SGX Securities

Are you working because of your pay?

2008-06-02T12:03:00.003+08:00

On 26 May 08, CNA ran a report with regard to business fresh graduates earning starting salaries to the tune of S$15,000! The original article can be found below.

For the majority of the population (much like myself) who have had or who are having measly starting pay in the range of $3K and below, I wonder what is the real motivation in going to work for us when we learn of some young punk earning 4X higher than our original salary, and who are presently earning much more than us, despite the 5-yr age gap? Do we simply compare ourselves with those earning $1.6-$1.8K to feel better and ignore these so called "top earners" as merely "rare individuals constituting perhaps 0.1% of the workforce"?

Alternatively, we can always tell ourselves that the job is not about the pay/salary - We work because we Love our job!! We love to attend meetings that have no meaningful conclusions; We love to spend 8 hours in office because we have nothing better to do with our lives; We love answering to bosses who should be our subordinates; We love the office politics, fake smiles and sarcastic remarks; We love to wake up early and squeeze in the commute because it's unhealthy to wake up late and lonely without the squeeze; We love to meet up with unreasonable clients because we enjoy getting scolded for no apparent reason. We love receiving projects with datelines that have expired 2 weeks ago because we have the power to reverse time.

Oh yeah, it's never about the pay; We just love our job.

Here's the original article:-

Survey shows NUS business graduates get higher starting pay

By Imelda Saad, Channel NewsAsia Posted: 26 May 2008 1937 hrs

SINGAPORE: The job market is looking rosy for business graduates from the National University of Singapore.

A survey on its 2007 batch of graduates showed that almost all secured jobs within six months of graduation.

Eight in 10 got a job even before graduation and about seven in 10 received two or more job offers.

The graduates are also getting higher starting salaries, with top earners receiving up to S$10,800 a month.

NUS said the mean starting pay of its business graduates rose by some 13 per cent to more than S$3,000.

Most of the graduates are employed in banking and finance, oil and energy, and fast moving consumer goods industries.

Also doing well are graduates from Nanyang Technological University (NTU). Its largest cohort of more than 4,800 last year were the highest paid.

Nine in 10 of them secured jobs within just a month of graduation and more received multiple job offers.

Salaries of some top earners exceeded as much as S$15,000 a month

Pro Financial FX

2008-01-28T10:35:00.000+08:00

The foreign exchange (currency or forex or FX) market exists wherever one currency is traded for another. It is by far the largest financial market in the world, and includes trading between large banks, central banks, currency speculators, multinational corporations, governments, and other financial markets and institutions. The average daily trade in the global forex and related markets currently is over US$ 3 trillion. Retail traders are a small fraction of this market and may only participate indirectly through brokers or banks.

At Pro Financial FX, they offer professionally managed forex accounts (or forex managed accounts) for individuals who have no time to monitor the 24-hr currency markets. These accounts offer 3 trading strategies for people with different risk appetites:-

(a) Premier - For those with a longer time horizon;
(b) EurAsia - For those who can stomach the intra-day volatility;
(c) On target - For those with a risk profile falling between (a) and (b).

If you want to profit from the falling US dollar, why not trial run the trading systems of Pro Financial FX today?

The Top Ten Reasons Driving the Stock Market Back to its Year Highs at Year End

2007-12-12T09:13:00.000+08:00

Those concerned that the US sub-prime crisis will continue to have an adverse impact on the Equities front should read John's article. In it, he talks about why he believes the Stock Market will move up by year end, despite ongoing circumstances. Even though the Fed has cut rates by 0.25%, financial stocks tanked as investors were expecting a 0.5% cut. Are people over-reacting to the whole situation? We will know in 2 weeks, won't we?

Housing Woes (Part 2)

2007-11-15T10:38:00.000+08:00

Telok Blangah Towers

We have applied for one of the 210 Premium Units (4-rm) of the above and there are already 6100+ ppl on queue for this. This translates to a ~3% chance of getting a flat for every couple. Assuming a 50% drop-out rate, we will require a Q no. of about 400. To make matters worse, it is a BTO exercise, so we have to wait for another 5 years for the flat to be built, even if we do get it. This means that during these 5 years of waiting, we have to find another flat for rental. With rental prices soaring every month, I wonder how much it will cost to rent a 3-room flat.

It's literally impossible to live in Singapore.

Review: Car Guy Garage

2007-11-04T12:08:00.000+08:00

What do you do with your garage? Is it still a place for your car to sleep in? After I have sold my car off last year (as I live a mere 10 mins away from my workplace), my garage has become my storeroom. I really dread going in there as I fear my old junk may just fall on me if they are not stacked properly, haha!

If you, like me, are thinking of "pimping up" your garage by installing some cool garage cabinets, why not pay carguygarage.com a visit? They cabinets, workbenches, tool boxes, garage flooring, garage storage, garage cabinets, garage door openers, organization, garage heaters, garage floor tile, floor mats, garage floor paint, storage systems, laundry room cabinets and other garage packages. You should be able to find something to spruce up your garage.

Housing Woes (Part 1)

2007-10-31T14:25:00.000+08:00

It's so difficult to get a place to live in Singapore.

Let me share some statistics on the resale flats I have viewed in the past month for your own research:-

(1) Stirling Rd
Block 181
Floor level: #11 to #15
Size: 4-room (95 sqm)
Convenience: 1 min walk from/to MRT
Overall feeling: Although the flat is only 7 years old, the flat exterior looks like it has been around since the late 80's. How about the interior? It's worse - It's not renovated at all and the current owners look like they can move out at a whim's notice.
Valuation: $398K
Asking Price: $478K ($80K COV)

(2)Redhill
Block 63B
Floor level: #5 to #10
Size: 4-room (100 sqm)
Age: 6 years
Convenience: 3 mins walk from/to MRT
Overall feeling: They have marble flooring! That's worth like $20K I was told. Its quite well renovated, so we can definitely save on renovation costs.
Valuation: $410K
Asking Price: $495K ($85K COV)

So amongst the 2 above, I don't mind paying $17K more for the Redhill property.

Magic Loans

2007-10-30T09:48:00.000+08:00

Magic Loans.

The name itself makes you wonder if the lender will just disappear with your money, doesn't it?

This company basically offers 3 types of loans:-
(a) Homeowner Loans - For new homebuyers or for existing homeowners who can use the money towards the refurbishment/improvement of their houses;
(b) Consolidation Loans - To pay off those outstanding repayments and high interest credit card bills; and
(c) Secured Loans - For those miscelleaneous purposes like buying a new car, taking that dream holiday or financing something very special, such as a family wedding or similar special celebration.

At the prevailing interest rate of 10.9% per annum, I think you can get a better deal elsewhere.

My advise? Caveat Emptor.

My article was featured!

2007-10-25T19:54:00.000+08:00

I have previously written a finance article for Helium back in May, and it was recently featured on the homepage! (Don't ask me why they took 5 months to feature it as I have no idea) This is the first time my writing has been recognized! And it's not even highly ranked amongst the Helium readers... Hmmm... I wonder why it made the cut in the first place...

Here's a link to the article.

I have stopped writing for Helium since 18th May 2007 because my consolidated earnings for these 5 months has been a staggering 65 cents... Haha...

PayPerPost has definitely been more rewarding, although I am only picking up drips and draps... Those US$100+ Opps are out of my reach due to my low Google PR...

Do you have adequate insurance?

2007-10-21T11:16:00.000+08:00

With over a thousand general insurance companies operating in the UK, wouldn't it be great if there's a website that will compare the insurance plans, premiums, T&Cs, etc., and simply tell you which plan is most suited for your particular profile? Well, head on down to nationsfinance.co.uk then!

To adequately protect your wealth in the event of a fire or a burglary, I would advise that you do not save on Home insurance.

Similarly, if you own a car, you should protect yourself by buying adequate Car insurance, especially if you are still servicing a loan on it.

Lastly, to minimize your loasses from the loss of a luggage during an overseas trip, you should have travel insurance before you even embark on the holiday.

In conclusion, whatever you may do, mitigate your risk with the appropriate insurance policies. It's money you cannot afford to not spend.

Why oil isn't so expensive after all

2007-10-20T23:58:00.001+08:00

Source: Moneyweek.com

I was reading an email form an ex-colleague in America this morning. He was arguing that the oil price would hit $300 a barrel should the US invade Iran. This seems more and more likely in my mind as the rhetoric ratchets up - and I hold my head in despair. (aC: US$300 per barrel on pure speculation?? Can that still be considered speculation or a calculated move?)

I fear that an attack on Iran is becoming a real and present danger, despite US government denials. After all, I remember Donald Rumsfeld saying on TV soon after 9/11 that the US government hawks would not use the terrorist attacks in New York as an excuse to attack Iraq. We all know what happened next.

The thought of oil at $300 is shocking, but is it realistic? Isn’t oil really expensive at the moment as it is?

Well, although I believe that $300 a barrel is unlikely in the short, or even the medium term, but I don’t think that oil is particularly expensive at the moment, despite it being at historic nominal highs.

I expect the price to rise – we should easily see $100 a barrel next year… maybe even this year should the White House warmongers hit the red Iran button. (aC: Hmmm... somehow I can picture the US President having a physical red button labelled "War"... Not as hard to imagine, compared to a $300 per barrel of crude oil.)

If you adjust for inflation, the oil price peak at the start of 1981 was in excess of $100. We are still below that figure. But this is not why I believe that the current oil price is cheap. Let’s take a look at some figures to illustrate my point of view.

First, let’s ask ourselves a basic question – how much crude is there in a barrel of oil…

One barrel of oil officially contains 42 US gallons…
This converts into 35 imperial gallons…
There are 8 pints in a gallon…
That means one barrel of oil contains 280 pints...
WTI futures are currently approximately $87 a barrel…
That means one pint of crude oil costs 31 cents, or 15p in real money...

When put like that, it does not sound as outrageously expensive as some commentators claim. So, what else can you buy for 15p a pint?

I took a quick look around Tesco.com to try and find out…

One pint of milk costs 40p.
The one pint equivalent of Evian water costs around 70p.
The cheapest vegetable oil costs 39p a pint.
Extra virgin olive oil costs 227p a pint.

And then there’s beer… The average cost of a pint of beer in the UK is 250p, according to a report I read on the BBC. However, that’s not what it costs the pub. It is not exactly easy to find out how much your local boozer pays for its beer, so I have to go as far back as 2004 and a written submission from the Federation of Small Businesses to the Trade & Industry Committee.

In this submission, it was revealed that Carlsberg-Tetley charged 42p a pint for Carlsberg lager when it supplied it to a freehouse. You can expect it to be higher than this level now, but 42p for a pint of Carling is significantly higher than 15p for a pint of crude.

Now, of course we are not really comparing like with like here, I understand that. Crude oil is a feed substrate not a finished product like the items on my Tesco shopping list or a pint of beer from a brewery. However, I think for illustrative purposes it makes a good point.

The truth is that oil is NOT extortionately priced and it is almost inevitable that the price is going to rise.

Also worth noting is that in 1981, when oil hit its peak price because of the Iran-Iraq war, a pint of milk cost 17p. That is still more expensive than a pint of crude costs today; without even taking the monster of inflation into consideration.

Oil is cheap, despite the newspaper headlines. The world population is soaring and demand is rising significantly. According to US government forecasts, world petroleum liquids consumption is expected to increases from 83 million barrels per day in 2004 to 118 million barrels per day in 2030.

That’s an increase of almost 30%... and we are not finding enough new oil reserves to meet this demand.

The price of oil has to increase otherwise it would be betraying the laws of economics. I bet that in 10 year’s time after the Asian population has boomed and gentrified and peak oil has hit home hard, you will have to agree with me that oil at $87 a barrel was cheap, cheap, cheap… (aC: Just like how we thought the prices of 1981 were expensive when oil was just traded at $21 per barrel...)

(aC: Hmmm... But it leaves me to ponder - What if mankind discovered other renewable sources of energy that could replace or potentially replace crude oil? Would oil price still mindlessly climb up? Well, we all know from economics 101 what near perfect substitutes does to the price of a commodity. And in this day and age, is it impossible to make such a "discovery" in chemical laboratories? So before you buy go all out to buy gallons of oil futures at $89, think again...)

Taking the Credit for Credit Cards

2007-10-20T00:05:00.000+08:00

cardguide.com.uk is an online website that provides a comparison guide of all the major credit cards available in the UK.

With regard to the hot topic of balance transfers, the above website recommends that one selects a credit card that offers 0% balance transfer and use it solely for its balance transfer feature. Do not make purchases on it. Why? This way, any repayment made to that card goes straight to repaying the balance transfer - and only the balance transfer. Make sure the balance is fully paid off before the 0% deal expires to avoid incurring interest charges, or transfer the debt remaining to another card.

There are also 0% purchase credit cards available. In a nutshell, these 0% credit cards offer you free credit for an introductory period before the standard annual interest reate is applied, in essence giving you a loan at 0% for a specified period of time before the credit card's standard rate kicks in. The "free period" ranges from 3 months to 13 months. My advise? Grab the 13-month one of course!

Singapore Banking Stocks - DBS & UOB (Part 1)

2007-10-18T10:16:00.000+08:00

DBS Group Holdings

DBS will be releasing its Q3 Results on 26 Oct 07 before market opens for trading.

On Sept 19 07, DBS announched a S$400 million share buy-back programme. Share buy-back tends to give a lift to the stock price, due to a decrease in the Shares Outstanding. As this buy-back has not been effected yet, we will not see the upward movement in the stock price in the short term due to the buy-back.

On 27 Sept 07, DBS announced that DBS Vickers Securities Online is now fully owned by its subsidiary. Given the current trading volume of the Singapore Stock market, and DBS Vickers' market share of online brokerage, this should have a positive contribution to DBS's bottomline, even after accounting for the cash consideration of $6.5 million. However, we should see this contributing to the Q4 results and not Q3.

On Oct 8 07, DBS China launched its RMB products - Although this has no material impact to its upcoming results, it should nonetheless have a positive contribution to its Q4 results.

From the above, I think my recommendation is kinda obvious by now. Hold DBS stocks/warrants till the release of its Q4 (FY) results.

Price target: $24 by year end.

eDeal Finder

2007-10-16T10:24:00.000+08:00

Ho Ho Ho! Christmas is just round the corner... Are you feeling overwhelmed by the tons of gifts you have/need to buy?

If you are, why not check out edealfinder.com for some amazing discount coupons?

Thinking of buying some jewellery from Blue Nile for that special someone, do check out these great BlueNile coupons!

For Computer and peripherals, go check out these fantastic Dell discounts!

Online Christmas Shopping has never been easier.

Bernanke has warning for Wall Street

2007-10-15T09:51:00.000+08:00

In a speech in New York, the Fed chairman said the central bank's big interest rate cut last month has helped but that the Fed can't 'insulate investors from risk.'

(Source: CNNMoney.com)

In a speech to the New York Economic Club Monday night, Federal Reserve Chairman Ben Bernanke said the central bank's rate cut in September has shown signs of success, but cautioned that lenders and investors must bear responsibility for financial decisions that caused the subprime mortgage meltdown.

"Although the Federal Reserve can seek to provide a more stable economic background that will benefit both investors and non-investors, the truth is that it can hardly insulate investors from risk, even if it wished to do so," Bernanke said, adding that "over the past few months...those who made bad investment decisions lost money."

The Fed slashed the federal funds rate, a key short-term interest rate that impacts rates on consumer loans, by a half of a percentage point on September 18. Bernanke said the rate cut, combined with an earlier cut to the symbolic discount rate in August, helped to "reduce some of the pressure in financial markets" and that "the improved functioning of financial markets is a positive development."

Behind the Citigroup rescue
Bernanke also said that the weakness in the housing market "is likely to be a significant drag on growth in the current quarter and through early next year."

But he hinted that it may not get that much worse and that investors and lenders may have learned from their mistakes. He did not specifically mention a plan unveiled Monday by a group of big banks to create a fund to buy mortgage-backed securities in his prepared remarks, however.

"Rather than becoming more crisis-prone, the financial system is likely to emerge from this episode healthier and more stable than before," he said.

Investors looking for a sign that the Fed may cut rates again at the conclusion of a two-day meeting on October 31 may be disappointed though. He indicated that the Fed "was prepared to reverse the policy easing if inflation pressures proved stronger than expected."

But during a question and answer session following his speech, David Malpass, chief economist at Bear Stearns, asked Bernanke if he thought the value of the dollar impacts inflation. Bernanke said he did not think a fixed exchange rate system affects the economy.

