October 8, 2017

“One man’s ceiling is another man’s floor.” – Paul Simon

One of the reasons I started this blog is to put down my thoughts when I buy or sell shares. I want to be able to have a bit of objectivity in analyzing the process I go through in buying or selling shares. I want to have a strategy that I can support with a process that is compatible to my personality type.

Market moves (or non-movement) typically depends on its reaction to news of the organization’s income, macro, industry or related industry, etc. As the PSEi is in all-time-high territory, it makes me want to head for the exits and I can’t be able to blame myself if I did. However, how do I know if it’s at the high? Would I still buy some shares at this price point? I will always remember selling URC at ₱13? or was it ₱10.30? (from around ₱5), before it went up (albeit) many years afterwards to around ₱200 (now down to around ₱150). More recently, I bought DD @ ₱4.34 sold it a week after at ₱5.72. I bought it again at ₱8.07 then sold it at ₱10.30. That stock is now around ₱40.

I definitely want to sell some to lock in some gains, but I’m impeded by CGT. My thinking moving forward is to put in more cash into my stock trading account and try to put the majority into preferred shares, and if the market falls, then I sell the preferred shares (cognizant of the buy-sell spread) and buy shares that I deem undervalued. I could also sell some losers (I think I currently have around 6 out of 68+ shares that I hold that are losing more than 5% of their value) that I have and use it against my CGT gains.

I have always cost-averaged to remove the temptation of wanting to be completely right. This goes completely against what Charlie Munger thinks, but then again, I wouldn’t want to compare myself to one of the greatest investors the world has seen… and I’ll continue to hedge against my bets.

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Bought GMA7@₱6.05

Bought some GMA7@₱6.05 today (it closed 2 centavos lower at ₱6.03). Hoping that they would continue on:

  • giving good cash dividends and
  • their streak of increasing earnings/share.

Its current P/E is around 10.4 (around its 5 year low of 10.29), P/B of 2.4, YTD net income is up 70+% but its Q/Q (last year) net income is down -48%.

I’m thinking SHLPH should declare cash dividends in the next few months and if only it didn’t already have a good portion of my portfolio, I’d buy some more.

Bought PIP for ₱3.16 on Aug 3, 2017

Bought some PIP for ₱3.16 on Aug 3 as the price is pretty low compared to its revenue. I also tried buying some RFM but no one matched at the price I bid… same with DDPR. I’ll just wait then. To quote W. Buffet, “What’s nice about investing is you don’t have to swing at pitches… No umpire is going to call you out. You can wait for the pitch you want.”

I’m also looking at LR as it has gone down considerably (approx 14%) since I last bought it a week or two ago.

I’m a bit surprised that the price of MEG didn’t go down even though the US Dems are proposing a bill on taxing US organizations that outsource. Maybe investors don’t see it affecting the Philippine economy.

I also tried selling most of my EDC at near its peak on Friday (Aug 4) but no one bit.

 

Sold MWIDE, MEG

Sold the MWIDE I mistakenly bought two weeks ago @ ₱17.72 for ₱18.48. That just gives me a cautionary tale that I should try to give it a second thought before trading as it reminds me of Eugene Fama’s Efficient Market Hypothesis. If you aren’t familiar with it, here’s a couple of links:

It also makes me think I should have just waited for FMETF before investing in a couple of UITFs in 2012. I also invested in PHILEQT back in Dec 2014 with no gains since. But that’s another story. Glad Pinoy Money Talk is posting again about UITFs.

I also sold some MEG holdings for ₱4.05 as it has gone up quite a bit from two weeks ago and even though I believe it will still go up, I try to risk manage if I think I can use the money for another stock.

I’m currently looking into buying IMI (ex-divs today) and FGEN… aside from those I mentioned in my last post.

Sell SHLPH? Some stocks to watch

SHLPH share price has slowly been going down from a peak of ₱80.00 to today’s close of ₱72.45. Was hoping of selling some of my holdings at around the ₱74++ mark, the only thing that’s stopping me is that the company intends to give out 75% of its earnings as cash dividends. To make a not-so-informed analysis of that, from the ₱4.68/share (2016 earnings) would give around a 4.8% div yield at today’s price. A rate that only a handful of other shares can top.

HLCM, another stock with good div yield has also been going down, partially (and supposedly) because of the anticipated listing of Eagle Cement.

Current stocks on my watchlist to buy (aside from HLCM @₱15.02) are as follows:

  • AP (₱41.30)
  • ELI (₱0.66)
  • FLI (₱1.63)
  • GTCAP (₱1134)
  • MEG (₱3.44)
  • ROX (₱2.75)

Still smarting from my mistakenly buying more MWIDE @ ₱17.72, extra shares of which I’ll probably sell if it goes anywhere near today’s high of ₱18.42.

I’m seeing a couple of outlets expecting WLCON to go up to ₱6.00 pretty soon. I’ll likely get out before that to fund other underappreciated stocks as the market has been in this range of around 7140 to 7370 since it suddenly jumped during the first trading week of the year.