Teh Hooi Leng calls it a day (Aggregate Asset Management)

(03-07-2019, 09:48 PM)dreamybear Wrote: In the Business Times article(link below), Mr Kong says "In the last three years, we could find stocks that paid 7 per cent dividends, with a net book value of S$1, a share price of 40 cents and PE in single digit. Such stocks give us big returns and little downside.
Reference : https://www.businesstimes.com.sg/magazin...g-on-value

As a layman, I think they have done well.   I am not vested(I am not an accredited investor) But I am dreaming of the day I can find such stocks with criteria defined by Aggregate !  

I think there will definitely be more lower-priced stocks found during market corrections. Maybe they got lucky and bought lots of good and cheap stocks in 2014 and 2015. During periods of market peace such as now, bargains will be few, or none.

Anyway, I think if an investor can meet the following conditions, his/her probability of success will be quite high.

1. Willing to accept a moderate level of return (maybe 8-9% p.a.) 
2. Able to not trade their stocks at least for 3 years 
3. Have sufficient ability to identify stocks that are able to provide stable & recurring dividends
4. Willing to diversify widely 
5. Possess cashflow to purchase more stocks during market corrections

I believe ghchua is one such person to have a very diversified portfolio of okay-quality stocks that pay regular dividends. Though ghchua's returns are not published, I believe they are close to a long-term average of 8-9% p.a..

Everyone can get returns like AAM or Inclusif. But because not everyone is willing (or able) to meet the conditions stated above, most get average results.

(04-07-2019, 09:47 AM)opmi Wrote: Focusing on value
Performance fee structure aligns with investor interests, says Aggregate Asset Management
TUE, DEC 05, 2017 - 5:50 AM

In the Business Times article(link below), Mr Kong says "In the last three years, we could find stocks that paid 7 per cent dividends, with a net book value of S$1, a share price of 40 cents and PE in single digit. Such stocks give us big returns and little downside.

I doubt AAM is following the above rule. Simply the AUM is too big. Imagine AUM $500m and 1% into 100 stocks. Minimum mkt cap for each stock will be $500m.
Mkt is surely more efficient at $500m than at $100m. Opportunity set surely smaller and more competition.

At bigger AUM, their old method may not work as well as when at small AUM.

Maybe should follow Walter Schloss. Keep AUM small and return excess profit.

hi opmi,
The ST article actually stated they have 633 stocks! So with their latest AUM of 460mil, that goes to 460/633mil --> 0.73mil per stock (on average).

At 633 stocks (wow!), they probably will do fine even at a billion dollars. Only doesn't work if add another zero to that.

With 633 stocks, I guess they must have relaxed their quantitative criteria and/or qualitative criteria or went outside their initial geographical coverage.

Guess it is a different animal from the one their earlier track record was based on.

How to cover 633 stocks....haha

Which explains why they're hugging the index.

Once AUM gets huge, I guess the portfolio manager will need more WB-like type of stock selection skills to get above-average returns.

Graham-style investing is easier to implement for retailers, with more less-researched small caps within their reach.

I like this article written by Teh, published in today's BT:

https://www.businesstimes.com.sg/investi...unknowable

I like her principle of basing investment decisions on their mathematical expectation.

And basing, in part, those mathematical expectations on history that is relevant to the investment.

dreamybear also tends to form attachments to stocks that had previously done well for bear. Other than psychological effects the article mentioned, I think the situation has also changed with disruptors, near 0 interest rates, climate change etc. What works well in the past may not work well in the future.

At the same time, in this age of rapid technological evolution, I think we need to be more discerning and pro-active in monitoring the world news & how the current state of affairs affect our holdings.

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Beware of hidden or opportunity costs
Sat, Oct 12, 2019 - 5:50 AM

....The idea of hidden or opportunity costs is a timely reminder for me as well. Because of the uncertainties in the macro environment, the valuations of many Asian stocks are rather depressed currently. We are seeing a number of stocks that have even more compelling valuations than those we currently own.....

....For example, investors may form attachment to the stocks they already own, possibly because the stocks have done well in the past. In cases where stocks have done very well such that their current valuations are no longer cheap, then chances of them continuing to generate the returns chalked up in the past will be reduced.

