Ein55 Charity Course on Global Growth Stocks (为善最乐)

Posted on December 7, 2020 Written by

In recent Ein55 Charity Course on Global Growth Stocks, we have raised fund of $21,000 to help needy families in Singapore. Under the spirit of charity, Dr Tee decides to share 4 global growth giant stocks in 4 countries with readers (read each details in this article to fully understand on how to position in these giant stocks):
1) Singapore Growth Stock – Valuetronics Holdings (SGX: BN2)
2) Malaysia Growth Stock – Allianz Malaysia (Bursa: 1163)
3) US Growth Stock – Amazon (NASDAQ: AMZN)
4) Hong Kong / China Growth Stock – Tencent (HKEx: 0700)

Dr Tee, Ein55 Mentors & Graduates have together organized 10 charity investment courses (REITs in Nov 2015, May 2017 and May 2019, High Dividend Stocks in Mar 2016, Oct 2017 and Nov 2019, Global Growth Stocks in Apr 2018 and Nov 2020, and Discounted NAV Stocks in Sep 2016 and Nov 2018) in the past 5 years, donating net income of around $197,000 to Tzu Chi 慈济 (Singapore).

We hope to inspire more Ein55 Graduates to reach out the society, helping others who are in need. More importantly, they have also learned the secrets of making money through investment. When more Ein55 Graduates are successful financially, they could also contribute back to the society to help more people in future.

Let’s learn these 4 growth giant stocks in 4 countries, understanding the business nature, investment clock and unique strategy.

1) Singapore Growth Stock – Valuetronics Holdings (SGX: BN2)
Valuetronics is an integrated electronics manufacturing services (EMS) provider, offering a competitive and broad combination of Design, Engineering, and Manufacturing services. It has 2 main business segments: Industrial & Commercial Electronics and Consumer Electronics.

Business of Valuetronics has been affected by both COVID-19 pandemic and US-China trade war. It is recovering steadily from lower optimism level in COVID-19 stock crisis. Valuetronics is also a good dividend stock which has paid over 5% dividend yield over the past 10 years of history. Bullish semiconductor / 5G sector could provide additional support to Valuetronics business. Biden as new US president likely would not make US-China trade war worse than the current condition.

Cyclic investing strategy (Buy Low Sell High) may be considered but stable regional political economy is crucial for Valuetronics. Defensive (nearly no debt) and dividend growth strategies could be integrated.

2) Malaysia Growth Stock – Allianz Malaysia (Bursa: 1163)
Allianz Malaysia is a diversified insurance company that provides life and general insurance in Malaysia for automotive, home, and personal insurance. Insurance company by default is protected by probability of nature through adjustment in premiums with reference to statistics (eg. past accidents). Allianz Malaysia is an insurance giant stock with strong business fundamental, besides capital gains, it could generate stable dividend of over 3% yield yearly (based on current share prices).

Allianz Malaysia is near fair value of mid optimism level for long term and medium term. It may be considered as Mid-fielder stock to balance between capital gains and passive incomes. Buy at or below fair price and hold for longer term is a valid stock investing strategy.

3) US Growth Stock – Amazon (NASDAQ: AMZN)
Amazon.com engages in the provision of online retail shopping services. It operates through the following business segments: North America, International, and Amazon Web Services (AWS). Amazon surpasses competitor, Microsoft (NASDAQ: MSFT), becoming world largest company by market cap.

Amazon has strong growth in business, highly cash generative, supporting its long term and medium share prices at higher optimism level which is more suitable to apply trend-following strategy for stock trading. During COVID-19 pandemic, many technology giant stocks including Amazon have experienced significant capital gains, mainly due to rising internet businesses. However, when fear of pandemic is fading with availability of effective vaccine, these technology stocks could suffer price correction or slower growth in share prices.

Since NASDAQ is at very high optimism level, moderation is required when positioning in technology stocks as there is potential dotcom bubble version 2.0 (after version 1.0 in Year 2000). Best time to invest in technology giant stocks is usually during global financial crisis. Current stock market is more suitable for short term to medium term trading for technology stocks.

4) Hong Kong / China Growth Stock – Tencent (HKEx: 0700)
Tencent is an internet / technology stock with diversified business segments: Value-Added Services, FinTech and Business Services, Online Advertising, etc. Popular Apps are Weixin, WeChat, QQ, etc. Tencent also invests in other giant stocks, eg. Meituan Dianping (HKEx: 3690), JD.COM (NASDAQ: JD), Tesla (NASDAQ: TSLA) and many others.

In long term perspective, Tencent is still at moderate low optimism but more suitable for longer term investor with strong holding power, supported by strong business fundamentals (yearly monitoring is required to ensure it is still a giant stock following Dr Tee criteria). In medium term, Tencent has reached a higher optimism level, currently under correction (together with technology sector) due to recovery of COVID-19 pandemic, trend-following is required for trading.

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There are over 1500 giant stocks in the world based on Dr Tee criteria, choice of 10 Dream Team giant stocks have to align with one’s unique personality, eg. for shorter term trading (eg. momentum or swing trading) or longer term investing (cyclic investing, undervalue investing or growth investing). Readers should not just “copy and paste” any stock (What to Buy, When to Buy/Sell) as successful action taking requires deeper consideration (LOFTP strategies – Level / Optimism / Fundamental / Technical / Personal Analysis) which you could learn further from Dr Tee Free 4-hr Webinar.

Drop by Dr Tee free 4hr webinar (learning at comfort of home with Zoom) to learn how to position in global giant stocks during COVID-19 stock crisis with 10 unique stock investing strategies, knowing What to Buy, When to Buy/Sell.

Zoom will be started 30 min before event, bonus talk (Q&A on any investment topics from readers) for early birds. There are many topics we will cover in this 4hr webinar, Dr Tee can have more time for Q&A if you could stay later after the webinar, you could ask on any global and local stocks including but not limited to 30 STI component stocks:

Ascendas Reit (SGX: A17U), CapitaLand (SGX: C31), CapitaLand Integrated Commercial Trust (SGX: C38U), City Development (SGX: C09), ComfortDelGro (SGX: C52), Dairy Farm International (SGX: D01), DBS Bank (SGX: D05), Genting Singapore (SGX: G13), Hongkong Land (SGX: H78), Jardine Cycle & Carriage (SGX: C07), Jardine Matheson Holdings JMH (SGX: J36), Jardine Strategic Holdings JSH (SGX: J37), Keppel Corp (SGX: BN4), Keppel DC Reit (SGX: AJBU), Mapletree Commercial Trust (SGX: N2IU), Mapletree Industrial Trust (SGX: ME8U), Mapletree Logistics Trust (SGX: M44U), OCBC Bank (SGX: O39), SATS (SGX: S58), Sembcorp Industries (SGX: U96), Singapore Airlines (SGX: C6L), Singapore Exchange (SGX: S68), Singtel (SGX: Z74), ST Engineering (SGX: S63), Thai Beverage (SGX: Y92), UOB Bank (SGX: U11), UOL (SGX: U14), Venture Corporation (SGX: V03), Wilmar International (SGX: F34), YZJ Shipbldg SGD (SGX: BS6).

Dr Tee will cover over 20 case studies, Singapore giant stocks, eg. CapitaLand Mall Trust (SGX: C38U), Singapore Exchange (SGX: S68), Keppel Corp (SGX: BN4), Top Glove (SGX: BVA), Jardine Matheson Holdings JMH (SGX: J36), Vicom (SGX: WJP) and many others, Malaysia giant stocks, Hong Kong giant stocks and US giant stocks, both long term investing and short term trading.

There are limited tickets left for this 4hr free webinar, please ensure 100% you could join when register: www.ein55.com

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Filed Under: Fundamental Analysis, Market Outlook, Stock Market Tagged: ,

Dr Tee Free 3hr Video Course: Defensive High Growth Singapore Giant Stocks (防御型高成长的新加坡强巨股)

Posted on November 29, 2020 Written by

In this Dr Tee 3-hr video education (Defensive High Growth Singapore Giant Stocks), you will learn:
1) COVID-19 Stock Crisis Recovery Rally with Sector Rotations
2) Singapore and Malaysia Stock Market Outlook 2021
3) Defensive Singapore Giant Stocks
4) Dividend Singapore Giant Stocks / REITs
5) High Growth Singapore Giant Stocks
6) Short Term Trading and Long Term Investing Strategies during Pandemic
7) Many Case Studies with Q&A of Audience

Here is Dr Tee Free 3-hr Video Course (suitable for bilingual learners: verbal presentation in Chinese, written notes in English, technical charts for everyone). Enjoy and give your comments for improvement. You may subscribe to Dr Tee Youtube channel (Ein Tee) for future Dr Tee video talks.

Dr Tee Video Course: https://youtu.be/KkV9MvZypCA

在这Dr Tee 三小时教育视频（防御型高成长的新加坡强巨股），您可学习：
1） COVID-19 股灾的牛市反弹良机。
2） 新加坡与马来西亚2021股市展望。
3） 新加坡成长股。
4） 新加坡高息股、房地产信托股。
5） 新加坡成长股。
6） 短期交易与长期投资策略。
7） 现场观众个股分析与问答环节。

这儿是 Dr Tee 免费三小时华语课程 （适合双语学员：华语表达，英语讲义，图表皆通）。请欣赏鄙作，留言求进步。您可订阅 Dr Tee Youtube 频道(Ein Tee)，链接未来投资视频。

Dr Tee 华语视频: https://youtu.be/KkV9MvZypCA

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There are over 1500 giant stocks in the world based on Dr Tee criteria, choice of 10 Dream Team giant stocks have to align with one’s unique personality, eg. for shorter term trading (eg. momentum or swing trading) or longer term investing (cyclic investing, undervalue investing or growth investing). Readers should not just “copy and paste” any stock (What to Buy, When to Buy/Sell) as successful action taking requires deeper consideration (LOFTP strategies – Level / Optimism / Fundamental / Technical / Personal Analysis) which you could learn further from Dr Tee Free 4-hr Webinar.

Drop by Dr Tee free 4hr webinar (learning at comfort of home with Zoom) to learn how to position in global giant stocks during COVID-19 stock crisis with 10 unique stock investing strategies, knowing What to Buy, When to Buy/Sell.

