Posted by JohnD0ugh > 2023-04-30 14:35 | Report Abuse

Will icapital.biz Berhad's (ICAP) NAV discount be there forever ? Should ICAP not be wound up in order to realise its underlying asset values ?

Well, first of all, ICAP was set up by Tan Teng Boo as a CEF meant for long-term investors. How long is long ? Let us learn a few lessons from Scottish Mortgage Investment Trust PLC, an investment trust listed on the London stock exchange.

Lessons from Scottish Mortgage

Scottish Mortgage Investment Trust PLC (Scottish Mortgage) is an investment trust that aims to maximise total returns over the long term from a high-conviction, actively-managed portfolio. This is similar to ICAP.

It invests globally, looking for strong businesses with above-average returns.

It was launched in 1909, about 112 years ago. In comparison, ICAP is but a spring chicken.

Scottish Mortgage holds total assets of US$20.424 bIn.

It is listed on the London Stock Exchange and is a constituent of the FTSE 100 Index.

Scottish Mortgage once traded at a persistent discount to its NAV. The discount disappeared in 2013, endowing its share price with a premium to NAV; in the last year or so, Scottish Mortgage's share price has traded around parity.

The share price of Scottish Mortgage rallied from around £44 in 1994 to above £1,300 in 2021, generating a massive gain of 29.5 times. An investment of $1,000 in 1994 would have been worth $29,500 in 2021. An investment of only $34,000 would have made one a millionaire.

The take-away here is that somebody who invested in Scottish Mortgage at a 15% NAV discount in 1994 would have gained "extra" returns from the disappearance of said discount. This is one of the most compelling strengths of a well-managed CEF - buy at a discount, sell at a premium.


i Capital Newsletter Volume 33 Issue 4 (www.icapital.biz)

Posted by speakup > 2023-04-30 17:18 | Report Abuse

Ok so when will icap turn from discount to Premium?

Posted by RealValueInvestor > 2023-05-01 01:58 | Report Abuse

I don't suppose for a second that John Dough can or will answer that. In fact, John Dough's just regurgitating from ICAP corporate documents again. Anyone would think he had something to do with the Company!!! Surely not, but maybe he just lacks wit and/or imagination, else he wouldn't be SO DULL!

Posted by dumbMoney > 2023-05-01 04:08 | Report Abuse

ChatGPT can write much better than this, instead of sounding like a broken record. Statistics wise, I can count 3 Singapore big bank managed CEFs and one Malaysian one that were self liquidated instead of waiting for the day when they could be trading at a premium again. That's a 4:1 historical odds.

Posted by Sslee > 2023-05-01 10:15 | Report Abuse

If Tan Teng Boo still have a little bit honor/worthiness in him, he should has do the right thing liquidate icapital and return the money to shareholders.

Insteads of comparing Icap to Scottish Mortgage Investment Trust PLC (Scottish Mortgage) and degrade Icap as a spring chicken.

Posted by speakup > 2023-05-01 12:14 | Report Abuse

Agree with Sslee

Posted by qqq47660 > 2023-05-01 13:46 | Report Abuse

There is no chance of any thing changing

Posted by dumbMoney > 2023-05-01 15:43 | Report Abuse

In the letter to shareholders by UOB giving the rationale for the members' voluntary liquidation of the CEF United International Securities, this is what it said under section 2.2 Benefits of Proposed Members' Voluntary Liquidation:
"Under the proposed members voluntary liquidation, all shareholders will be able to realise their entire investments in the shares.
As at 30 September 2013, the consolidated net assets of the Company stood at aproximately S$297.7million and the Company's consolidated net asset value ("NAV") per share was approximately S$1.49. The shares have been trading on the Singapore Exchange Securities Trading Limited at between S$1.08 to S$1.21 for the 12 months prior to 30 September 2013.
The actual amount available for distribution to shareholders pursuant to the proposed members' voluntary liquidation will vary depending upon the actual realised value of the Company's underlying portfolio of assets, and will be subject to provisions and deductions to be made for all the Company's existing liabilities (including tax liabilities), and costs and expenses to be incurred in connection with the proposed members' voluntary liquidation. The proposed members' voluntary liquidation offers an opportunity to all shareholders to realise their investments in UIS at a price which is closer to the NAV per share"
UIS shares were trading in a price discount range of 18.8% to 27.5% prior to liquidation, no where near where iCap is now, and yet, management felt enough is enough, better to close it down than to confront unhappy shareholders at every AGM and EGM. Management had more than 80% support at the previous AGM, so their position was never threatened, and yet they did the honorable thing for all members.

