Cory Diary : Cory Worth and Markets

Overview

Net Worth slips back to mean growth after last year Chinese Market onslaught. China market went feverish which I anticipated it will fall as it does not match with Xi anti-corruption drive. When the brick hits my chart, it still went for a dive and ended up with a lower gear of the continuum norm.We are now a quarter and half period before 2016 year finish and I hope we did not hit a brake like in 2015.  Roughly a year to come back up to the Pre-Crash level.

Top left of the chart is the "Is" and "Is Not". I have them structured that way previously and for comparison to continue as such.


Bre-Exit Period 2016

Strictly speaking the Bre-Exit did not boost my net worth. The portfolio recovered within span of a week. Did some mitigation moves unnecessarily which reduced my potential gains. Nevertheless, the market broad strength continues to accelerate up. Swiber could have caused a dent but mitigated due to other sectors progress and my avoidance in Oil/Gas counters, the impact has been mute. Took the opportunity to adjust my banking sector investments. I also took profit in a US Stock with 30% gains so that I can focus more on SG Markets in the coming months.

Crisis

Over the years, after each crisis, my asset continues to move up.This is also reflected in my investment returns. Governments tendency to moderate currency strength has shown to be the safer bet to support the new economy, and I feel is rightly so. No serious regulatory economist will do otherwise as the fear impact can be disastrous. However yield get lower over time and debts relatively cheap that we could finance huge supply in sector in Oil Infrastructure, Commodity and Shipping. Broadly speaking this are good for lowering the cost of living except for those who lost their jobs. Yet much cash is still in abundance, and property could be the next frontier again to absorb the excesses for those untapped.


Cory
20160815

Cory Diary : SEMBCORP MARINE LTD

I feel history today and do a quick study. Is like a review after a great battle. I am not vested in Oil and Shipping Industry directly but that doesn't mean I should not read up on it. So whatever I find and understand is subjective and conclusion could be wrong.

Started with an article from BT dated FEB 16, 2016.

http://www.businesstimes.com.sg/transport/sembmarine-cosco-buffeted-by-s1-billion-in-combined-q4-losses

"THE strain of low oil prices on the offshore and marine sector was in full display on Monday, as two heavily-exposed Singapore-listed companies reported a combined S$1 billion in fourth-quarter losses."

"The losses were partly the result of the reversal of profits already recognised for the construction of oil rigs and ships that might now never be delivered."

Next, reading latest reported AR. 

Profits for 2Q 2016 is $10,737 ('000). Down from 2Q 2015 $113,167('000)

So will we see even a larger crawl back later ?

Debts
And their debts reported increased quite significantly.

Then, i check other announcement and realised they still do Share Buyback. This doesn't feel good when we clearly know the market is not working and if we are using debts to push up prices. What are they thinking ? 

http://infopub.sgx.com/Apps?A=COW_CorpAnnouncement_Content&B=AnnouncementLast3MonthsSecurity&F=LYPA1524Z2VRQH6X&H=776398d18e8e71d5142d62155ee307be6b3ba12f8d4ccc813ae7660cfa29046b

Final check on the chart, and I can't help thinking is this industry boosted by loose monetary policy which like Shale Oil build up from debts and more debts except differ in cost foundation and which later pushes it further down the road.

Will it get worst ?

See the chart below.

http://www.bloomberg.com/news/articles/2016-06-28/singapore-s-millionaires-humbled-in-local-bond-restructurings

Conclusion

NAV is $1.2029. Share Price is $1.32. Considering the risk and returns, does it make sense ? Compare to another industry like Property which is still earning quite ok are at 30% discount to NAV. Opportunity cost is not my cost today when it can be really toxic.

Cory

20160807

Cory Diary : Misleading CAGR

Smoothed return

It assumes a smoothed return over the period that’s measured. In reality, investments experience significant short-term ups and downs. Be careful when you are sold with 1 Year to 8 Years performance. On 7-8 years, there's a low due to GFC that time in 2008 on crash and huge recovery. All monkeys able to perform. Fine ! Not all monkeys just "99.5%".

Size of fund

What this means is that a fund manager can work on multiple small funds, and then select the few that happens to wins over the measured period and present them to you. Which will convince the most sceptic their performance. 

Ins and Outs

It doesn't work on personal equity investment which has multiple transactions. 

From Investopedia,

"CAGR is very straightforward when there is a beginning and ending value, and set period of time. But in reality, investments, such as mutual funds, have continuous cash inflows and outflows and are required to report monthly, quarterly, annual, and even daily returns."

Cory

20160802