On a break

Marksman's Investment Corner is currently on a short break - expect activities to pick up from July 2018 onwards!

Are you for or against the merger between Alliance Minerals Assets Limited and Tawana Resources?

Friday, May 18, 2018

Reflections - My performance investing in Fraser Logistics and Industrial Trust

Recently, I sold away my (tiny) position in Fraser's Logistics and Industrial Trust to free up more cash for my new home. I had bought 1000 units at IPO in June 2016 as a way to compound my gains from dividends and distributions earned from CMT and Cache. Subsequently I sold at $1.09, earning $258.5 in capital gain and dividends after subtracting commission, for a total return of 29.22%. 

Annualised, this is a solid 16.70% per annum.

Due to the size of my purchase, commission fee has a more substantial effort on the overall gains. To show diluted effect of commission fees on the performance, I will run a simulation of the gains and comparisons against SPDR STI ETF based on if I had 10,000 units instead of just 1000. I will subsequently do similar simulation whenever I do reflections for cashing out on purchases under $4500.


Units purchased
Purchase price per unit
(include comm)
Period held (years)
Yield on cost
Overall gain from distributions
Annualised Capital Gain on cost
Overall Gain from Capital Gain
Annualised Overall Gain
Total Gain
1000
0.892*
1.75
5.67%
9.92%
11.03%
19.30%
16.70%
29.22%
10000
0.894**
1.75
5.66%
9.90%
12.37%
21.64%
18.03%
31.55%

If i scale this up to a level where the effect of commission is watered down (in this case - I'll simulate having bought 10,000 units), I would have had an overall gain of 31.55%.

*The commission here only takes into account the commission charge for IPO 
**The simulation takes it that I purchased from brokerage hence nominal commission fees apply.



Comparison to STI ETF

Units purchased
Purchase price per unit
(include comm)
Period held (years)
Yield on cost
Overall gain from distributions
Annualised Capital Gain on cost
Overall Gain from Capital Gain
Annualised Overall Gain
Total Gain
300
2.980
1.75
4.56%
7.99%
2.91%
5.10%
7.48%
13.09%
3000
2.892
1.75
4.70%
8.23%
10.07%
17.62%
14.77%
25.85%

In comparison to SPDR STI ETF, this is a solid win as I had outdone STI ETF in the period, even when scaled up accordingly. The Capital Gain at 300 unit is greatly reduced due to the commission fees on purchase (and there's no way I could have bought an IPO of it, can I? Haha.).

What could have been done better
I'm pretty proud of this achievement actually. There are only 2 things that can be done better:
- Buying more of it while it sits in the range of < $1 early on
- Developing stronger purchasing and holding power overall so that the position can be held and then subscribe to the non-renouncable rights even after flat purchase. :P

Challenging the market?
Altogether that makes 1 out-performance, and 2 under-performance.

Enjoyed reading my reflections? You can read the rest here!

1 comment:

  1. I really appreciate the kind of topics you post here. Thanks for sharing us a great information that is actually helpful. Good day!
    investferry 

    ReplyDelete