Portfolio 14-Oct-2006

This week, KLCI continues its "mini bull" trend by inching up another 1.29% to 983.54 points, an all time high in nearly 6.5 years. Looking back to my portfolio value compare to last week, it also managed to chunk out a reasonable 2.82% hike, mainly owing to the rise of Magnum.

Magnum has increased 3.3% over the week to RM2.17 due to active share buyback. Technically, I think Magnum is on the bullish trend based on my amateur analysis skill. From the MACD indicator, the bullish centerline crossover has just emerged after a rather weak positive divergence trend. This usually means buy signal. I am crossing my fingers hoping that Magnum will break through its resistance level of RM2.20-2.23 so that I am able to sell out partial of Magnum share at price beyond RM2.50.


Along the week, I also managed to sell out all the remaining YTLPWR-w at price RM0.65. The sudden surge of YTLPWR and its warrant without any positive news posed a great opportunity for me to dispose it totally. From the beginning till now, the whole trading of YTLPWR-w has costed me a loss of RM1450 or -6.96%. I learnt two important lessons from this losing trade. First, never buy any warrant during a stagnant or bearish market. Holding it will not generate any dividend and due to its price leveraging power, losses can be huge. Secondly, never buy a non growth stock at its peak price in a non bullish market. I do not doubt that YTLPWR is a fundamentally strong counter. Unfortunately, I also do not think that it can be considered as a growth stock, that can justifies any consistent price appreciation. The buy-in price of YTLPWR-w for me was as high as RM0.805 in Feb this year and I have to admit this was my big mistake.

On the other hand, my bond fund continues to grow in value. PBOND grows 0.23% while PIBOND grows 0.13%. Total value has increased to RM50,488.79. As of this week, my equity to bond ratio stands at 61:39, still far from my target of 10:90. I have set a dateline until 30th June 2007 to achieve this weighting, in preparation for an economic recession.

Frugal Living

I came across this article which I like so much and would like to share it here. It is not about the details or information in it, but the important message it conveys: delayed gratification. The author (a blogger) had a frugal living for the past 5 years after his graduation and start working; he lived as if he was still a college student. As such, he was able to build a healthy net worth at young age.

..... To net it down - What I believe I did right was disassociate my spending and living standards from my job salary. Instead every year as my net worth builds, my "expected" annual consumption and living standards grows with my worth.

And I truly agree with his principle, that is to disassociate the level of spending with one's earning. I am a strong believer of this, and this mentality has greatly helped me to leverage the value of my hard earned money. In exchange of some instant short stint of funs, I gained more years of easier life ahead by saving and investing those money. If you realise how significant the power of compounding effect, then you will agree how critically important to start saving / investing as early as you can.

Many do not believe an average working Joe can save up and become a millionaire one day. Worse still, some are struggling their whole life to become debt free. All in all, this is because many do not know how to appreciate a simpler life and keep on chasing a life style that is beyond their means.

The idea to be able to jump out from the rat race is my biggest motivation. Just imagine if one day that you do not have to work for living, then there will be so much more times for you to spend on more interesting and meaningful things in life instead. Better still, if that happens at young age when you have a lot of energy to try different things.

I believe I am on track to achieve my dream. If you ask me what is my secret formula, I will tell you to think twice about what you really want in your life. Is that the styling handphone, big nice 4-wheels, expensive massaging chair or the plasma TV for relieving your after-work tension, or a break from your mind boggling work forever... I believe you will know what to do once you have the answer.

Portfolio 07-Oct-2006

This week, my portfolio value rose 0.90%, outperformed KLCI (+0.35%). Along the week, I have made a switch, converting 10 lots of YTLPWR-w at price RM0.59 to 500 units of Tanjong at price RM12.50.

As mentioned last week, I strongly feel that Tanjong with price below RM12.50 is much better to hold than YTLPWR-w. Besides, referring to The Edge Daily, Tanjong PER is just about 12 and next interim dividend of 12 sen will be due on Oct 18. Its estimated dividend yield of 6.4% (or 80 sen per share) at RM12.50 now is irresistible. This although does not seem to be in line with my overall strategy of cashing out from equity, I bet Tanjong's downside risk is limited and hope that with this cost down, I can achieve a better opportunity to exit later.


Magnum has traded in a narrow band lately, with strong support at RM2.10. There is always the thinking to take profit lingering around in my mind but so far I have been able to suppress that. I still can see occasional share buyback of Magnum and this made me think its current RM2.10 will be well supported. I will only consider to dispose partial of it if it starts to breach RM2.20 again.

This week, my bond fund value increased to RM50399.97 from last week value of RM50298.11, or 0.21% increment w-o-w. PBOND still performed better than PIBOND, with to-date return of 1.03% and 0.57% respectively in a time frame of ~1 month. Frankly, I am very satisfied with these performances, considering the fact that these 2 funds are consistently rising from day to day.

Portfolio 30-Sept-2006

My portfolio almost stayed flat this week, with only slight gain of 0.14%. Compare to KLCI which rose marginally also, 0.24%, it is not that bad afterall.

Magnum regained 3 sen over the week, but unfortunately majority of the gain has been countered off by the drop in Tanjong's share price, from RM12.80 to RM12.60. Tanjong's earning report was disappointing, with net profit dropped 33% from RM117m to RM 78m on QoQ basis. The losses incurred by Germany Tropical Island project have widen to RM17.7m, despite euro 34m (~RM 158m) turn around plan is on way to save this sickening business. Personally, I do not think this leisure business undertaken by Tanjong has any bright prospect, simply because it does not and will not ever meet the expectation of most Europeans for a true tropical vacation. It would have been a huge attraction if it were an artificial snow house for skiing built in Malaysia but it will not be any success that it is a fake beach with unnatural sun-shine in the middle of Europe. Many Europeans do not mind to travel far to real seaside or tropical island to get themselves tanned and enjoy the sea wind, rather than stuck themselves into an imperfect, fake "tropical" dome. The consumerism behaviour of Europeans is totally unlike our Asean, and Tanjong is doomed if it is doing it the Asean way! Nonetheless, I do think the visitor number will go up in the coming next 2 quarters as weather in German is turning cold and into winter but even that, I really doubt the project will turn profitable!

Luckily, this leisure business is only a minor bit of Tanjong and other businesses such as gaming and power are still very stable and generating constant flow of profit. At current price of RM12.60, Tanjong is very attractive to me and I am looking forward to buy in more at price below RM12.50. I do not mind to hold Tanjong for long term as it has reasonable dividend yield (estimated 3-4% in my own calculation), much better than holding YTLPWR-w with zero dividend and bleak prospect of capital gain.


On the other hand, I will start reporting the performance of my other portion of investment, i.e. bond fund. I am still thinking a proper format to keep track of it but until end of this week, I am happy to report that both my PBOND and PIBOND has started generating profit. PBOND is the better performer, which has gained 0.77% while PIBOND gained 0.42%, despite both were purchased at 0.25% premium of its NAV price due to upfront loading. In value, my investment in bond fund has steadily increased to RM50,298.11 in just over 3 weeks. Sweet!