Monday, June 01, 2020

CB Prosperity Diaries #12 - Circuit Breaker : Endgame

Today is officially the last day of the circuit breaker.

In practice, nothing has changed for me since face to face classes has yet to resume and all the shops I like to shop at (like Kinokuniya) remain closed. Nevertheless, looking at the infection and discharge numbers in Singapore, things should be looking up and we should be back in full swing in July.

On the whole, the circuit breaker has been a good time for me even though I expect to be negatively impacted if this goes on for a further three or more months. Let me break down my situation into different components.

a) Training business 

We were really lucky to have a number of positives offset the negatives in my business. Although I was unable to meet our students face to face, our webinars are attended by hundreds of participants and we are able to survive throughout this period.

Transitioning into webinar classes was also quite smooth - we broke our lessons into smaller chunks and allowed more time to absorb the material. As we offer one day of face to face classes for all students, I will have three batches of students waiting for their lab sessions once the circuit breaker is up. I will honour this commitment because I still believe that networking and teamwork are important in the learning process.

The training business has changed irrevocably with the lockdown. We're no longer afraid of webinars and my future lessons will combine face to face classes with webinars. By 2021, I expect my program to become 4-day affairs - two weekdays and one weekend.

b) Financial markets

I've been quietly positioning myself to be hyper-bullish from 28 March when I conducted the 12th batch of my class. While I cautioned my students to hold back on leverage then, I took the portfolio they built and leveraged it by x1.25. ( Even without leverage, the students who went with me in March 2020 got their school fees back within 3 months. )

Thereafter, I've been upping my leverage and by early May, I was back at x2. As my computer program informed me that markets have already rebounded 10% from the bottom of 2,233, I have moved on and even went as far as to incorporate a V-shaped recovery stance relatively early. Things have been moving along fine today.

While I could have been more bullish in March by I know psychologically that's impossible. I am plugged into several discussion groups and decided that I cannot afford to be as bearish as the rest of the retail investors if I want to exploit the market recovery.

So far it's paid off rather well.

c) Financial Programming