Posted by i3lurker > 2023-05-01 16:35 | Report Abuse

sslee
You are trying to cast out evil spirits?
The evil spirits in the Bible said, Jesus I know but who are you?

Posted by JohnD0ugh > 2023-05-07 12:54 | Report Abuse

Can icapital.biz Berhad (ICAP) enjoy a similar outcome where its NAV discount vanishes ? The case for this is strong indeed. However, before we present it, one must first ask whether ICAP's NAV discount is a natural phenomenon or an artificial one.

In fact, keen-eyed investors, including the MSWG, should query City of London as to why they buy millions of ICAP shares (even going so far as to breach the regulatory 20% single shareholding limit) and consequently widen ICAP's NAV discount.

City of London used to pressure ICAP to conduct a 10% share buyback to narrow the NAV discount, while itself buying over 20% of ICAP's share capital, thereby worsening the discount it has been so persistently complaining about.

These complaints continue despite ICAP delivering an impressive performance on a consistent basis. So, what is really going on here ? Without all this interference, ICAP's share price would have been trading at a nice premium to its NAV by now, just like it did before City of London's persistent purchases.

ICAP's NAV performance over the course of its first 5,777 days was in fact superior to Scottish Mortgage's. And yet, ICAP still managed to preserve RM209 mln in cash or RM1.49 per share, poised to put it to good use at the nearest opportunity.

Perhaps Bursa Malaysia should make ICAP a constituent of the KLCI, just like the London stock exchange did with Scottish Mortgage.

On a side note, the Malaysian authorities should actively develop and promote the close-end fund industry. It will greatly benefit the Malaysian economy and capital market and thousands of retail investors.


i Capital Newsletter Volume 33 Issue 4 (www.icapital.biz)

Posted by Sslee > 2023-05-07 13:44 | Report Abuse

It should be because of TTB action against City of London (Substantial shareholder) open the eye of many potential investors that TTB will not even protect the interest of substantial shareholder what more about potecting the interest of minority shareholders that driven away all the potential investors hence consequently widen ICAP's NAV discount.

By the way because of Icap case that is why Malaysians loss their trust on close-end fund. And Malaysian authorities could never able to develop and promote the close-end fund industry due to Icap bad example.

Posted by speakup > 2023-05-07 17:23 | Report Abuse

Ttb killed the CEF in Malaysia. Rightfully so too cos he wants icap to be the one and only one listed CEF in Malaysia

Posted by Integrity. Intelligent. Industrious. 3iii (iiinvestsmart)$€£¥ > 2023-05-07 18:35 | Report Abuse

>>>>

These complaints continue despite ICAP delivering an impressive performance on a consistent basis. So, what is really going on here ? Without all this interference, ICAP's share price would have been trading at a nice premium to its NAV by now, just like it did before City of London's persistent purchases.

>>>>>


Not logical. Why should a closed end fund trades at a premium to its NAV?

The question more relevant to iCap is: why is iCap trading at a HUGE discount to its NAV? Why is this discount so much more than other closed end funds?

Is City of London the cause of this huge discount to iCap’s NAV? Personally， I have difficulty agreeing with this statement. In my opinion, many have been “burnt” in iCap than profited over the last 15 years. Few willing buyers (even though deeply undervalued) with many trapped “sellers/owners” in iCap.

