Posted by dumbMoney > 2023-07-02 04:05 | Report Abuse

Theoretically, if there is no limit to the amount of shares buyback allowed, it is then a riskless arbitrage between cash represented by the shares and cash itself and any price discount can be controlled by the company. This is also how ETF can control the tracking of its share price against the index by creating and buying back its own shares depending on the supply and demand in the market.

Posted by Integrity. Intelligent. Industrious. 3iii (iiinvestsmart)$€£¥ > 2023-07-02 07:41 | Report Abuse

iCAP
2010 RM 1.97 (share price)
2023 RM 2,08 (share price)
Total Dividends received RM 0.295

R = (2,08 - 1.97 + Dividends) / 1.97
= (0.09 + 0.295) / 1.97
= 0.304 / 1.97
= 0.15x

Posted by Integrity. Intelligent. Industrious. 3iii (iiinvestsmart)$€£¥ > 2023-07-02 07:44 | Report Abuse

>>>
iCAP
2010 RM 1.97 (share price)
2023 RM 2,08 (share price)
Total Dividends received RM 0.295

R = (2,08 - 1.97 + Dividends) / 1.97
= (0.09 + 0.295) / 1.97
= 0.304 / 1.97
= 0.15x

>>>




Did you know that if you bought ICAP shares 2 years ago, its share price has jumped 18.5% while the KLSE plunged 14.4%? 🤣🤣🤣

Posted by speakup > 2023-07-02 08:20 | Report Abuse

Good to see Icap move up a bit lately. Few weeks ago was below rm2

Posted by speakup > 2023-07-02 08:21 | Report Abuse

Of course nothing to shout about. Still better than nothing

Posted by Integrity. Intelligent. Industrious. 3iii (iiinvestsmart)$€£¥ > 2023-07-02 14:43 | Report Abuse

>>>
iCAP
2010 RM 1.97 (share price)
2023 RM 2,08 (share price)
Total Dividends received RM 0.295

R = (2,08 - 1.97 + Dividends) / 1.97
= (0.09 + 0.295) / 1.97
= 0.304 / 1.97
= 0.15x

>>>


FD
2010 RM 1.97
2023 RM 1.97
Interest received 3% yearly
R = (1.97 - 1.97 + Interests) / 1.97
= (1.97 - 1.97 + 0.7092) / 1.97
= 0.7092 / 1.97
= 0.36 or 36%

Posted by Integrity. Intelligent. Industrious. 3iii (iiinvestsmart)$€£¥ > 2023-07-02 14:43 | Report Abuse

>>>
iCAP
2010 RM 1.97 (share price)
2023 RM 2,08 (share price)
Total Dividends received RM 0.295

R = (2,08 - 1.97 + Dividends) / 1.97
= (0.09 + 0.295) / 1.97
= 0.304 / 1.97
= 0.15x

>>>


FD
2010 RM 1.97
2023 RM 1.97
Interest received 3% yearly
R = (1.97 - 1.97 + Interests) / 1.97
= (1.97 - 1.97 + 0.7092) / 1.97
= 0.7092 / 1.97
= 0.36 or 36%

Posted by JohnD0ugh > 2023-07-02 22:56 | Report Abuse

It is extremely important to revisit the investment objective and investment policy of icapital.biz Bhd, which should be the ONLY criteria one uses to evaluate a fund manager's performance.

i Capital Newsletter Volume 30 Issue 1 (www.icapital.biz)

Posted by dumbMoney > 2023-07-03 09:49 | Report Abuse

@Integrity So is the share a low risk high returns investment as claimed?

Posted by DividendGuy67 > 2023-07-03 22:32 | Report Abuse

It is true that ICAP NAV has massive discounts to their market prices. There is a reason for this that is structural.
Basically, Market does not believe TTB can sell its holdings at market value. Just look at how concentrated ICAP holdings are, look at their stock prices, and ask yourself - what will happen if TTB tries to sell at current depressed market? I believe, its holdings will collapse, market value collapse, and the NAV crashes. Look at ICAP biggest holdings:
1. Sam Engineering 17.9%
2. Padini Holdings 14.0%
3. Kelington Group 9.0%
4. Capital A 4.3%
5. Kronologi Asia 3.3%
6. Apex 3.0%
7. Suria Capita 3.0%
8. Hibiscus Petroleum 2.8%
9. United Plantation 2.6%
The Top 9 represents 60% of its NAV. Nearly 30% is in Cash. Remaining 10% is spread across many small stocks.

