742 - some events, Swiss and Creative

Swiss remove its ceiling from Euro.
The Forex chart went crazy, the Swiss currency shot upwards.

Creative shares shot up again today, over 4%.
And it happened around half hour before the market closed.
I have the urge to sell.
Not because it is a good price to sell, but simply because I no longer like the company.
But good thing for me, I haven't done so yet.

I have been suspecting that someone is buying in bulks.
There are sudden short spikes.
And the person waits until the price to drop back again before making the purchase.
The sellers are starting to get flushed out, leaving only the people that are holding on behind.
Is there some news that might be coming out?
I am hoping something like Beats audio wants to acquire Creative, haha.

Stocks - debt

It has puzzled me for some time, about how to understand the financial health of a company.

One ratio you can use is the Debt/Equity ratio, which is also leverage ratio, I suppose.

It might seem straight forward, but not really.
It is not total liabilities divide by total equity.
So how do you get the figure?

Go to balance sheet, go to the liabilities section.
For both of the long term and short term portion, look for descriptions with 'debt' in it.
Total them up, and divide it by total equity.
That is how you get your debt/equity ratio.
Warren Buffet only buys company with debt/equity ratio of 0.5 or below.
In other words, there are 2 times more equity than debt.

Chip Eng Seng has d/e ratio of 0.8.
Sembcorp Marine has d/e ratio of 0.4.

So today, I learnt something more about finance/
An important one, a new dimension of viewing companies.

742 - Crazy movements

Now is the time of some crazy moments again.

GBP/CHF

Rejection at Resistance zone.
Though it did not happen at the peak (1.55).
The overall trend is also bullish.
So the price action and long term trend contradicts.

 NZD/USD

Not a very strong signal.
But very obvious support zone.
The overall trend is also a little ambiguous.
It seemed like a bull trend, but it also seem to be bending downwards.

Stocks - Creative (currently holding)

Accidentally deleted this post, now I need to re-write it again.

Was thinking of selling some portion of my Creative shares.
One of the good things I learnt from trading Forex.
It is good to gradually reduce your trade size when you are earning or losing money.
So that you lock in on profits, or reduce the damage.
But you must enter the bet size to allow you to do this in the first place. Like for Singapore, minimum is 1000 shares or 1 lot. So you should enter at least 2 lots and above.

Why not sell all?
Currently, they are suing Apple and some other big company for copying their patents.
So that they might get a big increase in cash, that is when I will sell if that comes true.

Why sell?
I have lost confidence in their business.
They have good products, but bad marketing strategy.
I saw their products in Popular book stores.
The kind of place kids go to to stock up on their school supplies.
I thought they are good enough to be standing beside Beats or Bose.

Why buy in the first place?
Good quality products, at very good prices.
Strong balance sheet. High cash, which I think they got it when they successfully sued Apple for copying their MP3 patent.
I think Apple paid them 500 mil.
Low liabilities.
Good PE ratio, below 10.
New Roar portable speakers that launched. I was impressed with the design and capabilities. I thought it could be a game changer for them.

Currently, I have not reduce the lot size yet.
I am not in a rush.
I want to wait awhile after the Christmas period.
They might generate a good profit then.

Mysteriously, the stock price has surged around 5% since last Friday.
No reported news, there should be some insider trading.
Either they know their latest financial results, or they know the status of the legal battle, or someone is simply playing some game to raise the price and offload even more (think Jesse Livermore).

I shall wait for a few more weeks or months to see what unfolds.

Stocks - First REIT (did not buy)

Never bought a REIT before, looking to add one to my portfolio.

I like its website, clean and neat.

I like its idea. Hospitals, and nursing homes. The world will have many long life old people soon.

Heavily invested in Indonesia. Great because I want to ride on the most powerful thriving SEA country. Around 10 facilities there.

3 facilities in Singapore. 

1 facility in South Korea.

PE ratio is around 8.

Revenue doing well in 4Q, but, net income suffered.

So you will see the PE ratio increasing in the next reporting, as EPS dips.

This is my favorite REIT, and I may monitor it.

Dividend yield of around 5%.

The other REIT catering to hospital and nursing home is AIMS REIT, I think. 

But their focus is on Japan, which in my view, does not have a great potential to boom more than Indonesia.

Stocks - Lian Beng (did not buy)

Similar to Chip Eng Seng. I want to ride on the '6.9 million population by 2020' construction trend, I don't need 2 companies that are similar.
Similar to Lantro, they also have an ugly website.
Their management have many links to the government.
The CEO has a meaty nose. Chinese people think that it stands for prosperity, think Jackie Chan.
Their PE ratio is only 3.
Their financial statistics are like steps. All increasing.

But one major thing is that they are quite stingy with dividends. Around 1-2%.

I am starting to buy shares that pay good dividends, as I am aiming to be financial free.

Assuming dividend yield of 4%, 

200k, I have close to 1k per mth.

100k, I have close to 500 per mth.

50k, I have around 250 per mth.

It feels good to be paid not doing anything. Make your money work for you.

They have healthy balance sheet, quite a lot of cash.

Stocks - Welcome Lantro Vision

Added Lantro Vision to my portfolio today.
I am quite bullish about the market.
I feel it is in the middle between low confidence and over-confidence.
I do not have much cash left, which is not ideal.
My theory is that I should hold 50% cash of what I have in shares.
Why?
So that when the stock market crash, I can use the money to buy cheap stocks.
It is to keep me unworried about market crash, and know what to do then.
I am likely to have a decent bonus next year in February.
So the bonus will be used for me to increase my cash.

Lantro Vision (bought)
Ok PE ratio of around 11%.
Very good balance sheet. Their cash is 30 mil. Their current liabilities is 32 mil.
Total Liabilities is very low.
They do networking, and cloud computing, etc.
I can imagine them being part of the development of many SEA countries.
I can also use them to ride on the data center hype.
Their website looks ugly and cheap. Reminds me of what Peter Lynch said. He is impressed with companies that are thrifty. He mentioned about one company last time when he met the CEO, the CEO does not waste any paper, and uses back unwanted paper to write notes.
They pay decent dividends, at 0.05, and their current price is 0.55. Around 5% dividend yield.
Their 4Q 2014 result is also good. Increase in revenue, and even better increase in net income.

Lets talk technical analysis.

I also feel it is a right time to enter.
Upward long term trend.
Hit the support zone around 3 times recently.
The last hit, there is a bullish pin bar present.