Tuesday, April 10, 2007



MEIN PORTFOLIO

I bet you were wondering what i have on my CDS Account.

Here it is:

TOTAL
BAT
EQUITY BANK

sales in the past4 months

Eveready

Jubilee Holdings

KENOL

TOTAL(my stake is much smaller)

MUMIAS

Comments
Made a kill on Jubilee.I got in at sh.180 and sold at sh.300.Sold EVEREADY @SH.16. Sold TOTAL at a loss i.e. bought it @ sh.35-37 18 months ago.Sold at Sh34-32 .
Mumias made a loss of sh4 per share on the sale.

GOALS

I'm still engaged in flipping i.e. i buy and sell shares as long as i can make 15-20% per trade after covering the transaction costs approx 4.2% when u buy and sell.These shares make up my sales.The shares in my Portfolio are LONG TERM i will hold them for at least 3 years.I'm adding more international holdings to the Portfolio(but i wont flip international shares-commissions and currency costs are too high).

NOTE: To flip, you need a good broker, coz you can trade upto 3-5 times a week.Sometimes you buy and sell the same shares in 10 days.
I can get a JSE(south africa) account.But one thing about JSE is that commissions r too high u have to deal at least Sh100,000 per transaction to make it worthwhile.JSE is more of an institutional market unlike the way NSE goes out of its way to make retail investors welcome.JSE assumes that retail guys should buy mutual funds and leave the market to the 'experts'.

US trading Accounts have better trading terms and conditions.You only need to sign a
W8-BEN(IRS form indicating you ain't a tax resident in the USA) and a few requirements and you are in business

Problem

I want to move to LSE (London Stock Exchange) but no one(online) seems to be able to accept an Account from Non-UK residents.They think you must be Pablo escobar or Osama bin Laden's Treasurer.How can a Third World resident have a share trading Account they ask? OR the money to trade?(they dont ask this question explicitly he..heh..).

Locally,Francis Drummond can introduce you to a broker registered on the LSE but you need a minimum of Ksh1,000,000.

Help wanted

Anybody knows how Kenyan residents can trade cheaply(preferrably online) on the LSE holller,email or add a comment how.Because the only solution left is for me to get fingerprinted and go to London to physically open an Account.

13 comments:

Ssembonge said...

You cannot open a discount brokerage account in the UK. Don't bother travelling to the UK. I tried to do so last year. Even with my UK bank account and credit card. My non-resident tax status was not helpful either. You have to be on the electral roll which means you have to be paying council tax to be considered a resident.

The only option is to open an account with UK based investment banks. I understand a lot of elite Kenyans are doing so. I doubt that the minimum ammount is 10,000 pounds, unless this amount has been lowered lately.

The good thing is that from the US I have access to ADR's that trade in the US market. Once NASDAQ buys LSE, may be things will improve. I certainly think having a US accoun is much better than the UK accounts. The US brokers have better developed trading accounts than their UK counterparts and provide access to more information.

kudrinketh said...

Just ignore the LSE, they obviously dont want your business so take it elsewhere(preferably NYSE,NASDAQ). May I suggest www.tradeking.com they are the cheapest and best online brokers(only $4.95 per trade,65 cents per option contract, no minimum,no fine prints, no BS in other words).

While at it concider Exchange traded funds(ETFs) if you're interested in European exposure, in fact there's an ETF for any market segment,country,anything really.

pesa tu said...

@ssembonge:Agree the ADRs give better exposure BUt they raise the unit cost per share.

True that about the US trading Accounts.
The Ksh 1,000,000 is if u r introduced by a Kenyan stockbroker to the LSE registered one.
By the way rich Kenyans have lots of trading Accounts in SA,Botswana and UK.They get around it coz they r given references and introductions by the Wealth managment arms of reputable banks like HSBSC and Barclays.
Bet u didnt know it but HSBC has a small office in Nairobi to keep tabs on its regional biz

@Kudrinketh:I like EFTs but i find that they are useful when making sector based plays e.g.. if u think IT or China is going up you buy an EFT in that sector.
I need individual stock selection for certain sectors and firms.
Will look at tradeking.

@Everyone: Thanks guys for the advice.
I had another IDEA, supposiing i get a UK resident to buy me shares in Vodafone for example.Then transfer the shares to me.Then, i approach a Broker in the UK to sell them.
Wont this be an interesting backdoor way to acquire the trading/stock Account?

bankelele said...

Solid portfolio, not room for speculation. I have not lost interest in trading, but I also can't recall making any trades in the last 4 months. Great on Jubilee and I see you walked from Mumias and Eveready before the fall.

Interesting perspective on JSE, I guest BEE has not made retail trading a priority, unlike making banking for the masses affordable

Mitzy said...

@ PesaTu, try E*Trade, they are not just US based, you could open a UK based account to trade on the LSE. I don't think you have to be a UK resident. Check it out and good luck.

Mitzy said...

Here is the UK ETrade Link

MainaT said...

Pesa-tu without the big account ($10k), you may find it difficult. Easiest route will be via a very trusted UK resident.
"Interesting portfolio"- I like Equity-funny thing is i think the price will probably double now its affordable to the mwananchi.
SSEM-LSE won't do a NASDAQ deal unless they fire Claire Furse the CEO and they won't fire her cos she is good at her job. No harm in hoping though...

pesa tu said...

@mitzy:Thanks will do so

@bankelele:Still bearish on Mumias will say more soon
BEE was meant to enable blacks buy stakes in the South African components of the Multinationals e.g. SABMiller, Old Mutual etc.For instance the BEE for Old Mutual Plc only involves selling stakes in Old Mutual Sputh Africa Co.s
JSE believes retail investors should buy unit trusts and leave the market to the 'Experts'.By the way the CDS equivalent of JSE has fewer accounts than the Kenyan one.
People claim BEE is like the Africanisation policy in Kenya in the 1960s.Only a few people benefit.In SA they claim 4 black africans benefit;Tokyo sexwale,Cyril Ramaphosa and 2 others(cant remember them).In fact TIME magazine did a cover on this BEE angle sometime back.

@mainat:Am looking at the trusted UK resident option closely.By the way the Continent and US dont have all these restrictions on trading.Why so in the UK?

MainaT said...

Money-laundering, fraud is rampant. If you then add in the terrorist angle, it becomes clear that they will only trust u if you have a regd place of abode. I am surprised the US doesn't have similar restrictions. Europe, I don't enough individuals trade compared to the UK/US anglo-saxon model.

Odegle said...

how do you manage to trade like that? brokers always claim they couldn't get sales or purchases

pesa tu said...

@:Odegle:First, u get a broker registered with the FSA(in the UK) plus the LSE(UK) and JSE(SA).All orders r express(i.e. written) thru eMail or fax.

Second, the regulatory Authorities over there will crack down on any reports of abuse(unlike here).
What keeps brokers straight is that u compalin and they r questioned by the Regulators.

@mainat: europeans arent too commercially adventurerous

Emerging Africa Capital said...

Don't you think that its time to forget about the Kenyan market for at least 9months? I get the feeling that things will really get bad... in months to come. A range of factors are a contributor.

pesa tu said...

@Emg africa: Nope,some counters r overvalued BUT there are still a few gems here and there.Will xplain later.

Plus if u go away u will miss the opportunities