Monday, January 31, 2011

Sold Alcom @ 0.98, 3,000 shares

(Click on the image to see in details)

As of Jan 28, 2011, my cash level was at 8,666 and portfolio value stood at 40,151 or cash/portfolio of about 20%. However, if I were to include Amway which I consider as near cash, my cash level is about 32%. Actually I am quite comfortable with my cash level without disposing anything. I have decided to dispose 3000 Alcom shares at 0.98 for some reasons I will explain shortly. This will bring my cash to 15,711 to about 40%.

It is kind of difficult to decide which stocks to go or why am I not getting rid of MUI or Parkson again. MUI has corporate exercise in place and stock price has been resilient despite of strong corrections in the past two weeks. Parkson is still selling at steep discount compared to what is being sold in HKEX. CIMBX25 is very cheap and I do not think it is right that I let go this stock. ICAP is greatly undervalued. Even the stock were to fall by 10%, it is still selling at 12-13% discount to its NAV. Alcom is emitting bullish signs actually but the strong Ringgit is one of my concerns and relatively muted recovery in demand may need longer time to realize its potential. So, among the whole bunch of stocks, I reluctantly letting go this one.

Looking at stock market actions in our Bursa today, the stock market is relatively resilient despite of we are going into long weekend. I hope retail investors should not get too bearish.

Going back to the US market, though the market has started to correct, the question is what kind of market correction will we get - shallow ( 5 - 7%, 11,500) or deep correction (10% or just below 11,000). I am leaning towards shallow correction for now.

Saturday, January 29, 2011

Monday, time to walk the talk

It's 1:09 am Saturday in Penang now. Dow stood at 11,835 down by 1.29%. The correction time has finally kicked in. Perhaps I should change my blog from Turtle Investor 888 to Black Crow Investor 444. Corrections did happened for most of the times when I turned cautious. Some may say I bring bad luck whenever I "ak, ak, ak". I did take profit or cut losses at personal level but have not done it for Turtle portfolio or publicly. Some of readers may doubt whether I walk the talk. Come Monday, it will be the time to walk the talk for Turtle Investor. I should trim my cash to about 40% level before Chinese New Year.

After having sufficient cash, remember uncle WB famous quote:

"Be greedy when others are fearful, be fearful when others are greedy."

Thursday, January 27, 2011

Just sharing

Found some interesting quotes for sharing:

Good advice

"Do you chase the markets up, or chase the markets down? Either way makes money (or losses), so pay attention to valuations." OSK-UOB

"Do not fully invest at all times, always keep some cash" Pheim

"Volatility is like performance, it works well when it leaps and bounces" AmMutual

"You don't have to be wealthy to invest, you need to invest to be wealthy." Affind Fund

Bad advice

""Anytime" is the best time to invest when you invest for the long-term" Prudential

"Stay invested ~ hug the bear and ride the bull." Alliance Investment Management

Tuesday, January 25, 2011

Dow 12,000

The market is pushing for Dow 12,000. Sentiments have been strong and perma-bears got brutally murdered. One of the big bear, David Rosenberg got so pissed off that he said this "So put that in your pipe and smoke it."

In our quick skim of David Rosenberg's daily note, we missed the huge rant right up at the top (big thanks to ZeroHedge for catching it) in which the Gluskin-Sheff economist bellows cathartically at his critics.

And he really lets them have it.

First, he starts by defending his (wrong) double dip call: ran an article yesterday quoting some obscure analyst criticizing our macro economic and bond yield call for 2010, basically ridiculing us, calling for a contraction in either Q3 or Q4 and for the yield on the U.S. 10-year note to get as low as 2% or below. Here is the reality. The U.S. economy was clearly sputtering by the spring and summer and we were calling for that early on as the consensus was gazing at 5%+ fourth quarter growth in Q4 of 2009 and 3%+ in the first quarter of 2010. Only when the long arm of the law — another round of monetary and fiscal stimulus — was extended to give Mr. Market a nice lift did the clouds part. That shows how fragile this recovery has been and remains — just read the FOMC minutes to get a glimpse of the array of downside risks cited (more on this below). While the 10-year yield did not finish the year at 2%, it almost got there in the fall and nobody, except us, was calling for that a year ago. So put that in your pipe and smoke it.

