Year: 2008

Categories
Master Series

Why Buffett is not another money manager

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Last Updated on May 7, 2008 by stlplace

Buffett released his annual letter to shareholder last Friday, which I will discuss in next few days. First let me lay out my 5 year observations about Buffett and many other money managers.

1) Buffett will tell you his stock Berkshire Hathaway (BRK.A and BRK.B) is expensive all the time (don’t buy it); while money managers will say anything you want to hear to manage your money (and earn the fees). They will do seminars, show their cool technologies, send you advertisement (Mail, TV, Internet), etc. All this reminds me of the promoters of stock trading software on Shanghai street 🙂

2) Buffett does not think too much of stock daily price, quote him “if you care about the daily fluctuations of a stock, you should not buy the stock at first place”; some money managers watched the market every day, every hour, every minute. This reminds me one thing: if somebody/something needs constant attention, and it’s not your baby, then something is wrong (notice Britney Spears getting media attention lately).

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Categories
Stocks

IPO and secondary offering: I

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Last Updated on March 3, 2008 by stlplace

I have written an article talking about why Chinese companies come to list in NYSE or Nasdaq a while ago. This is a topic warrants more than one article, amid the VISA filing for IPO and recent controversy of Chinese companies (Ping’an and Pu Fa) tried to do secondary in Shanghai. So let me talk about the reasons why companies go to capital market for money.

I remember Ken Fisher talked about the use of debt or stock for companies in terms of raising money, in his book “Only 3 questions that count“. To sum it up, a company will always look for a better way to finance its operation/growth, if the debt (borrow from banks) is available and cheap, they will do it. On the other hand, they will go with issusing stocks. He further explains why maturing companies (with low PE) finds borrowing is cheaper, and growth companies finds issuing stocks is cheaper.

China Ping an insurance IPO pic
(Picture above: CEO of China Ping’an insurance at IPO media event)

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Categories
CFA

Coffee, espresso, coke and investing: II

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Last Updated on April 30, 2008 by stlplace

The Coca Cola stock vs. Starbucks stock
In last 10 years (Mar 6 1998 to today Feb 28 2008), according Google Finance, SBUX went up from 4.93 to 18.78 (+280%, split adjusted, SBUX has not paid any dividend). That’s about 14% price appreciation annually.

On the other hand, KO went from 68.66 to 59.56 (-14.44%). But there is a caveat, Coca Cola pays out a cash dividend each quarter, so we should adjust the dividend when calculate Coke’s return.

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Categories
Life Tips

Coffee, espresso, coke and investing: I

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Last Updated on February 28, 2008 by stlplace

The caffeine effect
Which one has the most caffeine? A tall (12 fl oz, or 355 ml) brewed coffee, a tall latte with one shot of espresso (both at Starbucks), and a can (12 fl oz) classic Coca Cola?

Your instant answer maybe the latte (espresso), but the correct answer is the brewed coffee. According to Starbucks Nutrition By the Cup (PDF), 12 fl oz coffee has 240 mg caffeine, one shot espresso (1 fl oz) has 75 mg caffeine. As to Coke, I saw it says “caffeine content: 34mg per 12 fl oz”.

I don’t know what is the appropriate amount of caffeine a person could consume daily. My guess is one small cup a day should be ok for most people. I think it also depends on person’s health condition (weight, height, habbit of drinking). But just like many other things in life, moderation is the key. A cup of regular coffee will get one refreshed in the morning (it has caffeine equivalent to 7 cups of Coke). But when the initial effect of coffee goes away in a few hours, he/she will resort to another coffee. And so on. I think we can be more easily get caffeinated that way.

starbucks coffee cup size pic
(picture souce: will work for food)

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Categories
Life Tips

Cell phone and web cam deal

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Last Updated on February 29, 2008 by stlplace

I found this Samsung A437 cell phone deal through dealsea. I was thinking about replacing my good old Nokia 6010, not that I am not satisfied with the voice quality etc. I would like to get a flip phone (6010 is a candy bar phone, and I have to lock the keypad to avoid placing accidental call, and the time display is not clear). By the way, I got two (one for my wife), as shown like the picture below:

Samsung A437 cell phone pic logitech quickcam deluxe notebook pic

Another nice thing about A437: it is a quad band phone, and (if unlocked) can be used in China.

Logitech QuickCam Deluxe for Notebooks
Found it through my friend googlist. Here is the link.

I always liked Logitech’s product, and the price (after rebate) is $8.99. So I bought one.

(Update Feb 29) The web cam arrived last night. Amazon Super Savers free shipping is fast. The next step is fill in the mail in rebate form 🙂

Categories
CFA

Less blogging and more CFA studying

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Last Updated on February 25, 2008 by stlplace

Study for CFA
Not just for the passing of the test, or the certificate, but also to learn the knowledge, which is more important for me. Actually as I read the quantatitive fundmental, I can connect the dots with my portfolio performance. Very practical stuff.

Blogging
It’s likely I will reduce the number of posts I write everyday, which is probablly a good thing, because I may actually come up with better blogs. More substance, less crap (aren’t the financial/stock blogsphere full of too many craps, no offense to any sincere blogger).

Advice from Vanguard Chairman
I received the Vanguard news letter in mail last week. Very good stuff. One thing I want to share is: don’t follow the headlines. Have a long term plan, and try to stick to it.

Categories
China Stocks

Economist also believe in technical analysis?

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Last Updated on February 25, 2008 by stlplace

By technical analysis (TA), I mean those candle charts, wave theory etc. Those are techniques day traders use frequently to make small profit out of price fluctuation. Nothing against it, but I feel those techniques are not useful for long term investors. Actually from I read, Buffett also learned all those stuff before, but obviously he did not make his fortune from TA.

