What to do with $4k?

Whoopie, I have just gotten my bonus and I should have $4k to invest.

After evaluating my choices, I decided to put this money into high yield stocks rather than speculative or growth stocks due to volality of the current market. Before I go into teh high yield stocks that I am eyeing on, I would just want to write about the 2 growth stocks which has reached my buying price. One is Contel and the other is UOL. Contel has been in my watchlist for a while and I have seen it going from 16c to the present 8c. It has also broke its 52 wks price of 8c but recovered to 8c. UOL has the backing of the Wee family and news that he bought a sustaintiate amount a couple months back at about $3.60 puts this stock into my watchlist. It has been see-sawing between the prices of $3.50 to $4. And 2 days ago, it broke my buying price of $3.50. I will monitor these 2 stocks further before i make a move.

For the high yield stocks, as you can read from my previous blog, I am holding 4 of them, of which 2 were bought using my CPF. One criteria for myself is to diversify the sectors. Currently, my four stocks are a) FSL, which is leasing ships, b) Cambridge, leasing warehouse and industrial properties, c) First Reits, which lease hospitals and homes in Indonesia, Spore and China, and lastly d) LMIR, leasing of malls in Indonesia. I am interested to get some Spore Reits but their yield is low as compared to those I am holding.

Out of the 4 stocks, I will not add to FSL as I think I have quite enough of cash tied to that. Cambridge is on the rage due to rumours of bigger Reits buying it over. I have very little First Reits and would like to up the amount and also to average down my buy price. LMIR has the lowest price of all the 4 stocks.

I feel that out of the 4 stocks, LMIR has the least potential as there isn't much activity about what they want to do. First Reits has expanded into Spore and China since IPO and I feel hospitality is a good business to be in. Cambridge has an advantage of getting bought over, so it has a short-mid term positiveness about the business. FSL has the most activities from its buying and leasing ships and furthermore, the price has appreciated and dividends is one of the highest.

After considerations, I will try to buy First Reits 1st. If I can't get at my preferred price, I will try Cambridge and lastly LMIR. Wish me luck!

Hotung the Venture Capitalist

Hotung is a Taiwanese venture capitalist. Basically, it funds new start ups and take certain percentage share of the start ups. It reaps the profits when the company gets listed. It fell into the black hole(making losses) during the dotcom bubble burst. Fundamentally, the company has posted a profit of NT$364m for FY06 vs a loss of NT$648m in FY05. It has 8 companies on hand targeting to get listed in Nasdaq and other bourses within the year.


I am more interested in the technical analysis of this counter. Personally, I only look at the moving average 20, 50 & 200, the MACD, volume and sometimes the candles. For any counter to be considered, the price must cut the MA20. If MA20 cuts MA50, it a good sign and if MA50 cuts MA200, it is normally one of the sure signs of a uptrend. For this counter, all the above scenarios have came true.

Next, MACD must be positive. It is now positive. The average volume per day is about 1-2 million shares changing hands. Though it is not considered very high volume, my criteria is just 1 million shares per day. So the above criterias have all passed.

I have drawn 2 purple lines, signifying the resistance and support lines. The bottom line is the support, and the top line is the resistance. Right now, the price seems to be consolidating between $0.14-$0.145. Once it is able to break the resistance of $0.155, it should shoot up.

From KELive research, the target is $0.19. If the target is reached, it translates to a 31% returns.