One Year On: Assessing The 14 Trades Made During The Market Bottom

It's been a year since the market bottom.

Over the past 12 months, the S&P 500 is up 70%, the STI is up 30% and even the Hang Seng Index is up about 20%.

On hindsight, March and April 2020 was a generational buying opportunity, especially in the US market. It's really possible to get a typical decade's return in just one year.

I have also never been so active before, making 14 trades in the span of two months. The value of each trade is also a high 4-digit or low 5-digit figure. To provide more context, I have only made 10 trades of this size over the past 10 months.

So yes, time for some reflection a year on from the panic.

==============================================

6 March 2020 - Buy DBS (SGD 23)

• DBS had dropped 10% from early Covid fears

• Pulled the trigger although I was way too early

• Big-cap and low-volatility stock

• Verdict: Up 25% (Fair)

9 March 2020 - Buy Keppel (SGD 5.81)

• Temasek was supposed to buy 30% off my hands at SGD 7.35

• Unexpectedly, Temasek pulled out of the deal

• The recent surge in oil prices has not positively impacted share price

• Verdict: Down 10% (Poor)

11 March 2020 - Buy Berk B (USD 195)

• Covid finally started impacting the US market in early March

• Berk B dropped 15% within 3 weeks

• Big cap and low-volatility stock

• Verdict: Up 30% (Fair)

12 March 2020 - Buy Berk B (USD 180)

• Berk B dropped another 10% overnight

• Recalled it was getting increasingly hard to pull trigger

• Desire to average down prevailed

• Verdict: Up 45% (Good)

16 March 2020 - Buy KORE (USD 0.55)

• Already dropped 30% from its high

• Recommendation from 2 astute investors and friends

• Sold in July 2020 and booked quick gains

• Verdict: Up 30% (Fair)

18 March 2020 - Buy CMT (SGD 1.86)

• Dropped 30% from its high

• SG REITs and Banks were on sale

• Surely, the retail malls will not be closed because of Covid-19?

• Verdict: Up 15% (Poor)

23 March 2020 - Buy DBS (SGD 16.94)

• Dropped another 25% since previous purchase 2 weeks ago

• This was the bottom bottom on hindsight

• Jittery, started to count amount of cash left

• Verdict: Up 70% (Good)

23 March 2020 - Buy Alphabet (USD 1022)

• Alphabet dropped 35% within a month from mid-Feb

• Foresee that Google would not be badly affected in the pandemic

• Opportunity to buy a great company at fair valuation

• Verdict: Up 100% (Good)

27 March 2020 - Sell FLT (SGD 0.865)

• 8 purchases in the last month left cash pile low

• Attempt to rotate to stocks with higher upside

• Did not foresee the resilience of logistics trusts in pandemic

• Verdict: Opportunity Cost of 65% (Poor)

27 March 2020 - Sell SGX (SGD 8.98)

• Trading volume was up amidst the volatility

• Share price actually went up in early 2020

• Great candidate to sell and rotate to beaten-down stocks

• Verdict: Opportunity Cost of 10% (Good)

31 March 2020 - Buy Disney (USD 97)

• Down 35% from its high

• Disney is alpha and standard-bearer in their industry

• Theme parks already closed, surely only upside from here?

• Verdict: Up 90% (Good)

2 April 2020 - Buy CMT (SGD 1.61)

• Down another 15% since previous purchase 2 weeks ago

• Singapore going into Circuit-Breaker, malls closed

• This must be the bottom, surely only upside from here?

• Verdict: Up 30% (Fair)

14 April 2020 - Buy Shangri La (HKD 5.79)

• Down 65% from peak in 2018

• Completed the biography of Robert Kuok in early 2020

• Opportunity to own the creme de la creme of Asian hoteliers

• Verdict: Up 40% (Fair)

29 April 2020 - Buy Ping An (HKD 79.75)

• Slow run-up in share price in April 2020

• Insurance is potentially a bigger market in China than US

• Pseudo tech stock that is stable

• Verdict: Up 15% (Poor)

Conclusion

The grades awarded are both holistic and arbitrary at the same time.

I tried to account for factors like timing, the type of stock, the expectations and of course, most importantly, the current market price. Yet, it also boiled down to benchmarking against my own set of standards.

The Mrs actually argued that I was being very harsh since 3 of the poor trades are actually still in the green. But well, opportunity costs do matter.

At the same time, the good trades are also relative. For example, a crypto native's returns over the past year would blow even my best trade out of the water.

So, the overall assessment of the 14 trades?

With 5 Good, 5 Fair and 4 Poor trades, I would give myself a "FAIR" overall grade.

This assessment has reiterated that my stock-picking skills are so-so at best. If I took all 12 buy trades and averaged them out, I would be up about 40% on average. Maybe slightly better than if I had bought a mix of US, SG and HK indexes.

What is maybe more commendable is having the resolve to deploy more often during the worst of the market crash in March and April 2020. This allowed me to capture more of the market returns.

Personally, I found this exercise fruitful. It enabled me to flesh out some of the details and thought process behind each trade during that period. My performance is clearer to analyse and I can always fall back on this post during future market dips.

Hopefully, this post will inspire you to reflect on your investment decisions during the market bottom.

I would love to hear the reflections from readers!

Update: Singvestor has written a similar post on his trades during the market bottom. I sincerely think his post provides greater context. Definitely more transparent and more illuminating. Do check it out.

==========================================

Thank you for reading!

Announcement:

Futu SG and Moomoo have listened to feedback that the new "3 trades" condition to qualify for a free Apple share is too demanding in this volatile market.

Therefore, from today, you only need to open a Moomoo account before 30th April 2021 and complete an initial deposit of SGD 2,700 within 45 days to receive the free Apple share.

Personally, I am very surprised by this update and this reiterates Futu SG and Moomoo's desire to create a better user experience for their customers!

So if you decide to open a Moomoo account, you can refer to my earlier post for a detailed guide or just sign up using this referral link.