Friday, March 2, 2007

End Of Week Review

This week saw the much anticipated correction become a reality. Many fundamental investors (like me) saw their portfolio wipped out. Many are probably seeing a red in their portfolio, but for me, I still see an overall green, other than the red for Swiber.

Realised my Put Warrant at $0.31, a 63% gain over $0.19. Decided to realise the warrant as the market was showing signs of "slowing drop", probably on its way to a recovery or out of this bull run. That will really help me in any more falls where I may see my margin ratio fall out of acceptable range (which is unlikely as my purchase prices of the shares was low).

But really, nothing seems to be any where close to predictable. Just when the market thought the worst was over, to my horror, we saw the US market open 200pts lower on Thursday, only to see the market quickly recover back to a 20-30 point drop.

This is a period where good financial results have no effect. China Hong Xing released their results and showed a 100++% gain in sales and profit. I'll be doing a review on it soon. Sino-Env, Swiber performed extremely well as well.

The reason why I did not sell Swiber was firstly cause I was late in seeing the price low (ie saw the closing price only), and the other reason was cause the closing price was about -6% consistantly for 2 days already. In this Bear run, I'm reluctant to let go of Swiber until the price actually closes at -7 to -8%.

With the weekend ahead, all we can look forward to is for the market to take a quick breather, and start next week stronger than ever.

11 comments:

Aragorn said...

i plan to hold for decades...

these puny losses worry me not...

im curious why the correction is so tiny?

i find it so tough to identify the bargains.

prices are still relatively high compared to 2006.

musicwhiz said...

Pehon,

Please check out this latest article on Swiber. They did an interview with Reuters it seems.

Follow this link:-

http://www.theedgedaily.com/cms/content.jsp?id=com.tms.cms.article.Article_116e56d7-cb73c03a-41a12f00-f7948ae0

Have a good week ! Looking forward to your review of China Hong and Sino-Environment.

P.S. - I have already sent in my queries to Swiber's Management through their online Q&A session (see their website). They will reply to all investors' questions on March 13.

Anonymous said...

I've been following the prices of your holdings in the recent turn of events. Both Sino and China Hong are now below your buy price and Swiber is almost 20% below your buy. Only RafflesEdu is still holding above at around $2. While the plunge was huge today, but given the incidence of last wednesday's collapse, it was not entirely unexpected on hindsight.

According to one of your earlier posts, you did specifically cite a cut loss rule to prevent fantastic paper profits from turning into horrifying paper losses.

Nonetheless, it seems that very often, we still act according to what we hope, despite rationally expecting what we dread.

I understand from your posts that you are on leverage and cannot afford to hold out and wait.

Are you facing a margin call and if so, do you intend to answer it?
Can we truly act according to what we think rather than what we hope?

Not meaning to gloat, for I too am a victim of the same circumstances...

Anonymous said...

Ya. Profit accumulated for 2-3 months
evaporated in 1 week. Surely there is a strategy for protect profit before they turn negative

PeHon said...

hi anon, as i posted, i'm on margin, and I mentioned i bought "insurance" with the Call Warrant, that will answer my margin call if any. But at current position today, i'm still good margin wise.

Anonymous said...

- Any stock that rises close to 20% should never be allowed to drop back into the loss column....Avoid making a second mistake of letting it develop into a loss. (Pg 112)

- Never Answer a Margin Call (Pg 118)

Quoted from "How to Make Money in Stocks" by William J O'Neil

Anonymous said...

Consider this situation: market rebound now. Put warrant drop a lot but your shares do not rise much. However some time later, big plunge comes again. Your shares drop a lot but your put warrant does not rise that much because expiry date is nearer(loss of time value).

What will you do?

PeHon said...

"Consider this situation: market rebound now. Put warrant drop a lot but your shares do not rise much. However some time later, big plunge comes again. Your shares drop a lot but your put warrant does not rise that much because expiry date is nearer(loss of time value).

What will you do? "

Dude, my view of warrants, its just insurance. If the price of warrant drops instead of rise, I paid premium. If it rises, i am rewarded for the insurance pay out.

And regarding expiry, notice i bought 0427 "insurance", though there are warrants that expire earlier. And notice i sold my warrant within the contra period since profit was realised, though the warrant did rise in price further a few days later.

And note the capital into the warrant was a small portion of my total holding.

Anonymous said...

Hi Pehon,

Haven't seen you update your blog for a while already. Looking forward to your review on Sino-Env and ChinaHong after full year results released.

PeHon said...

helllo,

sorry for the lack of updates, i've looked thru the reports ofthe 2 companies but haven't found the time to report on it. Will do itthis weekend.I promise =)

Marta said...

Good words.