Wilmar and China Minzhong: Time to go long?

My ill fated investments in Wilmar and China Minzhong are 30% and 45% down, respectively. The decision to be vested in these two counters were based on macro ideas and technically, they looked like they were resting on supports.

As regular readers know, I do not have cut loss prices and would seek to add to long positions if the technicals are favourable. Favourable? Yes, I look for higher lows in the momentum oscillators as share prices move lower.

Today, I added to my long positions in Wilmar and China Minzhong as their charts show me rising momentum oscillators while their share prices are retreating. The trading volumes have dwindled as well which led me to think that a floor could possibly be forming, if not the bottom.

Wilmar's share price is currently sitting on a golden ratio and if this should break, we could see $3.30 or even $3.08 tested next. Although the momentum oscillators are rising, the OBV is in decline which suggests that distribution activity is ongoing. I won't be too ambitious in adding to long positions.

China Minzhong's chart is similar to Wilmar's and if the Fibo lines I have drawn are any good, we could see 51.5c tested next. We could be seeing more selling although the the trading volume suggests that the action might not be as intense as before.

In both cases, it is not a good time to sell. Indeed, it would make more sense to stay vigilant for opportunities to buy in.

My strategy is to nibble and increase my additional purchases at lower prices if the technicals suggest that it could be a good idea. Of course, there is no way we can be absolutely sure and we can only call a bottom after it has been formed.

Telcos and REITs are top performers in May.

This is taken from an article in The Business Times today:

LMIR's Pluit Village.

The high dividend sectors of telcos and REITs performed the best in May. SGX highlighted the defensive nature of these two sectors in a market update on June 1.

In May, telcos declined 0.43% and REITs dropped 1.73%. The STI fell 7% from 2.979 to 2,773, the largest monthly drop this year.

SGX noted that the top performers year to date are FCOT, gaining 28.4% and AIMS AMP Capital Industrial REIT, gaining 20%.

Industrial buildings belonging to Cache Logistics Trust.

With 70% of my portfolio made up of S-REITs with good fundamentals, I sleep better at night, enjoying rather high yields and receiving regular income distributions.

Related posts:
1. Staying positive on S-REITs.
2. AIMS AMP Capital Industrial Trust: 4Q FY2012.
3. FCOT: DPU up 16.8% in 18 months.

DBS ups Starhill Global target price
Tuesday, 05 June 2012

© 2012 - The Edge Singapore

Tea with AK71: A new car for S$75,000?

I bought my Mazda 2 nearly two years ago for slightly more than S$70,000. I thought it was a little expensive but I pillarised my then Mazda 6 and was somewhat depressed. So, I got a new car.

Read the stories here:
1. Tea with AK71: Pillarised.
2. Tea with AK71: Bought a new car!

Anyway, buying a new car then proved to be a somewhat fortunate move since car prices have shot through the roof!

Read: Tea with AK71: The price of my car now.

Indeed, I found out that it would cost more than $100k now to buy a new Mazda 2!

As if that is not depressing enough, I am constantly reminded by foreigners what I could have bought in their home countries with the money I paid for my car.

Today, I am reminded once more of how expensive cars are in Singapore as I read the weekend's edition of The Business Times. Couldn't have missed it. It was on the front page.

In Singapore, a Chery QQ would set us back by S$74,988 now, after discount!

In the USA, we could buy a Porsche Boxster Black Edition for S$71,060!

In the U.K., we could buy a Mercedes Benz SLK for S$53,692!

OK, those countries are far away. What about nearer home? Well, in Malaysia, we could buy a Volkswagen Golf 1.4 TSI for S$60,704.

In Indonesia, we could buy an Audi A3 Sportback for S$70,672.

It is enough to make a grown (Singaporean) man cry.