2017 Year-End Notes

I have just concluded my investment return in 2017.
The return for 2017 is 35% while IDX returns 20%.

I’d remind the readers not to read too much into 1-year result and rather look at longer term horizon, at least 5-10 years cycle.

Points to note in 2017:

  • My result looks great on surface but at closer look, the return is exaggerated by last minute Mr Market’s dressing or putting lipstick to the pig.
  • Three-quarter of my portfolio is in CASS and hence that explains most of my return in the past 2 months of the year.
  • CASS share price is running ahead of its business numbers.
    The business has good long term potential, but current result isn’t great and the price shouldn’t be appreciated as much.
    However, apart from the Management constant damages to the business, CASS business should eventually (hopefully) catch up with the share price.

    At this moment though, my yearly result is overrated.

  • Other than CASS, I am holding APLN, LPCK, RDTX, SMDM, TSPC & TOTL. 
    All of which are less than 5%.
    I hope they can do better by getting cheaper next year.
    My eyes are in TSPC & TOTL and will be doing more deep-dive in them.
    The remaining companies are mainly to cover my cheapness side. (:
  • At the risk of repeating my broken cd, by and large I think IHSG is expensive and a lot of counters are ridiculously sky high.
    Sooner of rather some people are going to relearn the pain of the rudeness Mr Market (I sincerely hope that you won’t be one of them).
  • Bit coin is sky high and its price (NOT value) has been multiple by 10 or 100. However its value is still the same (to me), which is (drum drum drum), ZERO.
  • About half of my realised return this year came from PTRO.
    With the remaining from INDY, APLN, CTRA & LPCK.
  • The irony is that my biggest realised loss came from APLI. 
    The only company with perhaps the Management whom I thought was inline with my business investment principle.
    However upon closer look and musing over, again, the realisation of “bad business is more powerful than good management” and also the actions of the company are not in synch with the words (the acquisition of company from the father came in mind).
    In doubt, action always speaks louder than words.

Notes and action plans for 2018:

  • I hope to increase my cash holding from the current 13%, for my fall cushions.
  • Albeit sky high IDX, with manic depressive Mr Market, there are always undervalued companies around.
    I expect this situation to continue and even worsen by the influx of newbies who unfortunately will pay the price (school fees) to Mr Market.
  • With complacency and insanity of the human spirit, the bulls can last longer than what we can imagine.
    But, it may also pop in instant.Case in point are TOPS and Bitcoin.
    Some people are going to keep dreaming high and hope to never wake up to face the reality. Reality is tough, mates, choose your falls.
  • So what should we, as Intelligent Investors do?
    What we can’t control (such as Mr Market, human nature, politics, economy, crowd madness, crowd noises/opinions), just don’t bother.

    What we can control (analysing the company, follow the business, buy cheap and good companies, prepare cushion for the falls, our own mental state), we must do.

At the last, I’d let Warren has the last words:
“Be Fearful when others are Greedy”
“Be Greedy when others are Fearful”

Fall.Cushion_

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