If you want to own ICAP, ask yourself first - do you want to own all of its Top 9 holdings today, even at 50% discount and never sell? These stocks has a tendency to crash when there's a big seller.

There is a simple way for TTB to raise its share price. Just pay 7% dividend every year - he has tons of cash. He has tons of NAV. If the stock value holds, he should be able to sell some of the high value stocks convert to cash and pay cash out. If he does this, his stock price will SOAR to bridge the NAV discount to nil.

But 2 reasons why he won't do it.
1. He doesn't like to sell so much.
2. He is stubborn and doesn't believe in paying out high dividends.

Coupled with, market not believing in his holdings.

The only reason you want to own ICAP is because:
1. You think bull market is coming - in bull market, ICAP discount will shrink.
2. You believe TTB will start cashing out some of its biggest (speculative) holdings in such a way that he's able to convert to cash without causing the market price to crash.
3. You believe TTB will start paying out high dividends more than EPF rate like 7%.

He has loads of cash. He can afford to pay 7% dividends for many many many years.

Posted by DividendGuy67 > 2023-07-03 22:40 | Report Abuse

ICAP is a speculative fund - the fund holds a lot of warrants. I personally avoid that.
I also would never own Capital A for up to 4.3% of my portfolio, but TTB isn't worried about that.
I would not own so much (more than say 6% of portfolio) like 17.9%, 14.0% and 9.0% in Sam Eng, Padini, Kelington. I have zero holdings in these 3 counters. I just don't believe in more upside for them, and think there's more downside than upside, but I could be wrong.

Posted by DividendGuy67 > 2023-07-03 22:42 | Report Abuse

I see a few people quoted what TTB writes. It's okay, but do use your own independent mind to look beyond what he's written. Analyze what he owns, rather that regurgitate what he says. I personally ignores what he says and just look at what he owns. I ask myself - do I want him to manage my funds? The answer = I'm not too sure, because he's a speculator. If I was 30 years younger, maybe, but not today.

Posted by DividendGuy67 > 2023-07-03 22:44 | Report Abuse

However, one day, when Malaysia market gets to bull market - then, ICAP will do very well with its speculative strategy owning warrants and owning high growth stocks. That massive discount will shrink giving super booster returns. The question though is - when will KLCI turns into a super bull market? I think still a few years to come.

Posted by DividendGuy67 > 2023-07-03 22:56 | Report Abuse

Consider PADINI. To me, the chart looks "tired". Massive run up till mid 2018, then, massive crash from 6.2 peak down to 1.78 low - this kind of price action is not really a Warren Buffett type stock, but speculative stock. PADINI has a lot of competition, I think the high of 6.2 will not be met again for many years to come. The chart just screams "tired" to me. Owning 14.0% out of 70% in stocks in PADINI is not what I would do.

Posted by DividendGuy67 > 2023-07-03 23:02 | Report Abuse

Consider SAM. To me, the chart needs to "consolidate". It has gone up too fast too soon. That massive run up from Rm2 to RM6.4 and then crashed down to RM2.76 is not for the faint hearted. This is also not a Warren Buffett type stock, looks more speculative to me. It is ICAP biggest holding at nearly 18% holdings out of 70% stocks, his number 1 holding. I like to see TTB tries to sell SAM and see what happens to the stock price if he tries to cash out - e.g. if he tries to reduce his 18% holdings down to say 5%. SAM I think will crash if he does that.

Posted by DividendGuy67 > 2023-07-03 23:03 | Report Abuse

In short, I think that NAV of 3.42 cannot be converted into cash in this current environment.
It needs a strong bull market and TTB has to have the discipline to sell when the stocks he owns rises - if he tries to sell when the price is coming down, he will only accelerate the NAV fall.
Trouble is Malaysia KLCI market is not in a bull market right now, hence, the huge discount to NAV.

