Current Return and performance
January is a particular good month for the stock investor. KLCI went up from 1796.81 to 1868.58, netting a estimated holding period return of 4.27% (with dividend included). Bank Negara raised the key interest rate by 25 bp to 3.25% on 24th Jan 2018. This expect to help the performance of banking stock, which account for 40% of my portfolio.
Holding Period return for my portfolio, is 5.35%. Total holding period return for my portfolio since the inception is 31.%, annualized to be 5.11%, this still underperform KLCI total return of 36.40% (annualized, 5.9%)
As KLCI slowly climb back to the 2014 level before the oil price & ringgit crash, i believe the biggest uncertainty for the year will be concentrate around the outcome of General Election 14. Until the result of GE14 become clear with forming of a stable government, i will avoid fully invested into the market, keeping as much spare cash as possible.
Trading Activities
Addition of BAT (4162) at price around RM 32.5
BAT's share price fall because of two reasons,
1. declining legal cigarette market due to increase excise duty
2. Removal of the stock from KLCI index, causing some investors holding it as part of the KLCI to sell it.
With no further action by the government to further limit the legal cigarette consumption, i believe revenue & profit for BAT will be stable in the near term, which make the valuation (around P/E 16 and dividend rate of 6%) attractive at the price i add in.