What will be the catalyst that can unlock the value of iCap?

Perhaps another reason for the huge discount is the PERCEPTION that this fund’s return maybe lacklustre like the recent past decade. It did trade at a huge premium (irrationally so) its in early years soon after its launch. Why? Because the return on capital or its growth in NAV was very high.

Posted by dumbMoney > 2023-05-08 01:25 | Report Abuse

" Without all this interference, ICAP's share price would have been trading at a nice premium to its NAV by now, just like it did before City of London's persistent purchases." COL has been injuncted from further buying for more than a year now and yet the price discount has continued to widen. Why? Must thank the writer for the comic relief, my toes are laughing!

Posted by dumbMoney > 2023-05-08 15:22 | Report Abuse

Having taken COL's buying or the lack of it out of the equation, the discount is an indication of the trust deficit that has been widening along with John Dough's farcical posts.

Posted by dumbMoney > 2023-05-09 17:45 | Report Abuse

"In fact, keen-eyed investors, including the MSWG, should query City of London as to why they buy millions of ICAP shares (even going so far as to breach the regulatory 20% single shareholding limit) and consequently widen ICAP's NAV discount."
Having lost its case against COL with the Securities Commission, High Court and Court of Appeal that it has breached the 20% individual shareholding limit, why is the Company still insisting that there is a breach? Until it can overturn the previous verdicts with appeal to the Federal Court, the legal rulings stand, there is no breach, and any statement to the contrary is non-factual and against the court rulings. A minority ruling in its favor does not alter the verdict. Sure, spending more money on legal fees and appeal by all means, if the board of directors is convinced that it is in the shareholders' best interest to fight against the largest shareholder. It only delays the inevitable.

Posted by dumbMoney > 2023-05-10 00:05 | Report Abuse

One of the company's director is chairman of the MSWG. Does he agree that COL has breached the shareholding limit in spite of the court judgments? If so, yes, go ahead and shoot them a show cause letter as suggested above.

Posted by RealValueInvestor > 2023-05-10 16:26 | Report Abuse

The Company director who is Chairman of MSWG has a clear conflict of interests and should consider resigning from one of those two posts. If ever there was a situation where the MSWG should take action ICAP is it!

Posted by dumbMoney > 2023-05-10 20:39 | Report Abuse

The only legal obligation for a shareholder who has exceeded the declarable interest threshold, which is 5% substantial shareholder here in Malaysia is to declare all his share transactions henceforth. There has never been a requirement or precedent of having to explain or justify his position or voting, unless in support of resolutions proposed by him to the shareholders.

Posted by dumbMoney > 2023-05-10 21:52 | Report Abuse

At the end of the day, the Board of Directors must be prepared to justify to shareholders the legal costs of the injunction action against COL when presenting the bill to the shareholders, or are they going to just bury it in a footnote like what they did to the dual listing multi-million expenses? So if the company wins the suit and stop COL from further buying, the price discount will turn into a premium? This is the impression I have so far.

Posted by JohnD0ugh > 2023-05-14 21:25 | Report Abuse

At RM2.08, icapital.biz Berhad (ICAP) is capitalised at only RM291.2 mln. For this, what do investors get in return?

With ICAP, investors get a very attractive NAV discount. A rise from RM2.08 to RM3.47 would yield them a handsome gain of 67% with hardly any major risk. Even if the discount stays at 20%, investors still get to enjoy a decent 33.5% profit.

As we have shown above, a NAV discount eventually disappears. This profit projection has not yet taken into account the likelihood of further gains in ICAP's NAV.

With ICAP, investors get a well-managed CEF, founded on integrity, and offers excellent prospects. There is in fact no reason at all to wind up ICAP - why chop down a bountiful fruit tree before it has matured ?