(aC: I will stick my neck out and state it here that I do not think the Fed will cut its rates any further at its coming Oct 31 meeting. Reason? The Dow is back to its all time high at the 14,000 level; There has been no news lately with regard to any financial institutions going bankrupt because of the sub-prime mortgage crisis; Consumer confidence is back judging from job data and Consumer Price Index.)

National Pay Day

2007-10-14T10:22:00.000+08:00

Everybody's after your salary even before you earn it. Nope, not just your wife, but Everybody!

Banks are charging lesser on transaction costs if you invest in their mutual funds products on a monthly basis using your salary. This is becasue your salary acts as a form of guaranteed monthly cash flow for the bank, and they are "banking" on the fact that most people tend to forget where their money is being siphoned off to if its done electronically and remains hassle free for the investor.

Anyway, coming back to the point of short term loans, who needs short term loans in the first place? If you barely qualify for the no faxing payday loan that National Pay Day offers, then you are probably the right candidate. If you make about $1,000 per month, a 16-day tenure loan of a max of $600 means a 60% increase in your salary. But if $600 is considered critical for your needs, and you have no other avenues to turn to except for short-term loan companies, my advise is that you start saving. Seriously, please start examining your financial health because you should have at least 3 months worth of savings for emergency users.

I know this is probably easy for me to say esp. since I am not in any financial crisis, but I'm saying this because you will probably just dig yourself in a deeper hole by turning to short term loans. Don't forget that the interest rate is 25% - that's 1% higher than what most credit card companies are charging on a late payment. So, I guess the only reason you should take out a short term loan is if you can find an investment that guarantees you a 26% return within 16 days on a $600 principal. If you can find such a vehicle, pls let me know; I don't mind earning $6 every 16 days.

For those with strong willpower, that's a good offer for you - Your first $300 from National Pay Day is Free. Free in the sense that you just have to pay back $300 after 16 days and not $375. Again I stress that this is for those with strong willpower.

Are You A Better Investor (Part 3)

2007-10-11T10:00:00.000+08:00

This Post is continued from Part 2.

Three rules to invest by
So how do you put all the innovations of the past 35 years to the best use for you, not Wall Street? Follow these rules:

(1) If there's a cheap way and an expensive way to solve an investing
problem, stick with the cheap one.
The typical hedge fund gouges clients but produces mediocre returns. As for mutual funds, a recent study found that each 1 percent increase in annual expenses reduces performance by 1.6 percent; managers may be taking on more risk to overcome the drag of higher costs.
(aC: Some studies have shown that an actively managed stock portfolio is not able to beat the after cost net profits of a randonly picked stock portfolio that is passively managed. This means that you don't get anything in return for paying more)

(2) High returns and low risks don't come in the same package.
As Milton Friedman said, "There's no such thing as a free lunch." Just this summer, bank-loan and long-short funds became the latest "low risk, high return" products to flame out.
(aC: Maybe to make this more complete, it should be mentioned that High Returns and High Risks dont necessarily come in the same package either)

(3)If you are presented with too many choices, you'll end up afraid to choose at all.
Psychologists have shown that having to pick among dozens of options not only makes it much harder for us to make up our minds, but it also fills us with regret. No matter what we choose, we worry that another choice must have been better. So don't bother scouring among thousands of mutual funds and packing your 401(k) and other accounts with 78 of them. Instead, own a handful of low-cost, diversified index funds, add to them every month and do nothing else.
(aC: How true this is; If we are unable to filter the barrage of information that bombards us everyday, we will end up being paralysed by the wealth of information that the Internet and Media has brought us in today's world. I think one way to filter choices is to know clearly what you want in the first place, only after that when you presented with choices/options, you know which is the best/right choice. If you do not know what you want in the first place, you can be overwhelmed by the sheer amount of information)

The bottom line
Despite Wall Street's unrelenting efforts to complicate it, investing can be simple. But it isn't easy. In 2007 as in 1972, building wealth is very much like losing weight. Eat less, exercise more: That's simple! But it's not easy, because the world is teeming with chocolate cake and Cheetos.

Likewise, buy a diversified basket of index funds and do nothing: That's simple! But it's not easy because the world is full of TV touts, cold-calling brokers and (temporarily) hot funds. Realize that what's good about the difference between 1972 and 2007 is also what's bad. Lower cost is great if you trade rarely and wisely, but
not if it tempts you into buying and selling constantly. More choice is great if you add a few selected good things to your portfolio in moderation, but not if you end up with an unplanned jumble of investments. More convenience is great if you use it to make your life easier, but not if you take time away from family and friends to update your stock portfolio.

Lower cost, more choice and greater convenience are not means to an end, they are the end. Use them to achieve some other result, and you will fritter away the advantages the past 35 years have brought. You might as well be back in 1972, wearing plaid bell-bottoms and driving a Dodge Dart.

Review: DialAFlight

2007-10-05T00:05:00.000+08:00

If you are thinking of taking weekend breaks, short breaks or even city breaks with your friends or family, why not pay DialAFlight a visit, as they got some awesome deals for you.

DialAFlight is filled with some Cheap Flights and Incredible Holiday Offers! For example, on the top right hand corner of the site, you will find that you can stay at the Serpent Hostel for only £24! If you doubt the quality or question the comfort of a 1 star hotel, you can just scroll down the list as the offers are arranged according to the number of (hotel related) stars.

Hmmm... Again, I'm itching to recommend some improvements to the site. I know this is a UK-based company, but why should everything be displayed in "£"? If the target audience is that of an international one, I recommend that the website implement a function which would allow its users to change the currency of the displayed prices. The available currencies should at the very least include the countries being featured on the website.

Another laudable feature of the site is the ability to hire a vehicle, and it offers a different set of wheels for different states of Australia. Hmmm... £144 for a one-week drive of the Hyundai Getz in Cairns - Nice!

Lastly, if you accept DialAFlight's bundle offer of booking both a Flight as well as a Hotel stay, you get to enjoy a preferential rate! As to how "preferential" this rate is, you gotta call/phone/dial them to find out. Put your negotiation skills to the test!

Are you a better investor? (Part 2)

2007-10-05T00:01:00.000+08:00

This post is continued from Part 1.

2007: A simpler time
Fast-forward to 2007. Your stockbroker and your banker are a swirl of electrons. Adjusted for inflation, the average commission on a retail stock trade comes to about 3 percent of what it cost in 1972. You can choose from among more than 8,000 mutual funds and over 500 exchange-traded funds, or ETFs. You can buy a stock without getting out of your pajamas, and you've never had a trade fail to deliver. And you can watch the prices of your stocks change in real time from your office computer or your iPhone. (aC: Assuming you have already paid a premium for the live prices and dont mind the data charges on your iPhone)

Less cost, more choice and greater convenience: Investing has never been simpler. The birth of the index fund in 1976 enabled anybody with a couple thousand dollars to own every major U.S. stock for less than 0.2 percent in annual expenses. Critics scoffed when Vanguard rolled out the first index fund - "The name of the game is to be the best," said Fidelity chairman Ned Johnson, "and I can't conceive of investment managers not even trying to do better than average" - but year in and year out, indexing has beaten roughly three-quarters of all funds. The investor who minimizes costs maximizes returns. Period.

More recently, indexing has spread to other markets - bonds, foreign stocks, real estate - so you can minimize your costs and maximize your opportunities for profit by covering every base. Meanwhile, the electronic ease of dollar-cost averaging (automatically routing a fixed amount from your bank to your index funds once a month, every month) means you can be a committed investor without ever lifting a finger, second-guessing yourself or timing the market. Combine the two strategies of indexing and dollar-cost averaging and you an hold the entire planet in a single portfolio on permanent autopilot.

Nothing could be simpler.
One thing, however, hasn't changed over the past 35 years: human nature. In 1972, Benjamin Graham was finishing the revise of his seminal work, "The Intelligent Investor," in which he reminded readers that "the investor's chief obstacle - indeed, his worst enemy - is likely to be himself." (aC: I strongly recommend this book for all serious investors out there. Its 400 pages thick and most of the info is rather dry, though the tone of the author can become rather humourous at times, it is definitely a book you will learn a lot from. Best $25 I have invested!)

Then, as now, investors got in trouble by acting on impulse: either getting carried away by greed or being paralyzed by fear. And solutions like indexing have always seemed a little unsatisfying. You want investing to be more complex so you can feel special when you figure it out. And Wall Street wants it to be more complex so it can make more money off your attempts to figure it out.

Thus in the first seven months of 2007, more than 130 ETFs were created to invest in commodities, foreign currencies and single-industry sectors. You can bet on the Swedish krona, buy a basket of carbon-emissions trading credits or attempt to gain twice as much as mid-size stocks lose when they go down. There's now a fund for every conceivable need - and for plenty of inconceivable needs too.

Review: Coupon Chief

2007-10-04T12:15:00.000+08:00

Well, Christmas is in 2 months time and with the recent Bull Run, everybody's got that extra cash to spend! So what's a great place to do your Christmas shopping?

If you are looking for Home Electronics, do check out these amazing BestBuy.com deals!

10% Off on all Maytag & Whirlpool major kitchen appliances
$100 Off any Frigidaire front-loading laundry pair;
$10 - $50 Off select MP3 players plus Free Shipping;
$30 price drop on Sony T20 Cyber-shot 8.1MP digital camera; and
$50 price drop on Casio S770 EXILIM 7.2MP digital camera.

Or, if you prefer some Computers related gizmos, check out these great Dell.com bargains!

$20 off Viewsonic 19-inch Monitor with iPod Dock;
$16 off Samsung 19-inch Monitor; and
$584 off Inspiron E1405.

So what are you waiting for? Hurry on down to Coupon Chief to do your online shopping today!

Are You a Better Investor? (Part 1)

2007-10-04T12:09:00.000+08:00

Over the past 35 years, investing has become simple, cheap and convenient. Now it's a snap to build your wealth - or destroy it.

By Jason Zweig, Money Magazine senior writer/columnist

It is Oct. 26, 1972. You turn on your transistor radio and the newscaster reads the closing-bell report from the New York Stock Exchange: The Dow Jones industrial average - led by stocks like Bethlehem Steel, International Harvester, Johns-Manville and Union Carbide - closed at 950.56 on an extremely heavy volume of 20.8 million shares.

The next morning you drive over to see George, your stockbroker. He recommends the Fidelity Trend Fund, which charges a sales commission, or load, of only 8.5 percent; most of the 400 or so load funds in existence charge 8.75 percent. Whenever you buy and sell a stock, George's commission will average about 1.3 percent of the transaction. But so would any other broker's.

In 1972 "the investing world was much easier to comprehend," says Joel Seligman, a financial historian and president of the University of Rochester. You knew your broker, and he sold stocks, not funds of hedge funds. Your bank took deposits, not mutual-fund commissions. Your insurance agent didn't come at you swinging a variable annuity like a meat ax. During a typical week in 1972, the total of all trades on the New York Stock Exchange was less than the trading volume of Microsoft shares on a typical day in 2007.

Road map to a rich life
But the investing world of 1972 was also low in choice, high in cost and short on convenience and information. Nasdaq and money-market funds were less than a year old. There was no such thing as a discount broker, an index fund or a municipal bond fund, not to mention an IRA or a 401(k).

If you wanted a no-load fund, "first you had to find it," recalls fund expert Michael Lipper of Lipper Advisory Services. That meant watching for an ad, making a toll call, waiting for the prospectus, then mailing in the check - a process that could take weeks.

And 7 percent of all stock trades in 1972 "failed to deliver," meaning that the paper certificates for the shares did not change hands within five days, potentially voiding the transaction. To check on your investments, you waited for tomorrow's newspaper, or next week's - or the maiden issue of Money Magazine that October, which many charter subscribers signed up for as the only convenient way to track their mutual funds.

(aC: So which do you prefer? The 1970s or the 2007s? The cost of a trade transaction is definitely cheaper now, but the cost have been transferred to other avenues. If you want "Live Prices" - you gotta pay. If you want daily corporate news update - you gotta pay. Why? Because if you don't, you will be at a disadvantage. The speed of information is so important nowadays that news out in this morning's papers are already considered old news. There should be an update on the word "newspaper" to "oldpaper")

Continue to Part 2...

Car Guy Garage

2007-10-04T10:13:00.000+08:00

What do you do with your garage? Is it still a place for your car to sleep in? After I have sold my car off last year (as I live a mere 10 mins away from my workplace), my garage has become my storeroom. I really dread going in there as I fear my old junk may just fall on me if they are not stacked properly, haha!

If you, like me, are thinking of "pimping up" your garages, why not pay carguygarage.com a visit? They cabinets, workbenches, tool boxes, garage flooring, garage storage, garage cabinets, garage door openers, organization, garage heaters, garage floor tile, floor mats, garage floor paint, storage systems, laundry room cabinets and other garage packages. You should be able to find something to spruce up your garage.

Why stocks can shake off mortgage meltdown (Part 2)

2007-10-01T10:10:00.000+08:00

This post is continued from Part 1.

(3) Economy still fundamentally strong Turmoil in the credit markets is being caused by a repricing of risk, and not from problems stemming from the broader economy, many say.

"In our opinion this is a financial market event rather than a real economy event," said John Ip, senior economist for Morley Fund Management in London.

As a result, highly leveraged companies and financial firms are likely to feel the pain. But so far, it doesn't look like the upheaval is affecting the ability of companies on sound footing to get credit, he said.

Treasury Secretary Hank Paulson said Wednesday that the fallout from subprime problems was contained and that the global economy remains strong, Reuters reported.

In a sign of the strength of the worldwide economy, the International Monetary Fund last week revised its global growth forecast for 2007 and 2008 to 5.2 percent, up from a previous forecast of 4.9 percent.

(4) Plenty of cash out there Despite problems roiling the debt markets, liquidity - or the amount of money available for investing - remains plentiful worldwide.

China and Russia, for example, have accumulated massive reserves. The global economic boom has also helped drive corporate profits, and many companies are sitting on loads of cash.

"Liquidity is quite abundant and it will cushion the world's economy and the financial markets against the current turmoil," Tony Crescenzi, chief bond market strategist at Miller Tabak and Co. in New York, wrote in a note this week

The tumult in the credit market may persist for some time, but it's likely that "credit formation will return to levels sufficient to power a continuation of the global economic expansion," he wrote.

Review: Hotel Reservations

2007-09-27T00:25:00.000+08:00

How does Hotel Reservations stand out among its peers and competitors?

Here's what I think. Because of my background, I will be coming mostly from an Usability point of view and I do hope that the website owner will find my criticisms constructive enough to actually implement some of my recommendations to further enhance its website.

Homepage: Upon entering the homepage, I am bombarded by tons of information. Tons! The Homepage is too cluttered, just like most other online websites. Online surfers are impatient people with short attention spans, so they are easily put off when an encyclopedia wealth of information is being thrown in their face.

Recommendation Sub-page: I have problems getting started or even knowing how/where to get started; If I happen to be brought to the homepage without a destination in mind, will I know what to do next or will I just look for the exit? I hope the website can design a "Recommendations" page for those who were stung by the travelling bug but are clueless as to where they wanna go in the meantime.

Book Online: If you guys notice, there's a "Book online" tab near the top right hand corner of the screen. It would be useful to turn this plain text into a hyperlink to direct potential customers straight to the "Hotel Reservations" page.

Hotel Filter: At the Hotels sub-page, you can sort the Hotels according to "Best Value", "Quality", "Price" and "A-Z". Here's a breakdown of what this means:-

"Quality" - Hotels are arranged from 5 stars to 0 stars
"Price" - Hotels are arranged from the cheapest to the most expensive
"A-Z" - Alphabetical order

My question is - What does "Best Value" mean? Cheapest Hotel in each Quality standard? How does it differ from "Price"? (I did a sort according to both "Best Value" and "Price" and they both return different results) Maybe it would help if there's a pop-up text box which explains the above 4 categories when users do a scroll-over.

"Save up to 70% off": At the top right hand corner, I am sure you will be attracted by these 5 words. It would definitely help if HotelReservations.com can explain or give a breakdown as to why users can save up to 70% off when they make online bookings through the website.

"$100 Rebate" Promotion: There's an ongoing promotion which gives up to $100 cash rebate with online booking. The catch? You gotta make a 12-night booking. I'm sure you have heard of the phrase: "Nothing in life is free". Well, I have a personal saying which goes: "Free stuff often comes at a high price".

