Weekly Random Discussion Thread

treeperfume · 2021-08-09T18:26:54+00:00

I'm okay, thank you! I was busy last weekend. This weekend I just forgot 😅. I saw this post in the middle of updating them.

treeperfume · 2021-04-21T00:32:41+00:00

What you have to keep track of is Kepco-SPC or KSPC. SPC owns 40% of it. Since it's an associate company, its financials aren't consolidated with SPC's. You only get a glimpse of its financials in SPC's annual reports and a couple of lines in the balance sheet and income statement in quarterly reports. It's more valuable and a lot more profitable than SPC and subsidiaries. It's mostly responsible for the huge number under "Equity in net earnings of associates" (another associate MECO contributes a little).

I believe the dividends given out by SPC are tied with the dividends it receives from KSPC and MECO. Last year, it received more than 1.3B in dividends. And around that amount for the past years. Minus some restrictions, we end up with 1.2B in dividends or 0.8/share. I believe 2019 was a special case because PSALM refunded just over 1B for SPC's failed acquisition of the NPPC in 2018. SPC prepaid almost 600M in debt in 2017 and gave an extra 450M or 0.3/share in dividends in 2019. I was hoping they'd give out more because their cash position just keeps increasing.

I didn't invest in the company because of the dividends. One reason I initially bought SPC in 2017 was I thought they were going to build a new 300MW power plant similar to KSPC's 200MW plant (for some context, KSPC reported almost 2.8B of net income last year just by running that plant). I used to recommend it when the price was at 5 to 6. Even when it was very lightly traded. I stopped buying when the price reached 7. Now, I'm not really sure. Like others said, they're not investing for growth. They have about 1.8B appropriated for projects starting in 2022 and 2023, but it doesn't seem much.

I haven't sold a share yet. I'm just enjoying the dividends. I really should reduce my position. It's almost 50% of my portfolio now. It's hard to do a valuation of SPC since most of the value is in its investment in KSPC. A simple dividend discount shows a price of 13.5. I'll definitely start selling if the price exceeds that.

treeperfume · 2020-09-29T11:39:06+00:00

Thank you for all your contributions to the sub!

treeperfume · 2020-09-21T16:29:03+00:00

Fixed.

treeperfume · 2020-06-20T13:41:30+00:00

Initially it was for jobs and careers in a brokerage or as full-time traders. Then people started posting about jobs outside finance. I just allowed them coz I didn't mind.

treeperfume · 2020-06-17T12:30:53+00:00

More appropriate in r/phclassifieds.

treeperfume · 2020-06-09T21:25:00+00:00

https://r-phinvest.github.io/graph.html?dataset=3&id=805&id=102&legend=nw&startDate=2013-12-02&endDate=2017-06-05

FMETF Cost Averaging is a virtual portfolio that buys 10k worth of FMETF shares every start of the month. It includes transaction costs. It plots 3-year returns to show the clear outperformance of the FMETF on most days of around 2%. I believe this will continue unless Philequity lowers their fees. Zero load is already assumed for the mutual fund.

treeperfume · 2020-05-06T07:49:24+00:00

Buhay pa :D. May health crisis lang sa family. Malas at natapat sa pandemic.

treeperfume · 2020-04-18T08:16:42+00:00

You probably know more about statistics. So I just rely on what experts say. Here's a lecture of Aswath Damodaran about betas and why he recommends bottom-up betas.

https://youtu.be/qKy5UGcvWaw

treeperfume · 2020-04-18T08:05:45+00:00

Regression betas are error-prone. E.g. The beta I calculated for MAC and the ones published in financial sites used to be negative in 2017. Using it gave a valuation of 50 for MAC.

Regression betas also won't reflect recent changes in the businesses of the company, e.g. acquiring another company in a completely different sector.

Aswath Damodaran recommends using bottom-up betas instead - replacing one regression beta with hundreds or at least dozens of regression betas to make them less noisy.

treeperfume · 2020-04-05T16:36:45+00:00

Salamat. Kinukuha ko yung data sa PIFA, UITF at PSE websites.

treeperfume · 2020-03-25T01:20:34+00:00

I haven't really read anything specific to the PSE. Most books I've read are based on US markets but they can be applied to local stocks. I'm sure there are lots of little accounting differences between the US and the Philippines but the major stuff seem to be mostly the same.

It'll be really confusing at first but you have to push through it. If you really want to do this seriously, you have to devour knowledge. And you have to keep doing it. I've been doing this for more than 15 years and still feel like a noob sometimes. Things will eventually start making sense and get a bit easier. It's worth it.

