STEng @ $3.87

Sell @ $3.87

My last lots… only made some kopi-$$. After selling, I read a DBSV report dated 1-Apr, which was very positive on STEng, with a target price of $4++…. Thank You DBSV!

This will be considered the end of this round of theYield Rotation Strategy for me. Some statistics,

• Transactions
  • First Buy = 3 Jan 14
    • No. of Buy Days = 13
    • Buy Range : $3.72 to $3.88
  • Last Sell = 2 Apr 14
    • No. of Sell Days = 6
    • Sell Range : $3.76 to $3.90
  • Profit / Loss Range (based on Buy Days) = -$157.69 to $309.61
    • No actual losses based on Sell Days ie. losses are adequately offset by profits
  • Time Frame = 3 mths ie. 1Q
• Total Turnover (Buy + Sell) = $511,253.58
  • Total Buy Value = $255,238.47
  • Total Sell Value = $256,015.11
    • => Net Profit = $776.64
    • Net Profit /  Average Buy Value per Buy Day = 3.96%

Going forward, my target price as calculated in a previous post,

• Conditions : 4% Yield @ 75% Payout (FY14)
• Target Price
  • After xd : $3.51 or $3.68 (assume 5% Growth in EPS)
  • During cd (+12ct) : $3.63 or $3.80 (assume 5% Growth in EPS)
    • Will have to monitor the Quarterly Results for EPS Growth

So…. barring any Itchy Fingers Syndrome, I won't be buying back unless it hits below $3.80… The best for me would be to move on to my next targets (end-Mar FY stocks) of the Yield Rotation Strategy…

 

Comments

• Yield Rotation Strategy worked out well for this time
  • But, have to be prepared to hold for long term if things do not work out well ie. target stocks have to be fundamentally strong and entry prices not at high valuations
• The absolute returns is insufficient to maintain daily expenses unless,
  • Committed $$ is enlarged substantially. Note that altho' the Average Per Buy Day is ~$20k, the highest committed amount may be >3x ie. when prices drop, more buys were done to average down
• Other strategies were also utilised eg.
  • Step Down Averaging – When prices are falling. Can be intra-day
  • Step Up Avergaing – When prices are rising, to sell in steps
  • Profit & Loss Offsets – Loss making buys are sold together with profitable ones

In conclusion, I had a lot of fun… but I didn't make a lot of $$… But, I'm glad I didn't lose $$ or get stuck into a long term hold….The sudden cut in Dividend Payout Rate changed the whole landscape for me and contributed to my urgency to get rid of my holdings. To play safe, I'd rather wait to see the "EPS Growth" in their future Quarterly reports before I raise my target Buy price….

Note : Perhaps a better strategy would be to buy near the lows (that'd require applying a bigger margin of safety before doing any buys) and selling near the highs (must not have my kind of "kan-cheong spider" temperament)….:D