On the flip side, if the stocks have not been doing well, there is fear of selling them now only to see them surge the next day, or the next week. In order to avert regret, many just do nothing.

How best then can we overcome these psychological barriers in order to construct an optimal portfolio?

For me, evidence- and rules-based approach work best. I need to see the evidence from empirical research that certain strategy, backed by sound fundamental reasoning, works......

https://www.businesstimes.com.sg/investi...nity-costs

It's that time of the year again, time to take stock and hope for a better year.

Wishing buddies 新年快乐, 万事如意 in advance !

Grateful for all the help rendered by buddies in the past year, it is really a sliver lining amongst the many things that haven't been going 如意 for me.

The AVF inception is in its 9th anniversary and it is close to doubling the investment amount. Of course, we shdn't only look at a single point in time in investing but the performance over the long run. So far, I think the performance over the years is respectable.

I believe Aggregate is using more of a quantitative type of approach. I use qualitative investing approach and while I am thankful to perform decently, I seriously feel my way of investing is unsustainable. Based on the kind of effort and sacrifice, I can probably last only a few more years of the level of intensity. Though I am not any guru, from my observations and experience, moving fwd I feel it will get more and more challenging to practice spotting, buying and holding "gems" for a very long term, waiting for them to multiply. The rate of change in this world is just too fast with heightened uncertainty, abundant liquidity, etc.

Hopefully in a few more years, I will be able to retire comfortably before my last hurrah and park my funds with investment managers.

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https://aggregate.com.sg/index.php/home/index  > performance

Agree 100%, Bear.

I too am very grateful of the kind sharings by valuebuddies and that would include you too.

Moving ahead, we should try harder to identify stocks from Singapore as well as outside of Singapore, especially China and USA.  Obviously, it's another playing field which requires different type of mindset and risk management - which I'm more than willing to learn.  

The rewards would be tremendous with a bit of luck (and more stringent in punching the lottery holes).

Happy CNY and wishing all valuebuddies a safe and prosperous tiger year!

Gratitude.
 



 
Thank you Ms Teh, you're my emergent teacher and without you, I won't be a valuebuddies today.  

(29-01-2022, 05:05 PM)dreamybear Wrote: I believe Aggregate is using more of a quantitative type of approach. I use qualitative investing approach and while I am thankful to perform decently, I seriously feel my way of investing is unsustainable. Based on the kind of effort and sacrifice, I can probably last only a few more years of the level of intensity. Though I am not any guru, from my observations and experience, moving fwd I feel it will get more and more challenging to practice spotting, buying and holding "gems" for a very long term, waiting for them to multiply. The rate of change in this world is just too fast with heightened uncertainty, abundant liquidity, etc.

Hopefully in a few more years, I will be able to retire comfortably before my last hurrah and park my funds with investment managers.

There are 2 associated costs for every purchase decision. One is the money paid (ie. the monetary exchange) to acquire it, and the other is the effort/time to transform it to be of utility to us. For example, it takes 20dollars to buy Ron Chernow's Titan (first cost) but another 36 full hours to read and appreciate JD Rockafellar's life story.

I still think investing is a scalable activity - Money and knowledge compounds. And it is fun! However, I do empathize the struggles you mention, as all of us have our commitments to all the roles we play in our lives.

As I dwell into this activity (investing) further. I realize temperament plays a larger role than anything else. Of course, intellect and hard work are still required but somehow when one finally finds their "own flywheel" and it continues spinning, the momentum just allows us to move forward in spite of the friction.

Lao Tzu says, attaining knowledge is adding new things every day while attaining wisdom is removing things every day --> I will leave you with this quote that has guided me for some time.

(30-01-2022, 01:25 PM)weijian Wrote: Lao Tzu says, attaining knowledge is adding new things every day while attaining wisdom is removing things every day --> I will leave you with this quote that has guided me for some time.

 You will be a much better investor if you understand these 2 quotes below :

 True knowledge is knowing the extent of one's ignorance  - Confucius

 The art of being wise is the art of knowing what to overlook - William James