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Midas
AK_Francis
Supreme
31-Aug-2009 01:08     
 
AK_Francis About Contact  Quote this Post! Style: Fundamental   Mood: cool
Yells: "Happy go lucky, cheers."
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Yes, the risk has prevailed in China market. It had plunged 35% fr its height not long ago. Some may got hit now if entering during its peak, esp on those weak stocks n buy a lot. Again, d blues now r the limelight again.

As wat sifus always advocate that "people fear, we make ourselves as vanguard, others greed, we discard d hot stuff for good".

AK went into long China banks after Mar ds yr. Before that I only play very short term on only Bank of China, then first tasted it at ard 2.30 $HK, to make tea money. D only reason AK went in d bank sector then as China financial stability was rather stable n strong as compared to the other global giants countries illing financial sectors. Then Tamasick switched their western focus on banking investment to China, also given me some encouragement, though then it gradually evacuating BOA painfully.

AK bought in BOC(50 over cts in spore $ per lot) in Apr n later ICBC(just below a $S) ard May for long, till now. BOC runs fast, but ICBC no surprise issue. Ha ha, both dangerous, they are deemed penny, in Spore context. 

Ha ha, had collected first div fr BOC, not bad, got Carlsberg.

PS. Tamasick holds some stakes on BOC n CCB (China Construction Bank). ICBC is world largest bank in market cap, CCB second n BOC third, if not mistaken. Not surprise, as d population in China says.

Above for sharing only, no calling. Cheers. 

 
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lsj840428
Senior
30-Aug-2009 19:18     
 
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totally agreed to buy within our means....besides, wanted to add some, when really decided to buy as much as we can, must take note is not to buy those lousy counters, must be careful n prudent in choosing the right counter with low PE, fundamentally good, and if possible find those with brighter outlook.....



DnApeh      ( Date: 30-Aug-2009 17:57) Posted:



i feel that "BUY as mauch as we can" is alright.

The problem is when people buy more than they can afford, or contra, or borrow $, or buy on margins. That's when it becomes dangerous.

please buy, but within our means.
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DnApeh
Master
30-Aug-2009 17:57     
 
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i feel that "BUY as mauch as we can" is alright.

The problem is when people buy more than they can afford, or contra, or borrow $, or buy on margins. That's when it becomes dangerous.

please buy, but within our means.
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Hulumas
Supreme
30-Aug-2009 16:42     
 
Hulumas About Contact  Quote this Post! Style: Flexible   Mood: cool
Yells: "INVEST but not TRADE please!"
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 Alert Admin 		BUY as much as we can is the only option, to whom seek for handsome profit in the long run!!!

smartrader      ( Date: 29-Aug-2009 19:27) Posted:

Published August 29, 2009
Show me the money

Based on the assumption that equities are not overvalued today, China is worth taking a bet on

 

By TEH HOOI LING
SENIOR CORRESPONDENT

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EARLIER in the week, I attended a briefing by Henderson on its China fund. The fund manager, Andrew Mattock, is very bullish on the Chinese market. This is in contrast with the view of panelists at a discussion at the Invest Fair 2009 last weekend. They urged investors to be careful about going into Chinese stocks now, saying that the market is expensive and that there is a lot of hype over the market.

 


Taking a completely opposite view is Mr Mattock, who is managing the Henderson Horizon China Fund. Despite the sharp rebound since October last year - Chinese indices have, as at end-July, doubled from their lows of October 2008 - Mr Mattock still thinks that now is a very good entry point to the reawakening dragon in valuation terms.

'The market (stocks that Henderson is invested in) is now trading at 15 times 2009 earnings. We are now in September. We should be looking at what's going to happen in 2010. If we assume a 20 per cent earnings growth next year, the earnings multiple would drop to 12 times. And the companies are still coming from a low base in terms of earnings per share. The 20 per cent earnings growth only gets us half way to the top.' The Hang Seng China Enterprises Index can rise by another 30 per cent without stretching earnings growth estimates, he adds.

I asked him what kind of compounded returns investors can expect from the Chinese market if they were to stay invested in the next seven years. He says that the Chinese economy is going to track the growth of money supply. He reckons that deposits will grow by 15-20 per cent a year, and hence nominal GDP will be growing around 15 per cent per year. Ditto corporate earnings. So conservatively, the stock market should return 12-15 per cent compounded over the next seven years. And that's not factoring in the fluctuation in the renminbi, which he thinks will appreciate over time.

'I personally think I'm being conservative,' he says. It is to be expected that fund managers such as Mr Mattock would be bullish about the funds that they are managing. After all, they are trying to market the fund and the bigger the fund size, the bigger their pay cheques.