Conclusion: I have seen about 10 out of the 71 posts made by other bloggers, and they were all generic in nature, and nothing which were specific to HotelReservations.com. I do hope that the owners will appreciate my honest review of their website and implement some of my recommendations. Competition is stiff in this industry, and we must all strive to improve continuously. Overall, I think it is a good online travel website, but with a few tweaks, it can become better.

Investment: How many Stocks should you own? (Part 2)

2007-09-24T23:55:00.000+08:00

Click here for Part 1 of this post.

So the heck with diversification, right?

Well, not exactly.

First, the least-diversified investors frequently lagged the market; they just lagged by less than investors who held more stocks. Second, because stock returns are so uneven, the "average" undiversified investor doesn't really exist. At any given point, there are something like 10,000 stocks in the United States. Most of them are mediocre, but a handful are what Bill Bernstein of Efficient Frontier Advisers dubs "superstocks" capable of delivering gargantuan returns for years. Think Microsoft in the '90s, when it returned 9,000%. More often superstocks are lesser-known companies. (aC: This is so true; That is why my strategy is always to go after penny stocks with great fundamentals. You can buy more volume of stock A that's worth only $0.20 and wait for it to move to $1.20 as compared to a stock B that's worth $2.00 and watch it move to $3.00, even though the latter will usually move faster. With the same $10,000, you can buy 50 lots of stock A and reap $50,000 in gross profit as compared to 5 lots of stock B and gain just $5,000. Of course, the hard part lies in identifying those Stock As; Stock Bs are your typical Blue chips)

Across a large group of people whose portfolios are mostly in one or two stocks, the lucky few with superstock portfolios will make the group's average return look great, even if the vast majority of individual members have lousy or middling results.

On the other hand, investors who spread their bets across dozens of stocks have only a slightly better chance at catching a superstock. And if they do land one, it won't have nearly as much impact on their portfolios, or on the group's average return.

So the real story is that you need a lot of stocks to be adequately diversified, and you need a concentrated portfolio to give yourself a shot at striking it rich. An unsolvable catch-22? Hardly. In fact, you can have it both ways by employing a straightforward, two-part strategy.

First, direct 90 percent of your U.S. equity allocation into a total stock market index fund that automatically gives you a stake in thousands of companies. (aC: In Singapore terms, this will your ETFs that track indexes like your STI ETF 100) That guarantees you a piece of every superstock that already exists or might emerge later - and, more important, it means you'll be adequately diversified and your investing costs will be at rock bottom.

Then pursue your search for the next Microsoft or Google by researching the daylights out of a very small number of companies and putting the remaining 10 percent of your portfolio into your one to three best ideas. This way you'll let yourself have a little fun. You will also minimize your risk and maximize your hope.

(aC: Hmmm... I have a different recommendation here - I would recommend the allocation to be 70% ETF and 30% "undervalued penny stock". If it's 90/10 as recommended above, I dont think gains from the UPS portion will provide any meaningful offset to the market return of the ETFs.)

Review: Submit2Please

2007-09-21T12:24:00.000+08:00

Traffic - The currency equivalent of the Internet realm.

Submit2Please is an online business which offers manual directory submission to various directories across the world. They promise that your website's URL will not only be submitted but they will eventually be listed on the targeted directory.

So why is directory submission important?

Directory submission has 3 major benefits and they can be broken down as:-

Higher Positioning in Search Engine Results
Indexing of Web Site/Blog
Higher Probability of Click Through Traffic (otherwise known as CTC)

How much is it?

Submission to 500 Directories within 18 days - $99.95

Submission to 250 Directories (of PR 3+) within 14 days - $74.95

Submission to 250 Directories within 14 Days - $64.95

Submission to 150 Directories (of PR 4+) within 8 Days - $49.95

Guaranteed inclusion in Google index within 10 days - $9.95

Is the above expensive? That depends on how much revenue you are currently generating from your Blog/Website in the first place. My rule of thumb is 30% of your revenue should go into online marketing/advertising expenditure. So how do we put this into practise? Let's say your Blog is currently generating $50 a month, I would advise you to sacrifice 1 month of your revenue and pay for the 150 Directory submission and see if this boost up your revenue. If it does not result an increase in your monthly revenue by 200% (i.e. $150), then I would say it was a waste of money.

Lastly, let me touch on the ROI considerations provided by the website as follows:-

Assumptions (worst case scenario):

Consider our deal of submission to 500 directories for USD 99.95
Consider only 50% directories accept your site submission
Further you can safely consider that every directory which accepts your website will send your way at least four visitor in the entire year! So you still get 250 x 4 = 1000 unique visitors in an entire year for a cost of USD 99.95. So you get one unique visitor for less than 10 cents!

Here's what I think of the above. Firstly, a 50% hit rate is overly optimistic; A more realistic figure would be 5%. Secondly, I will use back the assumption that each directory will only send 4 visitors to our targeted URL over a one year period, because I think this is reasonable.

What we have is the following: 25 X 4 = 100 unique visitors over a one year period for a cost of ~US$100 or approximately US$1 per visitor. I personally find that too expensive. Furthermore, there's no guarantee that these visitors will return for a 2nd visit. Anyway, for those blogs that have 100 visitors in a single day will probably not be too thrilled by this kinda stats...

59th Emmy Awards - Stronger

2007-09-18T12:14:00.000+08:00

"Th Th Th Tha hat that dont kill me
Can only make me Stronger
I need you to hurry up now
Cos I can't wait much longer"

Haha! Have you guys seen the Emmys? The above video is super funny (if you take away the whole Ryan Seacrest part)

Rainn Wilson of "The Office" (US) fame has to compete with the king of hip hop, Kanye West in a rap song contest in order to win... NADA! As Wayne Brady puts it, the people at the Emmys are rich enough; They don't need no more prizes. Instead, the winner of the rap song showndown will get to present the next award - "Best Reality TV Series" (which explains the whole setup)

Review: PayPerPost

2007-09-14T00:05:00.000+08:00

I have been with PayPerPost, an online business that pays Bloggers to write sponsored content for them, since early August 2007. I have written about 7 Posts for them in this Blog so far (you can identify them by their "Sponsored" label) and have had both good and bad experiences with them.

Here's my story:-

The Good
(1) Support Ticket System - Fast response and some of the support personnel are very helpful.
(2) Active Community - Just pay a visit to their Forums section and you'll know what I mean; Some of the other Bloggers are very helpful too.
(3) PPP Direct - This is a feature of PayPerPost which brings advertiser directly to your doorstep. My first PPP Direct client found me within 2 weeks and if you are interested in reading this post, it is labelled as "PPP Direct".
(4) $1K Tuesday - There are loads of Opportunities (that pay a premium as high as $500), being released on every Tuesday. Such Opportunities are open to everyone, even those Blogs with a low Google Page Rank.

The Bad
(1) Support Ticket System - The response is fast but responses from some of the support personnel make you feel that they are more concerned with closing the ticket promptly rather than addressing your concerns
(2) Post Review - The posts are almost never reviewed within 72 hours as claimed by the TOS. I always have to send a trouble ticket to remind them.
(3) Payment - Have to wait for 30 days after your Sponsored Post has been put up.
(4) Opportunities - If you are joining this with hopes to snag a $500 Opportunity or even $50 ones, I would advise you to think again. Such Opportunities are rare gems and are snapped within seconds. No kidding, they are snatched the moment they are released. The highest amount I have gotten so far is $20.

The Verdict
It will be worth your while to sign up, but it will not make you the next Internet millionaire.

Investment: How many Stocks should you own? (Part 1)

2007-09-13T22:43:00.000+08:00

The answer is a lot more, and a lot fewer, than you probably think.

By Jason Zweig, Money Magazine senior writer/columnist

With the market near record highs and yet bouncy as a beat-up couch, you may be thinking it's time to focus on a small number of stocks that you know really well. What better way to keep returns up and risk down?

Conventional wisdom and new academic research certainly seem to suggest
that this is the way to go. Many financial planners and brokers will tell you that a portfolio of as few as 12 stocks (and up to 30) will
sufficiently diversify your (entire) holdings. (aC: The benefits of Diversification can be measured mathematically by the correlation coefficient of a portfolio; There is diversification benefit only if the addition of a new stock to a portfolio leads to a decrease in the overall correlation coefficient of a portfolio. So, the above study is saying that the addition of an additional stock (or more) to a portfolio of 30 stocks will not lower the overall correlation coefficient, and hence there is no diversification benefit from doing so.)

And three recent studies have found that individuals who own fewer stocks do better than those who own many.

However, as is often the case with conventional wisdom (and academic research), there's a lot more to the story. Fact is, if you build your portfolio entirely on the principle of "less is more," you're a lot more likely to end up with less than more. Here's why and what to do instead.

Those were the days
The idea that 12 to 30 stocks are all you need dates back at least to the 1960s, when academics, including Burton Malkiel, author of the classic "A Random Walk Down Wall Street," concluded that that's what it took to eliminate most of the risk from a portfolio. (They usually defined "risk" as the chance of suffering big swings away from the average market return.) (aC: Or even more specifically, it is defined as "unsystematic risk" - the kind of risk that can be diversifed away by adding certain uncorrelated stocks to an exisitng portfolio. There's also another kind of risk known as "systematic risk" that cannot be diversified away.)

But back in the days of hula hoops and transistor radios, and before computer-generated trading became common, stocks didn't bounce around the way they do today. In 2001, Malkiel found that it took 50 stocks to get the risk reduction that 20 used to provide. Others estimate that true diversification requires hundreds of stocks.

The focus factor
Just recently, however, researchers studying the performance of individual investors have discovered something that, at first glance, seems electrifying: The more concentrated a portfolio is, the higher the returns. One study found that investors whose portfolios were dominated by one or two stocks outperformed the most diversified stock owners by 0.8 to 4.8 percentage points annually on average. That's a huge gap. And roughly 8 percent of the top performers had portfolios concentrated in a single stock.

(aC: If you look at the definition of risk as defined above, you can see that risk may not neccessarily be a bad thing. If risk is the fluctuation around a certain mean/average return value, then this fluctuation can also be positive. In other words, becasue of the added risk, your portfolio returns can be higher. This is the basis for the saying - "Higher Risk; Higher Returns")

Continue here.

Review: CompuCram

2007-09-13T12:30:00.000+08:00

For those interested in taking the Financial Industry Regulatory Authority (FINRA) (previously the National Association of Securities Dealers or NASD) Series 7 license exam, do check out CompuCram.

The Series 7 provides an individual with the qualifications necessary in order to make different types of trades with all types of corporate securities, excluding commodities and futures. It is also one of the steps necessary in order for a member firm associate to register with FINRA. The Series 7 exam must be passed in order to take many other principal exams offered by FINRA.

So how will the CompuCram Exam Preparation Software help you pass the Exam? At a mere $69, you will enjoy the following benefits:-

(a) The software is written by a team of financial industry experts, all of whom are working professionals with up-to-date knowledge and experience.

(b) There is virtually an unlimited no. of exams which are continually updated with the latest questions; I guess this is the most important factor, because we just gotta practise, practise and practise for such financial exams.

(c) CompuCram provides a 100% guarantee that if you do not pass the exam, you will get a refund of your original purchase price (if you call them within 30 days of activation), so its virtually risk-free.

(d) There is no expiration date on the system.

Investment: The Top 10 Trading Rules - Part 2

2007-09-12T12:14:00.000+08:00

This is continued from my earlier post.

(6) Adapt your style to the market
At various junctures, different investment approaches are warranted and applying the right methodology is half the battle. Identify your time horizon and employ a risk profile that allows the market to work for you.

(7) Maximize your reward relative to your risk
If you're patient and pick your spots, edges will emerge that provide an advantageous risk/reward. Proactive patience is a virtue. (aC: This is very true in a sense; I realised that my Contra trades will never do better than the stocks that I hold even for just a few months)

(8) Perception is reality in the marketplace
Identifying the prevalent psychology is a necessary process when trading. It's not "what is," it's what's perceived to be that dictates supply and demand. (aC: On the philosophical side, isn't "Reality" itself just a matter of one's perception? One person's reality may be completely different or even opposite from another person's)

(9) When unsure, trade "in between"
Your risk profile should always be an extension of your thought process. If you're unsure, trade smaller--or paper trade--until your identify your comfort zone. (aC: THIS is the time to do that - during times of great volatility and extreme price fluctuations.)

(10) Don't let your bad trades turn into investments
Rationalization has no place in trading. If you put a position on for a catalyst and it passes, take the risk of win, lose or draw. (aC: Alright, hands up! I'm guilty of this too, but there ARE times when bad investments can be turned into good ones; That's a strategy I will leave till another time.)

There are obviously many more rules but I've found these to be my common threads through the years. Each of you has a unique risk profile and time horizon, so some of these commandments may not apply.

As always, I share these thoughts with hopes that they add value to your process. Find a style that works for you and always allow for a margin of error. No approach is failsafe and any trader worth his or her salt has endured periods of pain.

Good traders know how to make money but great traders know how to take a loss. For if there wasn't risk in this profession, it would be called "winning" rather than "trading."

Source: CNN Money.com

Pingo Mobile

2007-09-10T20:39:00.000+08:00

I previously owned a pre-paid card and it had a one year expiry date. When my card expired, I didn't even know about it until I tried making an outgoing call. The service provider should have the courtesy to inform its customers that their cards are expiring because of the following drawbacks when one's card becomes expired - Firstly, the stored value in the card is unredeemable. Secondly, the mobile number cannot be re-used, even when you offered to pay to do so. I guess such a problem wouldn't happen with Pingo since its prepaid calling cards have no supposed expiry dates (I would however recommend one to call their customer hotline to confirm this as this info isn't explicitly mentioned on their website.)

So, let's get down to it - What are some of the perks of becoming a Pingo user?

(a) Special phone card blog discount coupon: “ppp3” valid for $3 off Pingo

(b) Pingo offers one of the Cheapest Phone Card

(c) Receive $25 phone card for just $17 (I personally wouldn't be enticed by such offers becuase I don't believe in spending X dollars to save Y dollars)

(d) Pingo’s calling card affiliate program pays $15 for each new customer you refer

Why wait? Sign up for their instant calling card now!

(P.S. Pingo is a service of iBasis, which is a major provider of international long distance service to phone companies around the world.)

Investment: The Top 10 Trading Rules - Part 1

2007-09-09T08:07:00.000+08:00

By Todd Harrison

I remember why I wanted to be a trader. I figured that the easiest way to make money was to stand near the cash register. Of course, as I discovered through my 17-year career, there's a reason why consistent producers get paid the big bucks. Flashy bets and big swings sometimes connect but, in the end, a disciplined approach pays the bills.

I've tripped plenty through the years, the types of missteps that almost cost me my livelihood. But I persevered, climbed the ladder and morphed those mistakes into valuable lessons.
I evolved and matured as a vice-president at Morgan Stanley (MS), a Managing Director at the Galleon Group and as the President of Cramer Berkowitz, a $400 million hedge fund. My approach wasn't always constant but, in the end, certain rules allowed me to stay in the game.

These are those rules.

(1) Respect the price action but never defer to it
The action (or "eyes") is a valuable tool when trading but if you defer to the flickering ticks, stocks would be "better" up and "worse" down and that's a losing proposition.

(2) Discipline trumps conviction
No matter how strongly you feel on a given position, you must defer to the principles of discipline when trading. Always attempt to define your risk and never believe that you're smarter than the market.

(3) Opportunities are made up easier than losses
It's not necessary to play every day, it's only necessary to have a high winning percentage on the trades you choose to make. Sometimes the ability not to trade is as important as trading ability. (aC: Oh man, this is so true! The tempation to make a quick buck is always there, so one of the top trader's discipline is to resist temptation.)

(4) Emotion is the enemy when trading
Emotional decisions always have a way of coming back to haunt you. If you're personally attached to a position, your decision making process will be flawed. Always take a deep breath before risking your hard earned coin.

(5) Zig when others Zag
(aC: This is otherwise known as the Contrarian rule; Contrarians believe that the general investing public is usually wrong in its trading strategy, so the smart thing to do is to do the opposite) Sell hope, buy despair and take the other side of emotional disconnects (in the context of controlled risk). If you can't find the sheep in the herd, chances are that you're it.

Read Part 2 of this Post here...

Writing a New York Times Bestseller

2007-09-07T18:51:00.000+08:00

For the professional writers out there, if you are wondering why your books don't sell like Robert Kiyosaki's, even if you may be a more qualified writer than he is (Robert has always claimed that he has failed English in school), then you gotta check out John Kremer's webpage: BookMarket.com. John will teach you the tips on how to market your simple book to become a New York Times Bestseller List.