Posted by DividendGuy67 > 2023-07-03 23:06 | Report Abuse

My other criticism of TTB is that he has no exit strategy for his top speculative holdings - he doesn't seem to have a credible exit strategy for SAM or for PADINI yet. It's different if it's not speculative, but looking at the price action for both, it's too speculative for me.

Posted by DividendGuy67 > 2023-07-03 23:14 | Report Abuse

Sadly, ICAP share price has been flat for the last 10-15 years, with its ups and downs. In Sep 2007, its share price is the same as today. That's nearly 16 years. Anyone who puts monies into FD to earn 3% p.a. will have beaten ICAP hands down. Anyone who puts monies into EPF to earn 5%-6% would have beaten ICAP hands down.

The question is why does FD and EPF outperforms ICAP? The answer lies in its holdings. When you own speculative stocks and warrants, you need to buy low and sell high, not sit on it for too long. If you sit too long on speculative stocks and warrants, you are not going to perform well.

Posted by DividendGuy67 > 2023-07-03 23:18 | Report Abuse

lastly, if your fund manager plays warrants and trades speculative stocks, what you want the manager to do is to pay regular yearly dividends. You don't want him to hoard lots of cash, because one day, he's going to use that cash to buy more warrants and more speculative stocks and that won't be a happy ending.

If shareholders forces him to have the discipline to pay regular dividends (one that beats EPF), his stock price is going to SOAR.

Posted by enigmatic [bamboo investing style] > 2023-07-03 23:39 | Report Abuse

DividendGuy67, I'll reply you on my personal capacity & understanding as a shareholder.

1) ICAP is not a speculative fund. Otherwise, TTB would just trade goreng stocks, instead of buying boring stocks like UTDPLT or SURIA.

2) Why would TTB sell PADINI when PADINI dividends has reduced the cost price to 0?

3) SAM is meant to be purchased for the longer term. Some of SAM's shares were sold when the share price went up too quickly previously.

4) TTB applies similar value-investing principles to Buffett, but doesn't invest totally like Buffett. When Buffett sold airlines stocks, TTB purchased Airasia (now CAPITALA).

5) But I agree with your point that the discount to NAV is a structural one, although I differ on the point where a bull market will shrink the discount. ICAP had been trading at a discount despite the bull or bear market in the past 10 years.

6) Whether a portfolio is concentrated or diversified, is not a problem if it delivers good returns. I fail to see why that is an issue with TTB, when Buffett also applies a concentrated portfolio investing method.

7) On dividends, ICAP never claimed to be a dividend fund. In fact, the issue of dividends should not arise, unless ICAP decides to change its aim to a dividend-paying fund. Note that the two special dividends given in 2013 and 2022, were under very exceptional conditions.

Posted by stockraider > 2023-07-04 13:18 | Report Abuse

Liquidation day of icap is coming & closer loh!

Posted by ahbah > 2023-07-04 13:44 | Report Abuse

When is the liquidation day, please. Thanks.

Posted by ahbah > 2023-07-04 13:49 | Report Abuse

Icap ... on uptrend now ? Why ?

Posted by Patient Investor > 2023-07-04 22:00 | Report Abuse

Any shareholders interested to push for liquidation?
Fundsmith, which is labeled as Berkshire hathaway of UK liquidated one of their close end fund due to share price keep trailing below NAV.
I dont see TTB can do much better, and from the AGM, Terry smith speaks more sense than Tan Teng Boo.
Tan Teng Boo has a tendency trying to school the shareholders, and a biase tendency towards China.

The thing I dont like most is if compare how much salary the icap team draws for past five years vs the results, it sucks!

Posted by speakup > 2023-07-04 22:02 | Report Abuse

Yes liquidate please

Posted by Nepo > 2023-07-05 10:08 | Report Abuse

price resilient because of parkson share price spike up..

Posted by ahbah > 2023-07-05 14:28 | Report Abuse

ttb n co are working veri hard to keep their esi job n their big fat gaji onli ?