Then he notes that we're still just in a "bear-market" rally, and that the masses are missing everything, and aren't appreciating risk-adjusted returns:

There is no doubt that we have had an incredible bear market rally on our hands. But that is exactly what it is. As we noted yesterday, as per Bob Farrell, even these spasms can go further than anyone thinks. But after a monstrous 80%-plus rally from the March 2009 lows (over such a short time frame, and the most pronounced bounce since 1955) this market has become seriously overextended in our view. Meanwhile, we have practically every market pundit extrapolating the recent trend into the future because that is the easy thing to do. But the Farrell’s and Walter Murphy’s of this world have become very cautious and frankly, that is good enough for us. The fact that Laszlo Birinyi published a report yesterday concluding that the S&P 500 will rally to 2,854 (what ... no decimal place?) by September 4, 2013 (oh, only another 125% from here) is perfect. Absolutely perfect.

Meanwhile, the masses only see the returns, they do not see the risks that are nearly invisible to the naked eye. But we see the risks. We assess them; we measure them, and we benchmark the returns against them. I recall all too well that 2003-07 bear market rally — yes, that is what it was. It was no 1949-1966 or 1982-2000 secular bull run. It was a classic bear market rally, and did last five years. I was forever skeptical because what drove that bear market rally was phony wealth generated by a non-productive asset called housing alongside wide spread financial engineering, which triggered a wave of artificial paper profits. I knew it would end in tears ... sadly, I didn’t know exactly when. I was constantly defensive in my investment recommendations at the time and there was a huge price to be paid for being bearish when there is a bull on your business card, trust me on that one.
Then he pats himself on the back for his "extreme courage"

It is an amazing commentary on human behaviour that I was forgiven for having been more focused on bonds and gold during those go-go leveraged years of 2003-2007, and then treated like a hero after the financial system collapsed under its own weight of dramatic excess. It goes to show that in the final analysis, as much as it hurts, not to be involved in a speculative rally that sees the market surge more than 80%, it is much much tougher to actually experience a correction in the other direction. For the time being, it takes extreme courage and resolve to not jump on the bandwagon (“don’t fight the Fed”) and buy “the market” at current expensive pricing points.

And finally he blasts the foundations of the current recovery:

This is not the 1949-66 secular bull market that was underpinned by troops coming home and spurring on a baby-boom that would unleash years of tremendously strong domestic demand growth. The demographics in the U.S.A. are now downright poor — just look at the ratio of the working age population to the total population. Nor is this the 1982-2000 secular bull market that saw the central bank usher in years of disinflation (the current one is trying desperately to create inflation!) and a wave of innovation that saw the mainframe, the personal computer, the Internet, and then the smartphone, a boom in the capital stock that enhanced structural productivity growth and led to sustained gains in private sector economic activity, which by the end of that secular bull run, allowed the government to actually start to record budgetary surpluses. What is the major innovation today? The iPod? The iPad? Facebook? These may be fun, but they don’t do much to promote the growth rate in the nation’s capital stock or productivity.

What we have on our hands has been an economic revival and market bounce back premised on unprecedented monetary and fiscal stimulus. How the Fed and the federal government in the future manage to redress their pregnant balance sheets without creating a major disturbance for the overall economy is a legitimate question and, sorry, does not deserve a double-digit market multiple, in our view.

Read more:

Sunday, January 23, 2011

Ready for coming corrections?

You have seen me bought Amway which I think is a sign I am going defensive rather than chasing the market. You have also seen that that I bought Faber. Is that sign that the end of corrections? The truth is I don't really care though I think correction is coming. Faber is just an opportunistic swing as I am seeing at some point of time, it should rebound towards $ 2.40/share.

First, I think the market is over bullish. We have seen S & P 500 having 37 consecutive trading days without 1% correction. It's one of the highest and almost at the level of April 2010.

Secondly, take a look at VIX. It's rebounding. If you don't like to short the markets, buy some VIX, I think you will make some money.

Third, watch EEM. It has pulled back to 50 MA. Mild profit taking has been going on for the last 2 weeks.

Back to local scene. Finance index and Small cap are rolling over too. Good luck.

Saturday, January 22, 2011

Shall we boycott the Star?

Mama advised that you should count 10 in descending order if you are angry. I let you read the whole piece and you make your own decision.

(theStar)REMEMBER a blog called Sime Darby Watch (SDW)? It has been completely wiped out when the mysterious blogger he never revealed his identity on the blog abruptly called it quits in April 2009. It's therefore hard to pinpoint when it was created, but early 2008 seems to be a safe bet.

One news report puts it as March 2008. That was not long after the completion of the mega-merger that saw Sime Darby Bhd, Kumpulan Guthrie Bhd and Golden Hope Plantations Bhd becoming a single entity we now know as Sime Darby Bhd.

