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What are you investing in?

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  #121 (permalink)  
Old 27-09-2013, 08:53 PM
Zhang
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Very sharp observation. Indeed forex risk is a problem for residents of countries with strong currencies like Singapore.

I mitigated it to a degree by taking 80% loan so am only 20% exposed, but clearly renovation cost and transaction costs are not hedged. Net net I took c. Rm410k loan, so my unhedged exposure was c. Rm185k. At avg entry price of 2.48, I have lost c. RM5 to 6k.

This is c. 4 months rental. Remember the rm500 is positive cashflow not net profit. Net profit is c. Rm1.3 to 1.5k because the part of the mortgage payment also goes towards repayment of principal, and not all to interest.

But big picture, am ok w sgd-myr at 2.48 because this was a 15 yr low for myr. Its hard to see the sgd maintain at current levels, in my view. Businesses are starting to feel the pain of the high sgd, as reflected by the poor export numbers. Believe once the housing market in singapore is brought under control, mas will allow sgd to weaken to boost the economy. Now mas' hands are tied because once they allow sgd to weaken, the housing prices could jump again, and thats becoming a real political problem for the govt.

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  #122 (permalink)  
Old 27-09-2013, 10:31 PM
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i have $20K in my bank that I can invest.
Any suggestions what I can do ? I have not done any investment so far.



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  #123 (permalink)  
Old 28-09-2013, 09:22 AM
Zhang
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Default A better arbitrage play ?

For those who are interested in arbitrage plays, I've uncovered another one that appears pretty compelling.

For those of you who have explored Iskandar property, you would probably have heard of Paragon Suites.

- Its right next to the Immigration Complex
- Within 500m from the purported MRT site
- Within 500m from Peter Lim's RM10billion medical/retail/commercial/residential hub
- Fully sold at RM800 to 1000 psf
- Highly popular with Singaporeans
- developed by a well known hotel player.
- In the secondary market, prices are going at between RM1.1k to 1.4k psf

Condominium For Sale - paragon [email protected] JB city iskandar, jalan indera putra , johor bahru, Malaysia, Condominium, 2BR, 909sqft, #2574977

For those who are looking for a location arbitrage, I found a place literally 100m away, @ 240 psf. Check out Indera Putera Courts.

Condominium For Sale - Indera Putra Courts, 22 Jalan Indera Putera, 80300 Malaysia, Condominium, 3BR, 2000sqft, #1862315

Its essentially a liquidity arbitrage play. In an efficient market, such arbitrages won't be there.

Considerations such as no rental, forex risk etc are still there. But wow, what a location arbitrage!

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  #124 (permalink)  
Old 29-09-2013, 06:04 PM
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Quote:
Originally Posted by Zhang View Post
Very sharp observation. Indeed forex risk is a problem for residents of countries with strong currencies like Singapore.

I mitigated it to a degree by taking 80% loan so am only 20% exposed, but clearly renovation cost and transaction costs are not hedged. Net net I took c. Rm410k loan, so my unhedged exposure was c. Rm185k. At avg entry price of 2.48, I have lost c. RM5 to 6k.

This is c. 4 months rental. Remember the rm500 is positive cashflow not net profit. Net profit is c. Rm1.3 to 1.5k because the part of the mortgage payment also goes towards repayment of principal, and not all to interest.

But big picture, am ok w sgd-myr at 2.48 because this was a 15 yr low for myr. Its hard to see the sgd maintain at current levels, in my view. Businesses are starting to feel the pain of the high sgd, as reflected by the poor export numbers. Believe once the housing market in singapore is brought under control, mas will allow sgd to weaken to boost the economy. Now mas' hands are tied because once they allow sgd to weaken, the housing prices could jump again, and thats becoming a real political problem for the govt.
Suggest you measure this way over the life of x years say 3 years:
Your 20% injection is exposed to SGD. Consider your MYR 1.3 -1.5k as your dividend flow/returns over this investment. Assume spot rate transfer out.

