HDFIV Report Card @ 7 Nov 08

Performance:
HDFIV is at the moment outperforming KLCI by 8.50% (30 Sept 08: 8.90%) at a loss of 24.32% (30 Sept 08: 14.54%) while KLCI suffered a loss of 32.82% (30 Sept 08: 23.44%). There was a dip in terms of performance during the month - bringing down our performance below KLCI's as IOI and Lion Industries had a major dip. Both stocks recovered and we are back on track in terms of outperforming KLCI.

Portfolio:

With our short term trading stratety, we have managed to reduce our cost per share in Lion Industries Berhad from RM1.391 to RM1.160 (19% decrease). We have also added Genting Berhad into our portfolio.

Asset Allocation:

21% cash available for short term trading and continuous cost averaging down.

HDFIV Report Card @ 15 Sept 2008

Performance:

HDFIV is currently beating KLCI by 6.96% (5 Sept 08: 7.80%) at a loss of 15.96% (5 Sept 08: 11.75%) while KLCI suffered a loss of 22.47% (5 Sept 08: 19.55%). KLCI continued to be dragged down by political uncertainties as well as the performance of plantation stocks. Our fund has managed to maintain the gap with KLCI's performance notwithstanding the drop in IOI's price.

Portfolio:

No purchases and sales this week.

Asset Allocation:

Allocation of idle cash into fixed deposit for 1 month period.

Strategy:

To watch out for tomorrow's political development.

HDFIV Report Card @ 5 Sept 2008

Performance:
HDFIV is currently beating KLCI by 7.80% (29 Aug 08: 5.79%) at a loss of 11.75% (29 Aug 08: 11.50%) while KLCI suffered a loss of 19.55% (27 Aug 08: 17.29%). KLCI continued its downtrend as Dow Jones Industrial Average suffered a 300 over points drop as well as the political uncertainties that have yet to see any light at the end of the tunnel. Our fund has managed to extend our gap with KLCI's performance with the contribution of our holdings that have been holding relatively steady during the week as well as the dilution of losses from our monthly cash inflow.

















Portfolio:
No purchases and sales this week.


















Asset Allocation:
Cash increased to about 20% from 7% after the monthly cash inflow.






















Strategy:
With the exciting date i.e. 16 Sept 08 around the corner, we would prefer to stay on the sideline during this period. We are not timing the market but waiting for opportunity to sweep some cheap stocks if KLCI happened to react badly on political developments. Stocks under radar are Resorts World and Bursa Securities.

HDFIV Report Card @ 22 August 2008

Performance:
HDFIV is currently beating KLCI by 5.50% (20 Aug 08: 4.24%) at a loss of 12.91% (20 Aug 08: 15.11%) while KLCI suffered a loss of 18.41% (20 Aug 08: 19.34% ). Crude palm oil price rebounded as well of recoveries of commodities prices in the United States propelled KLCI slightly higher. IOI was the top performer in the fund this week with recovery from RM4.80 to RM5.15.



















Portfolio:
No purchases or sales this week.


















Asset Allocation:
Staying at 7% cash (20 Aug 08: 7% cash)





















Strategy:
Brokers and remisiers revealed that funds are buying back into IOI Corporation Berhad after the massive sell down that caused the share price of IOI to drop from RM8.00 plus to RM4.00 plus. Reason is the higher crude palm oil price. Now people, investors, speculators are looking at crude palm oil hitting RM3,000 per tonne again. Such development is very short term based for simple reason - movement in daily crude palm oil does not have immediate impact on the operational and financial performance of IOI as the company may be able to hedge prices if they want or leave it exposed. But what is happening is investors are reacting to movement of crude palm oil and make buy and sell decisions of IOI stock based on movement in crude palm oil.

In other words, the increase in crude palm oil may not be sustainable in three days time (for example) and after three days, buyers might dump IOI stock if crude palm oil decreases again.

We will just have to take advantage of these movements and continue to accumulate stocks when it's below our cost as we believe crude palm oil is a commodity with no real substitute in the world. Further, any increase in crude oil will make crude palm oil viable for biodisel as well, creating another source of demand for crude palm oil. And I am wondering when CIMB Research will start to come back with another buy call with "increase in crude palm oil price" as one of the key re-rating catalyst.

HDFIV Report Card @ 8 August 2008

Performance:
HDFIV is currently beating KLCI by 2.87% at a loss of 12.81% while KLCI suffered a loss of 15.69%. KLCI continued to be weighed down by slump in global economies as well as the political uncertainties in Malaysia.

Portfolio:
We have averaged out our cost in IOI Corporation Berhad via additional purchase of 1,400 units at RM4.88. Average cost has been brought down to RM5.63 from RM6.60. We continue to adopt the stance in accumulating this plantation stock which have been battered down from it's high for the year at RM8.60 (in 15 January 2008) - a decrease of 43%. 1 month and 3 months high were recorded at RM6.7 and RM7.65 respectively.

Asset Allocation:
Cash position dropped from 24% to 7% after our investment in IOI Corporation Berhad.

Strategy:
We have been taking a very contrarian approach so far with regards to our investments, especially in Bursa Malaysia Berhad and IOI Corporation Berhad. Research houses have been calling for a sell on these stocks and naturally the stock prices have reacted by trending downwards. We have been ignoring these calls and these calls are basically made on 12 months basis and have been very market-based. Check out a coming article on a recent analysis of a research house buy and sell call on IOI.

