Insanity is repeating the same thing time and again and expecting a different outcome...

I just couldn't resist it. IPE dropped from $0.40 to $0.35 today, so I decided to place an after-hours order to buy 10,000 of them. If the order is filled on Monday it will increase my current block of IPE to 100,000 shares (the current 90,000 I hold were bought at $1.00 each). The company announces NTA figures each month, and they reported an NTA of around $1.04 at the end of October and $0.99 at the end of November. The 31 December NTA figure should be released around the 12th, and I expect it will still be in the high 90c region, given the overall stock market movement last month. Of course "Mr Market" must consider the NTA figures to be completely unbelievable for the price of IPE to be where it is, but I'm gambling that if the market recovers somewhat during 2009 the NTA figures will stay around $1.00 per share. In 2007 the NTA was around $1.35 when the shares traded around $1.05-$1.20, so if market confidence is restored the current NTA would indicate a possible market valuation of around 75c. Then again, the fact that the NTA has only dropped around 35% when the overall stock market has dropped by about 45% suggests there's something fishy about the NTA figures. The one good thing with my IPE investment is that Comsec has a 0% margin valuation for this stock - so my margin utilisation isn't affected by fluctuations in the price of my IPE holding. If the trade goes through on Monday I'll have to transfer $3,520 from my St George Portfolio Loan into my Comsec margin lending account to cover the settlement.

Subscribe to Enough Wealth. Copyright 2006-2008

Net Worth Update: December 2008

My net worth as at 31 December decreased by "only" -$10,773 (-1.61%) during the month to $659,775 (AUD). This month the decline was due to modest losses in both my geared equity investments (down by -$8,326 or -39.23% - the percentage figure is large due the the portfolio now being worth only fractionally more than the outstanding margin loan amount!) and another drop in the valuations of our real estate investments (down -$5,353 or -0.69%). The balance of my half of the mortgage was fairly constant, decreasing by $382 to -$367,926. The interest rate cuts over the past six months have had a significant impact on the interest being charged on the variable component of our home loans, and a few more rate cuts wil enable us to meet the monthly mortgage repayments without using our redraw facility.

The balance of my retirement account increased slightly this month, up by $3,288 (+1.36%) to $244,474, but this increase was mainly due to my monthly contribution of around $4,200 (SGL and salary sacrifice amounts) rather than investment performance.

Subscribe to Enough Wealth. Copyright 2006-2008

That was a year to remember

Well, the Australian stock market has ceased trading for the year (it closed early today so everyone can get a good vantage point for tonight's fireworks and/or partying). The All Ordinaries index had its worst calendar year on record, plummeting 43%, compared to the 32% slump during the oil shock of 1974 and the 34% fall in 1930, during the Great Depression. The drop in 1987 calendar year doesn't even rate a mention.

Hopefully I'll still be around in twenty or thirty years to be telling my grand kids "I remember the Great Stock Market Meltdown of '08"...

Subscribe to Enough Wealth. Copyright 2006-2008

Displaying the All Ordinaries Index on Desktop

At work we're still using Windows 2000, so I have loaded the Sydney Morning Herald's All Ordinaries chart onto my Active Desktop. This also works with XP, but active desktop isn't available in Vista so I use a sidebar gadget at home. Monitoring the market serves no useful purpose (for me anyhow - but if you are day trading using your mobile phone it *might* be helpful), but on volatile days I can glance at it and go "Ooh, Aaah" as the market plummets or takes off. A bit like watching a fireworks display.



At home I now have Vista, so I've loaded the Stocks 3.3 sidebar gadget and set the options to only display the All Ordinaries Index (data from Yahoo!, code ^AORD). If you want to track your portfolio live you can add up to 30 symbols, such as BHP.AX, and you can specify the number bought and (average) cost so it displays current profit/loss. Unfortunately it doesn't seem to allow a portfolio total to be displayed, which would be fun (you could see your net worth going up and down minute by minute).

Subscribe to Enough Wealth. Copyright 2006-2008