Tuesday, March 24, 2020

What Happens If You Are Almost 100% Vested? - Part 3 (Updated)

I have receive lots of comments on InvestingNote on my previous post. It made me realise that I have taken too little risk.

I have also complicate matters by my formula.

So I have made changes and revamped the plan.


This should help everyone to understand my plan better.

1. I will borrow 3Y for 6 months for the initial balance transfer.
2. I will pay A for 5 months to reduce the outstanding. Note that Y=5A (It should not be 6A because you run the risk of not paying in the last month).
3. Roll over 2Y for another 6 months for the subsequent balance transfer.
4. Continue to pay A to reduce the subsequent balance transfer.
5. Place Y into SSB to offset some of the processing fee in both the balance transfer. 

Thus, it is important to ensure that Y should be below your monthly gross pay. A should be about 15% of your gross pay.

Do note that the main risk of this plan is losing your job. Therefore, if your job is unstable now, please DO NOT ENGAGE IN THIS PLAN.

Hope the above shows a better understanding.

Crazy Plan. Crazy Thoughts. Crazy Portfolio.

These information were shared with members of my Fundamental Scorecard Telegram group. If you are interested, feel free to join us. 

We talk about everything under the sun about investing with a focus on US, HK (slightly lesser) and SG companies.

Monday, March 23, 2020

What Happens If You Are Almost 100% Vested? - Part 3

To update all readers, the plan has already been carried out.

I continued to have friends, whom advised me against carrying out the plan, as well as some others whom have carried out their own leverage plan.

Just to emphasize I will not be going ahead with margin or leverage lending. I prefer to borrow a fixed sum with a discipline way of repayment. This will allow me to plan better.

Basically I did a fund transfer with Standard Chartered Promotion of 1% of processing fee for 6 months without any other cost.

And this is the plan of repayment:

1. I have "X" amount for investment.
2. I will place "X" into Singapore Saving Bonds.
3. I will borrow through Fund Transfer 1 for the amount of "X+Y" for 6 months.
4. The portion "Y" will be repaid via monthly injection of cash amount "A" over 6 months.
5. In the event the market recovers in 6 months, I will take out "X" from Singapore Saving Bonds and repaid the outstanding amount of Fund Transfer 1. The amount of Fund Transfer 1 should remains with either "X" amount or lesser.
6. In the event the market did not recover in 6 months, I will borrow the amount "Z" through another bank's Fund Transfer for another 6 months and use it to repaid the outstanding amount in the Fund Transfer 1.

The advantage of the plan is: 
(1) I have the ability to invest more at this moment and 
(2) to own the shares that I invest in currently, and 
(3) this investment will have a longer time to recover back, and
(4) I can continue to roll this debt forward at a lower amount as I repaid it consistently, and
(5) the interest earned from the Singapore Saving Bond can offset the processing fee over time. 

However, the risks of this plan is that: 
(1) you must be continually be employed during this period, and
(2) any non-payment will result in being charge 24% of late interest on the outstanding (I think so), and
(3) rolling over of debt will result in higher total processing fee, and
(4) I must be able to select the correct company.

Next up, I may talk about some strategy or go into each company that I am currently vested in.

Crazy Plan. Crazy Thoughts. Crazy Portfolio.

These information were shared with members of my Fundamental Scorecard Telegram group. If you are interested, feel free to join us. 

We talk about everything under the sun about investing with a focus on US, HK (slightly lesser) and SG companies.

Wednesday, March 11, 2020

What Happens If You Are Almost 100% Vested? - Part 2

After my last post, I have many friends that told me to not proceed with the plan. I also have friends asking me about rates and from which bank I am getting the loan from.

I will need to be upfront with all the readers, as I told one of them:

"I agree that if there is no need to leverage, then better not to leverage. In fact I don't encourage this as well. In almost all my courses, I already stated at the start of each course that we should only invest with disposable cash, so no irrational thoughts will occur."

However, due to the recent downturn, I also have thoughts that if I have the ability (in terms of future cashflow) and already the cash to pay off the amount I leverage, then I should be fine.

To be honest, this is similar to taking up a property loan. Just that a bit on the short term.

So what I found out and I intend to do?

After researching, I will be doing fund transfer as I found some banks offering 0% to 3% EIR/processing fee.

Eventually, I will only be getting a very low 5 figure fund transfer amount at 1% for 6 months.

In addition...

I also met up with a TA Guru recently. I was told the downtrend will continue for a significant prolong period - years in fact.

Rather than saying the whole market will be on a downtrend, I will say the market will be super volatile.

Oh.. and I am taught a new stuff today - DLC.

I have always said - as investors we should form our own opinions, have a plan, look forward.

Crazy Plan. Crazy Thoughts. Crazy Portfolio.

These information were shared with members of my Fundamental Scorecard Telegram group. If you are interested, feel free to join us. 

We talk about everything under the sun about investing with a focus on US, HK (slightly lesser) and SG companies.

Monday, March 9, 2020

What Happens If You Are Almost 100% Vested?

Yes. I am almost 100% vested todate and it is frustrating.