P.S. If you are wondering who Robert Kiyosaki is... You are probably in the wrong business to begin with...

The 10 Principles of Economics

2007-09-06T23:38:00.000+08:00

This is an interesting video on the 10 Principles of Economics. Don't worry, it's not boring nor dry... In fact, if only all economics professors were half as humourous as this guy, we would have more interesting macroeconomic articles in our local newspapers...

Improving Home Improvement

2007-09-06T10:22:00.000+08:00

Whenever I have free time (haha, does anybody has that nowadays?), I like to decorate or reorganise things around my house (esp. my room and study area). I will wonder: "How would this look here?" or "Would this be more accessible if I place it here?" or "How can I create more space as my room's pretty cramped and cluttered with stuff?" Well, if you share the same thoughts as me, why not hop on by to Anglian Home Improvements for more ideas?

Oh, do also check out their Conservatory page. I currently do not own a Conservatory at my place, but looking at the following pictures really makes me consider building one:

Imagine just chilling out in your own Conservatory with a good book. It's an ideal place to show off your plants to too!

Don't think you know it all, IDA

2007-09-02T11:50:00.000+08:00

Before I am where I am, I actually went for an interview at IDA. The job posting on Recruit highlighted that the role was that of project management with no hint that one must be very technically sound. The 1st part of the interview was the standard essay questions (as for most government or civil service related jobs), which was relatively routine. The second part was an interview with the immediate supervisor. You can tell right away that this guy was a techincal nerd and he started firing me all the technical questions after 5 mins of pleasantries. I was dumbfounded half the time as I didn't expect the job to be techincally focused. I went there with the mindset that the job requires you to understand the technical jargon but it does not require you to exemplify it. And he gave me a "What is this guy doing here?" look. I then told him that: "Well, your recruiting advert clearly stated that you are looking for a Project Manager with no requirements in technical expertise mentioned at all. But it seems to me that you are looking for a Project Engineer instead since the job is so techincally focused." HR then apologised for the misrepresentation.

Notwithstanding this, the techincal interviewer continued with his assault and asked me one final question: "So what do you think of IDA's 10 year masterplan?" I told him that it is quite a well conceived plan, encompassing the Financial sector to Education. However, there's one area that is not covered, and that is Transport. I'm a public transport commuter and there's a problem that bugs us public transport users which private car owners like y'self wouldn't understand. When I'm at the bus-stop, it would be helpful to know when my bus is arriving. And I think this problem can be easily solved using the same GPS technology that the EZ-link tap reader incorporates. An information (LED-display) board can then be constructed at bus-stops to show the estimated arrival times of each bus.

The arrogant interviewer then told me that: "Do you know why it is not done right now, even though we have the technology? This is because it is not economically feasible for LTA to do so. How are they going to fund such a project? They might have to increase transport costs by a dollar if they want to implement something like that. This is why this transport scheme is not part of the Masterplan."

Well, I beg to differ. Looks like LTA and I share the same thoughts. I seriously think that if this short-sighted, arrogant guy continues to a Director at IDA, I don't see how Infocomm can ever take off in Singapore.

LTA rolls out pilot project to provide arrival info at bus stops

By Asha Popatlal, Channel NewsAsia

SINGAPORE : The Land Transport Authority (LTA) has rolled out a pilot project to provide real-time bus arrival information at selected bus stops. This is expected to take the guesswork out of waiting for a bus for commuters. Panels with LED displays will be set up at the bus stops. They will list bus service numbers, what time the next and subsequent buses will arrive, plus or minus three minutes, and whether they are wheelchair-friendly.

The panels will be progressively installed at 30 selected bus stops in the Orchard Road, Ang Mo Kio and Yishun areas, at a cost of just over a million dollars. For now, it is a pilot scheme for 6 months. Although the panels will be located at a fairly low level, LTA says they should be fairly tamper-proof as they are made up of strong tempered glass surrounded by stainless steel frames. Many commuters say they are all for it, if it works well. "Sometimes you don't know when the bus is going to arrive. Supposedly they say bus interval is about 15 minutes, but it can be delayed by up to half an hour or one hour, (especially) during traffic jams. So with these bus panels, I think it will be... useful," said one commuter.

"Sometimes I'm not sure if I'll be late for school. So if I know the bus is taking too long, I can take a cab straight away and won't waste too much time," said another. "But the thing is that - will they really come? If they say 5 minutes, will the bus really come? To me, it's the same - not much difference. I'm used to waiting already." This is not the first time the LTA has tried out such a system. In 2003, the LTA aborted a three-year-old venture with homegrown company Stratech for a bus commuter information system. But Transport Minister Raymond Lim said things are different now. He said: "The main difference is that technology has improved and cost has come down."

Mr Lim added that the authorities want feedback from commuters before they go any further. Still, even if the scheme works well, it will not be going island-wide. Mr Lim said: "Because it's not cost effective. There are 4,000 over bus stops. You might not want to put one in every single bus stop. You look at where are the major areas where there are high commuter traffic and you target them." Also introduced on a pilot level are Key Bus Services Maps which will be installed at 36 key bus stops around Orchard Road by end-August. Primarily meant to help tourists, they are pictorial representations of surrounding landmarks and how to get there using the nearest bus stops and MRT stations.

DialAFlight.com

2007-08-29T20:02:00.000+08:00

If you are thinking of booking flights to Australia or spending your school holidays in Australia, why not give DialAFlight a try?

DialAFlight is filled with some Cheap Flights and Incredible Holiday Offers! For example, on the top right hand corner of the site, you will find that you can stay at the Serpent Hostel for only £24! If you doubt the quality or question the comfort of a 1 star hotel, you can just scroll down the list as the offers are arranged according to the number of (hotel related) stars.

Hmmm... Again, I'm itching to recommend some improvements to the site. I know this is a UK-based company, but why should everything be displayed in "£"? If the target audience is that of an international one, I recommend that the website implement a function which would allow its users to change the currency of the displayed prices. The available currencies should at the very least include the countries being featured on the website.

Another laudable feature of the site is the ability to hire a vehicle, and it offers a different set of wheels for different states of Australia. Hmmm... £144 for a one-week drive of the Hyundai Getz in Cairns - That's not bad!

Lastly, if you accept DialAFlight's bundle offer of booking both a Flight as well as a Hotel stay, you get to enjoy a preferential rate! However, as to how "preferential" this rate will be, you gotta call/phone/dial them to find out!

15-year-old clinches S$17,000 in online sales!

2007-08-26T20:34:00.000+08:00

15-year-old clinches S$17,000 in online sales within a month
Source: channelnewsasia.com

He sold $16,800 worth of electronic gadgets — mainly iPods and mobile phones — simply by monitoring eBay transactions and offering them below the prevailing prices.

He did this within just one month. And oh, Sanchit Bareja is 15 years old.

With entrepreneurship no longer just the domain of adults, the NUS High School student is one of many youths who are jumping into the business world — and out-doing them.

For Sanchit, it is simply a game of keen observation and good timing. (aC: At least he's honest about it. I don't see how he could have won an entreprenuership competition with such a concept. If you are talking about a competition titled Highest eBay S'pore Sales Volume in 2 weeks, then my hat's off him... But Entrepreneurship??)

“I have always known this shop along Race Course Road, which sold electronic goods cheaply,” said Sanchit, whose businessman father inspired his interest in entrepreneurship.

“Nowadays, you see a lot of youngsters buying new phones every three months, and I think the iPod has been quite a success as well, which is why I concentrated on these two items.”

Going by his eBay moniker Laptopnextdoor, he monitored the bids for these items and offered them at cheaper prices. (aC: Well, a skillset necessary for day trading, so we in fact have a day trader in the making!)

“I had to do so as I do not own a shop, and also, I’ve not built up a reputation for myself yet,” Sanchit said. “If customers could get a similar bargain from Sim Lim, why would they buy it from a young, unreliable and inexperienced guy like me?”

He did not reveal his profits. (aC: I did a search on eBay and this is what I found: Mr laptopnextdoor is selling the Nokia E65 for $630, iPods Shuffle 1GB for $130 and iPod nano 2GB for $225; I can't reasonably estimte his profits w/o a good grasp of the product costs.)

Sanchit’s business idea was part of the annual Enterprise Day Forum, a nationwide ebusiness competition where students from primary schools to tertiary institutions developed business plans and competed for sales on eBay. The competition was held two weekends ago, and saw some 200 students participate. His outstanding sales figure earned him the top prize of $1,500 in the non-tertiary category.

He also earned himself an endorsement from Minister of State for Trade and Industry Lee Yi Shyan, who said: “I understand from eBay that some 4,000 Singaporeans sell on eBay. And every hour, a Singaporean sells 300 MP3 players and 27 watches to the world. Imagine if this continues, what will happen to the watch retailing industry? Clearly this tells us that business models are changing.”

Mr Lee added: “The 15-year-old is arbitraging differences in price and product knowledge. (aC: There's just a every chim or profound way of saying: "he monitored the bids for these items and offered them at cheaper prices.") If he represents a new generation of entrepreneurs, then imagine the impact on existing physical stores.”

Indeed, competitions like these are springing up regularly. Another such contest — the ninth annual Youth Entrepreneurship Challenge — attracted 79 teams from 46 secondary schools recently.

Organised by Singapore Polytechnic’s School of Business, the competition reported interesting and more importantly, highly feasible proposals, including convertible high heels for ladies and a voltage-cum-ampere indicator for car batteries.

“We came up with the idea of constructing an ultra slim backup battery that is not as bulky as conventional ones, as well as an indicator which alerts drivers when their battery current and voltage is running low,” said Dunman Secondary School student Iris Tan, a member of the winning team.

It may be some time before these student entrepreneurs change the dynamics of the business world — but current statistics do show that more Singaporeans are starting their own business.

Results from the Start-Up Enterprise study — commissioned by credit and business information bureau DP Information Group — reflects a positive entrepreneurship trend in Singapore, with about 43,000 new companies and businesses established in 2005 — an all-time high.

-End of Article-

aC: My question is - How is selling something on eBay a newly developed business model? Isn't that eBay's business model? So he won because he acquired the most revenue? Makes me wonder what the rules of the Enterprise Day Forum are...

According to ACE which organises the competition, the participants are judged on the creativity and sustainability of their business plan, as well as the popularity of their webpage and sales volume. So, if you are curious like me, here is a breakdown of the judging criteria:

Target Market & Marketing Plan - 20%
Innovation & Creativity - 10%
Business Sustainability and Scalability - 10%
Effectiveness - 20% (This is based on the sales volume and the number of ‘views’ generated by listings/auction listing design from 14 May 2007 to 1 July 2007 (both dates inclusive). All you have to do is to sell more items on any eBay sites and achieve higher growth in eBay GMV or listing counts than other participating students with your account for the duration of this Contest.)

Unique Positive Feedback Score - 10%
About Me Page & Blogging - 10%
Bonus Points - 20% (Bonus point will be awarded to participants who take up a charity/social enterprise, offer Paypal as mode of payment and list internationally)

Detailed Product Comparison from BestBuy

2007-08-23T09:57:00.001+08:00

For page loading efficiency, I have moved this post to:-

http://a-bstraction.blogspot.com/2007/08/detailed-product-comparison-from.html

Fold your shirt in 2 seconds!

2007-08-18T09:59:00.000+08:00

2 Second T-Shirt Fold!! - Watch more funny videos here

The above video is one of the more popular online videos that has been circulating around the Internet.

There's one drawback to this whole 2 second folding time saving thing though - It doesn't take into account the time taken needed to lay out the shirt neatly on a flat surface prior to the fold; That itself took longer than just 2 seconds...

Website Review

2007-08-14T00:50:00.000+08:00

Merchant Circle is basically an online business which offers the following services for 2 types of businesses:

(1) For Online Businesses - Merchant Circle helps to create awareness, increase traffic and basically handles the online marketing aspects (including ATL promos) of the business.

(2) For Offline Businesses - Merchant Circle helps to create an online element to one's existing physical shop/office/company.

There are basically 3 Plans that a Business Owner can choose from:

(1) Free
Package includes Pictures & Video Upload, Coupon creation, Ad on Merchant
Circle network and Blog creation; I think this is sufficient for those businesses that currently do not have an online presence. For those businesses that already have an online presence, you might find this Free package pretty useless and you should consider the next one.

(2) Gold ($29.95/mth)
Package includes the following:-
(i)Ads on Google & Yahoo search engines - Create up to 1 rotating ad per month
(ii) Management of online reputation - Monitor and control what's being said about your company
(iii) Increase business's visibility in nearby cities - Add 2 additional cities (service areas) where customers can find you when searching for products and services
(iv) Premium customer support

I think 2(i) and 2(ii) are useful tools to have, especially the latter. This is because this tool will probably allow you to gather customer feedback about your company's products or services, and thus allowing you to improve/enhance your products and services.

I have no idea what 2(iii) does, and I was also not able to find any information on this from the website.

(3) Platinum ($99.95/mth)
Package includes the following:-
(i) Ads on Google & Yahoo search engines - Create up to 4 rotating ads per month
(ii) Increase your business's visibility in nearby cities - Add 4 additional cities (service areas) where customers can find you when searching for products and services
(iii) Advertise on major newspaper sites - Score placement on top publishing sites in your area, top providers include — Chicago Tribute, USA Today, ABC News, and FOX News
(iv) Advertise on 411 phone directory calls - Gain ad placement on relevant directory calls

I think this Plan is for the more serious business owners whose very livelihood depend on the income of the business. However, I would recommend this Plan only for those business with more than $500 in monthly revenue. On average, businesses should only spend up to 20% of their revenue on advertising and marketing (Of course, this is highly dependent on the industry that one is in)

This used to be a sponsored post by Creamaid like HotelReservations and Orlando Hotels, but I have decided to turn it into my personal review and am refusing payment for this review.

Orlando

2007-08-11T23:23:00.000+08:00

For page loading efficiency, I have moved this post to:-

http://a-bstraction.blogspot.com/2007/08/orlando.html

Movie Review - Transformers

2007-08-10T23:31:00.000+08:00

It's visually stunning... but where's the plot??

Wonder why they are bringing all the 1980s toys and cartoons to the big screen. First you have Teenage Mutant Ninja Turtles ("TMNT"), then Transformers and next, we are going to have the Simpsons... But come to think of it, is it because there are no other toys to feature in the first place? I mean, do you know any iconic toys from the 90's or after year 2000? (Pls, pls, PLS do not mention the Teletubbies... The mere thought sickens me...)

Anyway, here's my review of the Transformers

The Good
Great "Transformation" special effects!
Bumble Bee has better acting chops and conveys more emotions than the human actors. (And he beats them hands down by hardly talking for 99% of the film)

The Bad
One of the worst plots ever.
One of the worst ending ever.
Ultimas Prime behaves like a wussy.
Can hardly differentiate one Autobot from the Decepticon.
Lousy acting from all human characters.
What's with the batman trademark move? (The "lighted symbol shining into the nightsky" thing)
Can't see why they keep promoting Shia Labeouf as Hollywood's "Next Big Thing".

The Verdict
Go watch the original cartoons or the 1987 animated movie; They are much better. I literally shudder at the thought of another Transforers Movie by Michael Bay, as the ending seems to hint...

Well... As Ultimus Prime would say: "Autobots... Fall out..."

Don't be arrogant, Google

2007-08-07T21:52:00.000+08:00

Honest to goodness, I wanted to post a blog with the above title for sometime now, but the article below beat me to it.

But allow me to qualify first, what I wanted to say weeks ago has nothing to do with the article below. A few weeks back, I was an Adsense Publisher, but I was shut down by Google, without any prior warning that they would do so, because they suspected "invalid clicks". I was really pissed off at that time because I had qualified for their minimum payout of US$100 after 4 months of displaying their ads. Questions raced through my mind: "Is Google shutting me down because they do not want to pay me?? Would a Company that is earning billions in Revenue do that?? If they really suspected "invalid clicks", why didn't they shut me down earlier (i.e. 1,2 or even 3 months back)? Why shut me down only when I am due for payment at the end of the month?? This is ridiculous.

So, I emailed Google asking for an explanation. I requested to view their data logs to verify that the clicks I have received are "invalid". Here is my email:

Hi,

Pls send me a detailed breakdown of all the clicks for my site. Isn't it true that Google has a way of filtering valid clicks from those that are invalid? Isn't the publisher already not paid on days when invalid clicks were suspected? So shouldn't only valid clicks be recorded in my Adsense report?