ASX's oldest LIC has been around since 1928. NYSE and Toronto's oldest CEFs have been around since 1929, surviving even the 1929 Great Depression.

i Capital revises its rating on capital. biz Berhad from Buy below RM3.60 to a long-term Buy.


i Capital Newsletter Volume 33 Issue 4 (www.icapital.biz)

Posted by RealValueInvestor > 2023-05-15 13:19 | Report Abuse

JohnD0ugh - Thanks for pointing out the excellent returns to shareholders from a reduction or elimination of the discount! Maybe you could have a word with your mate TTB and get him (and the board) to do something properly constructive to achieve such a wonderful outcome for investors. In fact, why not point out to TTB that buying ICAPs own shares at a 42% discount means he would be buying a portfiolio that he must believe in, 42% cheaper than is possible any other way?!

Posted by Integrity. Intelligent. Industrious. 3iii (iiinvestsmart)$€£¥ > 2023-05-15 23:06 | Report Abuse

Why did I invest in iCAP in 2005?

Essentially for long term capital gains.
Time horizon was 15 years.
Hoping for a CAGR in its NAV of 15% per year. :-)

Alas, have to settle for a lower returns. But for those who has to cash out now or soon, very sad for them as they will be leaving a lot of cash behind.

Posted by rohank71 > 2023-05-15 23:37 | Report Abuse

hotel california. check in coz cheap and want to check out can't... coz even cheaper...

Posted by dumbMoney > 2023-05-16 02:26 | Report Abuse

Instead of touting the 42% discount, it should be pointed out that buying the shares get more compelling when looked at from the potential upside, turning the current 58 cents to the dollar valuation to par is a potential 72% ROI. Keep this up and the sharks may smell blood in the water. Then it will be just a matter of making up the numbers to make it happen. It is shark bait now.

Posted by stockraider > 2023-05-16 09:20 | Report Abuse

Remember monetization will come for this stock in 2025 loh!

If u buy hold this stock n make 48% over 2.5 yrs , it is consider really good mah!

Posted by dumbMoney > 2023-05-17 00:48 | Report Abuse

One of the arguments used by management against doing a share buyback is that it will reduce the fund size (and the management fee correspondingly) and funds available for future investments. This is only true if the bought back shares are cancelled immediately. But there is the option to just hold them as treasury shares and resell them later back to the market at more favorable prices. This then is no different from holding other shares in the portfolio and if it is such a bargain as touted by management, where is the downside if they truly believe in its merits? At least, the price discount will then also becomes the company's problem and not just the shareholders', an alignment of interests.

Posted by stockraider > 2023-05-17 12:06 | Report Abuse

The issue here is when the interest of shareholders & the icap fund manager interest conflict, for good corp governance the interest of shareholder should be given preference mah!

The absurd excuse the management give for not buying back icap share.....is buying icap shares.....its share price will fall loh!

What is a silly arguement management has given loh....buying back icap will mean less supply & more demand of icap shares mah! Thus price should be up loh.....furthermore u r creating value per share as we are buying back at huge discount loh!

Posted by dumbMoney > 11 hours ago | Report Abuse

One of the arguments used by management against doing a share buyback is that it will reduce the fund size (and the management fee correspondingly) and funds available for future investments. This is only true if the bought back shares are cancelled immediately. But there is the option to just hold them as treasury shares and resell them later back to the market at more favorable prices. This then is no different from holding other shares in the portfolio and if it is such a bargain as touted by management, where is the downside if they truly believe in its merits? At least, the price discount will then also becomes the company's problem and not just the shareholders', an alignment of interests.

Posted by rohank71 > 2023-05-17 13:16 | Report Abuse

@stockraider...u r correct.

Posted by dumbMoney > 2023-05-17 15:05 | Report Abuse

The company has to maintain this absurd narrative that the more COL buys, the further the price will fall, in order to appeal its case, as the other allegation that COL has exceeded the individual share holding limit has been dismissed with costs by both the high court and court of appeal, as well as by the SC initially. Clutching at straw!