So which is which? Should investors buy into China now, or sit on the sidelines first and see how things pan out? Of course, staying out of the market at the right time can enhance one's investment performance tremendously, particularly for volatile markets. And indeed, the stock markets in China have been shown to be extremely volatile.

Between early 1991 and mid-1992, the Shanghai Composite Index shot up by some eight times. Then it plunged by 60 per cent in the next four months. More recently, it moved from about 1,000 points in June 2005 to about 6,000 points by end-October 2007. In the next 12 months, it plummeted more than 70 per cent to just 1,700 points. From that low, it doubled to about 3,400 as at end of last month. But so far this month, it has given back 35 per cent of that gain!

So is it worth the while taking all those stomach-churning rides? I tested what kind of returns investors would have made if they had invested in the Shanghai Composite Index (SHCI) starting from various points in the last 18 years. I then compared the returns to that of the Straits Times Index (STI).

I examined five starting points: in 1991, 1996, 2000, 2002 and 2008. In each of the case, I assumed Investor A put in $100 at the start of the month into the SHCI. Investor B, on the other hand, put $100 at the beginning of every month in the STI.

From the table, you can see that the investor in SHCI has come out on top in four of the five investment periods. The outperformance is very significant. For the capital of $22,400 put in between February 1991 and August 2009, the SHCI portfolio has - as at yesterday - a market value of $68,313. The STI portfolio, on the other hand, is worth $34,134. The annual compounded return for Investor A is 10.3 per cent, and for Investor B, 4.2 per cent. During that time, Investor A actually suffered some currency loss. Back in 1991, one Singapore dollar could buy about three renminbi. Now it can buy close to five. That docked 0.7 per cent a year from the returns.

If we take last month's SHCI closing index of about 3,460 (this compares with yesterday's 2,860.7), Investor A's compounded annual returns for his investment since 1991 would be 12 per cent. This compares with 10.3 per cent based on yesterday's lower close, and 4.4 per cent return on the STI for Investor B.

At last month's closing price, Investor A would have outperformed Investor B for all five periods. The median outperformance is a whopping 6.7 per cent a year.

As it turned out, the 17 per cent correction this month has cut three percentage points from SHCI's median return over the five different investment periods.

What about someone who has invested into China near the peak? In January 2008, the SHCI was still at pretty lofty levels at about 5,261 points. Those who got in at that point in time would still be sitting on significant losses. But the thing is, the market corrected sharply in the months after that. So for investors who have a disciplined investment plan, those who put in a certain amount into the market every month, they would have picked up some bargains along the way.

And up till yesterday, they would have made a return of 5.6 per cent on their capital. This is the only period that the STI has outperformed the SHCI. Regular investors in the STI between January 2008 and now are sitting on gains of 13.8 per cent. Also, in the last 20 months or so, the Singapore dollar has strengthened against the renminbi. However, based on July's closing levels, the SHCI is ahead with an annualised return of 27.4 per cent between January 2008 and July 2009. The STI, in comparison, returned 16.8 per cent. Note that all the above calculations do not take into account transaction costs.

So is China worth the risks? From the above numbers, and based on the assumption that equities are not overvalued today, it would suggest that indeed, China is worth taking a bet on. A lump sum investment made in SHCI back in 1991 would have returned 18.1 per cent a year as at yesterday. The comparable number for the STI is 5.4 per cent.

 
  • The writer is a CFA charterholder

     

     

     

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    smartrader
    Elite
    		29-Aug-2009 19:27     
     
    smartrader About Contact  Quote this Post!   Mood: excited
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    Published August 29, 2009
    Show me the money

    Based on the assumption that equities are not overvalued today, China is worth taking a bet on

     

    By TEH HOOI LING
    SENIOR CORRESPONDENT

    Email this article
    Print article
    Feedback


     

    EARLIER in the week, I attended a briefing by Henderson on its China fund. The fund manager, Andrew Mattock, is very bullish on the Chinese market. This is in contrast with the view of panelists at a discussion at the Invest Fair 2009 last weekend. They urged investors to be careful about going into Chinese stocks now, saying that the market is expensive and that there is a lot of hype over the market.

     


    Taking a completely opposite view is Mr Mattock, who is managing the Henderson Horizon China Fund. Despite the sharp rebound since October last year - Chinese indices have, as at end-July, doubled from their lows of October 2008 - Mr Mattock still thinks that now is a very good entry point to the reawakening dragon in valuation terms.