I do not appreciate my account being deactivated esp. when payment is due to me at the end of this month. My account could have been deactivated earlier if invalid clicks were indeed suspected, but this deactivation just 2 weeks before I am due to receive payment makes me wonder if Google has had the intention of not paying me all along, and has set me up to publish its ads for free.

Regards,
aC

Below is Google's standard reply:-

Hello aC,

Thank you for your email.

As you know, Google treats instances of invalidclicks very seriously. By disabling your account, we feel that we have taken the necessary measures to ensure that invalid clicks will not continue to occur on your site. Due to the proprietary nature of our monitoring system , we are not able to disclose any specific details of these clicks. As previously noted, if you would like to appeal the disabling of youraccount, please contact us only through this form:http://www.google.com/support/adsense/bin/request.py?contact=invalid_clicks_appeal&hl=en_GB

Sincerely,

The Google AdSense Team

"proprietary nature of our monitoring system" - Ha! How convenient!

No one is asking to look at the source code of your Adsense program, I just wanted to look at the (audited) logs to verify that "invalid clicks" were indeed present. I subsequently appealed against this disabling of account but it was to no avail. In their last reply, Google said they will not entertain any more requests.

In such situations, what kind of recourse can the little guy take against a conglomerate? It seems like Google has the final say (in everything internet related), and we can do nothing else but accept its decision. If you are so sure that you are right, you should come clean and be transparent in your records. Prove your case to us instead of just simply mandating your decision upon us and expect us to accept them, knowing full well there isn't any alternatives for us, the little guys.

Will that stop this little guy from putting up Ads on my Blog? No way. So, don't be so arrogant Google. If you do not want us to be your publisher, there are other companies who will accept us (e.g. Bidvertiser).

(There's a danger in putting up this post because, as you know, Blogspot belongs to Google. So, in the near future, if you type in my URL and you find an error prompt which says "No such website found...", you know the reason... But some things need to be said.)

Dont be so arrogant

2007-08-07T20:55:00.000+08:00

Google is starting to act like your garden-variety monopoly, says Fortune's Brent Schlender.

By Brent Schlender, Fortune editor-at-large(Fortune Magazine)

-- What was good for our country was good for General Motors, and vice versa. - Charles E. Wilson, president of GM, 1953

What is it about powerful companies that makes them conflate their own selfish interests with those of their customers, their industry, and even the world at large? This is especially true in high tech. You could plug the name of any prominent Fortune 500 tech company into Charles Wilson's famous quote, and the result would sound like a mission statement for some of our most notorious corporate bullies. "What's good for Microsoft is good for the Internet." Oops, that's how Gates & Co. ran afoul of federal trustbusters as they trampled Netscape underfoot. Seriously, when a company attains extreme market domination, hubris and a sense of infallibility can't be far behind. It's only a matter of time before said market dominator tries to tell everyone else how to run their businesses.

The latest example is Google which lobbied hard in Washington to dictate the terms of an upcoming FCC auction of radio spectrum. The frequencies, currently used for UHF television, are to be sold next January. In 2009 the winning bidders will take their swaths of spectrum and unleash a new and (they hope) profitable era of data-intensive wireless devices - smartphones, media players, car computers and gizmos no one's thought of yet.

Why would the Google guys bother themselves with this auction? After all, the company isn't even in the big-time telecom biz ... yet. The answer is simple. Google wants to take its breathtakingly profitable targeted advertising beyond PCs and inject it into any other medium it can find, whether it be radio or TV or even newspapers and magazines. (aC: Seriously, I know the author is just trying to make a point here that Google is trying to dominate every known media known to men, but what synergy can Google possibly find or how can they incorporate their advertising algoirthm to the media of radio and print??? Enlighten me pls...) But the biggest prize of all may be cellphones. Why? Because there are so damn many of them, and they're behaving more and more like pocket-sized, full-blown computers (e.g. the iPhone).

Now we come to the hubris part. Google promised the FCC it would bid at least $4.6 billion to purchase spectrum rights - but only if the FCC met all of Google's terms. Specifically, the FCC must ensure that all networks using the new parcels of spectrum be "open platforms." That means four things: (1) The new networks must allow consumers to use any device they desire; (2) they would support standard software like Internet browsers and e-mail; (3) network operators would be required to lease some capacity to other providers; and (4) the new networks would all have to be mutually compatible. In other words, Google wants this spectrum to behave a lot like the Internet.

Sounds reasonable. Wouldn't it be nice to use your cellphone on any network you wanted? But traditional telecom powers like Verizon and AT&T which run tightly controlled wireless networks, felt blindsided when they first heard of Google's demands. Allow any old device to plug into their new networks to run any old software? That's giving away the store! Even more galling was the notion of being forced to lease out capacity to all comers. If they pay billions for spectrum, shouldn't they be entitled to use it as they see fit? What are we, communists? Moreover, by preemptively offering to meet the FCC's minimum bid if its conditions were met, Google appeared to be forcing the agency into an auction for spectrum that would arguably have far less business value. The spokesman for the Cellular Telecommunications Industry Association called it nothing short of "Silicon Valley welfare."

The FCC has offered a compromise: yes on the open devices and software; no on the other two conditions. Hungry for the new spectrum, AT&T reluctantly announced its support; at presstime, Verizon was mulling its choices. Google should be thrilled that the FCC adopted even some of its suggestions, given that it's not a big telecom player. But apparently "compromise" isn't in the company's vocabulary. After the vote, the nicest thing Google's chief telecom lobbyist could say was that the FCC ruling was "real, if incomplete, progress," adding that the company would take weeks before deciding whether to participate in the auction.

Open networks are a legitimate goal for Google and are good for consumers. But all the grandstanding has probably hurt Google's chances to get open networks. Message to the "Don't be evil" people: Don't be so arrogant, either.

Why stocks can shake off mortgage meltdown (Part 1)

2007-08-04T12:10:00.000+08:00

The following article is for people who are afraid that recent financial events are the onset of a Bear Market.

Turmoil in the credit markets is sparking a global sell off, but are investors overreacting?
By Grace Wong, CNNMoney.com staff writer

The threat of a broad credit crunch has jittery investors rushing for the exits, but those concerns may be overdone.

Problems in the risky debt and subprime mortgage sector have sparked wild swings in the market recently - these days few bat an eye at 100 point-plus drops and gains on the Dow Jones industrial average.

Investors have been rattled by a wave of credit woes that has hit leveraged buyouts and the mortgage sector. The worry is that a tightening of credit will have a broader impact on consumers and the economy.

Don't freak out about the Dow
There are reasons for concern. American Home Mortgage (Charts) said Tuesday lenders had cut off its access to credit and that it may have to sell off its assets. The collapse of companies like American Home and other mortgage lenders could make home loans more expensive for borrowers.

And after two years of rapid-fire deal making, the buyout boom is facing a lull. As a debt crunch starts to squeeze private equity firms, the boost take-private deals have provided for stocks could start to crumble.

Uncertainty about how wide credit problems will spread is likely to persist, which means investors are in for more sharp swings in the market. (Watch how you can protect your portfolio -- 6:07.) But there are a number of reasons why stocks aren't likely to fall off a cliff, analysts say.

(1) Stock valuations are reasonable For one, stocks aren't too pricey and sell offs are likely to bring in buyers looking for a bargain.

"A lot of stocks are looking reasonably cheap," said Peter Dixon, strategist at Commerzbank in London. "On the basis of valuations, you've got to continue to favor equities," he said.

In the U.S., the S&P 500 index is valued at about 15 times 2008 earnings, which makes stocks attractive investments, according to Stephen Leeb, president of New York-based Leeb Capital Management.

(2) Deals not doomed Private equity buyouts have helped support the stock rally in the U.S. and Europe as investors have bet that nearly any public company could be taken over.

The outlook for these deals is looking murky as buyout firms face hurdles securing financing, but a slowdown in leveraged buyouts isn't going to have a substantial impact on stocks.

"The exit of private equity is not going to be what caps this market. There are lots of corporate buyers out there willing to step up to the plate and fill the gaps left by private equity," Leeb said.

Continue Part 2 here...

Movie Review - Simpsons The Movie

2007-07-31T21:28:00.000+08:00

"Spider pig, Spider pig, And it does whatever Spider pig does..."

Haha! My Precious and I went to see this movie over the weekend and this is be far the best movie I have seen for the year 2007! It's a real hoot with it's laugh-a-minute jokes! I thought it would be tiring at first, but it didn't feel that way at all!

The Good

The sappy part when Marge taped over the wedding video to tell Homer she was going to leave him... ("Why do birds, suddenly appear... Every time... you are near...")

Green Day going: "Da Da Da Da Da Da Da Da Da Da Da Da" (Count the no. of "Da"s; it's correct) and the ship sinking ala Titanic style

Arnie going: "I was elected by the people to Lead... Not to Read!"

Homer scolding the audience (i.e. us) for watching a paid movie when we have been watching the cartoon on TV for free for so many years

My Precious likes the Naked Bart scene and the Boob Lady

Maggie 1st word: "Sequel" (Hopefully I don't have to wait another 18 years for that... Don't even know if I will still be around then...)

And of course - The Spider Pig song with the opera singers backup during the rolling of the Credits

The Bad

The hole through which the Simpsons escape from the Dome; Seems a bit too easy.

The side story about Bart wanting Ned Flenders as his Dad instead of Homer... Seems like the theme for one of the cartoon episodes... A bit repetitive...

The Verdict

Why are you still reading my review? Go watch the movie NOW!

When God Makes 2 + 2 = 5

2007-07-28T11:54:00.000+08:00

John Shore (Source: Crosswalk.com)
Writer, Editor, Author

In the course of recent posting of mine called The Comfort of the Cross, I wrote (under the paragraph "Pray"), "God, and only God, can make 2 + 2 = 5." A reader wrote to ask if I'd expound upon that a little.

Sure, reader. Thanks for asking! What I meant is that God can't do math. He's outstanding at trees, excels at underwater life forms, and most definitely has a thing for beetles. But math, not so much. Any of you who have ever tried to figure out logarithms has some insight as to why that might be true.

Ha! I'm kidding! KIDDING!
Boy, I hope God has a sense of humor.
Oh, right! The dung beetle!
So he does. Cool.

(aC: Haha! I'm sure the author is just kidding because God is the creator of numbers! He did the first count as he created the universe during the first 6 days and rested on the 7th (the Sabbath). And I thank him for making me numerically inclined)

Anyway, what I really meant was this: Sometimes I find myself involved in a situation about which I simply cannot find peace. Something will be genuinely wrong: someone will be doing myself or someone I care about harm, or someone with power will in some egregious way be abusing that power, or ... something will be happening that no one would be okay with. And so I'll be having a lot of emotional turmoil about that situation or dynamic.
About most stuff I can reason or feel my way into emotional clarity--with most conditions or situations I can make a pretty solid peace by just sort of ... relaxing around it. I usually just open myself to God's perspective on the troubling situation at hand, and then I sort of ... know how to feel or think about it

But sometimes that just doesn't work. Sometimes I can't move into a place where the thing I'm dealing with is okay. That's when I know I've really got a real problem on my hands. I can look at it from the top, the bottom, from either side, from beneath it--and no matter how I look at it, it still looks bad.

And that's when I ask God for his peace. Even though I know there's no way to be with that situation and still have peace, I ask God to bring me his peace. In effect--well, not in effect, in reality--I'm asking for a miracle. I know there's no way for me to feel okay with whatever's going on; I know it can't be okay. By the time I'm at the place where all I can do is pray for God's peace, an idiot would be able to see that I'm involved in a problem that would have Buddha whining and ulcerating.

And whenever I ask for God's peace, like that it's there. Almost instantly my anxiety about the situation is replaced by that expanded, deep, indescribably ... peaceful state God puts you in when he's decided to grant you a little taste of what heaven must be like.
And he never fails to grant me that peace when I ask him for it. I don't think he ever fails to bring that peace to anyone who asks for it.

So what I meant was that when you pray for God's peace, even though you know you're dealing with a situation that factually, really, quantifiably cannot be resolved--a situation where you know that what you've got is the equivalent of two plus two equaling four, and the four is the part that's killing you--God, and only God, can turn that four into a five. Or a six. Or two million six hundred thousand and eight.

Just by asking him to do it, God can make more out of the situation you're struggling with than you would have ever dreamed was possible before he performed that miracle.
I go to a church where, about half way through the service, everyone turns to those around them, shakes hands, and says, "Peace of the Lord." In the course of my daily life, I never say anything to anyone that I mean more than that.

(aC: I do pray to God to bless my investments. After some analysis, I realise most people succumb to greed when they trade; Afraid that they will will miss the boat if they dont act now. And that is usually the worst time to act. I realise to have peace in your trading activities, you must know why you are trading. In the hope to acquire riches - what are you going to do with it when you have it? When you can answer that question honestly and it aligns with God's will, then God will bless you. And you will automatically have peace even when performing a stressful task such as trading. It's that simple. But if you throw all that away and just trade to get get few hundred dollars regardless of how you get it... You will end up losing more...)

Fear and greed in the 2007 stock market: a tale of gonzo investing

2007-07-22T11:35:00.000+08:00

By R SIVANITHY SENIOR CORRESPONDENT (Source: Business Times)

POSSIBLY the most renowed book written by the late, great American journalist Hunter S Thompson is Fear and Loathing on the Campaign Trail '72, a wild and detailed account of his coverage of the 1972 US Presidential election for Rolling Stone magazine.

He subsequently went on to write a whole series of bestselling Fear and Loathing books that popularised 'gonzo journalism' a manic, full-tilt and often profane style of writing in which the writer lives within the story and often exaggerates it with personalised embellishments.
If Thompson were alive today to witness the current stock market boom, you'd have to wonder whether he'd write a book on the present mania and call it Fear and Greed in the 2007 Stock Market

To be sure, the present bubble in penny stocks bears all the hallmarks of 'gonzo investing' (if we may be allowed to borrow and tweak the term).
Punters have whacked stocks ten-fold in less than six months and incredibly, are still hell-bent on continuing to inflate what is already a devastatingly massive bubble.

Worst (like the dot-com mania of 1999-2000), most of the companies involved are fundamentally unsound with poor financials to begin with.
In many cases, vague speculation of a reverse takeover (RTO) accompanies the rises, as if there are that many foreign or domestic acquirers stupid enough to spend large sums of money taking over failed companies, assuming their debts and cleaning up their balance sheets just to get listed here. (aC: Haha, I like this description; people are just buying blindly whenver there are rumours of reverse takeovers)

You can't help but get the feeling though, that everyone knows that RTO stories are no more than flimsy fabrications aimed at covering up major syndicate manipulation (as are many of the other stories and announcements that accompany large price gains). Then again, the principle of 'caveat emptor' which is the perennial fallback as far as regulators are concerned, says that if everyone knows the game is a scam and everyone accepts the risks, then it's OK to leave things as they are. (aC: Well, the risks clearly falls on your retail investors then)

And what of blue chips? Here too, fear and greed intertwine, although 'gonzo investing' bears a tad more legitimacy in the form of programme trading and economic justification born from rationalisation in hindsight. (aC: Do people actually just leave their computers on and let the programs do the investing for you? It seems theoretically plausible but is it practical?)(aC: Hindsight benefit: I have seen so many "genuises" because of their hindsight wisdom)
By now, observers would be familiar with the way all markets move as one, the high degree of correlation undoubtedly due to the widespread rise of computerised buying or selling based on changes in predetermined parameters.

They'd also recognise how experts have glibly changed their tune about US interest rates being cut by year-end but because momentum and liquidity have remained high, have continued recommending investors buy and keep buying.
Fear however, will play a part in the early part of the week - Wall Street's Friday slump looks set to bring prices down in the early part of the week as will news of China's interest rate hike.
Thereafter, things get hazier. The US earnings reporting season has kicked off - not too auspiciously it would seem with Google and Caterpillar missing targets - but the best that can be said that Wall Street looks headed for another volatile week.

The same can probably be said for the local market. Headwinds as far as blue chips are concerned will come from Wall Street grappling with its inner demons - inflation, interest rates, skyrocketing oil prices, a crashing housing market and an economic slowdown, while it'll be interesting to see how the China market copes with yet another rate hike to cool off the economy.
On the other side of the fence sits a grim defiance instilled in all investors to buy the dips and keep buying because of a belief that they can't go wrong. In short, it's all about fear and greed - in that order.

