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This weblog is in reply to a remark by a reader who desires to know my opinion on what he thinks are “poor governance and regulatory oversight by MAS, DBS (its sole bookrunner) and SGX” within the case Eagle Hospitality Belief.
Hello HH Low,
Sadly, we can not all the time be proper and I’ve been mistaken quite a lot of occasions myself.
With Eagle Hospitality Belief (EHT), I used to be most likely within the minority in sounding the alarm as many funding bloggers and analysts have been saying the Belief was severely undervalued as its unit value declined.
Many purchased into the Belief and lots of extra adopted.
The significance of not driving on coattails and to do our personal due diligence actually can’t be overemphasized.
Additionally, it pays to do not forget that:
“We’d have completely different necessities and definitely completely different circumstances.
“So, it’s most likely not a good suggestion to trip on another person’s coattails, regardless of how well-known that somebody is.”
For instance, many have been shopping for into Alibaba since its inventory value went right into a tailspin and this has lasted many months.
There’s a saying that inventory costs circulation down a river of hope and it definitely has been the case for Alibaba.
Low can go decrease and if we don’t have deep pockets like Charlie Munger and need to borrow cash to spend money on Alibaba, we may be in for a lot of sleepless nights.
Common readers know the place I stand on such issues.
Not many have the abdomen for volatility and fewer nonetheless have the abdomen for continually declining inventory costs with no backside in sight.
It may be a greater concept to attend for costs to backside earlier than shopping for and that was what I did within the bear market final yr.
I’d miss out on some positive aspects however I might have spared myself fairly a little bit of psychological agony.
For instance, see:
Anyway, I digress.
Within the case of Eagle Hospitality Belief, for higher or for worse, like all the time, I caught to my views and it turned out I used to be proper about EHT.
The lesson?
We now have to do not forget that there is no such thing as a free lunch on this world and no one cares extra about our cash than we do.
Though I feel that individuals who have executed mistaken needs to be punished, in the true world, evil isn’t all the time punished whereas the great and the harmless usually pay heavy costs.
So, as a substitute of relying on regulators and consultants to do a great job, it’s most likely a good suggestion for us to be a bit cynical and if one thing is simply too good to be true, take a more in-depth look as a result of it might certainly be so.
I’m not the neatest individual round however I prefer to assume that I’ve some widespread sense which I imagine is widespread sufficient that most individuals have it.
I simply occur to make use of my widespread sense a bit extra, perhaps.
For anybody who may be , these are a few of my previous blogs on Eagle Hospitality Belief:
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