HDFIV Report Card @ 8 August 2008

Performance:
HDFIV is currently beating the KLCI 2.63% at at loss of 10.26% while KLCI suffered 12.89%. Dividend declared by both Bursa and Public Bank of 16.5% and 30.0% of par value respectively.

















Porfolio:
No additions or disposals of stocks this week.

Asset Allocation

Cash position increased from 15% to 24% with monthly contribution.

Strategy:
Will continue to monitor prices of existing holdings for cost averaging.

HDFIV Report Card @ 28 July 2008

Performance:

HDFIV currently is beating KLCI by 1.63% at a loss of 11.52% while KLCI registered loss of 13.15%.

Porfolio:
We have managed to accumulate stocks in gaming, banking, stock exchange, oil and gas as well as plantation over the past few months. 40% of our porftfolio lies in Public Bank Berhad, the bank that has solid track record over the years in terms of generating profits and providing returns via dividend and capital growth.

Asset Allocation:

We have been on a monthly basis accumulating stocks or averaging out purchases. Cash remains at 15% at the moment since it is near month end. Cash coffer expected to increase in month August 2008 with new contributions.

Strategy:

The decision to include volatile stocks such as Bursa in the porffolio will result in volatility in our portfolio's return. Further, any rise or fall in KLCI will have direct impact on our portfolio as all our holdings except for Wah Seong warrants are KLCI components. However in the event KLCI rebounds, we stand to reap the gain. Such volatility is mitigated with the benefits of monthly inflow. We will keep to our strategy of stock accumulation at various levels of prices. Fear is still greatly felt in the market at the moment due to political uncertainties. That is why we are accumulating despite calls from analysts and research houses to sell or hold.

HDFIV Report Card @ 11 July 2008

HDFIV Report Card @ 18 April 2008

Performance
We are registering a return of 5.76% so far, outperforming KLCI by 9.41% since inception (on 1 March 2008). KLCI is still down 3.66% since 1 March 2008. Berjaya Sports Toto and Bursa Malaysia are the top performers for our HDFIV this week, both registering returns of 7% and 6% respectively due to increase in price and the dividend income.

Purchase
No purchase this week.

Sell
No selling this week.
Asset allocation
We are holding about 25% cash and 75% equity at the moment.

HDFIV Report Card @ 11 April 2008

(will try to update the chart later - unable to upload at the moment)

Performance
Kuala Lumpur Composite Index ("KLCI") increased from 1,221.98 (4 April 2008) to 1,246.79 (11 April 2008), representing an increase of 2.0%. Hengdai Equity Fund IV ("HDFIV")'s registered a return of RM26.64 or 0.31%, down from 1.37% in the previous week. So far, HDFIV is beating KLCI by 6.61%, lower compared to 9.54% a week ago. KLCI had a small rally on Wednesday and Thursday, increasing from 1,228.63 to 1,246.79, mostly boosted by plantation stocks. At the moment, our portfolio does not hold any plantation stocks hence not riding up together with the KLCI.

Purchase

Bought 700 units of Bursa Malaysia (Stock code 1818) today at RM8.70.

Sell

No disposals during the week.


Asset Allocation

We have increased the equity exposure to 76% after today's purchase of Bursa Malaysia. That leaves a cash buffer of about 24% which will easily replenish itself back to 50% thereabout come the third month's capital inflow.


Note: Asset allocation shows the three main categories that our money lies in. The main category which we are expected to invest in to make the return that we wanted is Equities. Secondly, Fixed Income is in the form of fixed deposits that provides stable but low return. This second category provides small return when the cash is yet to be utilised for investment. As there is a lock-in period for fixed deposit such as at least for two months (if the amount is less than RM5,000), there is a need to maintain cash in the form of 'pure' cash, which is the third category. The set back of holding 'pure' cash ("Cash") is that we do not earn any return at all.

HDFIV Report Card @ 4 April 2008

Performance

Kuala Lumpur Composite Index ("KLCI") decreased from 1,256.54 (28 March 2008) to 1,221.98 (4 April 2008), representing a decrease of 2.8%. Hengdai Equity Fund IV ("HDFIV")'s registered a return of RM101.94 or 1.78%, down from 4.39% in the previous week. Reason for the decrease is due to the lower valuation of Malayan Banking Berhad and a larger capital base in view of the new shareholders and as well as the impact from 2nd month's inflow of capital.

So far, HDFIV is beating KLCI by 9.94%, consistent with 9.76% a week ago.

Purchase
No purchases during the week.

Sell
No disposals during the week.

Asset Allocation
With additional capital coming from new shareholders and 2nd month's inflow of capital, equity allocation has decreased from 71% to 42%. We are again holding back a comfortable cash buffer of 58%. This comfortable cash buffer will allow us to snap up some cheap stocks that took some beatings during this week. Hapseng Plantations Berhad is currently in my radar as the stock plummeted to one year low of RM2.57 on 3 April 2008. The stock recovered some lost ground by closing at RM2.65 today.

Note: Asset allocation shows the three main categories that our money lies in. The main category which we are expected to invest in to make the return that we wanted is Equities. Secondly, Fixed Income is in the form of fixed deposits that provides stable but low return. This second category provides small return when the cash is yet to be utilised for investment. As there is a lock-in period for fixed deposit such as at least for two months (if the amount is less than RM5,000), there is a need to maintain cash in the form of 'pure' cash, which is the third category. The set back of holding 'pure' cash ("Cash") is that we do not earn any return at all.