Posted by dumbMoney > 2023-05-17 15:07 | Report Abuse

COL has stopped buying for more than a year now and the discount has continued to widen. So now blame the shareholders for not knowing how good the shares is.

Posted by speakup > 2023-05-17 21:23 | Report Abuse

TTB no face anymore with Icap being the worst CEF in the WORLD!
JUARA DUNIA!

Posted by dumbMoney > 2023-05-18 23:05 | Report Abuse

Instead of John Dough paraphrasing iCapital, I have also been paraphrasing what ChatGPT said about share buy backs:
Is there a conflict of interest for a closed end fund's manager to reject suggestions for a share buy back at a deep discount on the grounds that it reduces the size of the fund (and hence its fees based on AUM)?
ChatGPT
There is a potential conflict of interest for a closed-end fund's manager when considering suggestions for a share buyback at a deep discount. The conflict arises from the fact that the fund manager's compensation is often tied to the fund's assets under management (AUM), which is influenced by the fund's size.

When a closed-end fund repurchases its own shares through a buyback program, it reduces the number of outstanding shares, effectively decreasing the fund's AUM. As a result, the fund manager's fees, which are typically based on a percentage of AUM, would also be reduced.

In this situation, the fund manager may have conflicting motivations. On one hand, the buyback program could be seen as a way to enhance shareholder value by narrowing the discount between the fund's market price and its net asset value (NAV). On the other hand, the manager may be hesitant to pursue a buyback that reduces the fund's AUM and, subsequently, their compensation.

It's important to note that the fund manager has a fiduciary duty to act in the best interests of the fund's shareholders. If a share buyback is genuinely believed to be in the best interest of the fund and its shareholders, the manager should carefully consider the proposal, taking into account the potential benefits and drawbacks.

Ultimately, the decision should prioritize the long-term performance and value creation for shareholders, rather than solely focusing on the manager's short-term compensation. Shareholders may play a role in holding the fund manager accountable for their decisions and advocating for actions that align with the best interests of the fund's investors.

Posted by RealValueInvestor > 2023-05-19 16:08 | Report Abuse

https://www.berkshirehathaway.com/letters/2022ltr.pdf

An extract from Warren Buffett's 2022 letter to shareholders, source above.
"When you are told that all repurchases are harmful to shareholders or to the country, or particularly beneficial to CEOs, you are listening to either an economic illiterate or a silver-tongued demagogue (characters that are not mutually exclusive)."

Makes you wonder which one of those applies in the case of ICAP!

Posted by dumbMoney > 2023-05-19 16:47 | Report Abuse

A WB Wannabe may need to deviate from the true teachings of WB in desperate times, as when under attack by foreign funds.

Posted by RealValueInvestor > 2023-05-19 20:03 | Report Abuse

Well Mr Money, it's not just Warren's teachings, it's Warren's actions!! Looking at the recent annual report:
https://www.berkshirehathaway.com/2022ar/2022ar.pdf
Page K-32 has a table of share repurchases for the last 3 months of last year. During that quarter Berkshire repurchased over USD2.8 BILLION worth of shares AND YET the Company still exists!

Posted by speakup > 2023-05-19 21:36 | Report Abuse

Eh! Icap tiba tiba close 2.08!
Something brewing?

Posted by Sslee > 2023-05-21 08:47 | Report Abuse

Berkshire Hathaway 3/4 of the portfolio is concentrated in just 5 companies,namely Apple, BOA, Chevro, Coca cola, AMEX.