Posted by dumbMoney > 2023-07-05 19:23 | Report Abuse

@Patient Investor No need to look so far, all the 3 CEF's managed by the major banks in Singapore went for self liquidation some time ago when they can't tackle the persistent price discounts.

Posted by sense maker > 2023-07-06 19:06 | Report Abuse

TTB’s main objective is to prolong his job that comes with handsome remunerations for as long as possible. It’s not to return as much money as possible to all shareholders as soon as possible. He uses excuses like low risks, prudent management, to hide his competence, without avail. When the fund is due to close shop and return the money to its shareholders? TTB can use his own money to make or lose money, and release this fund shareholders who are caught or imprisoned like JJPTR scheme.

Posted by speakup > 2023-07-06 21:26 | Report Abuse

as long as Icap continue going up to rm3, he can keep his job

Posted by fairplay > 2023-07-07 10:20 | Report Abuse

The persistent market discount of share price reflective of sentiment of poor prospect under current fund manager

Posted by speakup > 2023-07-08 08:19 | Report Abuse

a few weeks ago, icap was trading below 2. today it is 2.17. up a bit, but long way to go to repair TTB's tarnished reputation. if icap touches 3, TTB will be vindicated. only if it touches 3.

Posted by dumbMoney > 2023-07-08 16:29 | Report Abuse

@speakup You can see who has been actively buying up the shares. Putting money where his mouth is. The question is, why not a company share buyback? Keeping them as treasury shares do not deplete the AUM numbers.

Posted by JohnD0ugh > 2023-07-09 13:47 | Report Abuse

Imagine having a community where you share common goals, values, and interests. A place for you to talk about any number of topics, from investment ideas to the latest market trends to confusing local and global politics to Japan's cruel plan to release radioactive water into the Pacific Ocean or to more light-hearted events like durian picnics or kopitiam hopping and the list goes on. Imagine building camaraderie with those you least expect, all because you are all capital. biz Berhad share owners. Enter the ICAP Fan Club.

Our research shows that the number of individual shareholdings has fallen. What started off as an impressive range of 98 to 100% from the years 2005 to 2010, has fallen to 90% in 2011 and steadily decreased to 76% by 2023. At the same time, the institutional shareholdings are growing year by year.

Hence, the launch of the proposed ICAP Fan Club.

We aim to provide a space for like-minded individual shareholders to convene, no matter your shareholdings are or if you are 18 or 90 years old. We aspire to create, promote, and sustain positive values through sound investing, nurturing a harmonious prosperous society, and working towards a sustainable environment. The ICAP Fan Club is greater than just money; it is a long-term effort to leave behind a near-ideal world for our future generations.

Preliminary details of the ICAP Fan Club are:
It will be registered as a Society under Jabatan Pendaftaran Pertubuhan Malaysia (JPPM), takes around 1-3 months to set up;
It will be governed by The Societies Act 1966;

The proposed ICAP Fan Club will be a National Level Society. Hence, 7 compulsory committee members, each from different state, are required:
President
Vice President
Secretary
Assistant Secretary
Treasurer
2 committee members

Proposed types of membership:
Ordinary membership (must own ICAP shares): carry rights to vote and hold position.
Associate, Honorary, Life-long memberships:
No right to vote and hold position.

The proposed ICAP Fan Club will provide a sense of belonging and emotional bond that we naturally crave as humans, and which have been lacking due to the pandemic these past few years. Through this fan club, ideas will be exchanged, knowledge and experience will be shared, and friendship will be formed.

Suggested activities include research visits to listed companies with Tan Teng Boo himself, casual fireside chats on various topics, and other recreational activities and trips and the list goes on.

Once you are a member, you will be entitled to an exclusive members-only online space where forums and discussions can be held. You will also receive priority tickets for all Capital Dynamics events, and purchase ICAP and Capital Dynamics products, except the funds, at discounted rates.

So, what are you waiting for? Join us in making history by registering your interest. Or you can join in our nationwide ICAP roadshows for more details. When formed, the ICAP Fan Club will be the first of its kind in Malaysia.


i Capital Newsletter Volume 34 Issue 43 (www.icapital.biz)

Posted by dumbMoney > 2023-07-09 14:12 | Report Abuse

Who is going to fund the club, Capital Dynamics or the company, given that the name is ICap Fan Club, not Capital Dynamics Fan Club? So is this going to be like campaigning before the AGM, with road shows and ceramahs to bolster the support base?

