Perhaps the biggest blunder in the few years of investment has been with TEPCO, Tokyo Electric Company (JP:9501). It was stupid times when i was too aggressive and relied on speculation. Right after the devastating tsunami in Japan where everything in Sendai was wiped clean, Tepco nuclear plant faced daily risk of meltdown, their stock price plunged to the ground. And I foolishly invested a small amount of money in the hopes of making a quick buck. Soon after, rumours started flying around that the company might be delisted and taken over by the japanese government.
Lesson learned, never invest in a company directly involved in the tragedy. Same goes for BP after the Gulf of Mexico oil spill, where is BP now? still lagging behind major players, lost their credibility, their TNK-BP partnership in Russia broke down somewhat.
Getting back to TEPCO, there were times when i was down nearly 80%. Having lost all hope of regaining the money, i decided to leave it as it is, to remind myself everytime i checked my investment account. Stubborness took over and i never sold it at a loss. In my defence, before buying into the counter, i performed a thorough study and actually believed TEPCO will rise again one day. Believed in their 2020 vision of cutting fossil fuel dependancy. Nuclear power is actually 30% of their total revenue and they are diversified into other forms of renewable energy. The fact remains still, TEPCO is Japan's biggest power company by generating capacity.
Recently TEPCO rose a whopping 18% to JPY522 on the TSE yesterday and further risen to 613 today. One of the best performers this week from Japan. I am now at 17% profit from buy price but still not going to sell. This is because when i bought it SGD-JPY rate was 62, the Japanese Yen has depreciated by more than 30% over the past year. In terms of actual profit/loss...i am still at over 20% in the red after commissions and fees.
I am sharing this case study so that others may benefit and learn from my mistakes:
1. DONT INVEST IN COMPANIES DIRECTLY INVOLVED iN A DISASTER
2. DONT FORGET CURRENCY EXCHANGE LOSS
Lesson learned, never invest in a company directly involved in the tragedy. Same goes for BP after the Gulf of Mexico oil spill, where is BP now? still lagging behind major players, lost their credibility, their TNK-BP partnership in Russia broke down somewhat.
Getting back to TEPCO, there were times when i was down nearly 80%. Having lost all hope of regaining the money, i decided to leave it as it is, to remind myself everytime i checked my investment account. Stubborness took over and i never sold it at a loss. In my defence, before buying into the counter, i performed a thorough study and actually believed TEPCO will rise again one day. Believed in their 2020 vision of cutting fossil fuel dependancy. Nuclear power is actually 30% of their total revenue and they are diversified into other forms of renewable energy. The fact remains still, TEPCO is Japan's biggest power company by generating capacity.
Recently TEPCO rose a whopping 18% to JPY522 on the TSE yesterday and further risen to 613 today. One of the best performers this week from Japan. I am now at 17% profit from buy price but still not going to sell. This is because when i bought it SGD-JPY rate was 62, the Japanese Yen has depreciated by more than 30% over the past year. In terms of actual profit/loss...i am still at over 20% in the red after commissions and fees.
I am sharing this case study so that others may benefit and learn from my mistakes:
1. DONT INVEST IN COMPANIES DIRECTLY INVOLVED iN A DISASTER
2. DONT FORGET CURRENCY EXCHANGE LOSS
Good that you pointed TEPCO out but...
ReplyDeleteHow to buy Japanese shares, are you using E*trade etc?
Personally, with Abe taking charge, they will return nuclear power sooner than later..
Let me know
I've been trading with iOCBC, commission per trade on TSE is 0.75% (or min 3000JPY)+ 7% GST
DeleteIt makes sense for trades above JPY 400k. (Approx. S$4880) There is also a monthly custody holding fee of $2/counter.
E*trade charges 3399JPY per transaction. Not sure if they have a custody fee or not.
Kind of expensive to trade Japanese stocks eh? turnaround cost is 1.605% + $2/mth