It was apparent that the blogger had not come from the old Sime Darby. In fact, he explained that the blog was “for employees of the now-defunct Kumpulan Guthrie and Golden Hope to voice their views and concerns”. The blogger clearly had access to a lot that was going on at the new Sime Darby and was decidedly critical of its management, which was dominated by executives from the old Sime Darby. He often brought to light major developments and issues at the company that had not been publicly available.

SDW was easily the most well-known among the blogs that targeted local businesses. Sime Darby was (and still is) one of Malaysia's biggest companies, and the merger had enlarged it further although not everyone thought the exercise was a good idea. And as a government-linked company, there was (and still is) a political dimension to many of its actions and decisions. These factors guaranteed a ready audience for dirt on Sime Darby.

The blogger's ability to consistently expose alleged wrongdoings and his writing skills in lambasting his target, also helped SDW garner a significant following.

No other anti-corporation blogs have so far come close to SDW's influence. Most have been short-lived, seldom lasting beyond a handful of entries after the bloggers had run out of things to say or have simply exhausted their motivation to blog.

However, another blog has recently surfaced, promising to go on “for months to come to weed out corporate misconducts (sic) as a service to the taxpayers and Malaysians in general”. The blog's title, zarinahtakesapaycut, is a swipe at Securities Commission chairman Tan Sri Zarinah Anwar, but the principal target is actually professional services firm PricewaterhouseCoopers (PwC).

The anonymous blogger has been prolific so far. The blog kicked off on Dec 1 last year with four postings. Until yesterday, there have been 34 more. That's an average of one posting every 36 hours! He has also been persistent (and somewhat pesky), compiling an email list to ensure that all those on the list including this columnist and some colleagues are notified whenever the blog has a new entry.

The blogger definitely knows a thing or two about grabbing attention. The headlines for the blog entries are usually cleverly crafted and compelling. The blogger has been creative and resourceful in generating angles and themes that suggest that the blog is constantly introducing fresh information and highlighting new players and developments. For example, a Dec 31 entry cited a May 2009 article by this columnist to back up the blog's claims about PwC.

The truth is, zarinahtakesapaycut is a relentless attempt to discredit PwC by harping on the same few issues. The bias is obvious. Only the hopelessly clueless will think that the blogger is being objective. Even so, we can't dismiss the blog with the wave of a hand, partly because the blogger is insistent in bombarding readers with details.

This is not the place to dwell on how much of the blog is factual. The point here is that the blogosphere has become part albeit a small one for now of the corporate landscape. However, we have yet to properly understand how we treat the information we get from the blogs. The idea of regulating blogs is an incendiary matter and we may not even have to go there but there ought to be more discussion and engagement within the business community about this subject.

How can we not be ambivalent about these anonymous bloggers who attack listed companies, Big Four firms and business regulators? On one hand, we are thrilled by the pugnacious muckraking and the whiff of scandal, and we cheer the notion of the lone guy, armed with a PC and Internet connection, going up against the deep-pocketed, soulless corporation? Yet, can we really afford to ignore the questions about the bloggers' motives and integrity, and the veracity of the information they put up in cyberspace?

Sure, we can agree that everybody ought to take the content of these blogs with a pinch of salt, but that does nothing to address the lack of fairness and transparency that can occur. Besides, if the bloggers are indeed accurate and have revealed stuff that the companies had intended to hide, our scepticism may well work against us. And what if the bloggers are way off the mark, or worse, are deliberately spreading lies? In such cases, sometimes, no amount of salt can undo the damage suffered by the targets. And when the businesses suffer, their stakeholders (such as the minority shareholders) feel the pain as well.

Yes, legal action is an option, and yes, the mainstream media isn't perfect either. We know this, but what we need to learn next is how to effectively deal with irresponsible blogging. In business, as in politics, one of the worst things that can happen to us is when our ability to choose what to believe in, is weakened by bad information.

● Deputy executive editor Errol Oh doesn't have a blog.

Friday, January 21, 2011

Sunday, January 16, 2011

Faber : An opportunity or catching a falling knife?

This stock has been off my radar since April last year when I sold it for $2.45/share. This stock caught my attention when I saw this on the Edge.

Growing concerns on its earnings prospects sparked heavy selling on Faber Group Bhd shares after the group’s two integrated facilities management (IFM) contracts in Abu Dhabi were not renewed by the authorities in the Gulf.

The news also triggered worries on the renewal of the group’s other contracts locally and abroad resulting in downgrades by investment analysts on the stock.