(aC: Well, I have predicted correctly that the slump on Wall Street on Wed will persist longer but I see many clueless investors still jumping onto the equity bandwagon on Wed, Thurs and Fri this week, chasing the prices up thinking that everything now is at a discount. Using Fri as an example, the STI opened 107 points down and close at around 85 points still down no less, but that is evidence that some ppl have chased stocks up for about 20+ points. Given the overnight slump of 200+ points on Wall St, I expect the week starting 30 July to be a continued downtrend in the market)

IPO Review - MAP Technology (Part 2)

2007-07-21T12:30:00.001+08:00

(1) Business of the 3 main subsidiaries (revised):

(a) Min Aik Precision
Principal Activity - Precision Stamping - VCM Plates (main product)
Operations - China
Main Customers - Maxtor (20%) and Western Digital (80%) for FY06
Revenue Contribution - 22%

(b) M&J Technologies
Principal Activity - EMS Solutions - EHDD (main product)
Operations - Thailand
Main Customers - Western Digital and Latronix (in Nov 06; Reputable customer but too new to determine sustainability and significance)
Revenue Contribution - 66%

(c) Art Craft
Principal Activity - Die-cut components
Operations - Singapore
Main Customers - BMS Tech, Metalform, etc whose end customer is Western Digital
Revenue Contribution - 6%

Conclusion: Company is highly dependent on Western Digital for its Revenue; If for whatever reasons it loses WD as customer, its revenue will be adversely affected.

(2) EMS Solutions
The Company employs 696 full time production operators and 530 subcontract workers - Is this normal?

(3) Utilisation Rates (FY06)

(a) Precision stamping - 44.7%
Q: What are the Company's plans for the under-utilised maunfacturing facilities since the focus moving forward is clearly EMS solutions

(b) EMS - 49%
Q: Why does the company still need to spend $8.2 million (of net proceeds) on expansion when it is under-utilized?

(c) Die-cut - 98.9%
Efficient!; But sadly, this is a low revenue contributor.

(4) R&D
The company mentions that R&D is an essential part of the precision stamping business - So why is none of the proceeds spent on R&D?

(5) Credit policy
Allowance for doubtful receivables increased from $17K in FY05 to $63K in FY06, but no bad debts have been written off in FY06; The company gives bad estimates for doubtful receivables

(6) Customers
Min Aik Technology (a controlling shareholder) contributes 76% and 45% to FY04 and FY05 Revenue respectively. This decreased to 22.3% in FY06 with Western Digital accounting for the Company's FY06 Revenue.
Q: What do the revenue figures become if we remove Min Aik Tech's contribution?

(7) Strategic M&A
Form the Prospectus, it does not seem that the Company is certain of any JVs or M&As, so why is $7.8M (of the net proceeds) being set aside for it?

IPO Review - MAP Technology (Part 1)

2007-07-20T20:23:00.001+08:00

Prospectus Fundamental Analysis

You can get a copy of the Prospectus here.

(1) Issue Price: $0.32

Issue Size: 76.5M New Shares comprising only 3M Public tranche (representing only 3.9%) - I suspect this is going to be heavily subscribed again.

(2) Business: 3 Principal activities:

(a) EMS Solutions (66% of FY06 Revenue)
- Main product: Data storage devices (such as EHDDs)
- Main operations: Thailand

(b) Precision Stamping Products (25% of FY06 Revenue)
- Main product: VCM plates of HDDs
- Main operations: ROC

(c) Die-cut Components (9% of FY06 Revenue)
- Main product: Acoustic Damper
- Main operations: S'pore

(3) Historical EPS: 2.4 US cents = ~3.6 Sing cents (Therefore 15X EPS gives S$0.54)

P/E Ratio: 8.7 X

(4) Use of Net Proceeds (S$21.1M)

(a) 38.9% - Expand EMS solution operations

(b) 35.5% - Expand business through M&As, JVs, etc. (Vague)

(5) Capitalisation & Indebtedness

Actual Cash + FD = US$6M

Actual Total shareholder's equity = US$26.6M

Both more than offsets Actual Total Debt of US$2.7M

(6) Dilution
Directors and Substantial shareholders holding stock at only ~S$0.13
Min Aik Tech holds 50.7% of total shareholdings

(7) Main Customers
(a) Western Digital - EMS Solutions
(b) Min Aik Tech - Precision Stamping Products (They are also substantial shareholders - check IPT/Conflict of Interest)

(8) COGS
Raw material costs constitute 82.2%; Raw materials maintained for only 7-14 days because of JIT system; Prices not subjected to seasonlity.

(9) Gross Profit Margin
Decreased from 29.6% in FY04 to 13.1% for FY06, mainly due to EMS Solutuions which typically command lower margins

(10) Inventory Management
Inventory Turnover = 25 days only due to JIT system (for FY06); No write off

Is The Party Over?

2007-07-20T20:22:00.000+08:00

Abrupt end to sizzling market rally serves as wake-up call for investors
By Goh Eng Yeow,
Source: Straits Times Interactive

THE recent super bull run by penny stocks has been nothing short of spectacular - despite Wednesday's slide which was followed by a rebound yesterday.
In just three months, stocks costing less than $1 have shot up in value by half.
This week alone, the more fancied counters have registered double-digit percentage gains daily - barely raising an eyebrow.
Buying into the right penny stocks at just the right moment seems to have become a sure-fire way to make quick money.

On Wednesday, trading became so frenzied that one counter - Ban Joo - attracted a volume of 581 million shares. This would have been the equivalent of a day's trading volume on the entire Singapore Exchange only two years ago.

For many observers, it begs the question as to whether the rally has become so fevered that it amounts to irrational exuberance - a term coined by former United States Federal Reserve chairman Alan Greenspan to describe a market that has lost its head.

Ever higher volumes and greater volatility - all these can lead to a build-up of a stock market bubble, and that may be what we have been witnessing in the penny-stock buying frenzy in recent weeks.

One brokerage's head of risk management noted that many of the punters did not even know the type of companies they were buying into when they snapped up penny stocks.
Many of these companies are financially-strapped firms whose businesses have been bled dry by years of losses.
The only reason why there is such hot demand for their stocks is that these companies have become attractive takeover targets for businessmen who want to inject assets or businesses into them.

But even this line of reasoning may not hold much water.

The run-up in prices of some penny counters has been so sharp that it defies any logical reason for the lofty valuations, even after throwing in the valuations of the businesses which may be injected into these companies.

Take Jade Technologies, for example. The company is worth $395 million, based on its stock's closing price of 46.5 cents yesterday.
In its latest full-year results, Jade reported a loss of $1.4 million on a revenue of only $39.2 million. The only attraction it holds for any new owner is its listed status, which may be worth up to $15 million. This barely justifies the price investors now pay for its shares.
But Jade is hardly the exception. Other penny stocks with similar characteristics include Rowsley, Ban Joo and Equation - which are worth more than $200 million each - even though they have businesses not worth shouting about.

And for all the exuberance associated with the giddy run-up in penny stocks, seasoned investors have been getting out of them in droves.
This may signal their discomfort with a market that relies not so much on the fundamentals supporting a company's share price, but rather on rotational plays among certain stocks taking their turns to be in the spotlight.

Businessman Oei Hong Leong, an investor with a history of savvy timing, has recently liquidated his stakes in small-capitalised stocks.
In the past two weeks, he has sold his entire 29.98 per cent stake in Sesdaq-listed China Healthcare, which he has held since 2005. He has also offloaded his 13.2 per cent share in Super Coffeemix Manufacturing, which he has held since 2003.
Unlike the small-time punters who get in and out of stocks daily in the hope of making a fast buck, Mr Oei has been known to hold his investments for years.
In recent years, his picks have included sizeable stakes in NatSteel, Haw Par, BIL and United Industrial Corp.
So the disposal of a stake in a listed company is not a decision he would have taken lightly.
Mr Oei's investing philosophy, similar to that of legendary US investor Warren Buffet, (aC: Serious? Is he really that good?) is to look for neglected companies whose values are waiting to be unlocked.

Besides share sales by savvy investors, there has also been a slew of data showing an increase in foreign fund outflows from Singapore-listed stocks recently.
A Citigroup report on Monday showed that the weekly outflows had doubled to US$7.9 million (S$12 million) last week, from only US$3.9 million the week before.
Admittedly, this is still a small amount, compared with the US$1.1 billion that foreigners had poured into the Singapore stock market since the start of the year.
But what worries market experts is the likelihood of the outflows increasing over the coming months.

And that raises the spectre of large numbers of badly burnt punters if the rally screeches to a halt.
The risks which could stall the market, said one UOB Kay Hian report, could come from anywhere. The brokerage has advised investors to exercise caution when punting heavily on speculative penny stocks.
On Wednesday, punters got a foretaste of what could happen when the runaway penny stock rally was abruptly stopped in its tracks.
Some Sesdaq counters tumbled by as much as 25 per cent from intra-day highs, in a knee-jerk selldown as the market reacted to a government move to raise development charges for new building projects.

The only redeeming factor so far is that brokerages are moving gradually to protect both their clients' interests and their own by imposing trading curbs on some of the most heavily traded speculative counters.

Yesterday, UOB Kay Hian imposed trading curbs on Jade, Ban Joo and Ocuclus, while Kim Eng Securities slapped similar controls on Alantac.
But requiring clients to put up cash upfront for a few stocks may lull many into believing that adequate measures are in place to stop a market bubble from forming.
There is no cause for panic, but retail investors would be well advised to do their homework before jumping in to buy the next hot stock.

This could save them from a scalding experience if market sentiment takes a sudden dive. (aC: I suspect there could be 2 more major corrections which would serve as a prelude to the impending bear runs. I would have expected one of the major correction to have happened today {25 July 07}, given Wall street's 226 points decline, but nothing of that sort happened; The Singapore market's index was rather muted. I think the major correction will happen today or tomorrow if Wall street remains flat or continues to decline even by a little today)

Raining Fish

2007-07-18T19:25:00.000+08:00

I have decided to take a break from blogging about Investments and talk about something different. I was inspired to blog about the following phenomenon by the movie "Next" (which, by the way, has one of the worst endings in the history of cinematography). But there's a difference in the given explanation (of the phenomenon) between the the movie and the post below. In the former, it was said that water containing fish eggs were actually evaporated into the sky, where they later hatched. I couldn't believe this was possible and decided to Google it.

Unusual objects sometimes fall from the sky, courtesy of waterspouts.

By Susan Cosier (from Scienceline.org)

Just before last New Year’s Eve, Carl and Kathy Hennige of Folsom, California e-mailed their local newspaper to report some strange weather. It was raining fish.

Although it may sound like some sort of mythical event, the Henniges weren’t telling tales. Neither were people in Manna, India, who reported seeing live, pencil-sized fish falling from the sky in July. It can happen, say scientists. The culprit: waterspouts.

Waterspouts, which are essentially tornadoes over water, form when cold air moves over warm water. They churn at speeds up to 200 miles an hour, but dissipate when rain begins to fall from their host cloud. Depending on how fast the winds are whipping, anything that is within about one yard of the surface of the water, including sailboats or fish of different sizes, can be lifted into the air, says Nilton Renno, an atmospheric scientist at the University of Michigan.

A waterspout can sometimes successfully suck small objects like fish out of the water and all the way up into the cloud. Even if the waterspout stops spinning, the fish in the cloud can be carried over land, buffeted up and down and around with the cloud’s winds until its currents no longer keep the flying fish in the atmosphere. It’s like the fish are swimming in the cloud, says Renno. Depending on how far they travel and how high they are taken into the atmosphere, the fish are sometimes dead by the time they rain down. People as far as 100 miles inland have experienced raining fish, he explains.

Fish can also be sucked up from rivers. The Henniges’ condo is just one mile above Lake Natoma and the Nimbus fish hatchery, where they think the fish came from. Carl Hennige writes in an e-mail that there was “an enormous windstorm” just before the fish fell.

Raining fish is not a common weather phenomenon. Fewer than 10 occurrences have been reported in the past year, according to a news search, so local five-day forecasts probably won’t include fish showers. Still, people have reported such events for centuries.

In the early 1900s, Charles Fort, a collector of stories of odd weather happenings, theorized that there was an ocean orbiting the earth that occasionally dropped its creatures onto the planet, writes author Richard Cerveny in his book, Freaks of the Storm.

Now that scientists have advanced technology like Doppler radar, they are less reliant on personal accounts. Fewer people are asked to describe the odd objects they see falling from the sky, says Cerveny, who is also a professor of weather and climate at Arizona State University. Also, people are less likely to report any strange occurrences now than they were 100 years ago. Cerveny explains that today, logical explanations through science are more readily available, so there is less mysticism behind strange weather phenomena. “They tend to sound more kooky now if they report it,” he says. Even though fewer personal accounts of strange weather have not necessarily hurt meteorology, “maybe it has taken away some of the fun of it,” says Cerveny.

Stories of raining fish, frogs or even turtles are an effective teaching tool for Cerveny when he lectures or gives presentations. “Everybody in that kind of a setting loves to hear about odd and unusual weather,” he says. Sometimes after a presentation people pull Cerveny aside, saying, “Well, when I was a kid…”

So keep an eye out, because next time the clouds open up, it may be more than raindrops that keep falling on your head.

Stock Review - TA on OSIM

2007-07-14T11:40:00.000+08:00

The stock suffered a plunge on 26 Apr 07; But with the 3 white soldiers advancing on 5th, 6th and 9th July (on high volume of ~10M no less), this might be a signal of further uptrend for the stock.

There is strong supprt at $0.88/0.885 as shown on 9/2, 26/4 and 9/7, and I expect the stock to advance to $0.95 in the short run (short term resistance).

For the secondary signals - all 3 are uptrend indicators:
(a) MACD is above the Centreline and above the Signal line.
(b) RSI is above 70% mark and its end just turned up.
(c) Stochastic dipped below the 80% mark but its relative distribution (as indicated by the sloping blue line) is still upward trending.

Some recent announcements on SGX:
(a) 26 July - Q2 Results will be out after market close! Most analysts expect this quarter to be a much better one for Osim. (Opening day of the Simpsons Movie too! No relevance though...)
(b) 12 July - Osim announces setting up of retail markets in Middle East markets (i.e. Kuwait, Iran and Oman) by end-2007 (Rich countries but lots of political unrest)
(c) 28 May - Ron Sim bought 500 lots at btw $0.685 - $0.70. Sign of confidence?

Recommendation: Buy during the week of 16 - 20 July with Buy Price of $0.88 and a Target Price of $0.95. Consider selling or pare down your holdings by 26 July if you have no confidence in the upcoming results.

How much can 10 Lots be worth?

2007-07-14T09:55:00.000+08:00

I am wondering, if one is able to be alloted 10 lots of RH Energy after balloting for 70 lots, how much would it be worth just 1 day after its listing? Here's the breakdown:

On the day of its listing (11/7/07), without the benefit of hindsight, if one has sold 5 lots at $0.75, it translates easily to a gross profit of $2,150 or a net profit of ~$2,105.

On the 2nd day of trading (12/7/07), again w/o the benefit of hindsight, if one would sell the remaining 5 lots at $0.905, it translates to another cool gross profit of 2,925 or a net profit of ~$2,880.

Thus, total net profit that one could have made from just 2 days of trading is: ~$4,985!!! Or a Net Profit Return of 156% from an initial invest of just $3,201. The conservative stock price surge to $0.905 was 283% over its issue price of $0.32.

For those who think there's nothing, I'm just talking about 10 lots here, mind you...

I had no idea whether speculators would further drive the stock up...

It turns out Rationalism was thrown out of the window that day and they did.

That's what 10 lots would be worth with a HPR of 2 days...

IPO Review - RH Energy

2007-07-07T11:33:00.000+08:00

To Subscribe or Not to Subscribe - That is the question.

And so here I present my fundamental analysis (based on Prospectus dated 2 July 07).

General Info:
Business: Full suite of integrated customised design, engineering, procurement, construction, installation and commissioning services to the oil and gas pipeline and oil companies.
3 Principal activities: (a) Equipment Integration services (contribute to 81% of Revenue)
(b) Manufacture & Procurement services
(c) Consultancy Services
Issue Price: S$0.32

(1) EPS Growth (based on SGD denomination) for past 3 years should be > 25%:
683% from FY2004 - FY2005; and
59.6% from FY2005 - FY2006

(2) Return-on-Equity should be > 30%:
ROE (FY2004): 11.5%;
ROE (FY2005): 47.5%;
ROE (FY2006): 55%
Increasing for the past 3 years.

