Jardine Group and UOB Group with Cross-Holding Stock Network

Ein55 Newsletter No 059 - 2017-03-07 - Jardine Cross Holding

Company A owns Company B. In return, Company B also owns Company A. This is a complex cross-holding of stock network. Let’s learn how smart investors in Jardine Group and UOB Group, using the complex structure to hide their undervalue gem of stock.

Jardine is a giant group of stocks with nearly 200 years of history for Jardine Matheson Holdings, originally from China/Hong Kong, then having dual stock listing in London and Singapore stock exchanges. Ein55 Graduates have already considered Jardine Group of stocks: Jardine Strategic Holdings (SGX: JSH), Jardine Matheson Holdings (SGX: JMH), Jardine Cycle & Carriage (SGXL C07), Hong Kong Land (SGX: H78) last year when their Optimism levels were still low, share prices have gone up more than 20% since then when the market fear has subsided.

There is an interesting history for the cross-holding structure for Jardine group (image source: seekingalpha).  Hong Kong richest person, Mr Li Ka-Shing planned to increase ownership in Hong Kong Land in 1980s, the Jardine group with Keswick family defended their control, forming JSH which owns JMH, in return JMH also owns JSH, very hard for any hostile takeover with this complex share structure.

UOB chairman, Mr Wee Cho Yaw also has a similar cross-holding network of stocks under UOB Group. There is a hidden gem in Wee family stock portfolio.  Ein55 Graduates have learned in the last Charity Course (Discounted Asset Stock) on this special stock.  The stock structure is so complex that undervalued stock could not be seen easily.

Ein55 Newsletter No 059 - 2017-03-07 - Wee Cho Yaw

Normal investors could only buy at fair price because they don’t know how low is considered low for a share price. Traders would buy at high price, following trend to sell at higher price.  Speculators would consider when there is good news with surge of more than 20%, buying at higher price, hoping to sell at highest price.  Due to difference in entry prices, their reward / risk ratio will be different.

Ein55 Graduates have learned to buy giant stocks at unfair price with low optimism.  For long term investors, some even consider low optimism from level 1 (business), level 2 (sector), level 3 (country) to level 4 (world).

 

3 Levels of Investor Mindsets

Ein55 Newsletter No 058 - 2017-03-06 - Steps

There are 3 Levels of investor mindset, wisdom gained in their typical investment journey. So, which stage are you in now?  Learn how to be an investor with advanced mindset.

Beginner Mindset

Attend various free seminars, busy record the tips on what stocks to buy, having potential to make some quick money.  Apply “Buy & Hope” strategy.  When investing decision is wrong, holding to losing stock as paper loss, becoming a long-term investor.

Intermediate Mindset
Having some foundation in investment knowledge, could be burnt before during the beginners time when following herd mentality. Willing to pay to learn some useful knowledge in trading system or investing strategies. Apply “Copy & paste” Strategy to use the same methods for own applications.

Advanced Mindset
Learned most of the analysis methods around in the market, eg. FA (Fundamental Analysis) and TA (Technical Analysis), knowing what to buy, when to buy, when to sell. At this stage, a person will finally know that the biggest challenge is to know oneself, there is no single way to make money, having own independent view, adopting a consistent strategy aligning to own personality.

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Some people with more than 20 years investing experience may still have beginner mindset. Most people are at intermediate level of mindset, busy learning the best methods in the world. Only minority of people are advanced investors, level is not measured by years of experience, but by their mindset.

You don’t have to go through a painful learning journey of beginner and intermediate learners. Integrate 3M: Methods, Mind Control and Money Management, learning with the right mindset of Advanced Investors, even you are a total beginner.

Crisis Stock: Noble Group vs Iceberg (壮士断腕、可悲可泣)

Ein55 Newsletter No 057 - image - cut arm

Poor Noble Group (SGX: N21), just about to recover, Iceberg is back with new report. Similar to Ezra and Cosco, it is a crisis stock with declining business and stock price.