If the FX /interest view is against you, your 1.3-1.5k MYR will get hit and shrink. If it improves , then this will increase.

If everything is in your favour, you will see your 20% stake increase in value ie house price go up, dividends get higher and higher in value ie fx and i/r, and your "asset stake" increase from 20% to x % due to loan amount reducing after factoring maintenance cost.

All the best. I think SGD trend is hard to predict despite whatever one says. eg
Many have lost big time because they thought SGD appreciate against USD. While history can point to this, when certain events happen, the bumps along the way can really be difficult to take
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  #125 (permalink)  
Old 29-09-2013, 07:43 PM
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Quote:
Originally Posted by Unregistered View Post
i have $20K in my bank that I can invest.
Any suggestions what I can do ? I have not done any investment so far.
You can invest it with me. I will make it $35k in 6 months.
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  #126 (permalink)  
Old 29-09-2013, 08:13 PM
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Default riviontely some

Quote:
Originally Posted by Unregistered View Post
You can invest it with me. I will make it $35k in 6 months.
sonds great dude! what's your contact?
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  #127 (permalink)  
Old 29-09-2013, 10:41 PM
Zhang
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Quote:
Originally Posted by lazyplane View Post
Suggest you measure this way over the life of x years say 3 years:
Your 20% injection is exposed to SGD. Consider your MYR 1.3 -1.5k as your dividend flow/returns over this investment. Assume spot rate transfer out.

If the FX /interest view is against you, your 1.3-1.5k MYR will get hit and shrink. If it improves , then this will increase.

If everything is in your favour, you will see your 20% stake increase in value ie house price go up, dividends get higher and higher in value ie fx and i/r, and your "asset stake" increase from 20% to x % due to loan amount reducing after factoring maintenance cost.

All the best. I think SGD trend is hard to predict despite whatever one says. eg
Many have lost big time because they thought SGD appreciate against USD. While history can point to this, when certain events happen, the bumps along the way can really be difficult to take
Thanks.

I think at the end of the day, and I've said this many times, you have to go in with your eyes open. Anyone that goes into a Msia investment without thinking that SGDMYR exposure is a risk is setting himself up for a fall.

I see the risk, but at the end of the day if I think its a risk worth taking because the upside-downside analysis makes sense, I mitigate the risk as best I can (Msia loan) and I go in.

If your primary analysis is centred around FX risk, you'll never go outside of Singapore. Which means you'll probably hv done well for the last 10yrs, but the past is no perfect predictor of the future, and now Singapore valuations are looking pretty toppish across the board (real estate, bonds, equity and currency).

I may be right or I may be wrong - nothing in life is assured. But I go in with my eyes wide open, and I never regret. If I'm right, good. If I'm wrong, I learn. Key is to parcel out our risk so that one mistake can never kill you.
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  #128 (permalink)  
Old 30-09-2013, 01:04 AM
Kenny
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Default Invest in Royal Square in Novena

Dear Doctors ,

There is this upcoming special invitation for Doctors only for the up coming medical suite at Novena, on the 04th Oct 2013. If you have interest to know more and wish to attend this event, please call me at 91099797 for an appointment .

Regards
Kenny Neo
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  #129 (permalink)  
Old 30-09-2013, 07:32 AM
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Quote:
Originally Posted by Kenny View Post
Dear Doctors ,

There is this upcoming special invitation for Doctors only for the up coming medical suite at Novena, on the 04th Oct 2013. If you have interest to know more and wish to attend this event, please call me at 91099797 for an appointment .

Regards
Kenny Neo
Haha from $100 psf property (Zhang) to $4000 - 5000 psf property (Kenny).

Interesting change of pace!
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  #130 (permalink)  
Old 05-01-2014, 05:35 PM
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Default Investing in Bitcoins

Bought 500 bitcoins using my bonus at the start of 2013 at around USD $30 per bitcoin. Now from current market prices, 1 Bitcoin is worth USD $800. My investment of around USD $15000 is now worth USD $400,000.
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