Tuesday, June 24, 2014

From Russia, With Love

Back in March, the whole Ukraine-Russia conflict was being blown way out of proportion and people were selling Russian equities even though they have one of the lowest P/E ratios in the world. Actually, they might have been the lowest, I'm not sure!

I always talk the talk about how my philosophy is contrarian and deep value investing, and since then, this seemed like the first real opportunity that I saw to invest with "blood on the streets", as many would like to say.

On 12th March I took the plunge and made a purchase into Russian equities. Here was my post that day. It felt quite exhilarating!

3 months later, let's see where we are shall we:

Since there is no easy way to invest in the RSX ETF, I invested in Russian equities through a unit trust, the HSBC GIF Russia Equity fund. The RSX chart above is just a proxy, which it tracks quite well.

As you can see, I pretty much managed to get in at the first plunge. Subsequent chart action looked very constructive, and I have been steadily in the money for more than a month now.

My previous price target to cash out was 27-30 just by eyeballing. However, looking back just a year, you can see that we have hit a strong support/resistance that is just below the 27 mark.

Adding that resistance hit along with the fact that the MACD is crossing down, way above it's zero line, I think this is a sell signal for me.

I actually am trying to build up a nice big fat war chest and reduce risky assets exposure, so I think it is good that I am trimming up my portfolio and keeping it lean.

I will be putting in a sell order for this baby tomorrow and smell some nice profits. 20% gains in 3 months is pretty good, eh?

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