Zoom will be started 30 min before event, bonus talk (Q&A on any investment topics from readers) for early birds. There are many topics we will cover in this 4hr webinar, Dr Tee can have more time for Q&A if you could stay later after the webinar, you could ask on any global and local stocks including but not limited to 30 STI component stocks:

Ascendas Reit (SGX: A17U), CapitaLand (SGX: C31), CapitaLand Integrated Commercial Trust (SGX: C38U), City Development (SGX: C09), ComfortDelGro (SGX: C52), Dairy Farm International (SGX: D01), DBS Bank (SGX: D05), Genting Singapore (SGX: G13), Hongkong Land (SGX: H78), Jardine Cycle & Carriage (SGX: C07), Jardine Matheson Holdings JMH (SGX: J36), Jardine Strategic Holdings JSH (SGX: J37), Keppel Corp (SGX: BN4), Keppel DC Reit (SGX: AJBU), Mapletree Commercial Trust (SGX: N2IU), Mapletree Industrial Trust (SGX: ME8U), Mapletree Logistics Trust (SGX: M44U), OCBC Bank (SGX: O39), SATS (SGX: S58), Sembcorp Industries (SGX: U96), Singapore Airlines (SGX: C6L), Singapore Exchange (SGX: S68), Singtel (SGX: Z74), ST Engineering (SGX: S63), Thai Beverage (SGX: Y92), UOB Bank (SGX: U11), UOL (SGX: U14), Venture Corporation (SGX: V03), Wilmar International (SGX: F34), YZJ Shipbldg SGD (SGX: BS6).

Dr Tee will cover over 20 case studies, Singapore giant stocks, eg. CapitaLand Mall Trust (SGX: C38U), Singapore Exchange (SGX: S68), Keppel Corp (SGX: BN4), Top Glove (SGX: BVA), Jardine Matheson Holdings JMH (SGX: J36), Vicom (SGX: WJP) and many others, Malaysia giant stocks, Hong Kong giant stocks and US giant stocks, both long term investing and short term trading.

There are limited tickets left for this 4hr free webinar, please ensure 100% you could join when register: www.ein55.com

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Filed Under: Fundamental Analysis, Market Cycle Investing, Market Outlook, Stock Market Tagged: , , , ,

10 Global Internet Giant Stocks (FANG-MAN-ATM) (龙头老大)

Posted on October 29, 2020 Written by

World has the largest IPO of all time with listing of Ant Finance (Ant Group, HKEX: 6688) on 5 Nov 2020, right after US presidential election but some retail investors are disappointed of could not get a piece of pie.  In fact, there are many proven technology giant stocks globally with great potential ahead, there is no need to invest in an emerging technology stock during IPO.

In this article, you will learn from Dr Tee on 10 US and Hong Kong Internet Giant Stocks (FANG-MAN-ATM) for longer term investing and / or short term trading with impact of COVID-19 crisis. Bonus for readers who could read every words of the entire article, learning alternative way of investing in all these giant stocks with limited capital.

1) FANG Stocks

– Facebook (NASDAQ: FB)

– Amazon (NASDAQ: AMZN)

– Netflix (NASDAQ: NFLX)

– Google (Alphabet) (NASDAQ: GOOGL)

2) MAN Stocks

– Microsoft (NASDAQ: MSFT)

– Apple (NASDAQ: AAPL)

– Nvidia (NASDAQ: NVDA)

3) ATM Stocks

– Alibaba (HKEX: 9988 / NYSE: BABA) & Ant Group (HKEX: 6688)

– Tencent (HKEX: 700)

– Meituan (HKEX: 3690)

Over a life time, an investor may experience a few generations of technology evolutions about every 20 years.  In 1980s, with invention of computer, Microsoft (Windows) and Apple (Mac) became popular and they manage to extend the company lifespan with next generation applications such as clouding computing and gaming industry, supporting new comer such as Nvidia. MAN stocks (Microsoft, Apple, Nvidia) are mainly supported by more internet users with computers and mobile devices.

In 2000s, with popularity of internet, FANG stocks (Facebook, Amazon, Netflix, Google) become highly demanded with disruptive technologies with strong global network. In 2020s, with support of high-speed 5G mobile applications among high population network in China, ATM stocks (Alibaba, Tencent, Meituan) are gaining momentum, becoming the Top 3 largest component stock of Hong Kong Hang Seng Tech Index.  As of today, all 10 giant internet stocks (FANG-MAN-ATM) with different length of company history, are leading in world with internet era.

It is hard to invest the same technology stock for life as new or disruptive technology could overthrow the existing market leaders, past examples are Yahoo, Motorola, Nokia, etc.  Therefore, technology stock investors need to know the stage of technology of a business, emerging, mature or declining.  In general, growth investing and / or momentum trading strategies could be more suitable for 10 FANG-MAN-ATM stocks.

Singapore technology stocks are mostly small cap, hard to have scale of economy and networking efficiency to compete with these 10 FANG-MAN-ATM stocks.  Just Netflix (smallest of 10 giant internet stocks) alone is about 40 times larger than the total market cap of all 88 technology stocks in Singapore (investor could still focus only on a few little giant stocks in Singapore for investing):

Accrelist Limited (SGX: QZG), Acma Limited (SGX: AYV), Advanced Systems Automation (SGX: 5TY), Adventus Holdings (SGX: 5EF), AEI Corporation (SGX: AWG), AEM Holdings (SGX: AWX), Allied Technologies Limited (SGX: A13), Amplefield Limited (SGX: AOF), Asian Micro Holdings (SGX: 585), ASTI Holdings (SGX: 575), Avi Tech Electronics (SGX: BKY), Ban Leong Technologies (SGX: B26), CDW Holding (SGX: BXE), CEI Limited (SGX: AVV), CFM Holdings (SGX: 5EB), Chuan Hup Holdings (SGX: C33), CPH Limited (SGX: 539), Creative Technology (SGX: C76), Datapulse Technology (SGX: BKW), Dragon Group International (SGX: MT1), Dutech Holdings (SGX: CZ4), Duty Free International (SGX: 5SO), Ellipsiz Limited (SGX: BIX), Excelpoint Technology (SGX: BDF), Frencken Group (SGX: E28), Global Invacom Group (SGX: QS9), Global Testing Corporation (SGX: AYN), GP Industries (SGX: G20), Grand Venture Technology (SGX: JLB), HGH Holdings (SGX: 5GZ), Hu An Cable Holdings (SGX: KI3), ICP Limited (SGX: 5I4), Jadason Enterprises (SGX: J03), JEP Holdings (SGX: 1J4), Karin Technology Holdings (SGX: K29), Ley Choon Group (SGX: Q0X), Libra Group (SGX: 5TR), Manufacturing Integration Technology (SGX: M11), Maruwa Yen1k (SGX: M12), MeGroup Limited (SGX: SJY), Micro-Mechanics Holdings (SGX: 5DD), Plastoform Holdings (SGX: AYD), Polaris Limited (SGX: 5BI), Powermatic Data Systems  (SGX: BCY), Renaissance United (SGX: I11), Serial System (SGX: S69), SEVAK Limited (SGX: BAI), Shinvest Holding (SGX: BJW), Sunright Limited (SGX: S71), Sunrise Shares Holdings (SGX: 581), SUTL Enterprise (SGX: BHU), Thakral Corporation (SGX: AWI), The Place Holdings (SGX: E27), Trek 2000 International (SGX: 5AB), TT International (SGX: T09), UMS Holdings (SGX: 558), Valuetronics Holdings (SGX: BN2), Venture Corporation (SGX: V03), Willas-Array Electronics Holdings (SGX: BDR), World Precision Machinery (SGX: B49), Alpha Energy Holdings (SGX: 5TS), Alset International (SGX: 40V), Artivision Technologies (SGX: 5NK), Asiatravel.com Holdings (SGX: 5AM), A-Smart Holdings (SGX: BQC), Azeus Systems Holdings (SGX: BBW), Boustead Singapore Limited (SGX: F9D), Captii (SGX: AWV), Challenger Technologies (SGX: 573), CSE Global (SGX: 544), DISA (SGX: 532), International Press Softcom (SGX: 571), ISDN Holdings (SGX: I07), Keppel DC Reit (SGX: AJBU), Koyo International (SGX: 5OC), M Development (SGX: N14), Mapletree Industrial Trust (SGX: ME8U), New Silkroutes Group (SGX: BMT), New Wave Holdings (SGX: 5FX), PEC (SGX: IX2), Plato Capital (SGX: YYN), Procurri Corporation (SGX: BVQ), Rich Capital Holdings (SGX: 5G4), Silverlake Axis (SGX: 5CP), SinoCloud Group (SGX: 5EK), Stratech Group (SGX: BRR), Synagie Corp (SGX: V2Y), YuuZoo Networks Group Corp (SGX: AFC).

In fact, STI stock Index is much weaker than US stock index (S&P500 and NASDAQ) and Hong Kong stock index (HSI) mainly due to lack of giant growth technology stocks (such as 10 FANG-MAN-ATM stocks which are US and Hong Kong stock index main component stocks), having only 1 cyclic technology stock (Venture) in 30 STI index component stocks:

Ascendas Reit (SGX: A17U), CapitaLand (SGX: C31), CapitaLand Mall Trust (SGX: C38U), City Development (SGX: C09), ComfortDelGro (SGX: C52), Dairy Farm International (SGX: D01), DBS Bank (SGX: D05), Genting Singapore (SGX: G13), Hongkong Land (SGX: H78), Jardine Cycle & Carriage (SGX: C07), Jardine Matheson Holdings JMH (SGX: J36), Jardine Strategic Holdings JSH (SGX: J37), Keppel Corp (SGX: BN4), Keppel DC Reit (SGX: AJBU), Mapletree Commercial Trust (SGX: N2IU), Mapletree Industrial Trust (SGX: ME8U), Mapletree Logistics Trust (SGX: M44U), OCBC Bank (SGX: O39), SATS (SGX: S58), Sembcorp Industries (SGX: U96), Singapore Airlines (SGX: C6L), Singapore Exchange (SGX: S68), Singtel (SGX: Z74), ST Engineering (SGX: S63), Thai Beverage (SGX: Y92), UOB Bank (SGX: U11), UOL (SGX: U14), Venture Corporation (SGX: V03), Wilmar International (SGX: F34), YZJ Shipbldg SGD (SGX: BS6).

Therefore, an investor may need to consider to balance own stock portfolio, balance the slow growth / dividend stocks / REITs (Singapore, Malaysia, etc) with other global giant stocks (growth / momentum), including but not limited to 10 FANG-MAN-ATM stocks.

From the table sorted below for 10 FANG-MAN-ATM stocks, all are profitable (10 / 10 stocks were making money in businesses last year) with double digit ROE (except for Meituan which is still at emerging phase of business, focusing more on revenue growth instead of net profit. So, comparison for 10 giant stocks could be based on relative growth rate, eg. high earnings growth of Netflix, Amazon, Alibaba, Tencent, etc, have helped to support the rising momentum of share prices in shorter duration during the recovery from COVID19 pandemic with better business performance due to global lock down.

Most 10 FANG-MAN-ATM stocks don’t pay dividend (only 4 / 10 stocks pay dividend). Even if they do, for example, Microsoft with only about 1% dividend yield (need to offset 30% withholding tax, left 0.7%), is only a little bonus comparing with the high capital gains in share prices.