    'The market (stocks that Henderson is invested in) is now trading at 15 times 2009 earnings. We are now in September. We should be looking at what's going to happen in 2010. If we assume a 20 per cent earnings growth next year, the earnings multiple would drop to 12 times. And the companies are still coming from a low base in terms of earnings per share. The 20 per cent earnings growth only gets us half way to the top.' The Hang Seng China Enterprises Index can rise by another 30 per cent without stretching earnings growth estimates, he adds.

    I asked him what kind of compounded returns investors can expect from the Chinese market if they were to stay invested in the next seven years. He says that the Chinese economy is going to track the growth of money supply. He reckons that deposits will grow by 15-20 per cent a year, and hence nominal GDP will be growing around 15 per cent per year. Ditto corporate earnings. So conservatively, the stock market should return 12-15 per cent compounded over the next seven years. And that's not factoring in the fluctuation in the renminbi, which he thinks will appreciate over time.

    'I personally think I'm being conservative,' he says. It is to be expected that fund managers such as Mr Mattock would be bullish about the funds that they are managing. After all, they are trying to market the fund and the bigger the fund size, the bigger their pay cheques.

    So which is which? Should investors buy into China now, or sit on the sidelines first and see how things pan out? Of course, staying out of the market at the right time can enhance one's investment performance tremendously, particularly for volatile markets. And indeed, the stock markets in China have been shown to be extremely volatile.

    Between early 1991 and mid-1992, the Shanghai Composite Index shot up by some eight times. Then it plunged by 60 per cent in the next four months. More recently, it moved from about 1,000 points in June 2005 to about 6,000 points by end-October 2007. In the next 12 months, it plummeted more than 70 per cent to just 1,700 points. From that low, it doubled to about 3,400 as at end of last month. But so far this month, it has given back 35 per cent of that gain!

    So is it worth the while taking all those stomach-churning rides? I tested what kind of returns investors would have made if they had invested in the Shanghai Composite Index (SHCI) starting from various points in the last 18 years. I then compared the returns to that of the Straits Times Index (STI).

    I examined five starting points: in 1991, 1996, 2000, 2002 and 2008. In each of the case, I assumed Investor A put in $100 at the start of the month into the SHCI. Investor B, on the other hand, put $100 at the beginning of every month in the STI.

    From the table, you can see that the investor in SHCI has come out on top in four of the five investment periods. The outperformance is very significant. For the capital of $22,400 put in between February 1991 and August 2009, the SHCI portfolio has - as at yesterday - a market value of $68,313. The STI portfolio, on the other hand, is worth $34,134. The annual compounded return for Investor A is 10.3 per cent, and for Investor B, 4.2 per cent. During that time, Investor A actually suffered some currency loss. Back in 1991, one Singapore dollar could buy about three renminbi. Now it can buy close to five. That docked 0.7 per cent a year from the returns.

    If we take last month's SHCI closing index of about 3,460 (this compares with yesterday's 2,860.7), Investor A's compounded annual returns for his investment since 1991 would be 12 per cent. This compares with 10.3 per cent based on yesterday's lower close, and 4.4 per cent return on the STI for Investor B.

    At last month's closing price, Investor A would have outperformed Investor B for all five periods. The median outperformance is a whopping 6.7 per cent a year.

    As it turned out, the 17 per cent correction this month has cut three percentage points from SHCI's median return over the five different investment periods.

    What about someone who has invested into China near the peak? In January 2008, the SHCI was still at pretty lofty levels at about 5,261 points. Those who got in at that point in time would still be sitting on significant losses. But the thing is, the market corrected sharply in the months after that. So for investors who have a disciplined investment plan, those who put in a certain amount into the market every month, they would have picked up some bargains along the way.

    And up till yesterday, they would have made a return of 5.6 per cent on their capital. This is the only period that the STI has outperformed the SHCI. Regular investors in the STI between January 2008 and now are sitting on gains of 13.8 per cent. Also, in the last 20 months or so, the Singapore dollar has strengthened against the renminbi. However, based on July's closing levels, the SHCI is ahead with an annualised return of 27.4 per cent between January 2008 and July 2009. The STI, in comparison, returned 16.8 per cent. Note that all the above calculations do not take into account transaction costs.

    So is China worth the risks? From the above numbers, and based on the assumption that equities are not overvalued today, it would suggest that indeed, China is worth taking a bet on. A lump sum investment made in SHCI back in 1991 would have returned 18.1 per cent a year as at yesterday. The comparable number for the STI is 5.4 per cent.

     
  • The writer is a CFA charterholder

     

     

     
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