Thursday, February 11, 2010

Operation Fund Switch 1

Sold my 16 lots of Macquarie International Infrastructure Trust at 50 cents (60% profit) finally. This translates to a profit of about $3k plus.

Used funds to buy 4 lots Starhub at $2.100 today. I did it by jumping the queue at lunch time to grab the $2.100 lots on sale.

This........ is my Operation Fund Switch 1. I do not treat it as a new purchase, but merely a transfer of funds from 1 security to another.

Using the power of creative accounting, I shall report Starhub as $1.90 in my portfolio by putting back 1k of the realised profit into these new Starhub lots as paper gains (which I don't count as gains). That means, I will have realised about $2k+ gain from this transfer.

Reason for the transfer:

1) Dividends for MIIF is expected to be around 2.5 cts to probably 3 cts exclude special dividends. However, overall percentage yield at current prices is less than Starhub. Divestment of MEIF, and reduced or zero distribution from Arqiva will make it even lesser in the future.

2) Zero assets that I can see or touch in Singapore. I won't really know what will be happening. This is one of my important criteria nowadays unless I'm extremely confident of the company.

3) Starhub is more stable, so I can sleep better. It's around me, so I can see it. I can see who uses its services.

4) Technicals wise, Starhub is at a nice support. My entry price is just above the 200 MA. Also, Starhub has nicer volume distribution than MIIF for today.

With this transfer, my average monthly dividend income from my dividend portfolio has rose to pass the midway point of $500 monthly. If my investments and trading baskets were to be included, it would be even higher at $579, but that's beside the point.

I need another $500 monthly to reach my first target of average $1k monthly. Ganbatte to myself!

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