All 10 FANG-MAN-ATM (10 / 10) have Price-to-Book ratio ($ / NAV = PB) > 1 with premium over asset but this consideration is secondary for growth investing with asset light business. The ability to make more money in future is far more important buying cheaply (undervalue investing). Therefore, business growth is much more important than undervalue price to sustain the share prices with capital gains in longer term for technology stocks.

NoNameCodeROE (%)Dividend Yield (%)PB = Price /NAV
1Alibaba998820.29–7.51
2Tencent70021.860.29.74
3Meituan36902.46–17.79
4FacebookFB18.29–7.31
5AmazonAMZN18.67–22.33
6NetflixNFLX24.62–20.90
7AlphabetGOOGL17.05–5.25
8MicrosoftMSFT37.431.013.63
9AppleAAPL61.060.727.97
10NvidiaNVDA22.910.123.79

All 10 FANG-MAN-ATM stocks are high growth giant stocks, most of them are at moderate high optimism, mainly due to rising share prices, achieving new high after recovery from COVID-19 stock crisis. The main risk of high growth stocks are sustainable growth rate. Company such as Facebook is getting slower in growth rate due to global market saturation compared to earlier phase. 

Most FANG-MAN-ATM stocks are cyclical in nature, some of them (eg. Microsoft and Apple) have gone Year 2020 dotcom bubble when technology sector was speculated to extremely high prices before falling down over 50%.  Year 2020 and later years have potential to be version 2.0 of dotcom bubble when stock market is filled with greed to push up technology stocks (mainly represented by NASDAQ stock index) to another extreme high optimism level.

It is relatively safer to position with trend-following strategy either with short term momentum trading or long term growth investing for 10 FANG-MAN-ATM stocks. This would help to minimize the high risk if version 2.0 of dotcom may happen one day as next global financial crisis, especially in US with high optimism S&P500 and NASDAQ stock markets.

For retail investors with limited capital may not able to invest in expensive giant stock such as Amazon (over US$3000/share) and Google (Alphabet, over US$1500/share).  Recent stock split of Apple (1 to 4) has helped to make the stock more affordable to investors with small capitals. However, some investors may hope to form a diversified stock portfolio of 10 FANG-MAN-ATM and other stronger internet / technology stocks with limited capital.

A simple solution is to invest in Exchange Traded Fund, ETF (possible with capital of only $1000) with these technology giant stocks, eg. through Invesco QQQ ETF which follows NASDAQ Top 100 stocks (about 50% weightage are FANG-MAN stocks). For ATM stocks, possible to consider China stocks ETF such as KWEB or MSCI China ETF (MCHI ETF, about 40% weightage are ATM stocks).

It is important for a stock investor to have a balanced stock portfolio in various sectors (eg. technology, property / REIT, banking & finance, F&B, healthcare, oil & gas, commodity, etc) to minimize risk in each sector with unique market cycle.  High concentration of stock portfolio (eg. in 10 FANG-MAN-ATM internet stocks) would create high volatility which may be beyond risk tolerance level of an investor.  Knowing one’s personality is key for success in stock investing or trading, not simply following “tips” by anyone to take action.

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There are over 1500 giant stocks in the world based on Dr Tee criteria, choice of 10 Dream Team giant stocks have to align with one’s unique personality, eg. for shorter term trading (eg. momentum or swing trading) or longer term investing (cyclic investing, undervalue investing or growth investing). Readers should not just “copy and paste” any stock (What to Buy, When to Buy/Sell) as successful action taking requires deeper consideration (LOFTP strategies – Level / Optimism / Fundamental / Technical / Personal Analysis) which you could learn further from Dr Tee Free 4-hr Webinar.

Drop by Dr Tee free 4hr webinar (learning at comfort of home with Zoom) to learn how to position in global giant stocks during COVID-19 stock crisis with 10 unique stock investing strategies, knowing What to Buy, When to Buy/Sell.

Zoom will be started 30 min before event, bonus talk (Q&A on any investment topics from readers) for early birds. There are many topics we will cover in this 4hr webinar, Dr Tee can have more time for Q&A if you could stay later after the webinar.

Dr Tee will cover over 20 case studies, Singapore giant stocks, eg. CapitaLand Mall Trust (SGX: C38U), Singapore Exchange (SGX: S68), Keppel Corp (SGX: BN4), Top Glove (SGX: BVA), Jardine Matheson Holdings JMH (SGX: J36), Vicom (SGX: WJP) and many others, Malaysia giant stocks, Hong Kong giant stocks and US giant stocks, both long term investing and short term trading.

There are limited tickets left for this 4hr free webinar, please ensure 100% you could join when register: www.ein55.com

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Filed Under: Market Cycle Investing, Market Outlook, Stock Market Tagged: , ,

111 Singapore S-Chip and Greater China Stocks (龙潭虎穴)

Posted on October 2, 2020 Written by

China is world No 2 economy, therefore there are many China business related stocks in the world (Singapore, China, Hong Kong, Taiwan, US). The quality of China related stocks could vary significantly, including 111 S-Chip stocks in Singapore with 20% weak stocks are suspended and also some strong China stocks could double the share price in a short period.

In this article, you will learn from Dr Tee on 4 China related Giant Stocks which are efficient in making money with strong business growth in Greater China market (China, Hong Kong, Taiwan). Bonus for readers who could read every words of the entire article, learning unique strategy for each giant stock.

1) Singapore All-Rounded Giant Stock (S-Chip / A-Share)

– Tianjin Zhongxin Pharmaceutical Group (SGX: T14 / China Shanghai: 600329, 天津中新药业)

2) China / Hong Kong Giant Bank Stock (H-Share / A-Share)

– Industrial And Commercial Bank Of China, ICBC (China Shanghai: 601398 / HKEX: 1398, 中國工商銀行)

3) China F&B Giant Stock (A-Share)

– Kweichow Moutai (China Shanghai: 600519, 貴州茅台酒)

4) Taiwan Technology Giant Stock (ADR)

– Taiwan Semiconductor Manufacturing, TSMC (Taiwan: 2330 / NYSE: TSM, 台積電)

After China joining WTO since 2001, it has opened up its door to the world, including many global stocks in different stock markets, eg. Singapore (S-Chip), China (A-Share), Hong Kong (H-Share), US (ADR), etc.  Greater China market includes China, Hong Kong, Macao and Taiwan, which is a fast rising region, attracting global investors.

In fact, reputation of S-Chip (China business with stock listed in Singapore) is relatively low as 20% of these stocks (24 / 111 stocks) have been suspended as of now due to various reasons, including poor businesses, not following SGX codes of business practices, potential scandals, etc.  This concern is also observed in global stock exchanges for other China related stocks in Hong Kong (H-Share) or even in US, eg. Luckin Coffee (NASDAQ: LK) with “excellent” financial report but proven was not reported truthfully.  Greed could make a business choose shortcut to achieve the goal.  So, a stock investor has to make an integrated analysis of China related stocks, taking calculated risks to ride the uptrend wave of businesses.

There are 111 S-chip or China related Stocks in Singapore, making money with businesses in Greater China (龙潭虎穴):

AnAn International (SGX: Y35), Anchun International Holdings (SGX: BTX), AnnAik Limited (SGX: A52), ARA LOGOS Logistics Trust (SGX: K2LU), BM Mobility (SGX: I9T), Bund Center Investment Ltd (SGX: BTE), CapitaLand Retail China Trust (SGX: AU8U), Chasen Holdings (SGX: 5NV), China Aviation Oil Singapore Corp (SGX: G92), China Environment (SGX: 5OU), China Everbright Water (SGX: U9E), China Fishery (SGX: B0Z), China Great Land (SGX: D50), China Haida (SGX: C92), China Hongxing Sports (SGX: BR9), China International Holdings (SGX: BEH), China Jishan Holdings (SGX: J18), China Mining (SGX: BHD), China Paper Holdings (SGX: C71), China Real Estate Group (SGX: 5RA), China Sky Chem (SGX: E90), China Sports (SGX: FQ8), China Yuanbang Property Holdings (SGX: BCD), China Kangda Food Company (SGX: P74), China Kunda Technology Holdings (SGX: GU5), , Combine Will International Holdings (SGX: N0Z), COSCO Shipping International Singapore (SGX: F83), Courage Investment Group (SGX: CIN), Darco Water Technologies (SGX: BLR), Debao Property Development (SGX: BTF), Dukang Distillers Holdings (SGX: BKV), Dutech Holdings (SGX: CZ4), Emerging Towns & Cities Singapore (SGX: 1C0), Fabchem China (SGX: BFT), First Sponsor Group (SGX: ADN), Full Apex (SGX: BTY), Fuxing China Group (SGX: AWK), Global Invacom Group (SGX: QS9), Green Build Technology (SGX: Y06), Guoan International (SGX: G11), Healthway Medical Cor (SGX: 5NG), Hi-P International (SGX: H17), Hutchison Port Holdings Trust SGD (SGX: P7VU), Hutchison Port Holdings Trust USD (SGX: NS8U), Hu An Cable Holdings (SGX: KI3), Hyflux Limited (SGX: 600), IEV Holdings (SGX: 5TN), Japfa Limited (SGX: UD2), Jason Marine Group (SGX: 5PF), JES International Holdings (SGX: EG0), Jiutian Chemical Group (SGX: C8R), Joyas International Holdings (SGX: E9L), KOP Limited (SGX: 5I1), LCT Holdings (SGX: BJL), Leader Environmental Technologies Limited (SGX: LS9), Lion Asiapac Limited (SGX: BAZ), Luzhou Bio-chem Technology Limited (SGX: L46), Mapletree North Asia Commercial Trust (SGX: RW0U), Memstar Technology (SGX: 5MS), Mercurius Capital Investment (SGX: 5RF), Midas Holdings (SGX: 5EN), Mirach Energy Limited (SGX: AWO), MMP Resources Ltd (SGX: F3V), Malaysia Smelting Corp (SGX: NPW), Natural Cool Holdings (SGX: 5IF), Net Pacific Financial Holdings (SGX: 5QY), Nordic Group (SGX: MR7), Ouhua Energy Holdings (SGX: AJ2), Pacific Andes Resources Development (SGX: P11), Pacific Century Regional Developments (SGX: P15), Pan Hong Holdings Group (SGX: P36), PEC Limited (SGX: IX2), Plastoform Holdings (SGX: AYD), Raffles Infrastructure Holdings (SGX: LUY), Sapphire Corp (SGX: BRD), SBI Offshore Limited (SGX: 5PL), SembCorp Industries Limited (SGX: U96), Shanghai Turbo Enterprises (SGX: AWM), Shangri-La Asia Limited (SGX: S07), SIIC Environment Holdings (SGX: BHK), Sinarmas Land Limited (SGX: A26), Sincap group (SGX: 5UN), Sing Holdings (SGX: 5IC), Sinjia Land Limited (SGX: 5HH), Sino Grandness Food Industry Group (SGX: T4B), Sinopipe Holdings (SGX: X06), Sinostar PEC Holdings (SGX: C9Q), Starland Holdings (SGX: 5UA), Straco Corporation (SGX: S85), Sunpower Group (SGX: 5GD), Suntar Eco City (SGX: BKZ), SunVic Chemical Holdings (SGX: A7S), Swing Media Technology Group (SGX: BEV), Thakral Corporation (SGX: AWI), Tianjin Zhongxin Pharmaceutical Group (SGX: T14), Tiong Seng Holdings (SGX: BFI), United Food Holdings (SGX: AZR), USP Group Limited (SGX: BRS), Valuetronics Holdings (SGX: BN2), Willas-Array Electronics Holdings (SGX: BDR), Wilmar International (SGX: F34), World Precision Machinery (SGX: B49), Yamada Green Resources (SGX: BJV), Yanlord Land Group (SGX: Z25), Yongmao Holdings (SGX: BKX), Yunnan Energy International (SGX: T43), Yangzijiang Shipbuilding YZJ CNY (SGX: SO7), Yangzijiang Shipbuilding YZJ SGD (SGX: BS6), Zhongmin Baihui Retail Group (SGX: 5SR).

