Avenues for Raising Funds for Companies with Poor Liquidity

What are the avenues that a company can do to raise funds to pay off current debts? They are as follows:

• Borrow from Banks
• Issues Bonds
• Sell Part of the Business
• Private Placement to Financial Companies
• Shares offering to Institution / Existing Shareholder
• Rights Issues

DISCLAIMER The ideas expressed in this blog should not be used to buy or sell the securities, commodities or assets mentioned. The accuracy or completeness of the information provided cannot be guaranteed. Readers should carry out independent verification of information provided. No warranty whatsoever is given and no liability whatsoever is accepted for any loss howsoever arising whether directly or indirectly as a result of actions taken based on ideas and information found in this blog.

Using CURRENT RATIO in your Google Scanner

Investopedia explains 'Current Ratio'

The ratio is mainly used to give an idea of the company's ability to pay back its short-term liabilities (debt and payables) with its short-term assets (cash, inventory, receivables). The higher the current ratio, the more capable the company is of paying its obligations. A ratio under 1 suggests that the company would be unable to pay off its obligations if they came due at that point. While this shows the company is not in good financial health, it does not necessarily mean that it will go bankrupt - as there are many ways to access financing - but it is definitely not a good sign.

From the above, we will have an idea that Current Ratio < 1 are companies that have pay-back problems. This type of companies, we'll try to avoid. Thus, one of the screening criteria that i have use in Google Scanner is as follows:

Mkt Cap : 100M to Max
Div Yield: 5-15
Current Ratio < 1

DISCLAIMER The ideas expressed in this blog should not be used to buy or sell the securities, commodities or assets mentioned. The accuracy or completeness of the information provided cannot be guaranteed. Readers should carry out independent verification of information provided. No warranty whatsoever is given and no liability whatsoever is accepted for any loss howsoever arising whether directly or indirectly as a result of actions taken based on ideas and information found in this blog.

Criteria for Fundamental Scanning on Google Finance

In scanning for new ideas using google finance, what are the criteria to use to filter out unwanted stocks? There are many different type of investors in this world with different portfolio. What i uses is basically to suit the Growth and Dividend style investor.

Thus the criteria that i uses are as follows:

• Mkt cap: 100M - 56B
• Div: 5 -10%
• Book Value: 0-1
• Total Debt/Equity Ratio: 0-30%
• ROE: 8-50%

Explanation for the following criteria are as follows:

Mkt cap - We choose companies that have a minimum 100M in mkt capitalization. This is to ensure that the companies can survive any downturn in economy.

Div - A dividend of 5- 10% is to ensure that we as investors received the proper returns as we invest in the company selected. Using the 10-yr treasury yield as a risk free reference, investing in stocks takes risk. Thus by demanding a higher yields we can satisfy the risk as an investor take.

Book Value - Book value refers to the worth of a company should it wind up with all debts paid down. This value i have chose to 1 as it means looking for companies which is less than $1. You can play with more than 1 should you feel that u can invest in higher worth companies. By looking the book value, and comparing with the mkt price, we will know whether the company we have chosen are undervalued or overvalued.

Total Debt/Equity Ratio. This ratio tell us the total debt that a company is carrying against its equity. If it is more than 100%, this means that the company is borrowing heavily to sustain its operation. This is a BIG NO for investors and we need to avoid companies that has BIG BORROWING. I'll limit it to 30% of a company's equities.

ROE or Return on Equity measures the corporation profitability by revealing how much a company generates with the money. I've set it to 8% as a minimum. Any lower will probably affect the dividend payout.

DISCLAIMER The ideas expressed in this blog should not be used to buy or sell the securities, commodities or assets mentioned. The accuracy or completeness of the information provided cannot be guaranteed. Readers should carry out independent verification of information provided. No warranty whatsoever is given and no liability whatsoever is accepted for any loss howsoever arising whether directly or indirectly as a result of actions taken based on ideas and information found in this blog.

Technical Trades on Thai Beverage dtd 6 Dec 2013

Entry point @ 0.495
Stops @ 0.47
Target @ 0.53        Risk Reward Ratio: 1.4
Trade type: Long (Countertrend)
Minimum Vol => 15.9 mil


DISCLAIMER The ideas expressed in this blog should not be used to buy or sell the securities, commodities or assets mentioned. The accuracy or completeness of the information provided cannot be guaranteed. Readers should carry out independent verification of information provided. No warranty whatsoever is given and no liability whatsoever is accepted for any loss howsoever arising whether directly or indirectly as a result of actions taken based on ideas and information found in this blog.

Technical Analysis on Tech Oil&Gas

Entry point @ 0.68
Stops @ 0.63
Target @ 0.75        Risk Reward Ratio: 1.4
Trade type: Long
Minimum Vol => 1.44 mil



DISCLAIMER The ideas expressed in this blog should not be used to buy or sell the securities, commodities or assets mentioned. The accuracy or completeness of the information provided cannot be guaranteed. Readers should carry out independent verification of information provided. No warranty whatsoever is given and no liability whatsoever is accepted for any loss howsoever arising whether directly or indirectly as a result of actions taken based on ideas and information found in this blog.

Dogs of STI

A dividend idea that we can look into is known as "Dogs of the DOW".

Taken from Wikipedia definition:

The Dogs of the Dow is an investment strategy popularized by Michael B. O'Higgins, in 1991 which proposes that an investor annually select for investment the ten Dow Jones Industrial Average stocks whose dividend is the highest fraction of their price.

Proponents of the Dogs of the Dow strategy argue that blue chip companies do not alter their dividend to reflect trading conditions and, therefore, the dividend is a measure of the average worth of the company; the stock price, in contrast, fluctuates through the business cycle. This should mean that companies with a high yield, with high dividend relative to price, are near the bottom of their business cycle and are likely to see their stock price increase faster than low yield companies. Under this model, an investor annually reinvesting in high-yield companies should out-perform the overall market. The logic behind this is that a high dividend yield suggests both that the stock is oversold and that management believes in its company's prospects and is willing to back that up by paying out a relatively high dividend. Investors are thereby hoping to benefit from both above average stock price gains as well as a relatively high quarterly dividend. Of course, several assumptions are made in this argument. The first assumption is that the dividend price reflects the company size rather than the company business model. The second is that companies have a natural, repeating cycle in which good performances are predicted by bad ones.

We can applied this concept to STI market, thus we'll called it "Dogs of STI". Please note this cut-out is based on THE BUSINESS TIMES dtd 23 November 2013.

DISCLAIMER The ideas expressed in this blog should not be used to buy or sell the securities, commodities or assets mentioned. The accuracy or completeness of the information provided cannot be guaranteed. Readers should carry out independent verification of information provided. No warranty whatsoever is given and no liability whatsoever is accepted for any loss howsoever arising whether directly or indirectly as a result of actions taken based on ideas and information found in this blog.

Using Free Stock Scanners

Learning to use a stock scanner is a handy tool to scan for 700++ Singapore stocks for ideas. Google Finance has provided such a avenue that we can shorten the time we needed to look for an idea to buy a stock.

Using a few criteria which we can easily set, we can scan for small cap, mid cap or large caps stocks with dividend setting, net margin or some other criteria. Happy experimenting!

DISCLAIMER The ideas expressed in this blog should not be used to buy or sell the securities, commodities or assets mentioned. The accuracy or completeness of the information provided cannot be guaranteed. Readers should carry out independent verification of information provided. No warranty whatsoever is given and no liability whatsoever is accepted for any loss howsoever arising whether directly or indirectly as a result of actions taken based on ideas and information found in this blog.