You will have thought that the vast amount of experience I gain over the years will be able to carry me through this downtrend.

But no, at this point in time, the little cash I have left with make me doubt myself at times. This is especially so, when you know US market will fall more after New York declared a state of emergency.

So what did I do?

I wrote down all on companies I have on a piece of paper and stay away from all share price information. Then I decide which company in my portfolio I will want to add, hold or sell/reduce.

I realize I tend to remember the most important points of each company during this exercise. This point will eventually be the main reason why I bought in the first place and my subsequent action.

Next, I determine the cash I have if all selling actions are completed. After that, I filter out those companies that will recover the fastest or had declared dividends that will eventually be given out.

This will eventually allow me to concentrate the little cash I have to buy these companies.

So what else will I be doing?

However, I still realize that my cash amount is still slightly insufficient. Do note that, after the initial exercise, I decided only on 2 to 3 companies.

So I decided to leverage, not via margin, but to borrow from banks as an individual at a very low interest rate (below 3.5% pa). There is currently a facility in every bank that provides this service.

Nevertheless, this amount will not be significant but sufficient for now.

The reason I did not go for margin account is because, in this downtrend, I am unable to see the bottom yet. To leverage through margin at this point in time will be foolish. However, it is also important that one gets ready a margin account if the requirement arises in the later stage.

The reason I go for a bank loan is due to the fact that I will have some cash to purchase the selected companies at the current share price, with the ability to repay the purchase through installments or in phases over a fixed period of time.

Obviously, all plans have risks. The main risk is I lose my job and the ability to repay the purchase. Thus, I must ensure that I am employed during this period of repayment.

Crazy Plan. Crazy Thoughts. Crazy Portfolio.

These information were shared with members of my Fundamental Scorecard Telegram group. If you are interested, feel free to join us. 

We talk about everything under the sun about investing with a focus on US, HK (slightly lesser) and SG companies.

Sunday, March 1, 2020

Recap: Steps To Take During Market Correction

As an investor, we should strive to be better than ourselves.

This Coronavirus situation gave me an opportunity to relook at steps to take during market correction.

I had written 2 evergreen post in 2018 (post 1, post 2) where wrote about the situations and the possible actions to take during market correction. 

Nevertheless, the current situation allowed me to take a closer look at the steps. 

Basically, I have further broken down into a 4 step process: SELL, FOCUS, CONCENTRATE, PHASES.

This 4 steps basically meant that:

We should SELL our weak companies to increase our cash holdings. Then we should only FOCUS on companies in our portfolio and not our watchlist, unless those are more attractive (meaning margin of safety exceeded those companies on your portfolio). The idea is to reduce the number of holdings in your portfolio and increase your cash pile in order to CONCENTRATE on purchasing those companies in your portfolio that will recover the fastest when economy recovers. Finally if you have a huge warchest, purchase in at least 2 PHASES.

Nevertheless if you are, like me with little cash, you can consider to be 100% vested.

Some of you may question if I believe the bottom is near, thus I stated to be 100% vested? The answer is No.

This is because, I am looking individually at those companies in my portfolio.

As explained by a member of my Fundamental Scorecard Telegram Group stated, "to buy or accumulate on the company because it share price has reach your target price and you feel that you have a significant margin of safety". That is why I will consider to be 100% vested.

In addition for those that are timing the market, its time to act. If you continue to shift the goal post, the goal will never be scored. 

These information were shared with members of my Fundamental Scorecard Telegram group. If you are interested, feel free to join us. 

We talk about everything under the sun about investing with a focus on US, HK (slightly lesser) and SG companies. 

Sunday, February 16, 2020

Intrinsic Value - A Subjective Fake Motivation Number


I have been trying to come up with a way to calculate intrinsic value.

Over the years, I developed many ways to find out the intrinsic value (Just read my blog, look at Fundamental Scorecard or look at Moat Scorecard).

However, as I get more involved in overseas companies, especially the US market, my thinking starts to evolve again.

Don’t get me wrong. I still use my past methods on calculating intrinsic value for companies in SG and HK.

However, they are not workable for US market. US market at times looks at more qualitative rather than quantitative. Many companies are what I deem as – a company with a story, not back by financials.

Furthermore, I do not understand how can one hold a company who share price has grown for 10x for example.

So recently my Fundamental Scorecard Telegram Group had a discussion on Intrinsic value.

Before I continue, please ensure that I do note that Intrinsic Value (V) is NOT EQUAL to Share Price (P).

So back to the discussion - there was a line by a member stating that “if enough people believe in it, then V becomes a real thing.”

This brings me back to Ben Graham famous line - in the short run, the market is like a voting machine (tallying up which firms are popular and unpopular). But in the long run, the market is like a weighing machine (assessing the substance of a company).

Basically, I want to find a company where P is below V and remains unpopular. But eventually I will want more people to recognize this company where P = V.

To allow more people to recognize this company, it brings me back to Warren Buffet famous line – Buy wonderful companies at fair price.

So, if I purchase WONDERFUL or UNPOPULAR companies at FAIR prices and hold for the LONGER term (in my opinion, 3 years), I will be able to allow more people to recognize the V of the company and the P will eventually mean V.