From the table sorted below for 111 China related stocks in Singapore, only half are profitable (62 / 11 stocks were making money in businesses last year). Therefore, careful choices of giant China stocks are critical, some are at lower optimism share prices due to either stock market fear or actual business is affected during COVID-19 pandemic. 

Most China related stocks in Singapore don’t pay dividend (only 41 / 11 stocks pay dividend). Even if they do, for example, Hutchison Port Holdings Trust (SGX: P7VU / NS8U) with over 9% dividend yield, are not good dividend stocks (despite backed by Li Ka-shing, Hong Kong richest man) due to weaker business fundamental.

Many S-Chip stocks (81 / 11) have Price-to-Book ratio ($ / NAV = PB) < 1 with discount over asset but majority do not have high quality asset related to cash or properties. “Buy Low” may get lower in share prices, a common mistake by beginner investor to buy a stock cheaply (eg. at historical low price) without considering the business fundamental and economic moat.

For most local and global China related stocks, main strategy would be cyclic investing or swing trading, therefore understanding of business and stock market cycle is much more important than undervalue price or dividend payment.

NoNameCodeROE (%)Dividend Yield (%)PB = Price /NAV
1Alibaba Pictures GroupS91––1.80
2AnAn InternationalY35––1.23
3Anchun International HoldingsBTX3.9410.50.04
4AnnAik LimitedA523.344.70.31
5ARA LOGOS Logistics TrustK2LU–8.81.07
6BM MobilityI9T––4.38
7Bund Center Investment LtdBTE6.351.90.94
8CapitaLand Retail China TrustAU8U8.838.30.72
9Chasen Holdings5NV––0.39
10China Aviation Oil Singapore CorpG9211.965.10.70
11China Environment5OU––0.36
12China Everbright WaterU9E9.466.00.39
13China FisheryB0Z5.13–0.15
14China Great LandD50––-0.19
15China HaidaC92––0.05
16China Hongxing SportsBR9––-383.33
17China International HoldingsBEH5.61–0.32
18China Jishan HoldingsJ18––1.81
19China MiningBHD––0.41
20China Paper HoldingsC713.24–0.13
21China Real Estate Group5RA––0.77
22China Sky ChemE90––0.06
23China SportsFQ8––0.13
24China Yuanbang Property HoldingsBCD5.99–0.09
25China Kangda Food CompanyP740.68–0.19
26China Kunda Technology HoldingsGU5––1.20
27China Sunsine Chemical HoldingsQES15.18230.6385
28Combine Will International HoldingsN0Z8.115.0510.26
29COSCO Shipping International SingaporeF831.38–0.77
30Courage Investment GroupCIN0.41–0.18
31Darco Water TechnologiesBLR––0.29
32Debao Property DevelopmentBTF––0.10
33Dukang Distillers HoldingsBKV––0.03
34Dutech HoldingsCZ47.983.90.45
35Emerging Towns & Cities Singapore1C05.76–0.19
36Fabchem ChinaBFT––0.23
37First Sponsor GroupADN10.431.8510.78
38Full ApexBTY––0.08
39Fuxing China GroupAWK––0.10
40Global Invacom GroupQS9––0.39
41Green Build TechnologyY06––0.30
42Guoan InternationalG11––2.24
43Healthway Medical Cor5NG––0.79
44Hi-P InternationalH1713.512.4731.47
45Hutchison Port Holdings Trust SGDP7VU2.049.2940.39
46Hutchison Port Holdings Trust USDNS8U2.049.4030.40
47Hu An Cable HoldingsKI3––0.78
48Hyflux Limited600––-0.16
49IEV Holdings5TN14.10–5.28
50Japfa LimitedUD213.621.4790.90
51Jason Marine Group5PF8.803.4970.60
52JES International HoldingsEG0-44.12–-2.77
53Jiutian Chemical GroupC8R––1.28
54Joyas International HoldingsE9L––3.75
55KOP Limited5I1––0.36
56LCT HoldingsBJL1.00–0.68
57Leader Environmental Technologies LimitedLS9––4.27
58Lion Asiapac LimitedBAZ0.75–0.41
59Luzhou Bio-chem Technology LimitedL46––-0.75
60Mapletree North Asia Commercial TrustRW0U2.627.6880.66
61Memstar Technology5MS––-1.67
62Mercurius Capital Investment5RF––6.25
63Midas Holdings5EN––-7.71
64Mirach Energy LimitedAWO52.17–0.18
65MMP Resources LtdF3V––-0.48
66Malaysia Smelting CorpNPW9.012.5320.90
67Natural Cool Holdings5IF––0.60
68Net Pacific Financial Holdings5QY––0.59
69Nordic GroupMR79.874.060.95
70Ouhua Energy HoldingsAJ27.48–0.27
71Pacific Andes Resources DevelopmentP118.47–0.09
72Pacific Century Regional DevelopmentsP152.978.630.81
73Pan Hong Holdings GroupP3615.443.7220.37
74PEC LimitedIX2–1.250.56
75Plastoform HoldingsAYD––-0.34
76Raffles Infrastructure HoldingsLUY15.32–0.87
77Sapphire CorpBRD4.55–0.22
78SBI Offshore Limited5PL––0.55
79SembCorp Industries LimitedU963.073.7860.41
80Shanghai Turbo EnterprisesAWM––1.81
81Shangri-La Asia LimitedS072.461.2180.54
82SIIC Environment HoldingsBHK7.195.4950.28
83Sinarmas Land LimitedA2615.142.3320.25
84Sincap group5UN1.03–0.04
85Sing Holdings5IC15.354.8680.51
86Sinjia Land Limited5HH––0.58
87Sino Grandness Food Industry GroupT4B6.35–0.03
88Sinopipe HoldingsX06––-31.71
89Sinostar PEC HoldingsC9Q13.64–0.52
90Starland Holdings5UA1.05300.60
91Straco CorporationS8513.215.0571.62
92Sunpower Group5GD7.960.4761.07
93Suntar Eco CityBKZ0.03–2.47
94SunVic Chemical HoldingsA7S24.63–0.13
95Swing Media Technology GroupBEV4.76–0.09
96Thakral CorporationAWI6.719.5240.39
97Tianjin Zhongxin Pharmaceutical GroupT1411.615.3730.79
98Tiong Seng HoldingsBFI3.993.5960.24
99United Food HoldingsAZR––0.13
100USP Group LimitedBRS––0.25
101Valuetronics HoldingsBN214.536.481.08
102Willas-Array Electronics HoldingsBDR––0.31
103Wilmar InternationalF347.722.8391.22
104World Precision MachineryB491.855.3640.34
105Yamada Green ResourcesBJV2.25–0.99
106Yanlord Land GroupZ2511.866.0180.39
107Yongmao HoldingsBKX7.680.2830.40
108Yunnan Energy InternationalT43––0.91
109Yangzijiang Shipbuilding YZJ CNYSO79.994.4140.66
110Yangzijiang Shipbuilding YZJ SGDBS69.994.6120.62
111Zhongmin Baihui Retail Group5SR28.574.842.86

Due to globalization, most of the 30 STI component stocks have significant businesses in Greater China market (eg. Wilmar, Hongkong Land, etc), although they are not commonly labelled as S-Chip (such as Yangzijiang Shipbuilding, YZJ):

DBS Bank (SGX: D05), Singtel (SGX: Z74), OCBC Bank (SGX: O39), UOB Bank (SGX: U11), Wilmar International (SGX: F34), Jardine Matheson Holdings JMH (SGX: J36), Jardine Strategic Holdings JSH (SGX: J37), Thai Beverage (SGX: Y92), CapitaLand (SGX: C31), Ascendas Reit (SGX: A17U), Singapore Airlines (SGX: C6L), ST Engineering (SGX: S63), Keppel Corp (SGX: BN4), Singapore Exchange (SGX: S68), HongkongLand (SGX: H78), Genting Singapore (SGX: G13), Mapletree Logistics Trust (SGX: M44U), Jardine Cycle & Carriage (SGX: C07), Mapletree Industrial Trust (SGX: ME8U), City Development (SGX: C09) , CapitaLand Mall Trust (SGX: C38U), CapitaLand Commercial Trust (SGX: C61U), Mapletree Commercial Trust (SGX: N2IU), Dairy Farm International (SGX: D01), UOL (SGX: U14), Venture Corporation (SGX: V03), YZJ Shipbldg SGD (SGX: BS6), Sembcorp Industries (SGX: U96), SATS (SGX: S58), ComfortDelGro (SGX: C52).

An investor has to be selective in investing as some China related stocks in Singapore are weak (buy low may get lower in share price due to weak business, especially in a bearish stock market), despite some may have a beautiful Chinese name or belong to a promising China market but the competition is too intense, only giant China stocks could be profitable in longer term.

Here, let’s focus on 4 China related giant stocks in 4 different stock exchanges (Singapore, Hong Kong / China, Taiwan / US).

1) Singapore All-Rounded Giant Stock (S-Chip / A-Share)

– Tianjin Zhongxin Pharmaceutical Group (SGX: T14 / China Shanghai: 600329, 天津中新药业)

Despite Tianjin Zhongxin is much smaller than other pharmaceutical companies in China, it is a little giant stock. It is an all-rounded stock with many unique characteristic, eg cyclic, growth, dividend and even undervalue. This implies an investor or a trader would have more options but need to choose the right strategy aligning with own personality.

The stock is currently as lower optimism level, possible for long term cyclic investing to Buy Low but requires years of holding power before could sell high, supporting by steady business growth, even during COVID-19 pandemic.  The company also distributes high dividend (about 5% dividend yield), suitable for holding but weakness is cyclic share prices may result in losses for shorter term traders, therefore trend-following strategy may be considered. The stock is listed in both Singapore (S-Chip) and China Shanghai (A-Share) with some differences in short term prices due to different market responses (eg. China stock market is relatively more bullish than Singapore stock market over the past 1 year).

