One-third of our portfolio’s stake in Nikko Cordial (NIKOY.PK) was sold yesterday. The ADRs closed Wednesay at $16.30. Nikko Cordial was first recommended here last May at the split-adjusted price of $8.64. I stated then that I had owned the company's ADRs for a while and was adding to my position.
The financial landscape of Japan has been changing, including signs of inflation after years of deflation. This means a lot of Japanese equities have risen ignificantly and Nikko Cordial is one of them, with its ADRs increasing more than 88% since being mentioned on this site. But the company became -- by far -- the largest holding and taking some chips off the table seems prudent.
Even after selling one-third of this holding, the company remains a full position in the portfolio. In fact, Nikko is the second largest holding and I’m in no hurry to liquidate the entire position. With the company being Japan’s third-largest brokerage firm with significant investment banking activity, my hunch is that Nikko Cordial's underlying value and share price will further increase in the future.
NIKOY 1-yr chart:
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