Faber was the biggest loser on Bursa Malaysia yesterday, plunging nearly 17% or 44 sen to an eight-month low of RM2.19 with 17.7 million shares changing hands. The sharp fall in share price wiped out RM160 million from the group’s market capitalisation.

However, there may be a ray of hope for Faber to win back the contracts later when the authorities open them for re-tendering.

When contacted, an official from Faber explained that the notice of non-renewal of the contracts was due to the changes in the emirates’ Western Region Municipality’s (WRM) management.

The new management is currently reassessing the structure of all the contracts it had awarded earlier, the official told The Edge Financial Daily yesterday.

“Faber is not the only company that was affected, this affects other contractors too,” said the official. “They (WRM) will open for re-tendering again soon and Faber will bid for them.”

On top of that, Faber was working on several other IFM contracts in Abu Dhabi despite the non-renewal of the two existing ones.

The non-renewed contracts included the provisions of civil, mechanical and electrical maintenance services for low-cost houses at Madinat Zayed and Liwa, as well as the improvement, development, upgrade and maintenance of infrastructure facilities and projects at Madinat Zayed-Zone 1.

According to the announcement to Bursa Malaysia, Faber’s on-going job in the emirates included the provision of hospital support services for 12 hospitals and clinics in the UAE worth RM16 million per annum.

Faber said the non-renewal of the contracts would affect its net assets per share (and earnings per share) by about four sen for the financial year ending Dec 31, 2011.

Based on Faber’s issued base of 363 million shares, this works out to RM14.5 million in lost net earnings, although its market capitalisation fell by 11 times that amount yesterday.

For the financial year ended Dec 31, 2010, revenue contribution from the UAE is expected to account for some 25% of the group’s total, the official said.

For the nine-month period ended Sept 30, 2010, these contracts had contributed some RM200 million to Faber’s revenue.

Faber’s local hospital support services (HSS) concession will expire in October this year. A renewal of the concession would provide a major boost for Faber, especially if it comes with a tariff hike.

OSK Research revised its fair value by 15% lower at RM3.39 from RM4 following the news.

“Given that the contracts contribute higher margins, we are subsequently lowering our overall margins assumption for Faber as well as raising our effective tax rate assumption since the UAE contribution was tax-free,” it said.

HwangDBS has also downgraded its recommendation on Faber to “fully valued” from “hold” with target price revised to RM2 from RM2.60 given lack of earnings drivers following the non-renewal of the two major IFM contracts in the UAE.

“Furthermore, the concerns on risk of non-renewal of the HSS concession (locally) could cap upside, said HwangDBS. “While we think this risk is low, Faber has yet to announce any indication of the renewal.”

Another analyst noted that since Faber is a GLC (it is a unit of Khazanah Nasional’s UEM Group Bhd) and its HSS concession has been run very profitably and efficiently, the risks of non-renewal is low.

However, recent news reports suggest that several parties are eyeing parts of the concession, namely the Sabah and Sarawak portions.

Faber’s 15-year HSS concession covers public hospitals in the northern region of Malaysia, Sabah and Sarawak. - by Yantoultra Ngui Yichen,

My comments

Can this be a classic case of over-reaction? The stock has been on the downtrend after it peaked out in September 2010. This was the last straw that broke the camel back. In my view, this correction is overdue.

You can see very extreme valuations. DBS is one of the most negatives that I have seen. They turned very depressive implying the stock worth only RM 2.

OSK on the other hand is rational in its valuation but irrational emotionally. They knew the stock worth around $ 3.39 in the worst case scenario but do not have the conviction to hang on to it, calling it a trading buy.

Assuming both of them are wrong and middle ground of the two is somewhere in $ 2.60/share region.

Saturday, January 15, 2011

More parties eye MUI insurance unit

(TheStar)PETALING JAYA: Malayan United Industries Bhd (MUI) says the proposed disposal of shares in its general insurance unit, MUI Continental Insurance Bhd, comes after several parties expressed interest in the insurer since higher limits of foreign equity participation in local insurers were allowed.

“We've had a lot of people checking with us since foreign equity participation in local insurance companies was increased to 70% (from 49% in late April 2009). Foreign companies are keen to look at these markets as we (Malaysia) are a growing market,” MUI group chief financial officer Lai Chee Leong told StarBizWeek yesterday.

The company told Bursa Malaysia yesterday that Bank Negara, in a letter dated Jan 5, said it had no objections in principal for MUI's wholly-owned unit, Novimax (M) Sdn Bhd, to start preliminary negotiation with US-based Liberty International Holdings Inc on Novimax's stake disposal in MUI Continental.