Tianjin Zhongxin is a giant Singapore / China healthcare stock, much stronger than most of other 37 Singapore healthcare stocks in Singapore:

Accrelist Ltd (SGX: QZG), Alliance Healthcare (SGX: MIJ), Aoxin Q & M Dental (SGX: 1D4), Asia Vets Holdings (SGX: 5RE), AsiaMedic (SGX: 505), Asian Healthcare Specialists (SGX: 1J3), Beverly JCG (SGX: VFP), Biolidics (SGX: 8YY), Cordlife (SGX: P8A), First Reit (SGX: AW9U), Haw Par Corporation (SGX: H02), HC Surgical Specialists (SGX: 1B1), Healthway Medical Corporation (SGX: 5NG), Hyphens Pharma International (SGX: 1J5), IHH Healthcare (SGX: Q0F), ISEC Healthcare (SGX: 40T), IX Biopharma (SGX: 42C), Lonza Group (SGX: O6Z), Medinex (SGX: OTX), Medtecs International Corporation (SGX: 546), OUE Lippo Healthcare (SGX: 5WA), ParkwayLife Reit (SGX: C2PU), Pharmesis International (SGX: BFK), Q&M Dental Group (SGX: QC7), QT Vascular (SGX: 5I0), Raffles Medical Group (SGX: BSL), RHT Health Trust (SGX: RF1U), Riverstone Holdings (SGX: AP4), SingMedical Group (SGX: 5OT), Suntar Eco-City (SGX: BKZ), TalkMed (SGX: 5G3), Thomson Medical Group (SGX: A50), Tianjin Zhong Xin Pharmaceutical Group (SGX: T14), Top Glove Corporation (SGX: BVA), Trendlines Group (SGX: 42T), UG Healthcare Corporation (SGX: 41A), Vicplas International (SGX: 569).

2) China / Hong Kong Giant Bank Stock (H-Share/A-Share)

– Industrial And Commercial Bank Of China, ICBC (China Shanghai: 601398 / HKEX: 1398, 中國工商銀行)

ICBC is the world largest bank based on asset size, listed in both China Shanghai (A-Share) and Hong Kong (H-Share). It has steady business performance but the growth is limited over the past few years (transition from growth to mature company). It has attracted support of global funds including Temasek of Singapore as a major shareholder (8.4%).

The share price is at long term and medium term low optimism, could be considered for cyclic investing with Buy Low Sell High strategy but current bearish short term prices (sharp falling knife) could result in losses for a trader.  In addition, the stock pays consistent dividend in the past, currently dividend yield is about 7%, reasonable for passive income investor.

ICBC is a giant China / Hong Kong bank stock, much stronger than most of 30 Singapore Banking & Finance stocks in Singapore:

AMTD IB OV (SGX: HKB), B&M Hldg (SGX: CJN), DBS Bank (SGX: D05), Edition (SGX: 5HG), G K Goh (SGX: G41), Global Investment (SGX: B73), Great Eastern (SGX: G07), Hong Leong Finance (SGX: S41), Hotung Investment (SGX: BLS), IFAST Corporation (SGX: AIY), IFS Capital (SGX: I49), Intraco (SGX: I06), Maxi-Cash Finance (SGX: 5UF), MoneyMax Finance (SGX: 5WJ), Net Pacific Finance (SGX: 5QY), OCBC Bank (SGX: O39), Pacific Century (SGX: P15), Prudential USD (SGX: K6S), Singapore Exchange (SGX: S68), SHS (SGX: 566), Sing Investments & Finance (SGX: S35), Singapore Reinsurance (SGX: S49), Singapura Finance (SGX: S23), TIH (SGX: T55), Uni-Asia Group (SGX: CHJ), UOB Bank (SGX: U11), UOB-KAY HIAN HOLDINGS (SGX: U10), UOI (SGX: U13), ValueMax (SGX: T6I), Vibrant Group (SGX: BIP).

3) China F&B Giant Stock (A-Share)

– Kweichow Moutai (China Shanghai: 600519, 貴州茅台酒)

Kweichow Moutai is a famous Chinese liquor stock, also the largest in the world, surpassing Diageo (LSE: DGE) since 2017, mainly supported by high growth share prices. Competitor, Wuliangye Yibin (Shenzhen: 000858, 宜宾五粮液), is also an alternative stock investment option, having strong business fundamental but growth is relatively slower than Moutai.

Moutai is a strong growth stock in long term and also a strong momentum stock in short term. So, either an investor or a trader may apply “Buy & Hold” strategy, with timeframe following own personality.  The brand is a strong intangible asset for the company.

The liquor industry could be cyclic in longer time especially when there is any major change in China government policy, eg. about 10 years, due to anti-corruption campaign (eg. consumption or giving high price liquor as gift could be a common practice for decades), growth of Moutai Wuliangye was slow but start to gain momentum over the past few years.  In a longer term, premium alcoholic beverages of Moutai and Wuliangye would have sustainable growth, supported by rising middle class population in China with stable growing economy.

Kweichow Moutai and Wuliangye Yibin are giant China F&B stocks, much stronger than most of 48 Singapore F&B stocks in Singapore:

Abterra (SGX: L5I), Acma (SGX: AYV), Amara Holdings (SGX: A34), Bonvests Holdings (SGX: B28), ChasWood Resources (SGX: 5TW), China Fishery (SGX: B0Z), China Kangda Food (SGX: P74), Dairy Farm International (SGX: D01), Del Monte Pacific (SGX: D03), Delfi (SGX: P34), Dukang (SGX: BKV), Envictus (SGX: BQD), Food Empire Holdings (SGX: F03), Fraser and Neave F&N (SGX: F99), Hosen Group (SGX: 5EV), Japan Foods Holding (SGX: 5OI), Japfa (SGX: UD2), JB Foods (SGX: BEW), Jumbo Group (SGX: 42R), Katrina Group (SGX: 1A0), Khong Guan (SGX: K03), Kimly (SGX: 1D0), Koufu (SGX: VL6), Luzhou Bio-Chem (SGX: L46), Mewah International (SGX: MV4), Neo (SGX: 5UJ), No Signboard Holdings (SGX: 1G6), Old Chang Kee (SGX: 5ML), OneApex (SGX: 5SY), Pacific Andes (SGX: P11), Pavillon (SGX: 596), QAF (SGX: Q01), Sakae (SGX: 5DO), SATS (SGX: S58), Sheng Siong (SGX: OV8), Shopper360 (SGX: 1F0), Sino Grandness (SGX: T4B), Soup Restaurant (SGX: 5KI), ST Group Food (SGX: DRX), SunMoon Food (SGX: AAJ), Thai Beverage (SGX: Y92), Tung Lok Restaurants (SGX: 540), United Food (SGX: AZR), Wilmar International (SGX: F34), Yamada Green Resources (SGX: BJV), Yeo Hiap Seng (SGX: Y03), Zhongxin Fruit (SGX: 5EG).

4) Taiwan Technology Giant Stock (ADR)

– Taiwan Semiconductor Manufacturing, TSMC (Taiwan: 2330 / NYSE: TSM, 台積電)

Taiwan is one of “4 Small Dragons” in Asia (South Korea, Taiwan, Singapore and Hong Kong), also a strong technology hub, especially for semiconductor industry leading by TSMC, world largest IC chip manufacturing company.  TSMC is very advanced in IC technology development, currently the only player for 5nm technology, far ahead of competitor, Samsung.  With rising demand for 5G and internet related applications globally, TSMC has a monopoly of such advanced IC technology, able to sustain the growth with profits over the next decade.

TSMC is a strong growth investing stock and strong momentum stock, share price is doubled over the past few months, riding the wave of uptrend semiconductor industry and unique position as world semiconductor leader. The long term optimism level of TSMC is relatively high, more suitable for short term position trading to “Buy & Hold” with trend-following strategy, supported by strong business growth. 

TSMC is a giant Taiwan technology stock, much stronger than most of 53 Electronics stocks and 28 IT stocks, total 81 Technology Stocks in Singapore:

AEM Holdings (SGX: AWX), Accrelist Limited (SGX: QZG), Acma Limited (SGX: AYV), Adventus Holdings (SGX: 5EF), Allied Technologies Limited (SGX: A13), Amplefield Limited (SGX: AOF), Avi Tech Electronics (SGX: BKY), Ban Leong Technologies (SGX: B26), CDW Holding (SGX: BXE), CFM Holdings (SGX: 5EB), CPH Limited (SGX: 539), Chuan Hup Holdings (SGX: C33), Creative Technology (SGX: C76), Datapulse Technology (SGX: BKW), Dragon Group International (SGX: MT1), Dutech Holdings (SGX: CZ4), Ellipsiz Limited (SGX: BIX), Excelpoint Technology (SGX: BDF), Frencken Group (SGX: E28), Global Invacom Group (SGX: QS9), GP Industries (SGX: G20), Global Testing Corporation (SGX: AYN), Grand Venture Technology (SGX: JLB), HGH Holdings (SGX: 5GZ), Hu An Cable Holdings (SGX: KI3), JEP Holdings (SGX: 1J4), Jadason Enterprises (SGX: J03), Karin Technology Holdings (SGX: K29), Libra Group (SGX: 5TR), Manufacturing Integration Technology (SGX: M11), Maruwa Yen1k (SGX: M12), MeGroup Limited (SGX: SJY), Micro-Mechanics Holdings (SGX: 5DD), Plastoform Holdings (SGX: AYD), Polaris Limited (SGX: 5BI), Powermatic Data Systems  (SGX: BCY), Renaissance United (SGX: I11), SEVAK Limited (SGX: BAI), SUTL Enterprise (SGX: BHU), Serial System (SGX: S69), Shinvest Holding (SGX: BJW), Sunright Limited (SGX: S71), Sunrise Shares Holdings (SGX: 581), TT International (SGX: T09), Thakral Corporation (SGX: AWI), The Place Holdings (SGX: E27), Trek 2000 International (SGX: 5AB), Valuetronics Holdings (SGX: BN2), Venture Corporation (SGX: V03), Willas-Array Electronics Holdings (SGX: BDR), World Precision Machinery (SGX: B49). Alpha Energy Holdings (SGX: 5TS), Alset International (SGX: 40V), Artivision Technologies (SGX: 5NK), Asiatravel.com Holdings (SGX: 5AM), A-Smart Holdings (SGX: BQC), Azeus Systems Holdings (SGX: BBW), Boustead Singapore Limited (SGX: F9D), Captii (SGX: AWV), Challenger Technologies (SGX: 573), CSE Global (SGX: 544), DISA (SGX: 532), International Press Softcom (SGX: 571), ISDN Holdings (SGX: I07), Keppel DC Reit (SGX: AJBU), Koyo International (SGX: 5OC), M Development (SGX: N14), Mapletree Industrial Trust (SGX: ME8U), New Silkroutes Group (SGX: BMT), New Wave Holdings (SGX: 5FX), PEC (SGX: IX2), Plato Capital (SGX: YYN), Procurri Corporation (SGX: BVQ), Rich Capital Holdings (SGX: 5G4), Silverlake Axis (SGX: 5CP), SinoCloud Group (SGX: 5EK), Stratech Group (SGX: BRR), Synagie Corp (SGX: V2Y), YuuZoo Networks Group Corp (SGX: AFC).