It is not suitable to apply conventional method to analyze Noblle Group. Technically it is like a new company now, most of the good assets are sold to save the company by paying the debt. It may not have the same power to recover to the past glory.

Since it is a trader stock, fundamental will be relatively not so critical as in a bullish market, even weak fundamental stock could rise many times under speculation. It is more suitable for short term trading, using short term TA signals. 23 cents support was broken downward, combining with Iceberg (negative PA), tough on Noble. It is still above the intermediate support of 20 cents.  There is no need to guess for trading, prices with support and resistance will show us the probability.

NAV (Net Asset Value) criteria may not be suitable for Noble Group as it becomes asset light business, the asset quality is also a question mark. Good assets are properties and cash, many company have these quality assets, some with discounted share price.

Iceberg may be shorting all the way on Noble to low optimism with profits. If Iceberg is profit driven, similar to hedge fund, they could change to long position to “accept” Noble now, so that they could profit from recovery of Noble. Since Iceberg is still consistent in their negative views, it deserves some respect as they have principles. At low optimism, even for lousy business, very little profit potential to short a stock. With recovery of commodity market, Noble could have survived the greatest business crisis.

In ancient time, a warrior could cut off own arm to save one life when bitten by poisonous snake. Noble has cut his arm of core asset to save from 2 “snakes” with multiple bites from Iceberg and Muddy Water, starving in a cold winter (commodity crisis).  It deserves a chance to recover.

壮士断腕、可悲可泣。

 

Poker Game vs Investing

Ein55 Newsletter No 056 - image - poker game

There are many similarities between Poker Game and Investing. In fact, we could have more special edges or unfair advantage in investing but most people do not know.

1) Technical Analysis (TA) – Reward / Risk, Following Trend

For both poker and investing, we bid or invest more when the reward/risk is higher.  If we play Black Jack (total = 21 points), if you have 12 points, likely you will take the risk to add 1 more card because your chance (a card with 9 or less points, so that not exceeding 21 points) is high. Similarly, for trading or investing, eg. when stock price is near to the support, we would start to enter as the reward (upside) is more than the risk (downside).

Similarly, when a poker player has smooth win (good trend in winning), eg. facing a weak opponent, may add more position to maximize the gains.  This is similar to a trader who follows the market trend which is an edge.

https://en.wikipedia.org/wiki/Blackjack

 

2) Personal Analysis (PA) – Manage your emotions

A good poker player is calm, even holding lousy cards, will show confidence, so that opponents could not tell.  There is a poker game Bluff, the player could have lousy cards but pretend to have perfect cards. Opponent who challenges the truth could suffer as sometimes the player will purposely tell the truth. Similarly, a good investor will use the market greed and fear as a weapon, doing differently from the majority.

https://en.wikipedia.org/wiki/Bluff_(poker)

 

3) Fundamental Analysis (FA)

This is the main difference between Poker game and Investing.   Poker is a pure probability game, therefore TA & PA are the main edges. For investing, we could be selective to only consider strong business as they are more likely to grow in share price.

 

4) Optimism Strategies = FA + TA +PA (integration of all into strategies)

Strategies formation is important, integrating all the critical factors. Each poker player and trader / investor has own unique strategy, aligning to own personality, based on learning from positive experiences.  The strategies could change when the opponents (market) may be different, could be weaker (bear market) or stronger (bull market) opponents, which one would adjust the strategies accordingly.

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So, knowing the similarities and differences of poker game and investing (stock, property, etc), we understand that we could have the special edges or unfair advantage like Casino (more than 51% winning rate) if we know how to position Optimism + FA + TA + PA, aligning with own unique personality.

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ein55-newsletter-no-045-image-ebook-2017

Are you worried about the global stock market in year 2017, especially with the controversial new US President, Donald Trump?  Political analysts thought Trump has slim chance of winning, will this surprise outcome become the next black swan event to correct the global stock market?

