My $Buy > $Sell for a Change – an inflection point?

A subtle change but an important one for me – for the first time in many weeks, my $Buy is more than my $Sell this week. For some of you who have been following my blog, you will know that I had been doing pretty aggressive selling in the past 2 months. So, it is quite a change for me.

Let me try to recall what I bought this week … just to share with you

Ah … yes, I accumulated more Raffles Medical shares. It has become a habit for me to accumulate it when it started approaching $1.00. In the past few times, over a period of a few months, my experience was that it would climb slowly back to about $1.10 before repeating the cycle. At $1.10, I will typically take profit to sell some but not all and that helps to average down my cost and I still keep a sizeable core position. It is #4 in terms of holding in my portfolio.

I also went into Hong Kong to buy Li & Fung. Some of you may remember that Temasek bought a big 21.7% stake in L&F logistics, wholly owned subsidiary of Li & Fung  just a few weeks ago. With all financial brains and gurus there, I trust that they had done all the analysis and calculation before they determined the valuation of L & F logistics at HK$ 10.85 Bln.

And guess what, Li & Fung market cap as of yesterday was only HK$ 9.63 Bln, even below the valuation that Temasek put on its subsidiary. Li & Fung also got US$ 300 Mln cash in the bag because of this deal (blink blink Special Dividends???).

Hence, if we buy into Li & Fung, we are getting L&F Logistics at a cheaper price than Temasek and we got the rest of the Li & Fung business for free.

In fact, after they announced the deal, Li & Fung shares jumped up 20%. But since then it has fallen back to the original price level before Temasek bought it, hence, I thought it may be a good time to enter with “our big brother” and see if we can ride out the trade war successfully (profitably).

While I bought, I also sold (though lesser) ….

I finally started selling my Capitaland Retail China Trust, CRCT (after accumulating a fair bit over the last one year, link#1, link#2) as the current dividend yield entered into the bottom 25% percentile of its historical yield over the last few years. It is because its share price climbed above $1.60. CRCT has been a laggard to the rest of the SReits in the last few months probably due to investors’ concerns of the tradewar and the weaker China economy. I was wondering when it was going to catch up. And it finally started to move this week. So, I let go of some but still keep a core position (its #6 in terms of holding on my portfolio).

I also sold OUE Hospitality Trust as it moved towards $0.75. As I blogged earlier, I have started reducing my stake in OUE Hospitality as I am already quite exposed to OUE Commercial Trust already. The latter will soon take over the former and if I don’t do something, my exposure in OUE C Trust will be too big for me to feel comfortable. It is already #2 in terms of holding of my portfolio today. If I don’t do anything, it may overtake Singtel.

Talking about Singtel, it gave me heartache … it dropped ~5% or 17 cents in a single day on Friday. While I expect the share price to correct after ex-div, but it has gone beyond the 10.7 cents. Let’s see how it will perform from now on … Singtel share price is traditionally weak in 2nd half of the year. However, if it dropped below $3 again. I may started accumulating it. In my opinion, it is still a good company to hold.

It is still #1 in my portfolio despite the recent sale and drop in share price but its weighting has dropped below 9% now, reducing my portfolio’s “concentration risk” significantly.

These 2 weeks are heavy “dividend declaration” weeks. So far, most of the dividend declared did not show major growth. Most were flat or some even went lower. I am not optimistic that it will be any different next week.

Nonetheless, let’s sit tight. stay calm and collect dividend.

Gaining financial independence and freedom is not a sprint but a life long marathon. And always remember to enjoy the ride (don’t take too much risk that you can’t stomach)

With regards

Warriortan