Private Finance Blog

 I was just thinking of new investment ideas. Airbnb popped into my head and I saw a video(Neal Bawa) talking about property and Airbnb came up. It mentioned that there are almost a dozen other companies that make money by providing data analytics and automated price changes for properties listed on Airbnb. It got me thinking, here is a company that has gotten so popular. It doesn't even need to create the infrastructure to improve the app. A whole ecosystem just grows around it that supports and improves Airbnb's functionality.  So who are the competitors of Airbnb? I tried googling it and what came up were more or less listing websites that catered to existing hotels. So are they actually competing against, Agoda, Traveloka, Oyo, Booking.com? These are websites that list hotels or budget hotels. Who are the other competitors? Hilton, Marriotte, Starwood. But these are hotel operators. They provide lodging, but really they are fundamentally different from Airbnb. Hotels tend ...

 I've read a bunch of books on investing and somehow have gained the thought process that its better to buy and wait, rather than wait for a trend that seems certain before buying. The latter being more technical analysis and the former being just giving up on timing the market. So which is better?  Its come across my mind in short moments. Really it would have been better for there to be certainty, to wait for the real estate market to truly find a bottom, before actually committing. (Chinas real estate will influence steel demand, hence improve the demand dynamics for ferroalloy, a key input into steel). When the port was damaged in the hurricane and silicomanganese price spiked. I decided to jump in and use my margin to get around 30k shares. I paid about RM1.5 per share, I reasoned that I might miss the boat and the real estate market was half a year away from its bottom. Silicomanganese price spiked and  came down and broke its bottom. The share price is at RM1.15 th...

 I'm going to try and shorten my ideas into a single paragraph before writing up most of my thoughts. It will help me focus.

 It's not actually meant for anyone to read. Just fleshing my ideas out will make me appreciate whether I've gotten things wrong. Some things only sound stupid once written down.

 I was talking to someone in Rimbar, KL about a week ago and the topic of whether there would be a downturn coming soon. He mentioned that a lot of rich people expect there to be a major market downturn. The reason for this is that there has been too much money printing. They expect there to be a "hong hai", or red sea coming soon(red sea as opposed to blue seas). I don't think that this is the case(At least not in the immediate time period).  There is a good youtube video called How The Economic Machine Works by Ray Dalio, explaining how credit works. This is really just extrapolating some concepts in the video. Mainly credit. The 2 largest economies, US and China have healthy real estate markets.  The following chart is relevant. It is the Housing supply chart of the US Market. Notice the housing supply line? It has been consistently below 0 since the early 2010s due to the 2008 financial crash. This means that there has been a growing undersupply of houses in the US f...

 OMH is one of my failures, I had everything invested into this company. My saving grace is that I bought it at about 15 cents aud. Today it's trading at 40 cents aud. Over the 7 years I have held it. It's been a roller coaster. Going all the way up to 1.70+ aud, 12 times what I paid for it. Management is oblivious, and the company is heavily mismanaged. Today it is at 40 cents, still an undervalued company.  It's a sad story for my portfolio. I would have made at least RM5million or more had I sold above Aud 1 and went into some of the other ideas I've had over the years. I've had more than half a dozen great ideas. Many of them went up several times, but I persevered and believed in this stupid company and its incompetent management. Why is OMH a wonderful company? Well, it has access to cheap electricity. In the range of about RM0.15 per kwh of electricity. It is extremely well positioned to produce alloys which require high electricity to produce. Like the 6 foo...

 What other ideas do I have? Nubank. Its about 14.18USD per share today. PE of 45. Growing at 50% growth rates. They are gaining 15 to 20 million users every single year. They surpassed 100million recently. Mostly in Brazil and Mexico. The growth of the users is on top of the growth in the products. It becomes exponential. A growth of 20% in users and an expansion of the services provided to overall users grows by another 25%. Actual growth at the topline is (1.2*1.25=1.5)50%. Its growing explosively. Current PE is something like 45. Which I have come to learn, is not a high number when your company is growing at 30 to 50% each year. The PE/Growth is less than 1. The question is whether they are able to maintain such high growths. Some of the eye popping charts are the user growth  The upward trajectory from 24 million users in 2020 to 105million users in 2024 is truly eye opening. It's the type of chart that investors like me love. Attached is the 2nd quarter 2024 presentatio...

 I'm trying to get my life back in order. Its just so difficult to fill up my time without including some stupid game. I just need to fill my time up with something else. I need to make exercise a bit more entertaining

 The earlier posts are incoherent(2018 and earlier). It was really a structure that I was supposed to finish but didn't bother. The structure turns me off. It's better to just type in a conversational way. What other ideas do I have? Nubank is super interesting. I did some research on it, but the growth rates are just popping out at me. This is very much a blue chip company disrupting the latin america banking sector. They are gaining 15 to 20 million users every single year. They surpassed 100million recently. Mostly in Brazil and Mexico. The growth of the users is on top of the growth in the products. It becomes exponential. A growth of 20% in users and an expansion of the services provided to overall users grows by another 25%. Actual growth at the topline is (1.2*1.25=1.5)50%. Its growing explosively  I'll continue this later. This is really just a short of what the CEO, David Velez has stated in several interviews. The Brazil banking system is ripe for disruption as th...

 Fallen angels (Cigar butt companies?) When I initially started investing. I started looking at industries or sectors that have been hit badly, while looking for potential "fallen angels", good companies that have gone down when the sector has taken a large hit. That was the idea for the oil companies. The most notable ones I used to monitor was Borr Drilling and Valaris, to a lesser extent. Noble Corp. Looking back. This is really what the late Charlie Munger would call. Buying a fair company at a wonderful price, rather than a wonderful company at a fair price. Asianpac fits into this description. It really is a fair company trading at a wonderful price. The key thesis in my investment into this company is really its shopping mall. IMAGO Mall in Kota Kinabalu. Without going into detail about the company. This is really a back of the envelope calculation. Asianpac's assets can be divided into:-  1) IMAGO Mall 2) Parking Assets 3) Developer business (Land held for develop...

 The commodities market is an interesting one. Different commodities have different moats. Investing in the commodities market really boils down to investing in producers that have a low cost moat, and buying it cheap.  The cyclicality comes as the build out of capacity for certain commodities takes a number of years. While for other commodities, the capacity build out might take fewer years. Lets takes the example of a copper mine. In order to expand an existing mine, the investment may not take that many years. However, a new discovery may take half a decade or longer to expand capacity. Roads need to be built, machinery needs to come in, and a new hole needs to be dug. Then there are staffing requirements, it takes time to educate people. Salaries need to increase and jobs need to be available before people study to become a geologist, or whichever job a company needs. The lag time between when the commodity prices are high, and when supply is actually able to react to high...

 There was an old attempt at reviving my blog a number of years ago. But the posts are half finished and poorly worded. This latest attempt is really more a snapshot of whatever I am thinking of at the moment. My investment in OMH went parabolic in 2017, I tried to revive this blog in 2018. I almost had RM2million, but sadly its come down since then. I thought I would have at least RM5million in 5 years. But its been 6 and I am still stuck in this stupid company. There were so many issues with OMH's management, the company is such a great asset. But mismanagement has led to the share price underperforming over the years. I had so many good ideas. I should have sold this company when I had the chance. The real estate market in China is at its bottom, there has been a number of attempts to stimulate demand from properties, which were languishing since 2021 due to the 3 red lines policy by the Chinese government. The 3 red lines is an attempt to control the amount of leverage in the d...