Select Page
Tan Roland asked 4 years ago

Hi Victor, Rusmin and Adam,
In the bonus video on Investor Psychology, it was mentioned that the level of cash one decides to keep should commensurate with the valuation of the overall market. I also heard that in your opinion, the Singapore market is currently at fair value (not sure when the video was recorded but PEs have been on the rise in the last few months) and thus we have to search for good companies and buy them at fair value, otherwise, our hard earned monies could be better off left in the bank whilst we wait for valuations to become attractive again.
Bearing in mind the above, could you share (if it is not too confidential), the percentage of cash in your portfolios now. Will this cash percentage vary with the size of your portfolio, e.g., $100k to $100M. Thank you.
 
 

1 Answers
Victor Chng answered 4 years ago

Hi Roland,
 
The bonus video was recorded a few years back when the market condition is at fair value. From August 2015 to Jan 2016, the market crash a bit and the market valuation was undervalued, that is where our cash position drop to only 3%. Currently, the market value had increase back to fair value and our cash position is at around 28%. Regardless, the portfolio size, we always goes in term of percentage.

Tan Roland replied 4 years ago

Hi Victor,

Thanks for your reply. What do you do with the 28% cash that you are holding whilst waiting for prices to correct? Leave it in the bank and don’t be tempted deploy it since it is hard to find companies that will pass the investment quadrant?

How about investing in companies with Deep Value, e.g. HK Land, Boustead and Kingsmen

Victor Chng replied 4 years ago

Hi Roland,

We are still actively looking for companies to invest in. It just that the current climate require much more work to dig out undervalued companies. Hence, we are not in the rush to deploy it but of course if there is companies that hit our criteria we will deploy it immediately.

Tan Roland replied 4 years ago

Hi Victor,

Thanks for your reply