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Both China (Oct 1) and Taiwan (Oct 10) celebrate respective national days in the month of October, moon is the roundest on 1 Oct 2020 (Mid-Autumn Festival), implying peaceful political world could share the fortune but requiring investing in giant stocks. Both Big and 4 Small Dragons (including Singapore) are global economic growth engines, in transition from manufacturing to higher value technology development.

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There are over 1500 giant stocks in the world based on Dr Tee criteria, choice of 10 Dream Team giant stocks have to align with one’s unique personality, eg. for shorter term trading (eg. momentum or swing trading) or longer term investing (cyclic investing, undervalue investing or growth investing). Readers should not just “copy and paste” any stock (What to Buy, When to Buy/Sell) as successful action taking requires deeper consideration (LOFTP strategies – Level / Optimism / Fundamental / Technical / Personal Analysis) which you could learn further from Dr Tee Free 4-hr Webinar.

Drop by Dr Tee free 4hr webinar (learning at comfort of home with Zoom) to learn how to position in global giant stocks during COVID-19 stock crisis with 10 unique stock investing strategies, knowing What to Buy, When to Buy/Sell.

Zoom will be started 30 min before event, bonus talk (Q&A on any investment topics from readers) for early birds. There are many topics we will cover in this 4hr webinar, Dr Tee can have more time for Q&A if you could stay later after the webinar.

Dr Tee will cover over 20 case studies, Singapore giant stocks, eg. CapitaLand Mall Trust (SGX: C38U), Singapore Exchange (SGX: S68), Keppel Corp (SGX: BN4), Top Glove (SGX: BVA), Jardine Matheson Holdings JMH (SGX: J36), Vicom (SGX: WJP) and many others, Malaysia giant stocks, Hong Kong giant stocks and US giant stocks, both long term investing and short term trading.

There are limited tickets left for this 4hr free webinar, please ensure 100% you could join when register: www.ein55.com

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Filed Under: Fundamental Analysis, Macroeconomy, Market Cycle Investing, Market Outlook, Stock Market Tagged: , ,

Singapore and Malaysia National Giant Stocks (国庆财股)

Posted on August 9, 2020 Written by
Singapore Stocks DBS OCBC Singtel UOB

Both Singapore and Malaysia celebrate National Day in the month of August. It is timely to share the 4 National Giant Stocks in each country which preserve the national wealth. Learn from Dr Tee on how to position these stocks during COVID-19 stock crisis.

4 Singapore National Stocks:

1) DBS (SGX: D05)

2) Singtel (SGX: Z74)

3) OCBC (SGX: O39)

4) UOB (SGX: U11)

4 Malaysia National Stocks:

1) Maybank (Bursa: 1155)

2) Top Glove (Bursa: 7113) / (SGX: BVA)

3) Hartalega (Bursa: 5168)

4) Public Bank (Bursa: 1295)

Stock market is a hidden way to preserve and grow the national wealth. For Singapore SGX, there are 30 large cap stocks in STI Index (^STI), which can be sorted below by size of market cap (share price x number of shares) with ROE (Return on Equity):

No       Name  / Market Cap(M) (ROE, %)

1          DBS Bank (SGX: D05) 52304 (12.3)

2          Singtel (SGX: Z74) 38761 (4.0)

3          OCBC Bank (SGX: O39) 38413 (10.3)

4          UOB Bank (SGX: U11) 32687 (11.0)

5          Wilmar International (SGX: F34) 30509 (7.7)

6          Jardine Matheson Holdings JMH (SGX: J36)  29865 (9.4)

7          Jardine Strategic Holdings JSH (SGX: J37)   22731 ( 6.1)

8          Thai Beverage (SGX: Y92) 15195 (20.1)

9          CapitaLand (SGX: C31) 13844 (8.8)

10        Ascendas Reit (SGX: A17U) 12489 (4.8)

11        Singapore Airlines (SGX: C6L) 10346 (-0.1)

12        ST Engineering (SGX: S63) 10042 (26.0)

13        Keppel Corp (SGX: BN4) 9830 (6.3)

14        Singapore Exchange (SGX: S68) 9236 (37.9)

15        Hongkong Land USD (SGX: H78) 8635 (0.5)

16        Genting Singapore (SGX: G13) 8204 (8.5)

17        Mapletree Logistics Trust (SGX: M44U) 8027 (8.2)

18        Jardine Cycle & Carriage (SGX: C07) 7659 (12.8)

19        Mapletree Industrial Trust (SGX: ME8U) 7490 (10.3)

20        City Development (SGX: C09) 7463 (5.2)

21        CapitaLand Mall Trust (SGX: C38U) 6937 (9.0)

22        CapitaLand Commercial Trust (SGX: C61U) 6294 (6.0)

23        Mapletree Commercial Trust (SGX: N2IU) 6130 (9.4)

24        Dairy Farm International (SGX: D01) 5897 (26.8)

25        UOL (SGX: U14) 5491 (4.8)

26        Venture Corporation (SGX: V03) 5449 (14.5)

27        YZJ Shipbldg SGD (SGX: BS6) 3801 (10.0)

28        Sembcorp Industries (SGX: U96) 3394 (3.1)

29        SATS (SGX: S58) 3017 (10.4)

30        ComfortDelGro (SGX: C52) 2990 (10.2)

It is clear that the Top 4 stocks with the largest market cap in Singapore are DBS (SGX: D05), Singtel (SGX: Z74), OCBC (SGX: O39) and UOB (SGX: U11). Company size may not be the right criteria of a giant stock, therefore an investor has to monitor business fundamental changes (especially during COVID-19 pandemic), eg with ROE and other indicators.

For 30 STI stocks, only Singapore Airlines, SIA (SGX: C6L) records losses in last financial year. For 30 STI stocks, COVID-19 has different degrees of impact on near future business.  There is also on-going crisis, eg. low optimism crude oil price which affects the Oil & Gas sector, including Keppel Corp (SGX: BN4) and Sembcorp Industries (SGX: U96), which may take longer time to recover with strong support of sponsor, Temasek.

3 major bank stocks (DBS, OCBC, UOB) in Singapore have contributed to about 1/3 of Singapore stock market. Bank stocks are sensitive to interest rate changes, therefore current low interest rates globally (driven by nearly 0% interest rate by the Fed of US) have reduced the Net Interest Margin (NIM), resulting in lower interest related income. At the same time, Non-Performing Loan (NPL) is increasing during COVID-19, banks have to increase more provision funds to prepare for possible default in loan payment of some countries, including Oil & Gas sector (eg. Hin Leong which has high debt to 3 major banks).  As a result, it is not surprised to see bank stocks report poorer quarterly results for Q1 and Q2 / 2020.

MAS has requested 3 major banks in Singapore to cap the dividend payment for FY2020 to maximum of 60% of FY2019. This implies for an average dividend yield of 6%, an investor may only receive 6 x 0.6 = 3.6% for the next 1 year. As a result, 3 major bank stocks were under significant price correction recently (which also affect performance of STI). However, a long term bank stock investor should not consider dividend payment as a criteria to decide on investing. In fact, the share price correction of over 3% in 1 week has compensated for the “loss” of dividend (which is kept as retained earnings in balance sheet, a form of saving for investor, similar to many REITs in Q1 and Q2 / 2020 to preserve cash).

Here is a list of 30 Banking & Finance stocks in Singapore, an investor may focus on 3 major bank stocks:
AMTD IB OV (SGX: HKB), B&M Hldg (SGX: CJN), DBS Bank (SGX: D05), Edition (SGX: 5HG), G K Goh (SGX: G41), Global Investment (SGX: B73), Great Eastern (SGX: G07), Hong Leong Finance (SGX: S41), Hotung Investment (SGX: BLS), IFAST Corporation (SGX: AIY), IFS Capital (SGX: I49), Intraco (SGX: I06), Maxi-Cash Finance (SGX: 5UF), MoneyMax Finance (SGX: 5WJ), Net Pacific Finance (SGX: 5QY), OCBC Bank (SGX: O39), Pacific Century (SGX: P15), Prudential USD (SGX: K6S), Singapore Exchange (SGX: S68), SHS (SGX: 566), Sing Investments & Finance (SGX: S35), Singapore Reinsurance (SGX: S49), Singapura Finance (SGX: S23), TIH (SGX: T55), Uni-Asia Group (SGX: CHJ), UOB Bank (SGX: U11), UOB-KAY HIAN HOLDINGS (SGX: U10), UOI (SGX: U13), ValueMax (SGX: T6I), Vibrant Group (SGX: BIP).

Singtel is also a crisis giant stock in bearish Telco sector (started a few years before COVID-19), an investor who “Buy Low” may get Lower in share price, gaining dividend yield (eg. 5%) but making capital loss (lower share price). Telco business is saturated, economic moat is narrow as most Telco services could be easily replaced by other competitors, therefore profit margin is lower with intense competition not only in local market but also in regional market (Singtel has over 50% revenue from overseas markets).

OCBC, UOB and Singtel are relatively at lower optimism region while DBS is at moderate optimism level. Each giant stock requires different strategy (crisis, cyclic, growth, etc) in positioning, either for short term trading or long term investing.

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Malaysia Bursa with 30 KLCI (^KLCI) stocks, top 4 giant stocks by market cap has significant changes recently. Maybank (Bursa: 1155) is still the largest but both Top Glove (Bursa: 7113) / (SGX: BVA) and Hartalega (Bursa: 5168) have surpassed Public Bank (Bursa: 1295), mainly due to speculation in stocks during COVID-19 for glove related stocks.  Top Glove has dual listing in both Malaysia Bursa and Singapore SGX, therefore the wealth of a nation could be shared by global investors, regardless of nationality.

