A Fledgling Iskâ "Techno-Fundamentalist"

Here for the thrill of it. :)

“Tangkilikin natin ang OPM” – C.M.

Oriental Petroleum and Mineral Corporation (OPM) chart exhibiting volume spikes in the last few trading days.

Range trade or stay until it hits 0.030/sh?

Written by E

May 7, 2013 at 11:17 pm

Tagged with , ,

Exasperating.

I received yet another news about a Filipino Community (of OFWs) losing a combined amount of around $1.8 million to a Ponzi scheme. Again. Sigh. We all should learn how to value and protect our hard-earned money. We have to be careful and prudent about our investments. I cannot stress this enough — we need to be extra meticulous about these things. Hard-earned money. We are not wealthy people. Again. When it comes to money — “if it sounds too good to be true, then it probably is.” Last month, I wrote about MLMs and pyramiding scams in light of the Aman Futures Group fraudulence that “allegedly conned some 15,000 individuals across the Visayas and Mindanao regions out of P12-15 billion.” I am re-blogging here the article that was published in StarScience to hopefully educate and inform more of our kababayans about these things. Please feel free to share. [...] it has to be understood that if certain networking schemes depend solely on network membership growth (recruitment process) as means to make money, they are inevitably bound to collapse; that is, you will run out of “friends” and “acquaintances” to recruit. Regrettably, people situated at the lower levels of these networks are the ones who are most affected. In fact, in our work, we also showed that the “earning potential of (certain MLM architectures obeys) the Pareto “80–20” rule, implying an earning opportunity that is strongly biased against the most recent members.” This basically says that 80 percent of the wealth of certain MLM companies is owned by only a measly 20 percent of its total members — the top 20 members. To better understand the quoted statement, I am providing herewith a doodle/sketch of an arbitrary social network with some recruitment dynamics diagram as a guide. “Into the bargain, in small cities, communities and/or barangays, this clustering is especially expected to be higher, and the “world” becomes much “smaller”; that is, everyone seems to already know everyone else. What this fundamentally tells us is that people will eventually run out of friends, relatives, and/or acquaintances to recruit more quickly.” It must be noted, however, that there are legitimate MLMs, which are quite different from pyramiding schemes (illegal ones). Notwithstanding the fact that they both have close operational and structural resemblance (“multiple levels’ of distributors and recruits”), authorized multilevel marketing companies have actual products and/or services of good value to sell. To those who are interested in reading the StarScience article, follow this link. To those who are interested in the details of this research (technical), kindly follow this link. Written by E April 1, 2013 at 10:11 pm iGrade and the PSEi leave a comment » Fitch Ratings on Thursday finally raised its assessment of the Philippines from a BB+ to a BBB- with a positive stable outlook. This is the upgrade we have all been yakking about since the beginning. Finally, it’s here! This is the very first time that the country got an investment rating. Meaning we are now credible debtors. Simply put, with the upgrade, foreign investors are rushing in to our market to have a piece of the pie… now more than ever. Foreign money flocked to the local market, as foreigners were net buyers to the tune of P1.35 billion. Of course, this upgrade is super, super good news for our government. It’s a good reflection of its performance in the past years. A lot of the credit for the country’s recent economic performance goes to the current administration led by President Aquino, which has been very effective in combating corruption and tax evasion. [read more] Finally, the PH iGrade Upgrade and the Philippine Stock Market. On Thursday, the market and its investors had an early Easter celebration, with the PSEi closing to a new all-time high at 6,847.47 — the 24th new record high since the beginning of the year. Needless to say, it was the FR Upgrade that catalyzed the surge. When the news from Fitch Ratings broke out, the market was suddenly in a state of frenzy. See chart sketch below the list of companies in the PSEi. I have also listed the composition of the PSE index on paper — this is my new watchlist, for the time being. With the upgrade, expect that some of these companies will be greatly and positively affected. Make sure you have some exposure! Written by E March 30, 2013 at 9:20 pm What’s your bet?$BLOOM

Hello, once again. It’s been a while. I have been extra busy with my real job (thank God); and this is why in recent weeks, I have just been on the sidelines — tweeting sporadically about my thoughts and questions on the market. Lurking around for a few weeks now, I noticed that a few stocks have been making the rounds in many trader communities. I thought that I should check them out as some of the them seem extra enticing for me — for medium to long-term hold, or for a quick 10% gain — whichever comes first. I wish I can discuss all of them here, but it’s a Sunday — I’m trying so hard to limit my “study” and technical reading.

I like BLOOM, EDC, and DNL, among other stocks; but for now, allow me to put BLOOM in the spotlight.

Yesterday, the Solaire Resort and Casino — an entertainment and gambling complex debuted in Manila and opened its doors to the public. According to a report published on Bloomberg, Solaire Manila “is designed to get 45% of its revenues from VIPS, or high-stake bettors.” Welcome to Manila, gamblers!

Enrique Razon, who is the owner of Solaire Manila, controls 80% of Bloombery (BLOOM). This is why many have put their bets on the stock. However, even with the anticipated debut, the stock last Friday closed in the negative at 14.00/sh. Some speculate that this is “due to the consequent expiration of the lock-up period for the [GGAM], which holds 8.7% of BLOOM’s outstanding shares.” I think some people just don’t want to be left out — the closing seemed forced from my POV. Intuition tells me that the “sell-down” is a good sign, and IMO, a good buying opportunity (below 15.00/sh). Moreover, COL’s estimated fair value for the stock is 17.40/sh with a buy recommendation below 15.10/sh.

