2019 marks the year that I've invested in SIA for a decade. This will be the 5th stock in my investment portfolio after Genting Singapore, First Reit, SingPost and CapitaMall Trust to be in the "10-years club".
So anything to cheer about ? Afraid not from the perspective of return. Invested in 2009 at a price of $11.12 and adding some more a year later to make the holding price at $12.07. At the price of $9.1 on 21st Oct 2019, this gives an unrealized loss of -25.01% (annualized -2.84%) and a dividend return of +36.99%. This produces an overall return of +11.98% (annualized +1.14%). As a whole the return is still positive with the inclusion of dividend but on purely capital return, probably at least 60% of the time during the 10 years period it is in the red. A little comfort is this investment is not like those dudes from the town councils who lost every single cents in the investment during the 2008 GFC due to collapse of Lehman Brothers. If this investment does end up at that state, for sure my conscious will hunt me for the rest of my life simply because I'm a truly human beings. Does the conscious of those dudes hunt them for rest of their life ? Better be if not there will not be any justice done.
"I'm in for the investment for long term like 30 years so this current unrealized loss is not a big concern". Does that statement rings a bell ? Well if you are a true blooded Singaporean you should realize where that statement origins from to act as an excuse to cover up a mistake. I'm not going to use that for this SIA investment simply I'm not a pseudo elite who prides to wear white but actually is just an empty vessel. I will boldly admit the investment in SIA in 2009 is a mistake. No excuse, a mistake is a mistake !
If it is a mistake why no cut loss and continue to hold it ? I have reasons in doing so.
Firstly, investment in a stock is investment in a company. To invest in a company I don't simply just put the money there, let it auto pilot and just monitor the metrics to determine how the investment fares. It also allows me to follow closely how management using strategies (business strategies) to overcome difficult situations. For the past 10 years, SIA has to combat the emerging of Low Cost Carrier (LCC), the volatility of the crude oil price which affects their revenue and the weakness of global economy result in weaken air traveling. To be honest, SIA still not out of the wood but can see what's the management has been doing to combat those difficulties. Not every measure works and if it isn't what's the reason. That is something I could learn from if I continue to stay invested in it. Having this type of experience will definitely equipped me better for my next investment in another stock (company).
Secondly, maybe after more than 2 decades in stock market, the perception of stock investing is different from majority. The main focus of how much return I could get is no longer priority but rather applying the correct strategy is the one. In short, I'm enjoying investment now not for the return but for what type of strategies I could deploy. As long as it is the correct strategy, the return will follow. Even if it is a wrong strategy, it can always overcome the wrong result with another strategy after learning from mistake.
Thirdly, probably more from personal perception. SIA to me together with SGX are the only 2 companies that in Singapore is too big to fail. The consequences of them belly up is very catastrophic as there isn't any replacement for them. Some might say bank should be the one, there is more than 1 banks in Singapore, do I need to elaborate further ? SIA has not registered a single full year loss for the 10 years I've invested in and if I'm not wrong, SIA yet to register a full year loss since listed in 1992 despite the 1997-98 AFC, 2001 9/11 incident and 2003 SARS when it was hit the hardest. This spells a good foundation in its fundamental. To add, at least till now, the management is not one of those paper general apart from 老黄卖瓜，自卖自夸, their experience in running a corporation is not much better than the average Joe on the street.
There is also another mistake that I made during these periods, divested away the SATS share that was given to me when SIA divested SATS. I should have hold on the SATS share instead. However, there is still one good move I made that was divested the SIA from my kid's portfolio years ago with a profit.
So what's going forward ? Like mentioned earlier, focus is on strategy, I do have 2 strategies in mind that wanted to test out, newly conceptualize based on 孙子兵法 since last year. Of all the stocks in my investment portfolio, SIA is one of the prime target for me to test it on. I have started to apply one of the strategy and that helped me to reduce the holding price from $12.07 to $12.028. It is still ongoing as this strategies will take times to test it out which I have plenty. As for the 2nd strategy I'm still waiting for opportunity to test it out or maybe I'm not applying that to SIA. So I guess while testing out those strategies, I will just continue to collect dividend along the way. Another thing is from Elliott Wave analysis in term of SuperCycle perspective, I see something going forward but you must have the times to allow that to finally materialize.
