Words of Widsom

In today's trading, Bear Sterns dropped more than 50% from yesterday's close. MYOB has a famous quote from Mr Guru himself, Warren Buffett, on investing.

"It's far better to buy a wonderful company at a fair price than a fair company at a wonderful price. " --- Warren Buffett

You can decide for yourself if Bear Sterns falls into the former or latter catergory.

Participation Certificates - Make it your business?

Merrill Lynch to issue four China Participation Certificates on SGX

Merrill Lynch announced on 5 Mar 2008 that it will issue four Participation Certificates in April on the Singapore Exchange (SGX) that provide investors with a cost effective way to obtain access to selected China-themed sectors.

The four Participation Certificates are China Water, China Consumer Brands, China HShares
Discount and China S-Shares and as the names indicate, provide transparent access to the
China water sector, China consumer brands sector, a basket of H-Shares which are trading at a
discount to their A-Share counterparts and a basket of S-Shares which likely to benefit from
China’s economic growth and subsequent money flows into the Singapore stock market,
respectively.

The underlying indices for the four Participation Certificates are the Merrill Lynch China
Water SGD Index, the Merrill Lynch China Consumer Brand SGD Index, the Merrill Lynch HShares Discount SGD, and the Merrill Lynch S-Shares SGD Index, respectively. Each index is
based on Merrill Lynch research and the composition is reviewed at least twice a year.


The Participation Certificates are designed to be buy-and-hold investments, whose price
return is tied to a stock index, a single stock or a basket of stocks and indices. It is a non-leveraged product with exercise price of zero and is suitable for investors who wish to have an exposure to some of these unique baskets of stocks, indices or both.

As I type, Bernanke is speaking on CNBC talking about measures to solve the housing/credit problem. The Dow is down some 200+ points. The martket will continue to be highly volatile, with down side bias. MYOB will dissect the participation certificates to see if you should make it your business.

Stay tuned.

Words of Wisdom

MYOB brings to you a new series -- Words of Wisdom. This new series will feature poignant quotes on value investing. In this chaotic period, the inaugural post will feature Mr Benjamin Graham.


"Most of the time common stocks are subject to irrational and excessive price fluctuations in both directions as the consequence of the ingrained tendency of most people to speculate or gamble... to give way to hope, fear and greed."

Straits Trading: OCBC's white flagl!!!

Following the Lees and GEH's decision to sell their stake in STCL to Tecity, it is no surprise to MYOB when OCBC also gave up their stake in the company, citing the loss of the added value of being part of the combined stake in 33.4% held by OCBC Bank, Great Eastern Holdings Group, Knowledge Two and Lee Family Companies.

Just for the records, MYOB did not think that the Lees would give it up so easily. MYOB has assumed that the status quo would remain, based on the state of the affairs after Tecity's declaration that $6.70 would be their last offer.
Having received valid acceptances of more than 50%, Tecity has on 4 Mar made their offer unconditional. Accordingly, as at 5.00pm on 4 Mar 2008, Tecity has 74.37% of the issued share capital of STCL. The Closing Date of the Offer will be extended to 3 April 2008.

MYOB hopes and expects that Tecity keeps the listed status of STCL. Once again, MYOB does not think that it might not be such a bad idea to hang on for your shares.