Dr Tee has written an eBook on “Global Market Outlook 2017” to provide solutions with comprehensive coverage of various investment topics in major global stock markets (US, Singapore, Hong Kong, China, Europe).  Readers have benefited from the past Market Outlook reports by Dr Tee. Let’s learn the current global investment market risks and opportunities.

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Table of Contents for Investment eBook

1. Mass Market Sentiment Survey

2. Review of Global Stock Markets

3. US Market Outlook

3.1  US President & Government

3.2  Effect of QE

3.3  US Interest Rate Hike

3.4  US Job Market

3.5  US Property Market

3.6  US Bond Market

3.7  US Dollar vs Commodity (Gold / Silver / Crude Oil)

4. Regional Market Outlook

4.1  Europe Market

4.2  China Market

4.3  Hong Kong Market

5. Singapore Market Outlook

5.1  Singapore Stock Market

5.2  Singapore Property Market

6. Conclusions and Recommendations

Appendix (附录)

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The unique Optimism Strategy developed by Dr Tee provides a special advantage to know which investment (stock, forex, property, commodity, bond, etc) to buy safely, when to buy, when to sell, including option of long term holding.  So far over 10,000 audience have benefited from Dr Tee high quality free courses to the public.  Take action now to invest in your financial knowledge, starting your journey towards financial freedom.

 

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What is Investment?

Ein55 Newsletter No 055 - image - Investment

Investment is to take calculated risk, using special edges (eg. Optimism + FA + TA + PA) to give unfair advantages in winning rate over time, aligning to own personality with independent thinking.

Investment is NOT to copy and paste the methods with stock tips, news and rumours, following herd mentality with hope strategy.

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No one could know what will happen tomorrow. Guessing or hoping is not a reliable strategy for investment. Instead, we should know ourselves first, our unique personality which comprises of many aspects, eg. control of greed and fear, stress management, risk tolerance level, profit target, financial condition, holding power, resources available, etc.

Even if one only masters one weapon, it could give special edge, although it is limited. Eg:

Investor – using FA (Fundamental Analysis) weapon to find strong business
Trader – using TA (Technical Analysis) weapon to ride the trend of prices.

One should bridge between FA & TA:
FA + TA = FATA (发达)

Ideally, we could add 2 more weapons of Optimism + PA (Personal Analysis) to form a personalized strategy for any investment: stock, property, bond, commodity, forex, etc.

4 Critical Actions in Bullish Stock Market

Ein55 Newsletter No 054 - image - Action

There are many people confused, what they should do in the phase2 of bull market. Which action is right? Buy, Hold, Sell, Wait or Shorting?

The answer is dependent on unique personality and condition. In general, we could broadly categorize 4 types of critical actions for 4 groups of traders and investors. Each of them as a gift from heaven:

 

1) Long Term Investor (No Stock)
– best gift from heaven is to wait patiently for global financial crisis, applying low optimism to buy fundamentally strong stocks at lousy price

– intermediate plan is for a long term investor to apply mid-term trading (provided able to match with this personality) to profit from the phase2 of bull market, but the investor must follow trading exit strategy as Optimism is high.

 

2) Long Term Investor (with Stocks)
– examine the past entry price, was it low optimism? If yes, hold during intermediate optimism (with consideration of L2-L4 signals), prepare to take profit when optimism is high. Ein55 Graduates have learned many techniques to integrate trading into investing to maximize the gains.

– after selling the stocks one day, move to Group1 for next action.

 

3) Short Term Trader (No Stock)
– 2 possible strategies, 1) buy low sell high (swing trading) which requires a minor correction, 2) buy high sell higher (position trading) with momentum trading or breakout strategy, entering when a critical resistance is broken upward.

 

4) Short Term Trader (with Stocks)
– hold and take profit using quicker signal, different price target as Group 2.

– after exit, the buy/sell process could be repeated many times until the bull run has ended one day, then applying reversed strategy of shorting to profit from bearish market one day. Trend follower for short term trader.