Liberty has expressed interest to buy Novimax's 52.21% stake in MUI Continental.

Both parties are to conclude negotiations within six months from the date of approval.

“The proposed disposal is just a normal course of doing business. When opportunities arise, we will look at them. Therefore, we are entering the preliminary talks,” said Lai.

He added that it was premature for a price to be put on the general insurance unit.

The sale of an insurance company tends to present its own complexities, as common yardsticks such as net asset value or price earnings ratio are not the best tools to value the company's intrinsic value. Many proposed acquisitions in the insurance industry have fallen through as both parties fail to agree on pricing.

A recent example was Pacific & Orient Bhd discontinuing its preliminary negotiations with Prudential Holdings Ltd for a stake sale in its insurance unit, Pacific & Orient Insurance Co Bhd. While it did not say why talks were discontinued, news reports citing sources suggested that price was the main reason.

According to its website, MUI Continental was established in 1976 with CNA Financial Corp as one of its shareholders.

MUI Continental, which offers fire, marine, health, motor and other specialised insurance products, has 12 branch offices throughout Malaysia.

For its financial year ended Dec 31 2009, operating revenue was RM224.2mil while profit was RM26.7mil.

Liberty, which is the global arm of Liberty Mutual Group, operates insurance subsidiaries around the world, including Latin America, Europe and Asia. Its largest operations are in Latin America, focused on Brazil, Argentina, Venezuela and Colombia.

An analyst covering insurance stocks said that many foreign insurance companies from Japan and the United States were looking to enter the local market.

Some insurance deals done last year included the sale of Jerneh Insurance Bhd to US-based ACE INA International Holding Ltd and the merging of Hong Leong Financial Group's non-life insurance business with Japan's Mitsui Sumitomo Insurance Co and a sale stake in its life business.

MUI's share price gained 16%, or 3.5 sen, to 25.5 sen yesterday on news of the proposed sale.

Whether the market is getting ahead of itself or not is yet to be seen. I do not think MUI is desperate for cash as this point of time. In my view, they should continue to focus on retail business and get rid of this business. What is clear at this point of time the market needs reasons to re-rate this stock. Selling off insurance unit or stock broking business, revalue its property? or simply tag a higher valuation for its retail arm of Metro Jaya and Laura Ashley. I hope it can stay a bit longer on the top volume leader board for a while so that more people will initiate coverage on this stock. I still think this stock worth closer to $ 0.80/share but the market has no interest to recognize this for the past few years. The time for the owner to unlock its value is getting nearer. You may want to read my past postings for more details.

Wednesday, January 12, 2011

Turtle bought 500 shares Amway at $ 8.21

KLCI = 1,566.

Is it the time to buy Top Glove?

Is it time to pick up Top Glove? Nope. I think the sentiment is not bad enough though most of the people already factor in several negative catalysts:

1. Rising latex price/lagging cost passing on
2. Industry excess capacity
3. Normalizing demand
4. Weak US $

(Business Times)For the quarter under review, Top Glove's revenue went down 9.2 per cent to RM491.5 million from RM541.4 million in the previous quarter.
Lim said average latex prices had risen 57 per cent from RM4.58 per kg in the first quarter of last year to RM7.20 per kg to date.

"Demand for rubber gloves, which has been normalising, coupled with the excess capacity situation, have impacted the industry," he added.

Lim noted that the average US dollar had weakened against the ringgit by 9.3 per cent (RM3.43 in the first quarter of 2010 versus RM3.11 in the first quarter of 2011).

Customers, he said, had kept their inventory at a minimum level due to the high selling price of latex gloves, which reflected the increasing cost of latex prices.

"We will share some of these higher costs with our customers, even though there will be a time lag for the higher cost to be passed down."

In efforts to mitigate the impact of latex prices, Top Glove will spend an estimated RM160 million to plant rubber trees in Cambodia, its first downstream plantation activity.

Covering a net area of 8,000 hectares and land concession of 70 years, Lim said planting will spread over six years.

Read more: Top Glove feels pinch of latex prices, weak dollar

The other issue is I feel that they are running out of rooms to squeeze cost and begin to move upstream. A major change in strategy will always create uncertainty or risk. Is it a good move? I would think if you truly have pricing power, stick to what you know best -- making glove and not planting rubber trees.

Monday, January 10, 2011

Raise debt limit to avoid national catastrophe, Geithner warns Congress

If this headline was shown during the European sovereign debt crisis, it will surely cause a few hundred points drop in the stock markets.