Then there are 2 others problems that I realize in my concept of V.

In the past, I tend to look at V with a conservative mindset. This is to allow for a bigger margin of safety because concept of V is SUBJECTIVE. Because of this, my V is low. This resulted in anchoring bias within my perspective. But the problem here is if I buy wonderful companies at fair prices? Why should I be conservative about a SUBJECTIVE number?

The next problem is CONVICTION. There are many times I bought into companies with known major risk (Example: IGG). This creates a limitation to my conviction to hold, as I always have the major risk at the back of my mind. At the end of the day, “noises” may eventually result in me making rash decision.

Thus, in short, I believe in future purchases I should: 
  • Have more conviction in my investment. This can be done by finding pros and mitigating cons. No cons should be left behind.
  • Allow my calculation to look at the highest limit of V. Find the range.
  • Continue to find wonderful companies at fair prices or Unpopular companies at low prices.


Nevertheless, this brings me to another set of questions - My investing strategy. Its probably time to relook at them and come up with a way to analyse them. 

If you are interested to know more, you can ask me on my Fundamental Scorecard Telegram Group, on my TUBInvesting Facebook Page or comment on my blog post!

Saturday, February 1, 2020

Impact of Wuhan Virus


With uncertainty ahead of us due to the Wuhan Virus, I decided to relook at each of the company in my Crazy Portfolio.

I intend to determine the impact of Wuhan Virus on their business. Eventually I will come up with some conclusion on each company on whether I intend to reduce, add or hold my position.

Indication of Impact: No Impact < Min Impact < Partial Impact < Big Impact < Direct Impact

SG Companies

OCBCPartial Impact due to Wing Hang and general market slowdown. But with Singapore as it’s base, revenue still supported. Consider Adding.

StarhillMin Impact. Only 1 property in Chengdu with 1 long term strategic client. Consider Adding.

StracoDirect Impact. All PRC parks closed since 25 Jan till End Feb (?). SG flyer Close since 25 Nov. 3rd Quarter report show flat earnings, FCF still sustainable for current 3.5 cents dividend. 4th quarter should still be 2.5 cents of dividend. But Q1 2020 will be heavily impacted and even with slow down generally. To Reduce 1/3 and accept some losses.

Special Company*No impact as Company only has Singapore business. But no intention to add or reduce position until FY report out.

Japan food Min Impact. Has Associates in China and marketing Minor Group business in China. As per HY report, associate already losing money. On the other hand, Singaporean may end up eating less outside. Maybe “take away” revenue will balance out. No intention to add or reduce position until next report out.

QAFNo impact. Main business in Singapore, Malaysia and Australia. In fact, Australia Pork prices went up due to Swine flu hit in China. This is a short-term position till FY report out. Expect good results. Consider Adding.

HKlandBig impact but Prices are already very low. Consider Adding.

HK Companies

Wahsun – Manufacture in Cambodia and ship to US and Europe. China factory for administrative purposes, logistic and design. Min Impact. Short term position. No intention to add or reduce position until next report out.

MedialinkMin impact generally since main business not in China. License to sell products also mostly in SEA. No intention to buy or reduce position.

PlaymatesPartial Impact. Property and factory in HK. But generally manufacturing to slow down slightly as orders will probably reduce. Expect dividend to drop slightly in the upcoming FY Report. Consider Adding.

Potentially finding another long term target.

US Companies

QudianDirectly impacted. Recent announcement had a change of tone within 2 months. Change of tone can be view from both extreme. But cons seem to be more than pros. Do not want to hold hopes. To sell all and accept losses.

Disney – Shanghai and HK Disneyland closes. But Disney is a diversified business. Partial Impact and great future potential. Consider Adding

Commercial Vehicle Group, Inc. – Generally worse off due to its industry. Have some exposure in China and there is also a China manufacturing plant. Big impact. Reduce 1/3 and accept losses

GlobalScape – Enhance File Transfer system. Working with cloud services now. No impact. Consider Adding

CynergisTek, Inc. – Cybersecurity for the healthcare industry with US industry. Have a high possibility that business will be better once the impact is over. Will be positive impact if HACKERs tries to enter into Healthcare industry now. Balance sheet is ok. Consider Adding

Rimini Street – Competitor to Oracle and SAP and Salesforce in maintenance business. Under-cut the original players. Already had significant gain. Min Impact. Consider Adding

On Deck Capital – Newest position. USA SME lending financial institution. No impact. Consider Adding

Universal Insurance – US property insurance company. No impact. 2nd Heaviest position. Consider Adding

Potentially finding another long term target.

In view of the conclusion I had on each company, the Wuhan Virus will have an OVERALL IMPACT of a Potential Loss of about 2.5% of the portfolio. 

The 2.5% is calculated because I converted paper losses to actual losses.

Nevertheless, we should have another plan of how we intend to add to our positions. This is because resources are limited. With that, I will like to bring you back to my evergreen post - Steps To Take In A Market Correction


If you are interested to know more, you can ask me on my Fundamental Scorecard Telegram Group, on my TUBInvesting Facebook Page or comment on my blog post!