Posted by speakup > 2023-07-09 15:36 | Report Abuse

Speaku not subscriber of Icap newsletter but is a small shareholder of Icap. Can join fan club?

Posted by Nepo > 2023-07-10 15:19 | Report Abuse

i don't wwant to join this club

Posted by RealValueInvestor > 2023-07-10 16:57 | Report Abuse

ICAP Fan Club! You couldn't make this stuff up! Welcome to the surreal world of John "TTB" Dough.

There are many causes for discounts, and many possible cures but not having a fan club and deciding to invent one is a very odd route to choose

Posted by dumbMoney > 2023-07-10 18:10 | Report Abuse

Fan clubs are so archaic, why not just a FB, Instagram or Twitter account? These are free, and you can use big data to track your followers and their response? Just look at Elon Musk!

Posted by Patient Investor > 2023-07-12 16:21 | Report Abuse

@dumbmoney If online platform works, EM wont ask everyone to report back in office to work.

Posted by stockraider > 2023-07-14 11:06 | Report Abuse

Kick the bugger TTB out & opt for coming liquidation of icap loh!

Stop continuing destroying your asset networth by underperformer fd investor like TTB loh!

Posted by JohnD0ugh > 2023-07-16 10:40 | Report Abuse

As stated in Item 1.2 of the Prospectus, "The primary investment objective of capital. biz Bhd is long-term capital appreciation of its investments, whilst dividend and/or interest income from these investments would be of secondary consideration."

On investment policy, "icapital. biz Bhd will select companies where there is a disparity between the company's market price (in the case of listed securities) and selling price (in the case of unlisted securities) and underlying business values over the medium to long-term. icapital.biz Bhd may also invest in cash deposits and/or in short-term obligations in order to have funds available for general corporate purposes. It may also maintain such cash deposits for defensive purposes or to enable it to take advantage of buying opportunities."

Therefore, our analysis here will focus on three questions: has the fund manager achieved this investment objective? Has the fund manager's investment followed its investment policy? More importantly, if the fund manager has or has not delivered as promised, why is this so?


i Capital Newsletter Volume 30 Issue 1 (www.icapital.biz)

Posted by Nepo > 2023-07-16 12:13 | Report Abuse

So you select Salute no hope company and remains in the portfolio and now you claim Salute overview still ok?

Posted by blackrock88 > 2023-07-17 13:14 | Report Abuse

Investing in this fund trading at a significant discount from its NAV may not necessarily present an arbitrage or favorable opportunity due to several factors that contribute to this situation. These factors include market expectations regarding the fund's future performance, the credibility of the fund manager, stock liquidity, and dividend policies, among others. Shareholders of such funds have not experienced any substantial returns (apart from occasional dividends) over the past decade. Therefore, it might be more prudent to consider alternative investments, such as reputable bank stocks like Maybank, which offer a 7% dividend yield, thereby minimizing the opportunity cost associated with investing in discounted funds. Do not forget that, the fund manager is getting RM7m+ management fee annually with very minimal transaction on their stock allocation to really improve the fund performance.

Posted by dumbMoney > 2023-07-17 15:03 | Report Abuse

@blackrock88 I have suggested that this is not a simple arbitrage case between market price and NAV, but a risk arbitrage hoping that there can be a fundamental change to the status quo. Caveat emptor.

Posted by JohnD0ugh > 2023-07-23 13:36 | Report Abuse

With a long-term investment approach, icapital.biz Bhd can always make absolute gains in the long term. We can confidently say Capital Dynamics has met icapital.biz Bhd's investment objective as stated in its Prospectus.

More importantly, the only way Capital Dynamics can be incentivised is to grow the NAV. Today, if the NAV of icapital.biz Bhd is still RM140 mln, Capital Dynamics would still be getting the same fees in terms of absolute amount compared with 13 years ago.

