Date: 10:26 2009/02/01
Cash Balance: 991,024.00
Holdings:
comp num_shares price
EEI 10,000 0.88
Total Portfolio Value: 999,648.00
Transaction History:
time date type num_shares price cost
10:20 2009/02/01 BUY 10,000 0.88 8,976.00
Showing posts with label stock trading. Show all posts
Showing posts with label stock trading. Show all posts
Monday, February 9, 2009
Stock portfolio: Buying EEI
Sunday, February 8, 2009
Stock portfolio: Change in strategy
Previously, selldown made the following strategy:
1. Trade a maximum of one buy-transaction per month.
2. A buy-transaction must not exceed 33,000 Pesos.
I thought about it and I think it would be better to change it to the following:
1. Buy transactions for a single month must not exceed 33,000 Pesos.
This would mean that one could issue an infinite number of buy transactions in a single month as long as the sum of the transactions do not go beyond 33,000 Pesos.
On why I think this is better is because there are so many good companies out there that isolating a buy transaction to a single company for a given month would lose us the opportunity of cost-averaging the purchase of other good companies. So our strategy would be to cost-average the purchase of several good companies simultaneously over time.
1. Trade a maximum of one buy-transaction per month.
2. A buy-transaction must not exceed 33,000 Pesos.
I thought about it and I think it would be better to change it to the following:
1. Buy transactions for a single month must not exceed 33,000 Pesos.
This would mean that one could issue an infinite number of buy transactions in a single month as long as the sum of the transactions do not go beyond 33,000 Pesos.
On why I think this is better is because there are so many good companies out there that isolating a buy transaction to a single company for a given month would lose us the opportunity of cost-averaging the purchase of other good companies. So our strategy would be to cost-average the purchase of several good companies simultaneously over time.
Wednesday, January 28, 2009
The stock portfolio simulation
Assumption of the stock portfolio:
1. The stock portfolio is unreal. It is just a simulation game.
2. It assumes an initial cash balance of 1,000,000 (1 million) Philippine Pesos.
3. It assumes a 2% charge for every transaction.
4. It assumes Philippine time is used.
5. It assumes the currency of the Philippine Peso.
The purpose of the stock portfolio is to test whether the strategies to earn money via stock trading, as discussed in this blog, are successful. A strategy is considered successful if it was able to earn money. It is considered a failure if it lost money.
The following is the initial stock portfolio:
Date: 10:34 AM, 29 January 2008
Cash Balance:
1,000,000
Stock Portfolio
No stocks in portfolio.
Transaction History:
No transactions in history.
1. The stock portfolio is unreal. It is just a simulation game.
2. It assumes an initial cash balance of 1,000,000 (1 million) Philippine Pesos.
3. It assumes a 2% charge for every transaction.
4. It assumes Philippine time is used.
5. It assumes the currency of the Philippine Peso.
The purpose of the stock portfolio is to test whether the strategies to earn money via stock trading, as discussed in this blog, are successful. A strategy is considered successful if it was able to earn money. It is considered a failure if it lost money.
The following is the initial stock portfolio:
Date: 10:34 AM, 29 January 2008
Cash Balance:
1,000,000
Stock Portfolio
No stocks in portfolio.
Transaction History:
No transactions in history.
On why EEI might be a good buy
Not everybody is familiar with the company EEI in the Philippines. Most probably, perhaps maybe just even one out of a hundred Filipinos know that such a company exists. But for a person familiar with stock trading in the Philippines, there's a higher chance that he has heard of this company.
EEI is generally a construction firm based on the Philippines. Though its logo claims that it has been in the construction business since 1931, its name is relatively unknown to the common Filipino perhaps because most construction firms remain largely uncommon to the ear of the average person, regardless of geographical region, at least in comparison to popular names such as McDonald's or WalMart.
So on why I think EEI is a good buy is simple. At least for me, whenever I go to work, I see its name and logo almost at every corner. From my home, I would see its logo at a huge construction going on along Quezon Avenue corner EDSA. From the MRT, I would see the deep escavation and the huge cranes swinging their mighty arms several stories above ground.
Then when I near my office along Shaw Boulevard corner EDSA, I see the same logo again. And with the logo comes some big, big construction going underway, consisting of twin towers. I think these towers belong to the St. Francis Square company. Then when I visit some friends at Fort Bonifacio, there's another huge residential construction going on beside the Serendra condominiums. And you guessed it right, I see the logo again that becomes more and more familiar as the years go by.
Well, one may argue that just because one sees a company's businesses sprouting everywhere in the city, does not mean that the company will automatically be earning big in the near term. Heck, this company has been in the Philippines since 1931. And no one still knows about it.
Think about it. If this company has had a high of about 5.5 Pesos in the past two years, and it is now trading at 0.90 Pesos a share because of the global economic recession which nobody has control of, then give it around two to five years and the chances of it rebounding to its previous highs of five Pesos are quite optimistic.
EEI is generally a construction firm based on the Philippines. Though its logo claims that it has been in the construction business since 1931, its name is relatively unknown to the common Filipino perhaps because most construction firms remain largely uncommon to the ear of the average person, regardless of geographical region, at least in comparison to popular names such as McDonald's or WalMart.
So on why I think EEI is a good buy is simple. At least for me, whenever I go to work, I see its name and logo almost at every corner. From my home, I would see its logo at a huge construction going on along Quezon Avenue corner EDSA. From the MRT, I would see the deep escavation and the huge cranes swinging their mighty arms several stories above ground.
Then when I near my office along Shaw Boulevard corner EDSA, I see the same logo again. And with the logo comes some big, big construction going underway, consisting of twin towers. I think these towers belong to the St. Francis Square company. Then when I visit some friends at Fort Bonifacio, there's another huge residential construction going on beside the Serendra condominiums. And you guessed it right, I see the logo again that becomes more and more familiar as the years go by.
Well, one may argue that just because one sees a company's businesses sprouting everywhere in the city, does not mean that the company will automatically be earning big in the near term. Heck, this company has been in the Philippines since 1931. And no one still knows about it.
Think about it. If this company has had a high of about 5.5 Pesos in the past two years, and it is now trading at 0.90 Pesos a share because of the global economic recession which nobody has control of, then give it around two to five years and the chances of it rebounding to its previous highs of five Pesos are quite optimistic.
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