So anything to cheer about ? Afraid not from the perspective of return. Invested in 2009 at a price of $11.12 and adding some more a year later to make the holding price at $12.07. At the price of $9.1 on 21st Oct 2019, this gives an unrealized loss of -25.01% (annualized -2.84%) and a dividend return of +36.99%. This produces an overall return of +11.98% (annualized +1.14%). As a whole the return is still positive with the inclusion of dividend but on purely capital return, probably at least 60% of the time during the 10 years period it is in the red. A little comfort is this investment is not like those dudes from the town councils who lost every single cents in the investment during the 2008 GFC due to collapse of Lehman Brothers. If this investment does end up at that state, for sure my conscious will hunt me for the rest of my life simply because I'm a truly human beings. Does the conscious of those dudes hunt them for rest of their life ? Better be if not there will not be any justice done.
"I'm in for the investment for long term like 30 years so this current unrealized loss is not a big concern". Does that statement rings a bell ? Well if you are a true blooded Singaporean you should realize where that statement origins from to act as an excuse to cover up a mistake. I'm not going to use that for this SIA investment simply I'm not a pseudo elite who prides to wear white but actually is just an empty vessel. I will boldly admit the investment in SIA in 2009 is a mistake. No excuse, a mistake is a mistake !
If it is a mistake why no cut loss and continue to hold it ? I have reasons in doing so.
Firstly, investment in a stock is investment in a company. To invest in a company I don't simply just put the money there, let it auto pilot and just monitor the metrics to determine how the investment fares. It also allows me to follow closely how management using strategies (business strategies) to overcome difficult situations. For the past 10 years, SIA has to combat the emerging of Low Cost Carrier (LCC), the volatility of the crude oil price which affects their revenue and the weakness of global economy result in weaken air traveling. To be honest, SIA still not out of the wood but can see what's the management has been doing to combat those difficulties. Not every measure works and if it isn't what's the reason. That is something I could learn from if I continue to stay invested in it. Having this type of experience will definitely equipped me better for my next investment in another stock (company).
Secondly, maybe after more than 2 decades in stock market, the perception of stock investing is different from majority. The main focus of how much return I could get is no longer priority but rather applying the correct strategy is the one. In short, I'm enjoying investment now not for the return but for what type of strategies I could deploy. As long as it is the correct strategy, the return will follow. Even if it is a wrong strategy, it can always overcome the wrong result with another strategy after learning from mistake.
Thirdly, probably more from personal perception. SIA to me together with SGX are the only 2 companies that in Singapore is too big to fail. The consequences of them belly up is very catastrophic as there isn't any replacement for them. Some might say bank should be the one, there is more than 1 banks in Singapore, do I need to elaborate further ? SIA has not registered a single full year loss for the 10 years I've invested in and if I'm not wrong, SIA yet to register a full year loss since listed in 1992 despite the 1997-98 AFC, 2001 9/11 incident and 2003 SARS when it was hit the hardest. This spells a good foundation in its fundamental. To add, at least till now, the management is not one of those paper general apart from 老黄卖瓜，自卖自夸, their experience in running a corporation is not much better than the average Joe on the street.
There is also another mistake that I made during these periods, divested away the SATS share that was given to me when SIA divested SATS. I should have hold on the SATS share instead. However, there is still one good move I made that was divested the SIA from my kid's portfolio years ago with a profit.
So what's going forward ? Like mentioned earlier, focus is on strategy, I do have 2 strategies in mind that wanted to test out, newly conceptualize based on 孙子兵法 since last year. Of all the stocks in my investment portfolio, SIA is one of the prime target for me to test it on. I have started to apply one of the strategy and that helped me to reduce the holding price from $12.07 to $12.028. It is still ongoing as this strategies will take times to test it out which I have plenty. As for the 2nd strategy I'm still waiting for opportunity to test it out or maybe I'm not applying that to SIA. So I guess while testing out those strategies, I will just continue to collect dividend along the way. Another thing is from Elliott Wave analysis in term of SuperCycle perspective, I see something going forward but you must have the times to allow that to finally materialize.
What's destiny to fly won't rest forever.