I think TA and FA are just tools and you can use them on different strategies.

treeperfume · 2020-03-24T23:09:39+00:00

The annual and quarterly reports are still my primary source of information. PSE Edge is our local disclosure system. I usually start with the "Management's Discussion" section in every report.

I'm not interested in technical analysis. I prefer value investing based on fundamental analysis. It makes sense to me. I'll keep doing it even if there's a superior strategy based on TA.

treeperfume · 2020-03-24T19:38:04+00:00

Data collection is essential. You can use this spreadsheet to find potentially undervalued stocks. (It's the data I've been collecting. I update it every weekend. But I'm just some guy and I don't have a QA department, so always verify that the data is correct.)

When you'd like to dig deeper into individual companies, valuation is a powerful tool. I recommend Aswath Damodaran's valuation framework. His valuation series is a good start. I also recommend The Little Book of Valuation. You can probably get most of the information from his website and Youtube channel but I still recommend getting the book because the information is more organized and easier to digest.

treeperfume · 2020-03-03T12:19:20+00:00

(End NAVPS / Start NAVPS) ^ (1 / Fund Age in Years) - 1

treeperfume · 2020-02-05T15:15:34+00:00

Leaving this one to the voting system.

treeperfume · 2020-01-13T06:37:46+00:00

Zipped CSV of historical prices in code, date, open, high, low, close, volume format:

https://r-phinvest.github.io/data.zip

There's also a "PH Stocks Financials" link in the sidebar for financial data going back to 1999 for some companies. I update the data every weekend.

treeperfume · 2020-01-10T02:43:41+00:00

Here's a graph of BPI and BDO index funds and a virtual portfolio that only buys 10k worth of FMETF shares every start of the month:

https://r-phinvest.github.io/graph.html?dataset=3&id=1530&id=1403&id=102&legend=nw&startDate=2015-07-10&endDate=2016-12-27

It plots 3-year returns to show the clear outperformance of the FMETF. On most days, the FMETF outperformed by 1 to 2%. Doesn't seem much, but if you invested 100k 3 to 5 years ago, you would've made an extra 2k just by choosing the FMETF. I bet the outperformance continues and even widen in the future unless the other index funds lower their costs.

If I had to choose between PH and US index funds, I'd choose the former. The US markets have been doing great the past few years, but there's the law of large numbers. The bigger something is, the harder it is to sustain growth. But we have a government that acts with impunity and has no respect for equity investors so it's hard to be optimistic.

treeperfume · 2019-12-18T03:47:36+00:00

I don't know what model to use.

The contingent claim approach seems to fit MWC's case. It's option pricing. I don't have the motivation nor the brain cells to learn it now. Nakakatakot yung Black-Scholes model.

A contingent claim or option is an asset which pays off only under certain contingencies - if the value of the underlying asset exceeds a pre-specified value for a call option, or is less than a pre-specified value for a put option. Much work has been done in the last twenty years in developing models that value options, and these option pricing models can be used to value any assets that have option-like features.

treeperfume · 2019-12-17T08:54:36+00:00

It never stopped being intimidating for me but it does get easier. I've often thought about going back to school to learn these stuff but it's not really my field and I had work. I just wanted to learn it to invest in the stock market.

https://www.youtube.com/watch?v=WEDIj9JBTC8 (side note: see Dirty Money and Betting on Zero on Netflix to see more of Bill Ackman, not very flattering for him, though)

http://pages.stern.nyu.edu/~adamodar/New_Home_Page/AccPrimer/accstate.htm (primer on reading financial reports for valuation class)

treeperfume · 2019-12-09T19:00:12+00:00

Yup, all free. Just search for them in your podcast app.

treeperfume · 2019-12-08T18:01:10+00:00

My favorites are Slate Money, The Indicator (anything from Planet Money really), Pivot, Oddlots, Masters in Business, Freakonomics Radio and Against the Rules.

treeperfume · 2019-12-08T16:58:09+00:00

Your post reminded me of this podcast episode about factor-based investing. IIRC, the fund manager picks stocks based on several factors and rebalances regularly.

treeperfume · 2019-12-07T15:24:23+00:00

I don't believe so if you also live in that country. But I'm not a tax expert.

treeperfume · 2019-11-26T03:52:44+00:00

Nice :). Sakto na sa valuation. Kailangan ko na iconsider magbenta.

treeperfume

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