Tuesday, September 30, 2014

Balls Deep - That's How I Roll (Part II)

Put your money where your mouth is at right? I'm a contrarian, so here we go!

Earlier this March, I took a seemingly crazy trade and went into Russian equities. I know, crazy right?

Fast forward to 3 months later, I exited my position in Russia for a nice cool 20% odd gain.


Today I just entered into another 2 seemingly stupid positions as well. Check out these 2 charts below.



These are the 5 year charts of the GDX and the RSX. Gold mining equities and Russian equities. I think the consensus is pretty clear that everyone thinks Gold is a crap and worthless asset, while Russia is going to be sanctioned to oblivion.

But oh well, buy low, sell high, right?

I purchased the unit trust proxies for these 2 ETFs and I am planning to sit on these babies for years to come or as long as it takes. Downside seems limited and upside seems plentiful, while I am just worried about the expenses eating into my capital base. It's the last day of the Phillip 0% promotion, so at least I can console myself saying that I saved 0.75% making these trades? Haha.

4 comments:

  1. Wow nice gain there on the Russian market.

    Can I check where did you make trades on the Russian ETF? I heard that it was low in valuation but never really checked them as I do not know much about the economy there.

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    1. Heya B,

      Thanks, it really was a good emotional test for me, especially with bad news coming out every other day.

      I didn't purchase the ETF for Russia, though the tickers would be RSX and RSXJ (small cap). Instead I purchased the HSBC GIF Russia Equity AD SGD unit trust from POEMS. It is not a perfect proxy, but I think the idea is there. It is not easy to get exposure in this really specific and niche asset class, however I think at this valuations based on PE, CAPE and forward PE.... it is well worth looking at more closely!

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  2. impressive gains also. if it can be repeated, wow...super.

    for me, i cannot seem to make money so fast....people call me tortoise investor.. visit me when u r free

    paullowinvestmentjourney.blogspot.sg

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    Replies
    1. Hi Paul,

      Thanks for the comment. I didn't expect the gains so fast, so I took profits early. I didn't mean for it to be a swing trade! I think slow and steady is a good approach to investing, rather than fast and furious. The more boring the method, the better it is because emotions take a backseat and rational logic will block bad decisions!

      Yes, looking forward to more of your analysis! SL is already on my watchlist, but Genting is not.

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