The interesting point is, Ba Shu Song (巴曙松), the rising Chinese economist, seems also believed in this. From his blog post 投資港股有用網站連結, he listed some TA web sites in the end.

股票教學
咩野係股票 http://hkisc.hkstock.com.hk/hkstock/investment/ch1.htm
期權教學 http://fuweb.polaris.com.hk/home/qiquan/option28/typeoneoff.htm
技術分析教學
– http://td.hkii.org/investu/c_investuindex.php
– http://www.angelibrary.com/economic/gsjs/
– http://www.metaquotes.net/
– http://www.dick.cpcs.net/stock_game/tutorial2.php#
– http://www.pcn.com.hk/education_ma.html
– http://www.moneydj.com/z/analyst/analyst1.htm

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Categories
IPO

Visa IPO

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Last Updated on June 19, 2009 by stlplace

Yes, the long anticipated credit card giant is filing for the IPO. Here is its S1 prospectus. I have not read the S1, but from what I read (from MSNBC), they are going to raise up to $10 billion. That’s the largest IPO in US since 2000, and it’s the category of China ICBC’s IPO couple years ago (1398.HK).

My gut feeling of its IPO is two fold:
1) It will be priced (relative terms) higher than MasterCard IPO couple years ago, the reason goes as follows: MA went up from $40 to $200 in that period. Now people who missed the boat on MasterCard IPO will try hard to get on the Visa ship, thinking they can get the return like MA did.

2) current market condition is not friendly for IPO, because the big investment banks are in financial difficulty now. So, do they expect little guys (like us) to hold the bag?

Business wise, we all know the credit card transaction is booming. From developed countries to developing countries, everyone is addicted to the plastic, as shown by the following pic (from Visa prospectus).

Visa card pic

Visa is an Olympics sposor, so pack your visa card if you visit Beijing this August 🙂

(Update Feb 28) My friend LaoZhang (author of StrengthTrader.com) wrote a good piece about Visa IPO (in Chinese), here is the link.

Chinese translation
如题所述，VISA这个信用卡巨无霸要开始发行新股了。这里是它的S1 招股说明书，我还没来得及读，但是据MSNBC说，VISA准备至少募股100亿美元。这将是2000年以来美国最大的IPO，和几年前中国工商银行的IPO(1398.HK)有的一拼。

听到VISA 发行股票，我的直觉是：

1）相对而言，VISA股票的定价会比几年前MasterCard IPO高，原因是：从发行到现在，MasterCard股票由40美元涨到200美元，于是错过MasterCard IPO 那趟船的人现在会挤破头努力登上VISA IPO 这艘舰，满心以为可以得到象MasterCard那般的回报。

2）现在的市场条件并不利于发行股票，因为目前很多大型投资银行都缺钱。难道VISA期望我们这些散户一头扎进去，然后被套牢？

从商业角度而言，谁都知道信用卡交易正在急速发展。无论发达国家还是发展中国家，几乎每个人都对这小小的塑料卡片上了瘾，就如下图所展示的（图片来源：VISA招股说明书）

Categories
Chinese articles Politics

我说美国大选: I

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Last Updated on June 26, 2022 by stlplace

来美国已有十年, 美国大选也经历了三届. 从两千(1999)年的布什, 戈尔佛罗里达选举大战, 到最后最高法院介入. 套用我前同事的话, 最高法院(注意: 不是老百姓)选了布什.

2004年, 民主党想夺回白宫, 不少仁人志士跃跃欲试, 参与初选.

先是狄恩(HOWARD DEAN), 这老兄本是医科出身, 偶然的机会参政, 任美国东北部佛蒙特州长十余年, 倒是把这个东北农业州治理得井井有条. 想必也与医生出身, 做事理性务实有关. 他在任内最主要成就, 是实现了州财政盈余. 要知道在他当政之前该州多年财政赤字. 言归正传, 狄兄作为小州的州长, 虽有政绩, 但是缺少资金和全国的名气. 他想到了一招, 用网络来传播他的施政纲领和筹款. 还记得MEETUP.COM, 这个(网上)组织聚会的网站, 当时的名气有点像现在的YOU TUBE. 不知道是DEAN和MEETUP是谁帮谁出了名, 结果是DEAN筹的款最多. IOWA(衣阿华)CAUCUS之前, 戈尔大哥也宣布支持DEAN. 看来民主党提名是非DEAN莫属. 民意调查也显示DEAN领先.

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Categories
Stocks

Two strikes on CROX

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Last Updated on July 25, 2008 by stlplace

Last two quarter earning report has dragged Crocs stock from $75 to around $25. Many analysts, bloggers, pundits, pretty-much-everybody-wears-shoes (and consequently knows the shoe business) think the stock price is reasonable now.

That is, assume Crocs can unload its massive $250 million inventory successfully. By success I mean they did not give it away to charity, or dump it to PayLessShoes.

Let’s forget the financial analysis, technical analysis for a minute, just think a shoe company attributes its very success to sophiscated supply chain management, got an F grade on it. A lot progress has made in global supply chain management in last 10 years: many great companies have cut inventory level down (think DELL?). Some Japanese car maker (Toyota) even tried Just-In-Time manufacturing (zero inventory). Oh well, one can argue they are mostly manufacturers not retailers. But Crocs has been mostly a manufacturer too.

The bottom line is Crocs got two strikes in a row, one more strike they are out.

(update Feb 25) I read this article about CROX from theStockMasters. Very funny article, but I don’t think CROX is a stock worthy of our long term portfolio.