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In summary, there is no one solution, one could make money with any action aligning to one’s personality: Buy, Hold, Sell, Wait or Shorting. If there is a mismatch in personality with strategy, then any action could result in losses eventually. So, we should know ourselves first before planning for stock trading or investing. Actual personality is much more complicated, each one of us is unique but the 4 types above are the most common ones: trader vs investor, with and without stocks.

We need to take action to convert knowledge into fortune. It has to be the right action at right time, aligning to our unique personality.

Make Friend with Billionaires in Investment

Ein55 Newsletter No 053 - image - Richest Billionaire

A multi-billionaire could become super rich mostly because they they have a profitable business or they invest in other people’s profitable business.  Their wealth is growing over the years, some could be as rich as the wealth of a small country.

We may not be able to establish the same business as them but we could make friends with these multi-billionaires by becoming a shareholder of their business.  Alternatively, we could also study their stock portfolio because they also invest in other businesses.

So, what are the billionaire stocks to buy?  The Billionaire Index is a compilation of stocks owned by global billionaire investors

https://www.ibillionaire.me/ibillionaireindex/

Based on a homework done by Ein55 Graduate, many (but not all) of these stocks by billionaires are strong business. So, it it is critical for us to know what are the truly giant stocks which make these billionaires richer over the time. Even we may not become a billionaire, we could share a profit by becoming a millionaire one day, if we know their investing mindset.  More importantly, many of these stocks are at high price due to high optimism of US market.

We only make friends with these billionaires when their net worth is reduced by more than 20% one day during global financial crisis due to falling down in share prices but the strong business still make money consistently yearly for them and for us.

Consumer Stocks: Discretionary vs Staples

Ein55 Newsletter No 052 - image - Consumer products

Stock prices will rise over time when business is growing.  Consumer stocks depends on businesses in consumer market. A consumer business sells us products and services which could be in 2 broad categories:

 

1) Good to Have (we WANT)

Optional for us, eg high end restaurants, premium property, branded handbag, children enrichment programs, etc.

In stock market, “Good to Have” are Consumer Discretionary stocks, they are usually dependent on consumer purchasing power which subject to economy condition. In a bull market, many people could make money in stocks or properties or having a higher increment in salary, therefore having more budget to buy non-essential products, eg. a car with high COE price, even public transportation is easily available.  In a bear market, this type of stocks are likely to fall down badly in share prices.

One could position with “Cyclic Investing” strategy for Stocks or Business with Good to Have products or services.

 

2) Must Have (we NEED)

Essential for us, eg. basic 3 meals in foodcourt or simple bread & coffee at home, a house (HDB) to stay (rent or own), a bag which we could carry when going for work, children public transport to school, etc.

In stock market , “Must Have” are Consumer Staples stocks, they are usually more defensive, needed in daily life regardless of economy condition.  Whether good time or bad time, people still need to eat & drink, taking bus or train, wearing clothes. Most people are unlikely to cancel their mobile phone plans or cut their utilities (water/electricity/gas) supplies.

One could position with “Long-term Defensive or Dividend Investing” strategy for Stocks or Business with Must Have products or services.

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In actual stock market, most stocks are hybrid of Good to have and Must have, because the definition of needs are dependent on individual.  Therefore, we could have a variety of investing strategies over a spectrum of needs for products and services.

10 Strategies of Buy Low Sell High in Stocks

Ein55 Newsletter No 051 - image - buy low sell high

There are many strategies of entry & exit for stocks, all are possible to make money but must be aligned with our unique personalities. Here are some methods which Ein55 Graduates have mastered:

 

(Swing Trading / Market Cycle Investing)

1) Buy Low Sell High (short term: weeks)

2) Buy Low Sell High (medium term: months)

3) Buy Low Sell High (long term: years)

(Position Trading / Growth Investing)

4) Buy Fair Price & Hold to Sell Higher (short term)

5) Buy Fair Price & Hold to Sell Higher (medium term)