And icapital: Include PN17 compamy.
Table 2: Size of Holdings as at 31 May 2022
Company (‘000 shares)
Bioalpha Holdings 49,058
Kronologi Asia 31,112
Capital A (formerly known as AirAsia Group) 29,282
Kelington Group 28,383
Parkson Holdings 22,942
SAM Engineering & Equipment 18,154
Padini Holdings 17,007
Boustead Holdings 12,148
Suria Capital 11,894
Capital A - RCUIDS shares 9,761
Kelington Group - Warrants 9,461
Bioalpha Holdings - ICPS 7,665
Luxchem Corporation 5,007
Capital A - Warrants 4,880
APM Automotive Holdings 4,541
OCK Group 3,410
Oceancash Pacific 3,145
MKH 2,951
Apex Healthcare 2,283
Tong Herr Resources 1,888
HPMT Holdings 1,803
Salutica 1,700
Wellcall Holdings 1,514
United Plantations 165
Eupe Corporation 100

Posted by speakup > 2023-05-21 11:29 | Report Abuse

Some good companies very hard to accumulate a lot without pushing up the share price a lot coz free float is low.

Posted by JohnD0ugh > 2023-05-21 12:05 | Report Abuse

Another way a value investor expresses their humility is by holding cash - lots of it in fact - when there is nothing attractive to invest in. If there are not enough securities to fill out a portfolio that meet value investing criteria, the answer is simply to hold cash until such securities can be found.

To be sure, holding cash is not the ultimate aim of a value investor; it is a by-product of the value investing process where humility is a huge part of its risk management. Take the still unfolding Covid-19 pandemic for example.

Due to the infectious nature of the novel coronavirus and the suddenness of the pandemic, governments worldwide were forced to implement lockdowns or impose strict restrictions on physical social interactions.
The impact on many businesses and firms brought business operations to an immediate standstill, and hence cash instantaneously stopped flowing into these businesses and firms. Enterprises, big or small, that do not have strong balance sheets, which always mean cash or near cash, are screaming for help. It is cash or perish.

For businesses and firms, cash is a necessity for dealing with the unexpected. Cash is the heart and blood of businesses. Cash and liquidity are much more important to a firm's survival than earnings or profitability.
Cash serves a similar purpose from an investor's or a portfolio manager's standpoint. Cash is the most vital raw material for an investor. If one can be absolutely sure that all the stocks one has bought are the correct stocks at the correct prices and valuations, or that there will not be any better opportunities coming your way later, then holding cash become superfluous. How can one be so cocky?

As Tan Teng Boo has previously shared, holding cash is like holding a very valuable option, except that it is one with no expiry date. The value of an option depends on its expiry date, amongst other factors.

The longer the expiry date, the more valuable the option becomes. An option has a fixed conversion price. With cash, it is the investor or the fund manager who decides what the conversion price will be. Since a value investor will buy only at an attractive price, the value of the option or cash goes up.

In summary, whether one is managing a business or managing a portfolio, it is a privilege to have a strong balance sheet now, one that is especially filled with cash.


i Capital Newsletter Volume 31 Issue 36 (www.icapital.biz)

Posted by speakup > 2023-05-21 12:34 | Report Abuse

TTB holding a lot cash cos hoping for another Asian Financial Crisis where he can buy Maybank for rm2

Posted by Income > 2023-05-21 12:59 | Report Abuse

Now inflation, cash is trash… 🤣

Posted by Nepo > 2023-05-21 14:34 | Report Abuse

Icap valuation is hitted by Parkson. What is Parkson future?
Bankrupt or it is chance to add more for physical retail mall share..?

Who knows?
.

Posted by dumbMoney > 2023-05-21 14:51 | Report Abuse

One more subtle and specific reason for iCap to oppose a share buy back is the threat posed by COL's big shareholding. A buyback reduces the number of voting shares and if COL's holding remains the same, a 10% share buyback increases the effective percentage of COL's block by 10% (not 10 percentage points), which may be critical in the coming proxy war.

Posted by speakup > 2023-05-21 14:59 | Report Abuse

If recall correctly, Icap already make impairment loss for Parkson a few years ago

Posted by dumbMoney > 2023-05-21 17:44 | Report Abuse

@Nepo Very simple question, is continuing to hold Parkson a better investment than switching to iCap? Why tout iCap is such a great buy at a discount and yet maintains that there is nothing worth buying in the market at the moment, hence the cash pile? At least try to be consistent and not insult the intelligence of the readers here by implying that Parkson is a better buy than iCap.