To evaluate whether the fund manager has followed icapital.biz Bhd's investment policy by investing in stocks of which the market value is significantly lower than the underlying business value, we look at the investments of icapital.biz Bhd.

We find icapital.biz Bhd's performance has mainly been the result of capital gains instead of dividends received from its underlying investments.

We also check whether the fund manager has made a good use of its cash to fulfil the investment policy's requirement on "defensive purposes or to enable it to take advantage of buying opportunities."

In contrast to the situation from 2006 to 2012, the cash level of icapital.biz Bhd has since been rising gradually, in response to a higher-risk, lower-return investment landscape.

Said change of cash level demonstrates that Capital Dynamics has treated cash as a call option with no expiry date, an option on every asset class, and with no strike price.

icapital.biz Bhd's performance is mainly driven by capital gains with dividends only contributing a minor part. We can therefore conclude that Capital Dynamics has followed the investment policy laid out in the Prospectus.


i Capital Newsletter Volume 30 Issue 1 (www.icapital.biz)

Posted by dumbMoney > 2023-07-23 22:12 | Report Abuse

Under Section 6.7 of the company's prospectus "“ Managing Discounts
A CEF and/or its shareholders have the power to take action to narrow or eliminate the discount. Some of the options that may be available include share repurchase, open-ending, takeover, liquidation, managed distribution policy and shareholder activism.”
Why is the company so opposed to any of the above as proposed by shareholders?

Posted by DividendGuy67 > 2023-07-24 23:49 | Report Abuse

TTB tries to talk like Buffett, but the 2 are so completely different than one another.
- Buffett buys back Berkshire stock where Berkshire trades near NAV, consequently, Berkshire always trade at a premium to NAV.
- Whereas ICAP persistently trades a huge discount to NAV. TTB clearly doesn't believe in ICAP value to buy back ICAP shares on the cheap.

Posted by Patient Investor > 2023-07-25 17:15 | Report Abuse

TTB might not be buying back, but you can buy, buy until it move towards NAV. its still 30% below NAV as of now. ICAP only remains about 20-30% cash, which need to be used for bargain hunting

Posted by JohnD0ugh > 2023-07-30 12:44 | Report Abuse

The explanation of icapital.biz Bhd's superior performance

Investors are bombarded with good performance results from all kinds of investment products or investment managers. The fact of the matter is that only good results will reach us, as no fund management company would advertise a fund with a bad track record. This is a classical self-selection bias problem.

So a smart investor will always ask: what are the explanations for or sources of such good performance? Will these sources or factors persist in the future? This is like when we analyze a listed company: what are the company's moats or competitive advantages, how persistent are they?

If we do not understand the rationale behind icapital.biz Bhd's past performance to appreciate why Capital Dynamics is a good fund manager, we may be easily distracted by things unimportant or irrelevant to icapital.biz Bhd's investment objective.

Investors may even wonder: are Capital Dynamics and Tan Teng Boo the lucky fools that Nassim Taleb described in his book "Fooled by Randomness"?
We believe Capital Dynamics' secret to outperform the market is not just being good at investment, but, more importantly, avoiding most mistakes and flaws of investors, especially the inability to make long-term investment decisions based on business fundamentals. There are two common biases that have contributed to disastrous results experienced by many institutional and individual investors.

The first is institutional bias. Institutional investors are often constrained by obstacles such as: the performance pressures from short-term ranking, the compensation structure leading to too much risk, open-end funds' intrinsic inflow/outflow problem, and the frenzied atmosphere of the financial markets. As a result, institutional investors become enmeshed in a short-term relative-performance derby, in which temporary price fluctuations and the latest market fads become the dominant focus.

The second bias is behavioral bias. Emotions, especially greed and fear, have always driven investors to become their own worst enemies. When prices are generally rising, greedy investors become more optimistic about speculating by focusing on return while ignoring risk. On the other hand, when the market tumbles, the fear of loss causes investors to focus solely on the possibility of further price declines to the exclusion of business fundamentals.

Let us see how icapital.biz Bhd has overcome said two biases to achieve a superior performance.


i Capital Newsletter Volume 30 Issue 1 (www.icapital.biz)