entry?

We have to take note that Valuetronic is indeed facing competition in the market and the Profit have came down.

Will Valuetronic be able to increase their revenue in the future and pay consistent dividend?

Your Guess is as Good as My Guess but it will be good to look for any high volume break out from 0.375 for a Good Reversal.

If there isn't any reversal, we might just see a possible Eillot Wave C to be formed at 0.265.

Invest Safely Everyone. Always do your own Due Diligent!

Is Dollar Averaging the Magic Pill and Does it suits Everyone? Part Three of Three!



Part 3. 


Is Dollar Averaging the Magic Pill and Does it suits Everyone?

For starters, the Idea of Dollar Averaging are suitable for people who are not interested in the price of the units, until the day they wanted to sell the accumulated units (partial or not) for profit.

(hopefully not sell in losses due to cash constraint).

1. It is a good portfolio for retirement when the tide is in your favor but we must not depend just on this portfolio for retirement just in case the market is very very dim.

2. It is good for people who want to start small and wants a decent ROI.

3. It is good for people who don't have the time to look at the market.

4. It is good for people who are savvy or not savvy in investment plus time is on their side.
(The main thing you need to know is the expenses you are incurring.)

Let's look at the STI Chart,

All the Blue Shade are the Start of a New Year.

All the Red Share are the No NO Zone to sell your Dollar Averaging Units.

As you can see from the chart, the person who are not afraid of the sell down and believe that the market will moving towards their advantage in the future will be the Winner.

If the Chart does not give you an idea, you can download the excel sheet (from the blog) and pluck in the figures to confirm your own understanding.

http://singaporeanstocksinvestor.blogspot.sg/2013/08/tea-with-matthew-seah-dollar-cost.html

-------------------------------------------------------------------------------------------------------------------------

In a nutshell, Dollar Averaging is suitable for everyone but it is not a magic pill because when you use it in a wrong counter that can go bust, it is Game Over and that is why STI ETF is recommended because it will never go bust.

-------------------------------------------------------------------------------------------------------------------------

@Ambrosini Maximiliano asked: Kenji can share some advantage/disadvantage comparing these bcip/saver plans against higher dividend lower volatility counters, for example reits

Assuming a Monthly Purchase,

Reits:

Upside:

1. When you use Dollar Averaging (DA) to buy Reits, you get to choose the price you want to buy in since it will be done through your own brokerage.

2. You get to set your own rules (hopefully you follow them), and get to buy cheaper.

3. Lower expenses (if the DA saving plans charges increase)

4. The Dividend is Higher.

5. You can use the Dividend to do Compounding Anytime.

Downside:

1. The Reits you pick fall faster then it picks up especially when it under perform all other Reits

2. You need to have the cash since you are buying by lots now (1000units).

3. The Reits might be in very bad shape and your average units price are above the market price.

----------------------------------------------------------------------------------------------------------------------

Dollar Averaging Saving Plans with STI ETF:

Upside:

1. The Dollar Averaging Saving Plans is Automated as long as your account have the money to purchase.

2. You get to start with a small amount and increase gradually (if you want).

3. Lower expenses (if the bank never increase their charges)

4. You still get a Dividend better then Bank Interest Rate.

5. You have a choice to study (or not) the market.

6. STI ETF will not go bust and recovery is gradually.

Downside:

1. Your Expenses are Controlled by the Bank Charges

2. The Bank have the Rights to amend the Rules which sometime can create some inconvenience.

3. You don't get to compound the dividend if the bank does not provide flexibility in changing the amount to purchase at ease.

4. You don't get to choose the price to buy in since the date will do the job.

5. When your entry price starts from high, you will need a considerable time to accumulate your units price to low.

I hope these 3 parts on Dollar Averaging will benefit Everyone who understand what are their objectives.

Invest Safely Everyone!

Another Good Deed Done!

Is Dollar Averaging the Magic Pill and Does it suits Everyone? Part Two of Three!



