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Friday, October 30, 2015

Transaction in Nexttrade Recovery Portfolio

Today, I disposed off 5000 Canone at RM3.38. This stock was acquired at RM2.62 on October 13. The investment yielded a profit of RM3568.66. In addition, I bought 10000 Teoseng at RM1.55.


The holdings of Nexttrade Recovery Portfolio


 The allocation of Nexttrade Recovery Portfolio

Our initial capital as at October 13, 2015 of RM100,000 has grown to RM103,419.26.

7 comments:

Andrew Lee said...

Dear Mr Alex

Thank you for providing us your Nexttrade portfolio to share with us some of your kindly selected stocks. If I may, will you be able to update your portfolio every week as to show us the progress of your portfolio so we may learn from you progressively?

Also, why is your cash stands at 37% of your total portfolio and you have not fully utilised them? Are you waiting for another crash like the one during August? Probably, say this coming December US rate hike?

Please enlighten us. Your kind reply is appreciated.

Thank you,
Andrew

Baran Razali said...

Hi Alex

Why did you sell Canone at this level? Won't it go up higher to test its previous high many years ago?

Best regards
Baran

Baran Razali said...

Hi Alex

Why did you sell Canone at this level? Won't it go up higher to test its previous high many years ago?

Best regards
Baran

Ming Soon said...

Hi, Alex,

Please share your viewpoint for FBMKLCI for next 3 months,thank...

Alex Lu said...

Hi Andrew Lee

I will take your suggestion on more frequent updates on my Nexttrade Recovery portfolio. However you can actually see the portfolio's performance by going to the bottom of my front page.

Equity markets are in an uncertain state. After rising steadily for the past 6 years, the fear of a bear market on the horizon is on everyone's mind. Has equity market made a top in July? No one can be certain because the market has recovered fairly substantially.

To your question why I have not fully invested in the market: That's because I want to leave aside a portion of my capital for future investment. The buying of Teoseng is not tied to the selling of Canone. The latter has risen substantially- nearing its recent high of RM3.50-3.60. The objective of the portfolio (i.e. price recovery) has been achieved. Time to take profit.

Alex Lu said...

Hi Baran Razali

I took profit on Canone at this level because it is approaching its recent high of RM3.50-3.60. The objective of the portfolio (i.e. price recovery) has been achieved. Time to take profit.

It is possible that Canone may go higher. There is rumor or talk that the Kianjoo privatization is initiated or supported by Canone. If so, it would be a masterstroke! However, it would not surface anytime soon as it would be a violation of the exchange rules. If that story is true, Canone would firstly reject the privatization offer. Then after a decent period of 2-3 years, the "new shareholders" of Kianjoo & Canone might announce a deal for Canone to takeover Kianjoo and the "new shareholders" to exit the investment.

However, this could well be pure speculation. Canone may just dispose off its stake in Kianjoo and realize a handsome profit. The only reasons why the rumor has some substances are, firstly, Chee was an ex-employee of Canone & the price of Kianjoo's privatization is fised at a very low RM3.30. I doubt that would be sufficient to induce Canone to sell. Thus Canone should reject the offer to buy out its stake in Kianjoo and stay invested in Kianjoo.

Please make your decision on whether to stay invested in Canone based on your own criteria and investment objectives.

Alex Lu said...

Hi Ming Soon

My viewpoint for FBMKLCI is as per my last market outlook post. The market is at an inflection point. If FBMKLCI fails to recover above the 1680 early next week, then the bearish scenario may set in.

However, there are two opposing forces acting on the market. On the positive side, the recovery in the US equity markets provides support to global equity markets, including Malaysia. On the negative side, our political situation, weak economic outlook and weak MYR are acting as dead-weight on the market.

If the index failed to stage a recovery above 1680 next week, its next slim chance for recovery would be to launch a sharp rise after hitting the 1650 mark. If that does not pan out, then we will revisit the August low.

If the index managed to stay above the 1680 level, we can expect the market to grind its way up to 1800. I doubt it can go beyond that unless our politic & economic outlook change substantially.

That's my 2-3 months outlook.