(3) Current Assets to Current Liabilities Ratio should be > 2
CA/CL (FY2006): 2.15
Company should be able to meet its short term obligations.
Moreoever, there is positive working capital of US$7.9M

(4) Debt-to-Equity Ratio should be less than 1
D/E (FY2006): 0.43

(5) Price-to-Earnings Ratio
Current P/E (based on Issue Price): 10.7X
15X P/E: $0.45 (Target price)

(6) Net Asset Value
NAV (FY2006): 3.92 cents (SGD)
NAV Premium (based on Issue Price): 716%

Issues/Concerns:
(1) Dilution (Pg.43) - Substantial shareholders and Pre-IPO investors paid only 4.95 cents and 11.16 cents per share respectively, so they are sure to sell once the Shares are listed. They are however subjected to a moratorium of 6 months, so that gives us some time for retail investors like us to play around with.
(2) MD&A > FY2006 Revenue VS FY2005 Revenue (Pg.57) - As a result of a strategy change, the Company's contract size decreased in FY2006 while no. of projects more than doubled to 71 (from 33), and this subsequently produced a drop in overall Revenue of 30.8%. However, this also contributed to higher net profits (67% increase) in FY2006 due to higher margins (and lower costs). My concern is: Is this sustainable? The Company doubled its no. of contracts in FY2006, will the Company be able to increase its no. of contracts in FY2007 and beyond (esp. since this strategy is based on quantity rather than contract size per contract)?
(3) Being in the oil industry, RH stock price will undoubtly (but irrationally, to me at least) track the NYMEX sweet crude oil futures which current stands at US$72.81. My take is that as long as prices remain above $70 on its listing day, the stock price will rise.

Recommendation: Subscribe/Buy

Is the property bubble going to burst anytime soon?

2007-07-01T23:29:00.000+08:00

10 years after the Asian financial crisis, Asia's real estate markets are bubbling again, led by Singapore. Given the key role overheated property played in that crisis, it bears asking, to what extent the current exuberance is a cause for concern this time around.

According to the Global Property Guide, Singapore experienced Asia's highest residential property price increases last year, with housing prices rising 9.5% in real terms (although this masks higher percentage increases in prime market segments). Quite likely, it will be a similar story 2007 as well. Real estate markets in China, India, Korea and the Philippines have also witnessed sharp run ups - and in those countries too, prime segments have seen double digit price increases in percentage terms. Indeed, more and more real estate funds and other institutional investors are pouring money into Asian property. Some element of speculative activity is also evident.

How much should we worry about all this? In a study on Asia's real estate markets in April, the IMF took a generally sanguine view - albeit with qualifications. It pointed out that while property prices have been rising more rapidly than inflation, most Asian countries 'are not experiencing unusually rapid housing price hikes'. It noted that in many cases, the increases follow on the heels of extended declines (about eight years, in the case of Singapore). Moreover, housing prices have not risen exceptionally, compared with other asset prices. On average, housing price increases have run ahead of income gains in about half the 12 countries covered, but these average prices might mask affordability problems for some segments of the population.

Apart from income gains, there are other reasons for property price run-ups: the proliferation of mortgage products and a rise in mortgage credit - especially in China and India; higher non-speculative foreign demand for housing and commercial space (which is true in Singapore as well) as well as an element of speculative capital inflows - though less than that in the 1990s.
Given that the run-up in real estate prices represents a rebound after several years of decline or stagnation, it does not, as yet, create cause for concern. The fact that institutional investors are far more active players in Asia's (and particularly Singapore's) property markets this time than they were in the 1990s is also reassuring. They introduce an element of stability and resilience because they have greater financial holding power than individuals, and are less likely to engage in panic selling.

However, having said all that, policymakers and banking regulators across the region need to be vigilant to ensure that lending standards do not become overly relaxed and that housing lenders are adequately provisioned against what the IMF calls 'a reasonable worst-case scenario of falling house prices'. The degree of household indebtedness - particularly in those segments of the population who are vulnerable to income shocks - is also an indicator that bears watching. But as of now, it is difficult to make the case that there are sufficient danger-signs to warrant government intervention in the market with the aim of bringing property prices down.

Fifteen Dollars' Worth of Smug

2007-06-27T22:44:00.000+08:00

Totally agree with Daniel on this issue - The whole charitable act doesn't even cost the law firm anything extra!

And I agree with the following statement too - "Only in this new gilded age could a $15 lunch for a 23-year-old student be seen as a self-abnegating act." Converted to Singapore dollars, that is S$22.50, mind you! Some young law punk could be eating ribeye steak or a japanese buffet spread with that kind of money and still proudly proclaim: "This is my sacrifice, so that my company can give S$67 to charity..."

What a New York law firm's charity-lunch program reveals about America.
By Daniel Gross (Source: http://www.slate.com/id/2170561/nav/tap3/)

Sometimes it takes a brilliant, carefully crafted novel, such as Anthony Trollope's The Way We Live Now or Tom Wolfe's The Bonfire of the Vanities, to capture a culture of money, ambition, and corporate avarice. And sometimes it takes just a few paragraphs, as with this 224-word article by Louise Kramer (fourth item down) in the Sunday New York Times business section, which describes a philanthropic trend at big New York law firms. Under the Chow for Charity program, now in its fifth year, summer associates at the giant law firm Simpson Thacher can elect not to enjoy a $60 per person lunch with a firm lawyer. Instead, if they choose to eat with the lawyer at a more down-scale joint and spend $15 or less each, the firm will donate the difference ($45 per person) to a nonprofit legal group like Legal Aid.

How does this small piece neatly encapsulate several important trends?

1) A Touch of Conscience.
These days, any company that markets to or needs to hire well-educated proto-yuppies must take bold action on topics of concern ranging from global warming to poverty. Or, if it doesn't actually want to take the action, it must at least appear to be concerned. Doing good isn't a serious commitment or an end in itself. Rather, it's an ornament, like a wall sconce, that makes consumers or employees feel good about themselves and the company. The Times paraphrases a recruiter who notes that such efforts "are part of an emerging trend to add a touch of social conscience to lavish recruiting practices for top students in a competitive market." The greatest desideratum of firms is to undertake publicity-generating good works that don't require them to spend extra money or change the way they do business. Buy some renewable energy, by all means, but continue to maintain that fleet of corporate jets. Chow for Charity is a perfect case, since it doesn't cost the firm a dime.

2. The New Gilded Age. This is a golden age for corporations, and for the professional firms that service them, such as Simpson Thacher. According to the American Lawyer, Simpson racked up profits of $2.5 million per partner in 2006. (Given that, loudly trumpeting a program that generates about $50,000 in charitable donations seems a little gauche.) But this style of philanthropy neatly encapsulates the frequent obliviousness of the very rich, and of the publications that cater to them, to the nation's glaring income inequality. (Last week, the New York Times ran largely unironic articles about $60,000 beds and $225,000 parking spots.) Only in this new gilded age could a $15 lunch for a 23-year-old student be seen as a self-abnegating act. I can assure you that it is quite easy to gorge yourself on excellent food in New York for $15—a fine all-you-can-eat Indian buffet, a sublime pastrami sandwich from Katz's Deli, four street-side schawarmas. And plenty of New Yorkers would be thrilled to have $15 a day to spend on food. In the recent congressional food stamp challenge, several solons tried, without much success, to live for a week on the average food stamp budget: $3 a day.

3) Defining Public Service Down.
For more and more of us, public service is something that other people do—other people with lower incomes, smaller apartments, and less nice stuff. (For the Iraq war version of this trend, see National Review columnist Jonah Goldberg.) The Times article quotes a recruiter who says law firms do this sort of charity because their recruits are really interested in community work. Now, law school is very expensive, and students take on large sums of debt to pay for it. So it may well be that many of Simpson Thacher's summer associates are just working there for the summer so they can go toil as community organizers upon graduation without excessive debt loads. But most are there because law firms such as Simpson pay massive salaries ($160,000 to start) and provide entree to even more-lucrative gigs at consulting firms, private-equity firms, and investment banks. Today, thanks to the benevolence of Simpson Thacher, you can pursue community work by taking your lunch at Pret a Manger instead of Le Bernardin.

4) It's Good To Be the King.
In this economy, management and owners of capital always win. The partners of law firms have been among the most fortunate owners in this economy. They don't face competition from China. They mark up the labor of junior associates and then pass on the costs associated with that labor—copying, car services, long-distance phone calls—to their deep-pocketed clients. Summer associates are already a great deal for law firms—their hours are billed out to clients at hourly rates of between $200 and $300, but the firms don't have to pay any benefits. Not surprisingly, this charitable endeavor presents the partners with yet another opportunity to profit. "Lawyers like having lunch with a summer associate because it means a faster meal, not the typical time-sapping 1.5 hours," the article notes. Translation: It's a double-winner when kids pick the cheap meals over leisurely lunches. First, senior lawyers don't have to spend as much time feigning interest in the ambitions of 23-year-olds. And it leaves one more hour of daylight in which they can bill out their own time—and that of the community-minded summer associates.

Trading With Confidence: How You Can Develop More Confidence In Your Trades

2007-06-20T20:44:00.000+08:00

Confidence is contagious. So is lack of confidence.
~Vince Lombardi

Have you ever opened a magazine and seen a full-page ad of some luminary sporting a "milk mustache"? I like the question, too. "Got Milk?" Everyone from Wentworth Miller to Jessica Alba has appeared on a print or TV ad with the milk mustache and the famous tag line. The ads insinuate that the success of these stars is attributed to drinking the nutritious liquid.

So, if we lined up the finest traders and had to put a tag line under their picture, what would it be? There is one characteristic that distinguishes the "haves" from the "have-nots" - a quality that's decidedly different for a top trader when he's at the height of his game versus when he's struggling (all traders have times of struggle)… What would the tag line be? Got Confidence?

Does trading success develop confidence, or is it the other way around? It's a fair question, but probably not the "right" one. A better question would be, "Have you ever seen a consistently profitable trader who lacked confidence?" Or, "When you have had a string of trading excellence, did you feel more or less confident than usual?" Here's why trading with confidence is crucial to your trading success, and how you can get it by focusing on three key elements…

Forming A Foundation For Confident Trading
As applied to the world of trading, let's call confidence the ability to act without reservation. Confidence is developed when key underlying characteristics have been put into place. One needs to have his trading psychology in place, a strategy or system that is proven, and execution proficiency.
When these three elements come together, they form a foundation upon which a trader can act with great confidence. Let's look at each of them, and see what steps you can take to help put them in place…

Confidence In Your Personal Trading Psychology
We'll start with the most important item - your personal trading psychology. To have confidence when you trade, you will need to develop a keen sense of who you are and how you will react to both common and extraordinary trading situations.
For example, how will you feel after losing six trades in a row? How will this affect your performance on trade seven of this string? What will be your plan to develop the patience, discipline and other attributes needed to provide consistent performance while trading? If you are not completely satisfied with your psychological state of readiness, your confidence as a trader will constantly be in doubt.

Confidence That Your Trading Strategy Works
The second area that you need to develop is your trading system or strategy. While this is an area that traders spend most of their time on, I find that they spend very little time developing confidence that the strategy works. This takes time and patience.

Can you state succinctly why your system works? Do you know what types of market conditions are best for your system's performance? In what types of markets does it perform poorly? What kind of losing streaks can you expect every month or quarter with your strategy? What size drawdowns will these loosing streaks produce? Too often, people buy a strategy or quickly develop one over a weekend and then start trading it without getting to know why, how and when the system works. So be prepared to spend the time required to really know the "nuts and bolts" of your trading strategy.

Confidence In Your Own Definitive Trading Plan
Once you have developed your trading psychology, and taken care to build a strategy that you know works, you need to be able to execute it consistently. There is a psychological element to this part of your trading (many traders have trouble "pulling the trigger"), but there are also some key logistics that you need to take care of in order to trade with confidence.

If you are worried that your trading software won't work or that you don't understand it, or if you're concerned that power outages and Internet issues will keep you from executing your exits, or if you think that the market makers and specialists are "out to get you," then you are definitely going to have trouble trading with confidence. The tool that can help you overcome these concerns is a well-defined trading plan that includes a "disaster plan" and a good understanding of how your trades are executed.

Confidence is not an end in itself, but it is a desired result of having a comprehensive trading process that works. If you struggle with achieving a state of confident trading, I suggest that you dissect the three areas that we talked about in this post. If you find one or more areas that need upgrades, then put together a plan to increase your mastery in that area - a psychology investment plan or a system upgrade plan, etc. Look toward improving your confidence to improve your trading.

Managing Risk

2007-06-10T10:37:00.000+08:00

Lessons From Warren Buffett: Two Ways To Avoid Getting Burned By "Competition-Style" Investing

By D. R. Barton, Jr.
Quantitative Analyst, Mt. Vernon Research

When this guy speaks, economists, investors, and the financial media across the globe sit up and take notice. He's one of the most well-known, successful, and respected investors in the world - and with a personal fortune of $44 billion, one of the wealthiest.

So it's not surprising that his investment decisions almost always make news. Most of them simply notch up more wealth for him, his shareholders, and the folks who take heed of him.

I'm talking about Mr. Warren Buffett, the 76-year old brains behind Berkshire Hathaway. But some people are questioning the merit of one of his recent decisions. Are they right, will we be learning lessons from Warren Buffett, or will he prevail? Let's take a look…

"The Apprentice"… Warren Buffett Style

What would you do with $5 billion in two years?
At the annual Berkshire Hathaway shareholder meeting earlier this month, Buffett surprised attendees by announcing that he will search for his successor by jumping on the reality show bandwagon.

Buffett will select three or four top candidates for the position and give them $5 billion to manage for two years. The winner of the $5 billion challenge will get the nod to run Berkshire Hathaway.

On the surface, it sounds like a nifty idea. And while it won't be on TV (at least not yet), Buffett's "reality show" has the makings of great drama. But if you look a bit deeper, this type of selection strategy has some serious flaws, because of the mistakes and rash decisions that such "competition-style" investing can trigger. And it's got some important lessons for us, too…

Win At All Costs? Not So Fast…

Warren Buffett's selection process has obviously caught the eye of the media, most notably in Austan Goolsbee's New York Times article, where he likens Buffett's tactics to Donald Trump's reality show, "The Apprentice."

There's certainly one aspect of this that is a big concern: Is a "win at all costs" reality show strategy the appropriate way to invest or choose an investment manager - especially one running the massive Berkshire Hathaway operation?
After all, if one of the contestants makes $3 more (on a $5 billion investment portfolio) over the course of the two years, is that significant? But the key issue here is that this type of competition easily encourages participants to take undue risks in order to be first past the post.

For the record, I'm sure Mr. Buffett and his staff has taken these issues (and plenty more) into consideration. But investors would do well to avoid the pitfalls inherent with competition-style investing. Here are some things to watch out to make sure you don't fall into one of these traps.
Monitor Your Risk When Seeking Higher Returns

If you want higher returns, you usually have to take on a little more risk to get them. But one of the most prevalent investing concerns is that investors don't fully understand these risks often dazzled by the potential upside and ignoring the downside when evaluating opportunities. Stay disciplined.

Don't Increase Your Risk Just To Make Pre-Determined Performance Goals

It's one of the classic mutual fund manager mistakes. They're notorious for taking inordinate risks to attract new clients or make a certain amount of money. If a fund has a chance to make a top 10 list at the end of the year, they know that such acclaim and publicity will lead to much greater capital inflows - with higher fees and bonuses to follow. That means managers can be tempted to take bigger risks with existing investors' money. If the risk works out, they reap some fat rewards. But if the wheels fall off, the fund will lose capital and credibility.

If you find your investment returns lagging your goal for any given month, quarter, or year, don't fall into the trap of hiking up your risk to make up the shortfall. Doing so, just to get to an arbitrary performance mark, will more than likely put you on the fast-track to lose money, not make it.

Basics in Equities Investing

2007-06-04T01:01:00.000+08:00

There are basically 2 schools of thought when it comes to investing in Equities - Technical Analysis & Fundamental Analysis. What are they?

