Mapletree Commercial Trust Preferential Share Offering: Got all the excess I applied for?

Mapletree Commercial Trust held a preferential share offering to fund its acquisition of Mapletree Business City at a price of $1.42 per share.

I applied for 3920 excess rights thinking that I'll only get part of what I applied for since the offering price of $1.42 was lower than market price.

To my surprise, I everything that I applied for. I  wonder what that says about investor demand for local REITs if 'free money' people didn't apply for more. People getting cautious about anyhow pressing at the ATM?

Strategy Report: August 2016 Part II

A bit too expensive now?

I am not very good at investing in upwards moving markets. As you can tell by the blog title, I prefer to buy after a crash.

I found it much easier to buy buy buy just after Brexit when everything was cheap and much harder to buy anything now since the prices have risen by so much.

In the absence of any fundamental economic shifts, I still believe in reversion to mean.

Since the last strategy report, there were 2 days more downturn which I used to buy more SAN followed by re-buying LYG at lower than my selling prices. But note that LYG went ex-Div last week. I also added a bit of BT when it dipped below $26.00 given its somewhat

defensive qualities.

But at the moment, I am sitting this upturn out. I will subscribe to scrip dividend for MapletreeLog and excess rights for MapletreeComm REITS since the upturn means that the prices for scrip dividend/excess rights is attractive.

Strategy Report: August 2016

 

For the month of August, I have subscribed to Morningstar's reports via IBKR. I was previously given a free trial and I liked the content. It costs $14.90/month, cheaper than subscribing through their website. More importantly, its very easy to switch on and off IBKR subscriptions. Since Morningstar is FA oriented, and fundamentals don't change that month, one could subscribe say, once every 3 months and not miss much.

Investing Idea: Banco Santander? (SAN - ADR)

I don't have any foreign bank counters apart from LYG and HSBC.  

US Banks will hit me with 30% withholding tax and their dividends aren't fantastic. If I really wanted US Banking exposure, it would be better to buy the SPDR financials ETF listed on LSE and with15% withholding on dividends. But I prefer to look for yield.

Banco Santander is Spain's largest bank with exposure to Latin America and the UK. It is listed on the LSE as BNC but there are also ADRs based on the underlying Spanish share. Spain has a 19% dividend withholding tax but the good news is that if you choose scrip dividend, you do not have to pay withholding tax :

• Santander Scrip Dividend

With a 5% dividend yield and  a "real"  banking business as opposed to "investment banking" (which some say is fake banking), I think that SAN is a better addition to my portfolio than another UK bank like Barclays (at the moment, no thank you) or Royal Bank of Scotland (my UK bank account is technically with RBS since they absorbed my previous bank during the last financial crisis).

So anyway, I have never been able to time the bottom and TA suggests signs of downside. But its a new month so I have initiated a position in SAN.

Footnote: Results of bank stress test: Bank stress test  - 4 UK banks were tested, LLOY best result, HSBC second, then RBS and BCS.

Dividend Report: Jan-Jul 2016

No S$ dividends collected in July, resulting in the average dividends per month plummeting to under S$3,000.

Vanguard's quarterly distribution came in this month (Jan/Apr/Jul/Oct) which increased the amount of US$ and £ collected. Some ADRs also paid dividends this month including Westpac Bank which also answered the question how much dividend withholding tax is applied to an Australian ADR. The answer is 15%, the most favourable rate possible (as opposed to 30%). 


I have also sold all my SCB foreign ETFs that declare dividend and replaced them with ETFs that reinvest dividend. This is due to the $10 minimum commission that makes it very expensive to reinvest the dividend.



Average dividends per month: Jan-Jul 2016:
S$2,736.93 -
US$187.31  +
£169.30 +


Average dividend = Total dividend collected ÷ number of months in the year so far
Different from DK style of total dividend ÷ 12 months


Previous monthly average
S$3193.08 +
US$129.10 -
£110.74 -

Last Trade for July?: LYG

I said I was in holding pattern,then suddenly on Thursday Lloyds' share price crashed. Could be linked to its announcement that its closing branches. One would have thought that cutting costs by closing unprofitable branches (you don't close profitable branches to cut costs) would have been factored into the share price. So much for the EMH (efficient market hypothesis), at least for the very short term.

Anyway, bought more LYG on Thursday at $2.81 (lower than the previous selling prices of $2.83/$2.87/$3.02 [I sold too early since it peaked at $3.10])  and today its back up to $2.87. The day is not over - it could crash again so I may need to update this post. But may I need to hold LYG longer and say $3 no sell.

But anyway, here's to the end of July and the beginning of SCB minimum $10 commissions. I failed to sell my Soilbuild REIT so its stuck in SCB. I'll just have to collect dividends from the holding until I decide to go for priority banking (no minimum commission for priority banking).

July Strategy: Holding Pattern till August

A couple of days more till the end of no minimum Commission and the start of $10 minimum for SCB. I still have not sold my tiny 2,000 soilbuild REIT shares. Probably someday after the lawsuits are settles, I will buy $5k to top-up the existing holdings. Still cheaper than regular brokers.

At the moment, I am not buying anything. Actually I wanted to pick up some Fraser's Retail bonds which I had added at $0.99 but even retail bonds have increased in price along with share prices.

Part of learning to be a good investor is to know when to pause all stock trading activity. I worry about all those investors who are boarding the "GLP boat" when it is almost touching $2.00. People already said this is a "FIFO stock", have to be very careful, but people seem to be happily loading up at $1.9x. In the long-run, they will probably be ok (but if they are only interested in long-run then STI ETF is even more ok).

After a rally, I would rather buy safe defensive stocks rather than "FIFO stocks" because the defensives usually lag the rally. Hence my interest in BT and VOD. 

I also need time to rebuild the warchest that I used during BREXIT. So I am taking a break till August unless there is major crash. I should also be able to update the dividends collected in July once the month is over.

Market might be swinging too far in one direction and pricing a higher probability of  no rate hike than is warranted.

Mid-July: Strategy Report

STI has rallied and so have other markets. In fact, UK has rallied impressively with gains in both the stock market and the GBP.

I sold some LYG as it went up to lock in some profit. At the same time, I used that money to accumulate more Vodafone to go together with my recent purchases of British Telecomms.

As  mentioned in the earlier post, when the market is bad, no point going defensive since defensive stocks won't benefit that much from a strong rally. But once the rally is underway, buying defensive stocks may be better than trying to chase the top gainers.

A strong rally is actually a good opportunity to stop buying equities and to rebalance by purchasing some bonds or simply rebuilding your reserves.