Gaming in the PH
An investment company forecasts a \$3 billion gaming industry expansion for the Philippine casino market by 2015. I am very excited about the future of the gaming industry in the country. I am willing to bet on it.

Bloomberry Resorts Corp

EXTRA NOTES:

Some Mining Industry Update
(from COL, PHILIPPINE EQUITY RESEARCH) dated Friday, 15 March 2013

Government lifts moratorium of new mine exploration.

The government said it will lift its moratorium on new mining applications beginning Monday. The lifting of the moratorium was recommended by the Mines and Geosciences Bureau, and approved by the DENR. The change follows a July 2012 presidential order that sought to reconcile regional and national mining rules.

Written by E

March 17, 2013 at 2:34 pm

Tagged with , ,

Some Strategy

Most of the time, I buy a stock based on its potential for growth (not because of some tsupitero’s tsismis or whatnot) – ito iyong sinasabi nilang fundamentals. Personally, the granularity of my “long-term” is in the order of years; but that doesn’t mean that I don’t do day trading. As most of you know, I engage in this very exhilarating exercise. This is why I have always found it necessary to open at least two trading accounts. My strategy has always been to maintain some core positions… then top-slice and range trade the “excesses” (for lack of a better term).

Sometimes, one just needs to stick to a (dynamic) plan — less worries. It’s all about ranges.

EP_1 – first entry price; \bar{EP} – average EP; highest – highest market price the stock has been traded; TP – target price

Written by E

February 22, 2013 at 11:56 am

Of Multilevel Markets, Pyramid Schemes, and Ponzi Scams

Remember, as the cliché goes, “if it sounds too good to be true, then it probably is,” especially when it comes to money and business.

I would like to share with you the article I contributed to the Philippine Star that was published early today. With the alarming news that we have been reading about people getting swindled off by fraudsters through Pyramid scams, I believe that sharing our previous work on multilevel markets and their growth dynamics is very timely. The article is titled Thinking through pyramid-like business schemes.

An excerpt:

One of the key results we found was that MLM membership growth “decelerates after reaching a size threshold, contrary to claims of unrestricted growth.” The network does not grow continuously and exponentially, but slumps down after some threshold level. This resulting growth dynamics was also observed in the data that we collected from an actual MLM company. One plausible explanation behind this phenomenon can be attributed to the “small-world” property of our social network. As mentioned above, social networks are “highly clustered,” i.e. your friends are most likely to be friends with each other, too. How is this relevant in MLM operations? To illustrate, imagine having five friends who are also friends with each other. Once you recruit all five of them, they all would have no one else to recruit, at least none within your circle or clique; or they would have five (including yourself) less people whom they can actually recruit. Into the bargain, in small cities, communities and/or barangays, this clustering is especially expected to be higher, and the “world” becomes much “smaller”; that is, everyone seems to already know everyone else. What this fundamentally tells us is that people will eventually run out of friends, relatives, and/or acquaintances to recruit more quickly.

Given this premise, it has to be understood that if certain networking schemes depend solely on network membership growth (recruitment process) as means to make money, they are inevitably bound to collapse; that is, you will run out of “friends” and “acquaintances” to recruit. Regrettably, people situated at the lower levels of these networks are the ones who are most affected. In fact, in our work, we also showed that the “earning potential of (certain MLM architectures obeys) the Pareto “80–20” rule, implying an earning opportunity that is strongly biased against the most recent members.” This basically says that 80 percent of the wealth of certain MLM companies is owned by only a measly 20 percent of its total members — the top 20 members.

xo

Written by E

February 7, 2013 at 4:47 pm

FOOD

First, on the PSE: I’m excited but at the same time a little strung out about the bullishness of our market. I guess it’s normal. It closed at 6,271.23pts earlier, +7.89% YTD. Is it already too high? Some of our experts believe that we still have fuel to push this further up, some are more pessimistic. Regardless, whenever I am on the fence about the market, I try to remember general quotes on investing, hoping to find some wisdom in them. For example,

Buy on fear, sell on greed.
Buy on the rumor, sell on the news.

The statements are pretty straightforward, but digesting them — I find it to be a bit tougher. Plus, we have the old adage

The four most dangerous words in investing are ‘This time it’s different,’

which further confuses me.

Clichés. In the end, we only see what we want to see, don’t we?

With all these precariousness, I think it’s best and safest if we remain cautiously optimistic — not too optimistic nor too cautious. Personally, I’m still bullish; but, I have also already started checking out other investment options such as franchising and/or real estate. I’ll definitely share here the stuff I’ll be learning in the days/weeks/months/years ahead.

Anyway, in this post, I’m really more interested in sharing my thoughts on FOOD (Alliance Select Foods Int’l, Inc.). I started following FOOD in virtue of a friend’s recommendation, and recently, I have been accumulating. A few days ago, I read a brief news clip on FOOD through my COL dashboard. I’m sharing below a snapshot of the news clipping.

COL News on FOOD. (1 SGD = 32.86 PHP, as of this posting)

Now, I am more convinced that FOOD has potential. I checked the historical broker transaction (Dec 03, 2012-Jan 30, 2013) on the stock, and here’s what I got (source: COL).

Historical Broker Transactions

On the other hand, I did some basic technical analysis on the chart and I came to the conclusion that… people are undecided about the stock. The prices are hovering within the Ichimoku cloud; and then there’s the doji.

(I’m not so sure what my point is here.)
Some of you might find this information on FOOD useless (as it is also not “mainstream”), but I guess what I really wanted to accomplish here is to egg on my dear readers to check the stock out and let me know what you think on FOOD!

Written by E

January 30, 2013 at 9:36 pm