My Investing Muse

Daily Journal Corp (DJCO) has released its Q2/2022 13F update recently.  There are some observations that I have made, especially regarding the recent purchases and sales of Alibaba shares by Mr Charlie Munger.   Charlie Munger is one of my biggest influences coming to value investing.  I am a great fan of the wit, humour and temperament that he displayed pertaining to investing - especially the patience.  In Q2/2022, there are no activities - no buy or sell in the last quarter.   From the table listing recent activities, we can see that Mr Munger is happy to sit on cash for years (No purchase or sales between Q1 2015 and Q42020).  This is a good 6 years of no activities.  It is hard to find others who can invest with such "patience".  Of course, the 13F filing reports only US stocks and does not include any international portfolios. Timeline of $BABA stock purchases by DJCO: Q1 2021 - purchase of 165,320 shares Q3 2021 - purchase of 13...

Alibaba released its recent earnings on 26 May 2022.  I will focus more on YoY performance in this review as this would provide a more balanced overview of the progress. Latest Earnings beat for Q1/2022  Here is the extract from their earnings report pertaining their fiscal year ended March 31, 2022: Revenue was RMB853,062 million (US$134,567 million), an increase of 19% year-over-year that was primarily driven by the revenue growth of the China commerce segment by 18% year-over-year to RMB592,705 million (US$93,497 million), Cloud segment by 23% year-over-year to RMB74,568 million (US$11,763 million) and International commerce segment by 25% year-over-year to RMB61,078 million (US$9,635 million). Excluding the consolidation of Sun Art, our revenue would have grown 14% year-over-year to RMB770,734 million (US$121,580 million). Income from operations was RMB69,638 million (US$10,985 million), a decrease of 22% year- over-year . Excluding one-off and certain other items as...

Before I start, let us not forget that we will need to qualify the business first through reviews of its fundamentals over a good period of time.  Its recovery from the ongoing pandemic can give us assurance on the quality of the businesses and the durable competitive advantages that it owns.  What I am doing now is the technical setup that helps me to take a position for trade or when a great company reaches a range of "discounted" prices.  This is also known as the margin of safety that value investors add. Personally, I prefer investing over trading that it essentially has a much longer-term time horizon - over 10 years into perpetuity.  Trading requires much more effort & closer monitoring.  The timezone difference does not permit me to trade actively when I live 12 hours away from the US market.  For the coming examples, I am exploring trading and not investing. Coming to trades, we need to consider market sentiment as that can drive the prices in...

Help! Charlie Munger has sold 50% of his holdings in    $BABA . Do we need to follow him?  If we ask the above question, it is likely that we have not done a deep dive into the business . Charlie Munger sold 50% of his BABA shares. People buy for 1 reason (to profit from the investment) but they can sell for a thousand reasons .   What could have led Mr Munger to sell may not be the same consideration for us.  If the stock is so bad, why should he still keep 300,000 shares?  If it is to "stop loss", wouldn't it be better for us to sell all?  This is important as we need to qualify our investment decisions through our own research.  We cannot invest based on borrowed conviction . Peter Lynch said this "If we are not able to explain the business to young children in 5 minutes, we do not know the business enough." The main consideration for our investments should be the fundamentals, moat and opportunity costs.  As one of the best va...

JP Morgan called China investable as per the 15Mar2022 news article.  Here is an extract from the news article : Chinese tech stock rout deepened, slashing billions of dollars from the likes of Alibaba Group Holding and Tencent Holdings in Hong Kong, on heightened concerns about an industry crackdown, Covid-19 outbreaks, and China's position on the Ukraine conflict. Losses spiralled after JPMorgan Chase downgraded 28 Chinese internet stocks including Alibaba, Tencent Holdings and Meituan to underweight, calling them "uninvestable" over the next six to 12 months due to rising geopolitical and macro risks, Bloomberg reported. $BABA released ownership updates as of 30 Mar 2022.  There seems to be much more institutional buying than selling as per the details below . Activity for 30Mar22 of holders (more than 0.5% change in shares outstanding) Some notable additions in Q1/2022: The Vanguard Group added 28.6M shares, totalling 469.9M shares as of 28Feb22 BlackRock Fund Adviso...

This is a landmark week in our modern history.  Ukraine found herself caught in a battle as Russian troops poured into the country from several sides. This single "black swan" event has commanded the attention of all countries and brought volatility to the global markets.  This has overshadowed the various good news which would have otherwise introduced positivity to the markets.  US CDC has eased their masking guidelines following a drop in the following: drop in new Covid cases per 100,000 residents in the past 7 days drop in new Covid related hospitalization drop in hospitalization by Covid patients There is also another landmark moment with the nomination of Ms Ketanji Brown Jackson (the first black woman) for Supreme Court.  On top of this, the Core personal-consumption-expenditures index (Fed's preferred inflation measurement) climbed 5.2% from a year ago to hit a new 38 years high for January 2022. photo taken from news - congestion at US ports There is some p...

  One of the tech darlings of China   $Alibaba(BABA)$   /   $Alibaba(09988)$   has shared their quarterly earnings for the quarter ending 31 Dec 2021 on 24 Feb 2022.  This is my review. update as per 26Feb2022 From a 52 week high of 245.69, the stock (last traded at $107.94) is trying to break the downtrend as per the chart above.  With a  TTM PE ratio of 15.07 , i s this stock greatly undervalued or is this something that we need to skip ? Some Notable highlights: Global annual active consumers reached 1.28 billion as of 31 Dec 2021 with quarterly growth of 43 million. This implied a 27% year over year increase for local customers and 18% for international customers. This is made up of 979 million consumers in China and 301 million consumers international (outside of China). Alibaba aims to reach carbon neutrality by 2030 and has committed to an additional 1.5 gigatons of decarbonization by 2035, p...

2021 has been a good year for me. though my overall portfolio remains in the red, I am thankful to have learned much.   Personally, investing is not just for the sole reason of financial independence.  With more financial security, it is about  gaining more time for the people and purposes I am passionate about .  Money can help us to do things simultaneously - sponsor a kid's education in Africa, support disaster recoveries for different countries, invest in sustainable solutions, getting help so that I have more with my family & interests.  I have been reminding myself that  time is the most expensive commodity and health is a close second .  These help me to prioritise my time towards my family, passions and friends. Biggest (paper) losses As of today, my biggest (paper) loss remains ‌‌ $Alibaba(BABA)$   ‌and I am still planning to DCA this regularly.  I remain hopeful for the growth of this company and time will prove me brave or...