Here is a list of 30 Malaysia Bursa KLCI Index component stocks which may be considered (investor has to focus only on giant stocks for investing):
CIMB (Bursa: 1023) CIMB GROUP HOLDINGS BERHAD, DIALOG (Bursa: 7277) DIALOG GROUP BERHAD, DIGI (Bursa: 6947) DIGI.COM BERHAD, GENM (Bursa: 4715) GENTING MALAYSIA BERHAD, GENTING (Bursa: 3182) GENTING BERHAD, HAPSENG (Bursa: 3034) HAP SENG CONSOLIDATED BERHAD, HARTA (Bursa: 5168) HARTALEGA HOLDINGS BERHAD, HLBANK (Bursa: 5819) HONG LEONG BANK BERHAD, HLFG (Bursa: 1082) HONG LEONG FINANCIAL GROUP BERHAD, IHH (Bursa: 5225) IHH HEALTHCARE BERHAD, IOICORP (1961) IOI CORPORATION BERHAD, KLCC (Bursa: 5235SS) KLCC PROPERTY HOLDINGS BERHAD, KLK (Bursa: 2445) KUALA LUMPUR KEPONG BERHAD, MAXIS (Bursa: 6012) MAXIS BERHAD, MAYBANK (Bursa: 1155) MALAYAN BANKING BERHAD, MISC (Bursa: 3816) MISC BERHAD, NESTLE (Bursa: 4707) NESTLE MALAYSIA BERHAD, PBBANK (Bursa: 1295) PUBLIC BANK BERHAD, PCHEM (Bursa: 5183) PETRONAS CHEMICALS GROUP BERHAD, PETDAG (Bursa: 5681) PETRONAS DAGANGAN BHD, PETGAS (Bursa: 6033) PETRONAS GAS BERHAD, PMETAL (Bursa: 8869) PRESS METAL ALUMINIUM HOLDINGS BERHAD, PPB (Bursa: 4065) PPB GROUP BERHAD, RHBBANK (Bursa: 1066) RHB BANK BERHAD, SIME (Bursa: 4197) SIME DARBY BERHAD, SIMEPLT (Bursa: 5285) SIME DARBY PLANTATION BERHAD, TENAGA (Bursa: 5347) TENAGA NASIONAL BHD, TM (Bursa: 4863) TELEKOM MALAYSIA BERHAD, TOPGLOV (Bursa: 7113) TOP GLOVE CORPORATION BHD.

Strong fundamental stocks (eg. glove business) with market greed usually result in market speculation or bubble.  Each positive news would be used as a reason to buy high for share prices. Despite strong business fundamental, glove stocks are more suitable for short term trading with trend-following strategies, Buy High Sell Higher.  However, due to relative high optimism level, each unexpected correction may incur high losses if a trader does not have a trading plan with S.E.T. (Stop Loss, Entry, Target) prices.

Maybank and Public Bank are aligned with Singapore and global banks at relatively lower optimism levels. Bank stocks are cyclic in nature, therefore investing in national banks (usually supported by local government) during global financial crisis would have higher chances of success for longer term investors who could overcome the market fear, investing with progressive entries of capital (eg. 10 x 10%, 5 x 20%, 2 x 50%, etc). Saving in banks would receive less than 1% return in interest but investing in giant bank stocks could receive over 100% return over a market cycle.

Each country or region has its own national blue chip stock. For example, TSMC (NYSE: TSM) contributed to 1/3 of Taiwan TSEC Stock Index (^TWII). With bullish semiconductor / 5G stocks, TSMC has doubled its share price in 6 months, contributing to higher index value of Taiwan stock market.  TSMC has monopoly of 5 nanometer technology in wafer fab, a crucial pillar for emerging 5G Telco business over the next 10 years.

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Dilemma of investors for global growth stocks (eg. technology, glove, healthcare, etc) are share prices are not cheap when market is not fearful. Therefore, crisis is always an opportunity, especially when a stock price drops significantly during an unexpected crisis (eg. COVID-19 pandemic) but business fundamental is not much affected or even growing.

Drop by Dr Tee free 4hr webinar to learn how to position in global giant stocks during COVID-19 stock crisis with 10 unique stock investing strategies, knowing What to Buy, When to Buy/Sell.

This is the first time, 4hr bonus investment course by Dr Tee is conducted through Webinar (learning at comfort of home with Zoom), a rare opportunity to learn remotely, profiting from Covid-19 stock crisis.

Zoom will be started 30 min before event, bonus talk (Q&A on any investment topics from readers) for early birds. There are many topics we will cover in this 4hr webinar, Dr Tee can have more time for Q&A if you could stay later after the webinar.

Dr Tee will cover over 20 case studies, Singapore giant stocks, eg. CapitaLand Mall Trust (SGX: C38U), Singapore Exchange (SGX: S68), Keppel Corp (SGX: BN4), Top Glove (SGX: BVA), Jardine Matheson Holdings JMH (SGX: J36), Vicom (SGX: WJP) and many others, Malaysia giant stocks, Hong Kong giant stocks and US giant stocks, both long term investing and short term trading.

There are limited tickets left for this 4hr free webinar, please ensure 100% you could join when register: www.ein55.com

Filed Under: Macroeconomy, Market Cycle Investing, Market Outlook, Stock Market, Technical Analysis Tagged: , , , , ,

3 Strategies for Double Top Stock Market (峰回路转)

Posted on June 12, 2020 Written by
Double Top Stock Market Strategies

US stock markets (both S&P 500 and Nasdaq indices) start to form potential “Double Top” at high optimism levels, after last few days of correction, indices are approaching / below 20 days moving average. At the same time, Asian stock markets (Singapore, Hong Kong, China, Malaysia, etc) are still struggling to recover gradually at moderate low optimism level but may need to follow the footstep of US.

In this article, Dr Tee will share 3 main strategies with 3 unique personalities for the current global stock markets, either short term trading or long term investing, both follow-trend and counter-trend.  Before that, let’s understand the main driver of stock and economic crisis: Covid-19 conditions locally and globally.

US has reported a few positive economic signals (eg. job market is not as bad as expected) but recovery phase would take longer time while stock market is back to high optimism level before Covid-19 crisis again.  Covid-19 condition in US shows very gradual drop in number of infected cases as social distancing may not be strictly enforced while many people could not wait to restart the economy. Based on projection, Covid-19 in US may need to wait until end of summer (around Aug 2020) to fade away. The positive signal is the number of new daily death cases are dropped to only about 1/3 of the peak, although number of new daily infected cases are still about 2/3 of peak cases. This implies the strain of Covid-19 is getting weaker after 5 months of pandemic.

At the same time, world number of infected Covid-19 cases are still increasing (7.5M cases), mainly due to high increment in a few high population countries such as Brazil and India which may be hard to balance between lockdown (minimize health crisis) and continuation of economy (minimize financial crisis). Some more healthy people may not mind take the risk to work as no income may be higher “risk” to the family. Again, positive signal is number of death cases are in declining mode globally.

For Singapore, most of the Covid-19 cases are within worker dormitories which are under control (few cases in the community) and very few death cases. Therefore, Singapore government has restarted economy in phases. There are even plans to start travel within the regions with countries having mild condition (eg. China). Malaysia has also restarted the economy, similar to many other global countries.

In short, Covid-19 condition is improving in many countries (at least within major economies: US, China, Japan, Europe), may fade away by end of summer. With restart of economy, the worst of monthly economic performance could be over (during last few months of global lockdown). However, each of the global government has to work hard to avoid Covid-19 induced short term economic crisis is extended into a longer term and bigger scale global financial crisis.

The most direct method would be economic stimulus plan, different names in each country, eg: Quantitative Easing (QE) in US which is unlimited in scale. As a result, there is a divergence between stock market (V-shape recovery) and economy (sluggish). When US stock markets are recovering back to the level before Covid-19 crisis (Nasdaq has even achieved new historical high of 10000 points), market starts to show correction.

Stock correction is healthy for longer term growth, similar to a person climbs up a hill, need some rests or slowing down in bumpy path to preserve the energy (峰回路转). However, potential “Double Top” pattern for US stock market at high optimism is still a big threat as no one would know the possible scales of correction: minor correction (less than 10%), major correction (10-20%), stock crisis (eg. 20-30% during Covid-19) or even global financial crisis (over 50%).

Therefore, it is important for a stock trader or investor to take action (Buy / Hold / Sell / Wait / Shorting) aligning with own personality. Here are 3 potential strategies for 3 unique personalities when there are potential signals of stock market correction (different levels):

1) Short Term Momentum / Cyclic Trading (trend-following)
A short term trader would exit progressively or reduce position with S.E.T. (Stop Loss / Entry / Target Prices) trading plan. When stock market is back to bullish again for short term, can always re-enter the trading (acceptable even the price could be higher than the selling price). Selling a stock is taking an insurance for a trader to reduce the risk, especially when uptrend price is corrected below own risk tolerance level.

Friend of a trader is always the clear price trends and bonus is strong fundamental business (just in case a retail trader could not follow the trading, if forced to become a long term investor, at least the giant stock would give the protection). Of course, it is possible to apply reversed strategy to do shorting, same requirement of following trading plan but in a reversed way (eg. downtrend price with weak fundamental business, best with negative market news).

2) Long Term Growth Investing
A long term growth investor would either reduce position (if trend-following but price is corrected more than own risk level) to protect the capital gain or possible to hold (regardless of potential stock crisis) but need to ensure stock portfolio is well diversified, based on 10-20 growth giant stocks with strong business fundamental. When stock is back to bullish again, may consider to “Average Up” with multiple entries for longer term investor. 

For investor who could also trade, there is also an option for hedging (shorting for short term while holding to position for long term if not selling).

3) Long Term Dividend Investing

A long term dividend investor, if applying contrarian strategy (counter-trend to buy low in bearish stock market), possible to apply multiple entries to enter while stocks are falling, 10-25% (or X% defined by individual) price gap between each entry to maximize the dividend yield (especially for Asian stock market at lower optimism) but need to ensure stock portfolio is well diversified, based on 10-20 giant dividend/growth stocks with strong business fundamental.

This is “Average Down” method, suitable for unknown scale of stock crisis (minor correction or global financial crisis), no need to guess the bottom as consistent averaging in prices would help but an investor needs to follow the discipline to continue to buy low (only for giant stocks) while others are fearful. 

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It is possible for 3 strategies above to be integrated, eg. trend-following dividend investing or growth + dividend investing, etc. There are over 10 different stock trading or investing strategies but one has to adjust to fit own personality. For example, for market cycle investor, needs to follow market optimism closely as US is back to high optimism level (>75%).  Commodity stock investor (eg. oil & gas stock) needs to integrate different market cycles of stock market and commodity market.

Of course, the last possible option is do nothing all the time, regardless up or down in stock market: zero risk, zero reward.  A stock trader or investor has to learn to take action (Buy / Hold / Sell / Wait / Shorting) unless “Do Nothing” (Wait or Hold) is part of strategy.

Drop by Dr Tee free 4hr investment course to learn how to position in global giant stocks with 10 unique stock investing strategies, knowing What to Buy, When to Buy/Sell.

Learn further from Dr Tee valuable 7hr Online Course, both English (How to Discover Giant Stocks) and Chinese (价值投资法: 探测强巨股) options, specially for learners who prefer to master stock investment strategies of over 100 global giant stocks at the comfort of home.