6) Buy Fair Price & Hold to Sell Higher (long term)

7) Buy Fair Price & Hold permanently

(Momentum Trading)

8) Buy High Sell Higher (short term)

(Shorting)

9) Short High Recover Low (short term to mid term)

(Value Investing / Dividend Investing)

10) Buy Low & Hold (short term, mid term, long term, permanently)

 

There are many other different combinations of strategies which Ein55 Graduates have learned (eg. integrating stocks with forex, properties, commodity, bonds, macroeconomy, Level 1-4). At the end, you just need to master 1 strategy, you could make money in stocks.

There are many trading / investing schools which will focus in 1 or 2 strategies above. We need to know ourselves first before knowing the right choice of investment and strategies to apply.

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I like this new term: “wrong term investment”, mismatch of personality and strategies. There are many people who fail simply because wrong choice of term, eg:

– a long term investor who learns short term forex trading

– a short term trader who learns undervalued property stocks

The saddest thing is to enter as a short term trader, when wrong, does not know how to cut loss, ending up as a long term investor, holding on to junk stock for life or until the company goes bankrupt. We should choose to be a long term investor, not being forced by the market to be a long term investor.

There are also a few more unique styles applied by some Ein55 Graduates:

1) long term trader = buy & sell like a trader every few years

2) short term investor = buy fundamental stocks for short term

3) long term CFD investor = buy CFD for long term dividend investing

In fact, investing and trading can be fun, we are investment coaches, designing the right and unique strategy for ourselves.

 

The safest time to buy a stock is when everyone is afraid the sky will fall while the business is still operating normally with consistent performance. This could be a rare opportunity to buy during a crisis; we should learn how to take this advantage to truly buy low sell high.

When Optimism Strategies are combined with Fundamental Analysis (value investing & growth investing), Technical Analysis (support / resistance / trends), and Personal Analysis (mind control of greed and fear), it is very powerful as one can take the right action (Buy, Hold, Sell, Wait or Short) at the right time aligning with his own personality.

The unique Optimism Strategy developed by Dr Tee provides a special advantage to know which investment (stock, forex, property, commodity, bond, etc.) to buy safely, when to buy, when to sell, including the option of long term holding.  So far over 20,000 attendees have benefited from Dr Tee high-quality free courses to the public. Take action now to invest in your financial knowledge, starting your journey towards financial freedom.

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Learn 10 Strategies of Stock Trading & Value Investing (股市投资策略)

1)    Master Buy Low Sell High for all investment markets (stock, property, commodity, forex, bond) (买低卖高:股票、房地产、商品、外汇、债券)

2)    Profit in bearish and bullish markets, understanding the true impact of US Interest Rate Hike, Bullish Global Economy, Oil & Gas Crisis (环球经济)

3)    Long-term investing strategies to outperform portfolio return of Temasek, Li Ka-Shing, Warren Buffett, major stock indices/ETF and other funds (长期投资策略)

4)    High-probability Shorting techniques for short term traders to profit from falling stock market while others are losing money or doing nothing (短期卖空技巧)

5)    Generate consistent Passive Income with REITS and real property with knowhow of high dividend stock and property market cycles (房地产信托股的被动收入)

6)    Methods of Spring Cleaning for own stock portfolio to eliminate junk stocks without any hope (股票大扫除)

7)    Time for Global Financial Crisis to buy blue chip stocks on sale (危机也是良机)

8)    What to buy (stock screening), When to buy/sell (buy low sell how), How much to buy/sell (risk management): (股票三部曲:买何股?何时买卖?买卖多少?)

9)    Fundamental   Analysis (FA) + Technical Analysis (TA) + Personal Analysis (PA), integrated with unique Optimism Strategy by Dr Tee (乐观指数:三法一体)

10) Global Stock Market Outlook: emerging opportunities with high potential in Singapore, US, China & Hong Kong stock markets (环球股票市场展望: 新美中港,股票良机)

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