Treasury Secretary Timothy F. Geithner warned lawmakers Thursday that the national debt could hit the legal limit on borrowing as soon as March 31, and he urged quick action to avoid a government default that would spark "catastrophic economic consequences that would last for decades."

In a letter sent to every member of Congress, Geithner said the national debt stands at $13.95 trillion - $335 billion short of the limit on borrowing that Congress set last year. Unless Congress acts to raise the limit, the letter says, the United States will default on its debt, an unprecedented event that could destroy "millions of American jobs," cause interest rates to spike, damage the dollar, and halt payments to millions of Social Security recipients, veterans and active U.S. troops.

"Failure to increase the limit would be deeply irresponsible," Geithner wrote. "For these reasons, I am requesting that Congress act to increase the limit early this year, well before the threat of default becomes imminent."

The story was long and convincing that something will happen if they don't do anything about it. However there is only one point in the whole story that is matter from investing perspective. What is the % of debt to GDP? It is still ok compared to Japan and other countries they will argue(slightly above 100%), so we will know where this story will end. Just a bit of drama trying show they are fighting the best for their people and they will raise the limit by the end of the day.

Saturday, January 8, 2011

Who is the Patsy?

Does the rally have more hops? asked the Star on the front page of Star Biz Week.

Hmmm, the immediate question came to my mind was who is the Patsy? Patsy by definition is a person that can be swindled easily or sucker. If you are playing poker, that is the guy you should bully.

Reading through the whole centerfold story, most of them think that 1,800 would be an easy piece. Most of them also feel that it will be achieved in the first half while second half of 2011 will be ?????????? many many question marks. Those buy at this level is convinced that there will be buyers at 1,800 but those buy at 1,800 would expect it to breach 2,000. many buyers out there really have a conviction of 2,000 points target?

Then I looked at the chart and critical events listed in the same article. Since I can't fit the whole page here, I have to be creative and folded the newspaper cutting to show the punch line. Here is the reproduction(click on the image to enlarge).

So who is the Patsy again? Double F.

Sorry if I mislead you to think something vulgar. Indeed you will get double F if you are not careful. ( I know I have some lady and religious readers, please pardon me, I just want to emphasize a point, a very strong point).

I could not find any data of foreign funds ownership all the way back to 1993 super bull run but limited data does show that high foreign ownership is coincides with the peak.It's either they have been churning out juicy stories to sell to their clients or they sparked the fever and many of the local get caught at the end.

The plot is getting thicker. That is because the benchmark index(KLCI or FBM-KLCI or whatever equivalent) is at its 38 years high. Any trend player will want to pile in to play for a while. Get out from the kitchen if you can't stand the heat, some seasoned chef might tell you..........It's too early to fold but just be careful.

Thursday, January 6, 2011

KLCI may stampede past 1,781

HwangDBS had a year-end target of 1,730, while UOB Kay Hian Research said the index may "stampede" past 1,781 by the first half of the year on foreign fund buying and expectations of a general election.

Read more: Best stock market volume in 20 months

(TheStar) According to MIDF Research in a recent research note, prospects for the local bourse would be good this year, with foreign liquidity continuing to be drawn to Malaysia.

Last October, the FTSE re-classified Malaysia as an "advanced emerging market", effective June this year.

"This is expected to attract foreign funds tracking FTSE indices (estimated to be more than US$3 trillion). Malaysia will be only one of nine countries to be in the category.

"Only four Asian countries are in the developed bracket (Hong Kong, Japan, Singapore, Korea) out of 25," MIDF Research said.

It is very difficult to find any negative catalyst at the moment why the stock market should go down. I would say go to the usual place and listen, see whether uncles and unties, taxi drivers, hair dressers will give you stock tips. Until then, enjoy the ride. Everyone is a stock genius now.

Tuesday, January 4, 2011

Experts Survey

Money CNN surveyed 32 stock market strategies, none of them forecasting the market is going to go down. Here are the ranges of S & P 500 target, implying 2-19% upside.
The other chart that I saw was the US retail investors finally pulling money out from bond funds. The money will have to go somewhere, most like ended in equity markets.

Monday, January 3, 2011

Good Morning 2011, Where are we?

Welcome back to first trading day. Let me kick of this year with my first chart. Where are we in the investor psychology cycle? I believe are moving up to confidence or acceptance level. Those have been missing the bus is kind of late but it is still not too late yet though the risk and volatility is getting higher. Good luck.