Technical Analysis (TA) is the study of historical price movements through the use of charts. The 3 main charts that most Technical Analysts use are the Line chart, Bar chart and Candlesticks. Personally, I prefer the use of Candlesticks for its more descriptive visuals. Technical analysts look for patterns in the charts and using the basic assumption that "History repeats itself" to forecast future price movements. They look for signals or indicators within graphs to tell them if a stock will continue its upward/downward trend or is heading towards a reversal. Proponents of TA will tell you that it is simple to use, signals can be quickly detected and the investor psychology is incorporated within the analysis. Some arguments against TA are that the indicators/signals are highly subjective to the user and that the value of indicative values will change over time (since they are dependent on a large number of variables)

Fundamental Analysis (FA), on the other hand, is the determination of a company's underlying value by analysing the company's financial statements, business model, its future prospects, management team and internal controls. Fundamental Analysts invest on the assumption that "an undervalued stock will always catch up to its underlying value in the future". Proponents of FA will tell you that since financial ratios such as Net-Asset-Value (NAV), Earnings-per-Share (EPS) and Return-on-Equity (ROE) are rigorously calculated, estimate of a company's underlying value will not differ too far from such tangible quantifications. Criticisms of FA are that even if the undervalued stock will rise to its underlying value, investors will never know when this will happen (via TA).

If you ask me, I suggest the use of both analysis - Use FA to identify which stocks to invest in, and use TA to determine when to do so (Timing).

Happy investing!

The Commonplace Temptation

2007-05-30T00:01:00.000+08:00

Starting on the 22nd of July 2007, I will dedicate 1 post each week to my Christian Faith. Here is the first. The words in bold below are so very true to me. Is it the same for you?

Source: http://blogs.polvero.com/index.php?id=b&name=JesuSpeaks&post=2602

The Commonplace Temptation

Matthew 4:1-11
(1) Then was Jesus led up of the spirit into the wilderness to be tempted of the devil.
(2) And when he had fasted forty days and forty nights, he was afterward hungry.
(3) And when the tempter came to him, he said, If thou be the Son of God, command that these stones be made bread.
(4) But he answered and said, It is written, Man shall not live by bread alone, but by every word that proceedeth out of the mouth of God.
(5) Then the devil taketh him up into the holy city, and setteth him on a pinnacle of the temple,(6) And saith unto him, If thou be the Son of God, cast thyself down: for it is written, He shall give his angels charge concerning thee: and in their hands they shall bear thee up, lest at any time thou dash thy foot against a stone.
(7) Jesus said unto him, It is written again, Thou shalt not tempt the Lord thy God.
(8) Again, the devil taketh him up into an exceeding high mountain, and showeth him all the kingdoms of the world, and the glory of them;
(9) And saith unto him, All these things will I give thee, if thou wilt fall down and worship me.(10) Then saith Jesus unto him, Get thee hence, Satan: for it is written, Thou shalt worship the Lord thy God, and him only shalt thou serve.
(11) Then the devil leaveth him, and, behold, angels came and ministered unto him.

I've read this scripture so many times before as I'm sure many of you have. And I'm sure that you've heard a number of sermons and teachings on why exactly Jesus was victorious against the enemy at this point. There are, however, key things that God has pointed out to me that make Jesus successful here. Simply quoting the Word is not enough and is not what caused Jesus to walk out victoriously.

The first thing we must realize is that Jesus was led up by the Spirit into the wilderness. Romans 8:13 teaches us that if we live by the dictates of the flesh, we'll die. But if, however, we live through the Spirit, knowing when and how to tell our flesh no and bring it into subjection, we shall surely live. In the previous chapter of Matthew, recognize that Jesus had just undergone a profound spiritual experience. I've come to recognize in my own life that anytime a profound spiritual experience occurs, I am tested on it almost immediately. In order to live a holy, righteous, resurrected life, we must, as Jesus said, "suffer now." It's important to take note of the dialogue between God and Satan in Job 1. (If you haven't read Job 1, I encourage you to do so). The Spirit of God will never take you where it can't keep you.

The second thing we realize is that Jesus flowed right from one spiritual experience into the next (Matthew 1:2). He went from being baptized, to the Spirit descending on Him, to hearing God declare is pleasure in Him, to being led by the Spirit into the wilderness for temptation, to a forty day fast. While the fast is important, I want to draw your attention to something else: is there an area in your life in which you know you are weak? After forty days without food, Jesus was weak in the area of hunger and the enemy took complete advantage of that. If there's an area in which you are weak, it's important to note how the enemy tries to influence. The enemy didn't command Jesus to turn stones into bread. No. He simply made a "harmless" suggestion. It was the equivalent of saying, "Well Jesus, I know you've fasted and you're hungry now. Your human. You have to eat. Why don't you just, well, I don't know, turn some stones into bread so you can eat? I know you're hungry." Now it's important to realize that Jesus replied confidently with the Word. There had to be some Word in Him for Him to give out. Not only did there have to be some Word in there to get out, His life had to match that which was in Him, which it had up until this point. This is an important life lesson for every believer.

The third thing to notice is that the enemy took Jesus to a holy place (or rather, Jesus of His own accord went along with the enemy to a holy place). A ploy, no doubt that would remind Him of the profound spiritual growth He had just undergone in the wilderness and the deeper spiritual connection He had with His Father at this point. It was this that the enemy was hoping would distract Jesus just enough to hear him out. Again, the enemy suggested something like, "Well Jesus, I know you just came off this spiritual high and you're feeling closer to God than ever and rightfully so! You've just fasted and prayed and everything. You and God are close. So, why don't you let Him show you just how great He is and just how much He loves and cares for you? Come on! Jump! He said that He'd send His angels to catch you so you're not harmed. Come on, Jesus! What do you have to lose?" Although this logic sounded great, Jesus was unmoved by it and undistracted by the holy place. And again, He let the Word that was in Him come back out of Him to fight the enemy off.

The fourth thing we notice is that the enemy becomes desperate. The enemy has studied mankind since it's inception, so he knows how he can get to the flesh side of man and what makes it tick. Indulgence makes it tick, and if it doesn't, surely making you believe that God owes you something will. If that fails, offer to tickle that flesh--offer riches. The enemy told Jesus as they were upon a high mountain, "I'll give you everything you see! Anything you want--anything--it's yours! Just name it. Just serve me. I mean, you only live once! Enjoy your life now! Worry about God and your future later!" And Jesus, unwilling to give His praise and worship to anyone but God commanded the enemy to leave Him, again quoting the Word that was in Him. And when the enemy left him--when he fleed because Jesus resisted, not of His own strength, power, or accord, but by the Word in His heart and lifestyle--God sent ministering angels to Jesus.

The enemy knows you. He knows what makes man tick. He knows how to get him. If he can just suggest one thought long enough for you to roll it around in your mind, even for a second, then he knows he has a good chance at having you. He has a good chance in ruining your progress with God. But notice, if we're persistently stubborn in the Word with the enemy, he will flee. I encourage you: stay strong in the Lord and the power of His might and may your lifestyle reflect the Word you read.

"Heavenly Father,Lord, I thank You! I praise You for the Word which is continually changing my heart, mind, actions, and lifestyle. Lord, give me the strength and allow me to walk in the strength at the appropriate time to resist the enemy that he might flee from me. Lord, I'm determined to go all the way with You, no matter what anyone says! AMEN!"

One of the most charismatic person I know - Michael Jordan

2007-05-20T11:32:00.000+08:00

This first video reminds me that there's nothing wrong with mistakes or failures; It's just part of the journey. The important thing is to learn from them and move on. Never repeat the same mistake. Persevere and you will succeed in the end.

If these are Jordan's own words, then I am like him in this respect. I always want people to challenge me. I enjoy proving my critics wrong. Their silence is reward to my ears.

Relationship Management in Private Banking

2007-05-10T22:16:00.000+08:00

The explosive growth in wealth throughout Asia adds to the fact that the region now accounts for one-in-five ultra high net worth individuals. It has fuelled a war for private banking talent across Asia. Competition for private bankers and clients in Asia's main financial capitals - Singapore and Hong Kong - will intensify as the number of private banks providing differentiated products and services increases.

In 2005, the rate of growth of the industry was 12-14% with some private banks reporting growth of 20-25%. This trend is expected to continue with the increase of individual's wealth. While poaching talent from competitors appears to be the priority for many private banks, the main game is still to offer the best service for one's clients. The ability of private bankers to develop long-term relationships with their clients will determine ultimately who can achieve succeed. Private banking clients look for relationships based on trust, a sound understanding of their investment needs and constraints, and an ability to link those needs to personal life goals within the constraints. With private banking products becoming increasingly commoditised, it is the relationship management abilities, not the technical know-how, which will differentiate high-performing private bankers from the mediocre. As competition intensifies, private bankers must be able to distinguish their offerings.

My personal experience in banking has shown that many private bankers are unable to answer the most important client question of all: 'Why should I hire you as my private banker out of the other thousand choices?' Banker training programmes that sharpen client relationship skills will lead to increased referrals from existing clients and greater share of wallet, while laying the foundation for 'trusted advisor' status. Poaching may help private banks achieve scale in the short-run, but only an investment in training and development (esp. in the area of relationship management) can ensure the company's long-term success.

Super stock returns: ROE/PTB vs ROE vs PTB (Part 1)

2007-04-28T20:17:00.000+08:00

The following article is a good read for all Fundamental Analysts out there!

By TEH HOOI LING SENIOR CORRESPONDENT (Source: Business Times)

LAST week's article - In Search Of Super Returns In Stocks - struck a chord with readers and investors out there, judging by the number of emails I received.
For those who missed it, basically I screened all the stocks listed on the Singapore Exchange from 1990 until 2006 based on their return on equity and price-to-book ratio.
I then grouped the stocks into 10 portfolios with equal numbers of stocks, starting from those with the highest ratio when we divided ROE by price-to-book, to the lowest. This screening process can help us identify some mispriced stocks.

A company that is able to generate a high return on equity - one that exceeds its cost of equity - should trade at a higher price than the book value of its equity. And vice versa. But if a company generates a relatively high ROE, yet is trading at a relatively low price-to-book ratio (PTB), careful analysis is warranted.

There could be legitimate reasons for the low valuation. For example, the earnings were due to exceptional items. If not, the stock may be under-priced.
But without any detailed analysis other than simply grouping stocks based on ROE/PTB, I found that investors can actually generate super returns.

By investing in the 10 per cent of stocks with the highest ROE/PTB every year between 1990 and 2006, and holding each portfolio for a year, one could have turned $100 into $34,000 over the past 17 years. That's a compounded return of 41 per cent a year. All the calculations exclude transaction costs.

If we assume that the investor had lost 10 per cent of the portfolio value to transaction costs every year, the return is still a respectable 27 per cent a year. But in absolute terms the portfolio value today, at $5,678, is significantly less than the $34,000 which excludes transaction costs.

From the above, we can see that ROE/PTB is a good screening tool.

Super stock returns: ROE/PTB vs ROE vs PTB (Part 2)

2007-04-28T20:12:00.000+08:00

By TEH HOOI LING SENIOR CORRESPONDENT

Separate rankings

If we pick stocks just based on ROE or just based on PTB, do we get results that are as good?
I decided to test this based on the same set of data last week. This time around, I ranked stocks based purely on their ROEs first. Again, I grouped them into 10 portfolios, with the first 10 per cent or first decile being stocks with the lowest ROEs. The 10th decile was made up of stocks with the highest ROEs.

As can be seen from the above chart, screening stocks using just their ROE still yields good returns. $100 invested in the highest ROE portfolio every year would grow to $8,752 today. That's a compounded annual return of 30 per cent.

But it would lag the performance of the basket of stocks with high ROE yet low PTB.
For both the first and second screening, I excluded loss-making companies.
Next, I ranked the stocks based on their PTB ratios. For this, I did not remove loss-making companies. The first decile is made up of stocks with the lowest PTB ratios. Some could even have negative PTB ratios. And the 10th decile consists of stocks with high PTB ratios.
As you can see from the third chart, there is a clear distinction in performance as well. The lower the PTB, the higher the return. And conversely, the higher the PTB, the lower the return. The lowest PTB stocks generated about 15 per cent return a year, while the highest PTB stocks chalked up a 7.3 per cent loss a year.

However, the returns of portfolio ranked purely on PTB ratio lagged those screened by ROE/PTB or purely on ROE.
One of the reasons for the under-performance could be the continued poor performance of loss-making companies. Other studies previously have found PTB to be the best predictor stock performance. Particularly so when there is a turnaround in the economy. This is also evident in five portfolios that The Business Times tracks every Monday.
But it takes guts to go against the crowd and buy into downtrodden stocks.

So perhaps, the ROE/PTB is a more comfortable approach for many. And as the results above indicated, it is rather rewarding as well.
It does, however, require a little more work. The use of ROE/PTB takes into consideration not only the underlying earnings capacity of a company, but also how much of that has been factored into its stock price.
So if a company can rake in good earnings and good growth and its share price has fully reflected that, it may not be a good stock to buy. What one wants is good earnings growth that is not recognised by the market.

Variations

A reader pointed out that with some simplifications, ROE is earnings per share (EPS) divided by net tangible assets (NTA). And PTB is price per share divided by NTA.
Dividing the former by the latter gives us EPS divided by price per share, which is earnings yield. So stocks with high ROE/PTB are also those with high earnings yield.
And we could go one step further. Earnings yield is the inverse of price-earnings (PE) ratio. So stocks with high earnings yield are also low PE stocks.

'Notwithstanding the mathematical accuracy, ROE relative to value is an interesting approach to investing,' he wrote. 'I have been using something similar for some time to good effect (ROE divided by PE coupled with some other criteria like minimum dividend payout and low debt to equity).

'A variation was also suggested in the book The Little Book That Beats The Market by Joel Greenblatt which uses ROE divided by return on invested capital (to correct for the use of excessive financial leverage). He even has a website www.magicformulainvesting.com to automatically select US stocks that meet the criteria.'

The reader added that the most comprehensive book he has come across on this is What Works On Wall Street by James P O'Shaughnessy.

So anyway, for the many who have asked, I have generated a table (above right) - using data from Bloomberg - showing 30 stocks with high ROE/PTB. Some of the numbers may be skewed by one-off items, so some analysis is advised before any action is taken.

Stock Review - YHI International

2007-04-18T23:08:00.000+08:00

REVIEW OF Q107 FINANCIAL RESULTS

You can obtain the financial results here.

The Group’s turnover for Q1'07 (of S$96.0 mil) was S$0.2 mil or 0.2% higher than the S$95.8 mil recorded in Q1'06. Turnover from the manufacturing business increased by ~S$8.6 mil or 36.6% from S$23.5 mil in Q1'06 to S$32.1 mil in Q1'07. The increase was primarily due to increased output from additional production capacity in Suzhou, PRC.

Turnover from the distribution business decreased by approximately S$8.4 mil or 11.6% from S$72.3 mil in Q106 to S$63.9 million in Q107. The decrease was primarily due to exclusion of sales from Yokohama tyres in the PRC region as a result of formation of a joint venture entity in which the Group has a 49% stake. Distribution and administrative expenses were lower in Q1'07 as compared to Q1\'06 mainly due to lower advertising and promotional expenses and lower allowance for impairment of doubtful receivables.

Finance costs in Q1'07 were higher as compared to Q1'06 attributable to higher borrowing costs incurred.Total Group’s GPM Q1\'07 decreased by about 1.8% as compared to Q1'06 attributable to lower gross margin from manufacturing business which was mainly affected by the rising aluminum prices and also operating losses due to diseconomies of scale in the Malaysia plant which is currently operating on a single production line. The Group’s PBT increased by ~S$0.3 million or 3.7% from S$6.8 million in Q1'06 to S$7.1 mil in Q1'07. Total current assets increased by ~S$13.1 mil due to increase in receivables of ~S$12.5 million, and in inventories of ~S$4.4 mil together with a reduction of S$3.5 mil in cash. The increase in trade receivables was due to timing differences and this is in line with normal trading activities.

The increase in inventories was primarily due to higher stockholdings in view of price increases from suppliers. The reduction in cash was primarily due to working capital changes. The increase in available-for-sale financial assets of ~S$0.4 mil was due to additional investments in Hangzhou Yokohama Tire Co Ltd. The increase in investment in associated companies of ~S$0.9 mil was due to share of profits contributed by the associates in OZ S.p.A and Yokohoma Tire (Shanghai) Sales Co Ltd.

The increase in current liabilities of ~S$8.5 million was primarily due to increase in trade payables of ~S$2.6 million from higher trading activities and an increase of ~S$5.0 million in current bank borrowings. Our cash flow for the period showed a net decrease in cash of about S$4.2 million in Q1'07 as compared to a net decrease of ~S$8.0 mil in the same period last year primarily due to lower capital expenditure spendings.

Disclosure Policy

2007-04-01T10:57:00.000+08:00

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