Part 2. POSB Invest Saver vs OCBC BCIP (Both work with Dollar Averaging)

Dollar Averaging in a nutshell,

1. When price action is lower, your $100 investment can buy more units.

.2. When price action is higher, your $100 investment buy less units.

On total average when low is more then high, your units' price is in average (possible) low.

-----------------------------------------------------------------------------------------------------------------------

There are a few shared post below to read up on Both Dollar Averaging Plan so I will go straight to the main points to compare.

1. POSB Invest Saver

(i) Pay a low sales charge of 1% (charged on each monthly transaction) from as low as S$1 based on the minimum investment of S$100 a month. There are no other administration or platform charges involved.

(ii) No exit or redemption charges. However, please note that this may be "subject to change." ("clause" is important for any documents)

(iii) On Purchase, as only round figures can be issued for the POSB Invest-Saver, the cost and sales charge of the residual units of 0.82 units will be refunded back to you.

(iv) Only purchase Nikko AM Singapore STI ETF

For more info:

http://www.posb.com.sg/personal/investments/invest-saver/faq-important-notice/default.page

http://singaporeanstocksinvestor.blogspot.sg/2013/07/tea-with-matthew-seah-posb-invest-saver.html

------------------------------------------------------------------------------------------------------------------------



2. OCBC BCIP

(i) For Fees Rate and Promotion refer to the link below

http://www.ocbc.com.sg/personal-banking/Investments/bluechip.html#fees

(ii) Exit or Transfer Charges. Refer to the same link

http://www.ocbc.com.sg/personal-banking/Investments/bluechip.html#fees

(iii) On Purchase, the quantity will be rounded to the nearest whole number. If rounded up, there will be no additional charges. "If rounded down, we will not credit any residual monies to you." (This is very important)

(iv) Can Purchase into either 18 share counters and one Exchange Traded Fund (ETF).

For more info:

http://www.ocbc.com.sg/personal-banking/Investments/bcip-faqs.pdf

http://singaporeanstocksinvestor.blogspot.sg/2013/07/tea-with-matthew-seah-ocbc-blue-chip.html

-------------------------------------------------------------------------------------------------------------------------

What we should take note in this article is,

POSB point 1 (iii)
OCBC point 2 (iii)

The objective of this Dollar Averaging Saving Plan is to make value out of money, but by incurring expenses that are not necessary just defeated the purposes.

Which plan would you recommend after reading this post?

Don't Buy into anything yet. Read Part 3.

In Part 3, I will explain, is Dollar Averaging the Magic Pill and whether it suits everyone.

Another Good Deed Done!

Is Dollar Averaging the Magic Pill and Does it suits Everyone? Part One of Three!



There will be 3 part to this post because I need to drive the whole day.


So let us start with Part 1.

What sparked this Post is an Enquiry on OCBC Blue Chip Investment Plan (BCIP).

Below is his reply when I ask what he knows about BCIP before I Forensic Analysis for him.

"oh right... so basically its just a saving plan that provides a higher % interest? can i put it in this way?"

From his answer, I know his main objective is to have a capital protected saving plan that give good return of interest rate.

In this case, this product might not be suitable for him because

1. it is an investment plan that is not capital protected but it does comes with a better dividend returns compare to INTEREST RATE from bank.

2. There is expenses incurred for every transaction that normal saving deposit does not incurred. (unless you over shot the 300pcs a day from counter deposit)

3. There is a risk that on the day you need to Sell the Shares you might be at a losing end.

-------------------------------------------------------------------------------------------------------------------------

This product is suitable for people who

1. Know ALL the expenses for buying and selling shares and are willing to accept the expenses

2. wants to Diversify thier extra funds like SRS or Spare Cash for a better ROI

3. Have Limited Capital but wants to start young and accumulate his position with $100 or more monthly and at the same time get better ROI.

4. Believe that the Dollar Averaging is moving towards their advantage in the future.

5. Knows the downside of this investment and knows when not to sell their shares when the market is dim.

In Part 2, I will talk about POSB Invest Saver vs OCBC BCIP and which one is recommended for his New Objective.

Driving off now!

Another Good Deed Done!