Posted by stockraider > 2023-05-21 17:49 | Report Abuse

When u r holding cash, like no cost of doing to him, like as in the case of TTB holding alot of cash for many years. surely u want to claim holding too much cash is not trash loh!

osted by JohnD0ugh > 5 hours ago | Report Abuse

Another way a value investor expresses their humility is by holding cash - lots of it in fact - when there is nothing attractive to invest in. If there are not enough securities to fill out a portfolio that meet value investing criteria, the answer is simply to hold cash until such securities can be found.

To be sure, holding cash is not the ultimate aim of a value investor; it is a by-product of the value investing process where humility is a huge part of its risk management. Take the still unfolding Covid-19 pandemic for example.

Due to the infectious nature of the novel coronavirus and the suddenness of the pandemic, governments worldwide were forced to implement lockdowns or impose strict restrictions on physical social interactions.
The impact on many businesses and firms brought business operations to an immediate standstill, and hence cash instantaneously stopped flowing into these businesses and firms. Enterprises, big or small, that do not have strong balance sheets, which always mean cash or near cash, are screaming for help. It is cash or perish.

For businesses and firms, cash is a necessity for dealing with the unexpected. Cash is the heart and blood of businesses. Cash and liquidity are much more important to a firm's survival than earnings or profitability.
Cash serves a similar purpose from an investor's or a portfolio manager's standpoint. Cash is the most vital raw material for an investor. If one can be absolutely sure that all the stocks one has bought are the correct stocks at the correct prices and valuations, or that there will not be any better opportunities coming your way later, then holding cash become superfluous. How can one be so cocky?

As Tan Teng Boo has previously shared, holding cash is like holding a very valuable option, except that it is one with no expiry date. The value of an option depends on its expiry date, amongst other factors.

The longer the expiry date, the more valuable the option becomes. An option has a fixed conversion price. With cash, it is the investor or the fund manager who decides what the conversion price will be. Since a value investor will buy only at an attractive price, the value of the option or cash goes up.

In summary, whether one is managing a business or managing a portfolio, it is a privilege to have a strong balance sheet now, one that is especially filled with cash.

Posted by Sslee > 2023-05-21 19:33 | Report Abuse

If you put your money in FD earning an interest rate of i and your country inflation rate is R. The your RM 1 million after 5 year will have NPV of RM [(1+i)/(1+R)]^5

If your interest rate is 3 % or i = 0.03
And R inflation is 6% or R = 0.06
Then your NPV of 1 million is (1.03/1.06)^5 = 0.8663 million

Posted by dumbMoney > 2023-05-21 22:47 | Report Abuse

If holding cash as a free option is such a great idea, then being able to buy cash at a 42% discount (the same discount that the cash portion of iCap's portfolio is valued at) will be an even greater idea? With the same logic that there are no better values in the current market than holding cash, then by implication, the current portfolio is considered better than holding cash, otherwise, they should also be converted into cash. So all the more reason to buy more of the same shares at a great discount? John Dough should have realised by now that the crowd here is quite different from the average Investor Day attendee.

Posted by stockraider > 2023-05-22 07:05 | Report Abuse

Ya loh.....TTB holding exceptional excessive cash in Icap for more than 6 yrs mah....his excuse is cannot identify good investment.....but even when he identify stock acceptable....he buy like pundann mah!

I think TTB strategy just want to lock in his fees longterm....not really investing for shareholders interest mah!

If he really invest for the interest shareholders interest....he should do share buy back for the shareholders mah!

It is a no brainer surewin for icap bcos it is deeply undervalue mah!

Warren Buffet also buy back berkshire but the discount is not as great compare to icap mah!
But buffer this is profitable n still see very safe positive value for its shareholder doing buy back mah!

The key is good corp governance loh!