You are invited to join Dr Tee private investment forum (educational platform, no commercial is allowed) to learn more investment knowledge, interacting with over 9000 members.

Dr Tee Investment Course (Stock, Property, Commodity, Forex, Bond)

Filed Under: Macroeconomy, Market Cycle Investing, Market Outlook, Stock Market, Technical Analysis, Value Investing Tagged: , , ,

Watching NASDAQ to 10000 Points (旁观者迷)

Posted on June 11, 2020 Written by
NASDAQ 10000 Points US Stock Market

10000 points tonight is an important milestone for Nasdaq (mainly technology stocks) as in Year 2000 Dotcom Bubble, it also fell down from “new” peak of 5000 points to about 1/3 of value. After 20 years later, the key difference is this time the driver is V-shape recovery after over 30% major correction which shows the power of “unlimited QE”.

US is more suitable for shorter term trading, especially momentum trading with support of greedy mass market. Trend-following may be required for some traders as optimism is back to high level for both NYSE and NASDAQ stock markets in US. Global stock markets (STI, KLCI, HSI, SSEC, DAX, etc) also recover well but not as bullish as US.

It may be hard to compare Apple (eg. US stock market) with Orange (eg. Asian stock market) but they are still connected as both are fruits (global stock market), therefore when demand for Apple is higher, likely demand for Orange may be higher as well.

At the same time, within each fruit, an investor should look for better Apple or better Orange as it may be confusing to apply the Orange criteria (eg. sweatness) on selection of Apple (eg. crunchy).

In short, you don’t have to like Apple or Orange but need to ensure their prices would be higher in future based on the timeframe of your interest.

Trading may not be suitable for everyone. Those who prefer to buy and forget may be more suitable for investing. There are a few who could invest and trade at the same time but applying 2 different strategies, even if the stock is the same.

When there is a reversal (eg. bear to bull), some would be happy (those who take actions to buy), some may feel sad (those who wait but now uncertain whether decision is right).

In fact, there is no need to worry as there is no right nor wrong in stock market. A trader or investor needs to have a trading plan or investing strategy as an “anchor” to position oneself (aligned with own personality), else will be drifted each day by the wave of stock market, confused with up or down until giddy, may make a “wrong” decision by following others who shout louder.

Covid-19 conditions (both # daily infected cases and death cases) are getting much better for major economies (US, China, Japan, Europe) and also in Singapore. If you follow Dr Tee articles and video education (www.ein55.com/blog) over the past 4 months since the pandemic started in Feb 2020, summer 2020 was a key factor and global Covid-19 trends have been reported to fade away by then.

With restart of economies in most global countries from June 2020, economy starts to show V-shape recovery. Oil price at low optimism starts to recover strongly after the negative oil price a few weeks ago, preparing for higher demand by the world after lockdown is over.

US job market is improving for May 2020, S&P 500 rises to another high of nearly 3200 points, could break historical high of 3300+ points if this momentum continues in June. Asia stock markets also recover gradually with less fear.

Warren Buffett is not wrong (selling Airlines stocks and bank stocks) as his actions are aligned with his own personality (sell when outlook is uncertain or beyond his knowledge) and this is only his partial stock portfolio, still holding lots of other stocks. So, even if stock market is truly recovering, Warren Buffett and Berkshire would benefit (rising in stock prices is a proof).

Those investors who follow Warren Buffett blindly (copy his actions and even extend to sell all stocks) are wrong as they don’t align the strategies with their own personalities, some even greedy to wait to buy all stocks at the lowest point (which no one knows), may end up missing the opportunity boat or given option to buy at much higher prices (旁观者迷).

There are 2 ways of analysis: relative and absolute way. Therefore, even for a bearish stock market or economy, some may view “less negative” as positive. This is similar to a weak business which should lose $1M yearly but when losing “only” $100k, it is considered positive.

Ideally economy should be strong to support stock market. However, during Covid-19 crisis, relative method may be applied.

Stock market is forward looking, therefore some traders prefer to look at price alone which could reflect most of the key market factors including emotions. A smart investor may combine business fundamental and trading together. The biggest enemy is usually ourselves, whether we are comfortable with the strategy, either short term trading or long term investing.

Analysts who have been bearish would keep quiet for a few weeks, then more posts will come out when there is correction over 10% again. Now, there will be more posts on bullish stock market. Readers would hear different views each time, eventually not able to take action at all if simply follow others.

There are always 2 views of market: bull or bear, that’s why for each transaction, there is always a pair of buyer and seller. Don’t follow analysts blindly. Instead, leverage on the views, do additional filtering, aligning with own personality.

No expert would know what may happen for tomorrow’s share price but in longer term, business with sustainable growth would have higher chance to make profits in business to support the rising price.

Since no one could see the future, a stock investor may need to apply probability investing during this uncertain period: position in 10-20 giant stocks (strikers / mid-fielders / defenders) with strategies (eg. momentum / growth / dividend / undervalue, etc) aligned with own personalities (eg. short term trading or long term / life investing), minimizing risks with multiple entries / exits.

It is fun to “watch” and cheer in the football game but at the end, observers may waste the time and money if not able to take even the first action nor having a clear strategy.

Running out of ideas of What Stocks to Buy? Read hundreds of articles by Dr Tee over the past few months of global stock crisis.

Drop by Dr Tee free 4hr investment course to learn how to position in global giant stocks with 10 unique stock investing strategies, knowing What to Buy, When to Buy/Sell.

Learn further from Dr Tee valuable 7hr Online Course, both English (How to Discover Giant Stocks) and Chinese (价值投资法: 探测强巨股) options, specially for learners who prefer to master stock investment strategies of over 100 global giant stocks at the comfort of home.

You are invited to join Dr Tee private investment forum (educational platform, no commercial is allowed) to learn more investment knowledge, interacting with over 9000 members.

Dr Tee Investment Course (Stock, Property, Commodity, Forex, Bond)
Filed Under: Macroeconomy, Market Cycle Investing, Market Outlook, Stock Market Tagged: , , ,

42 Singapore REITs & 16 Business Trusts (稳如泰山)

Posted on June 5, 2020 Written by
Singapore REITs, Business Trusts, Dividend Stocks

Singapore REITs are popular investment for passive income through stable dividend stocks. In this article, you will learn on how to invest in 21 giant stocks from 42 Singapore REITs and 16 Business Trusts with 3 key strategies (Striker / Mid-fielder / Defender) in 8 categories:

1) Retail REITs

2) Office REITs

3) Industrial REITs

4) Healthcare REITs

5) Diversified REITs

6) Data Center REIT

7) Hospitality REIT

8) Business Trusts

There are 6 Singapore REITs which are also Business Trusts, so total there are 42 + 16 – 6 = 52 Singapore REITs and Business Trusts as of current stock market. Currently, out of 30 STI Index stocks, 5 are REITs. Soon, SPH (SGX: T39) with declining trading market capitalization (lower share price and/or lower trading volume) will be replaced by Mapletree Industrial Trust (SGX: ME8U) as 6th REIT of STI.  CapitaMall Trust (SGX: C38U) will be merged with CapitaCom Trust (SGX: C61U) to form new CapitaLand Integrated Commercial Trust (CICT) Reit, therefore free up 1 seat in 30 STI. In near future, 5 reserve list of STI are all REITs or Business Trust:

Keppel DC Reit (SGX: AJBU), Suntec Reit (SGX: T82U), NetLink NBN Trust (SGX: CJLU), Frasers Logistics & Industrial Trust (SGX: BUOU) and Keppel Reit (SGX: K71U).

It implies at least 10 out of future 30 STI components would be from REITs and Business Trust. Future STI ETF (SGX: ES3)/(SGX: G3B) would be a more defensive investing tool, more dividend income but growth could be limited due to nature of Singapore REITs.

Diversification through REITs ETF (SGX: FSTAS8670) may not be a good strategy as not all stocks selected by index or fund manager are considered giant REITs (based on Dr Tee criteria) and systematic risk such as global financial crisis could potentially correct the REITs prices by more than 50% (eg. 70% price drop in 2008-2009 subprime crisis and about 40% correction in 2020 Covid-19 crisis) if an investor simply buys and hold for long term.

By law, REITs have to redistribute 90% taxable income (from property rental income) back to shareholders in the form of dividend. Therefore, a retail investor could play the role of landlord of giant property (shopping malls, commercial buildings, hospitals, hotels, etc) with minimal capital (could be less than $1000), saving the hassle to buy/sell property (REIT manager would help), no need to deal with tenants or operations (property manager would help).  Singapore REITs are exempted from corporate tax, therefore an Singapore investor could gain extra 1-2% rental or dividend yield compared with overseas REITs.

Business Trust is not limited to property rental, could be any form of business and even a company has good track record of dividend payment, it is not a legal obligation to do pay dividend in future, especially when there is a potential business crisis (eg. Covid-19) which needs more cash reserve. Therefore, from the perspective of a dividend stock investor, Singapore REITs are more preferred than Business Trusts for passive income generation.

However, a REIT investor has to buy the right REIT which could grow in rental business (most important action), aligning own personality with 3 possible strategies:

1) Striker – trading or crisis investing (Buy Low Sell High), mainly for capital gains

2) Mid-fielder – medium term investing, mainly for capital gains (dividend income as bonus)

3) Defender – long term investing, mainly for dividend income (capital gains as bonus)

After confirming a REIT / Business Trust is a giant, then investor has to master the investment clock (When to Buy / Sell), depending on type of REITs.  The best time to invest in a defensive REIT is usually during global stock crisis (with condition that the rental business is not significantly affected) which could maximize both the dividend yield and also higher upside for capital gains.

Below are all the 52 Singapore REITs and Business Trusts based on the last price traded (4 June 2020), sorted by type of REITs with details of 3 key strategies (Striker / Mid-fielder / Defender) and 3 critical Fundamental Criteria:
1) ROE (a basic criteria for REIT, eg. ROE > 0% to ensure business not losing money),
2) Dividend Yield, DY (a criteria for dividend stocks, eg. DY > 3 – 5%, depending on strategy),
3) Price-to-Book (PB) ratio, Price/NAV (a bonus for REIT is undervalue, eg. PB < 1).

NoTickerROEDividend Yield (%)PB = Price /NAVTypeStrategy
1BHG Retail Reit (SGX: BMGU)11.46.40.7Retail 
2CapitaLand Mall Trust (SGX: C38U)9.05.71.0RetailDefender
3CapitaLand Retail China Trust (SGX: AU8U)8.87.30.9RetailDefender
4Frasers Centrepoint Trust (SGX: J69U)8.34.71.2RetailDefender
5Lippo Malls Trust (SGX: D5IU)-0.715.40.7Retail 
6Sasseur Reit (SGX: CRPU)11.88.40.8Retail 
7SPH REIT (SGX: SK6U)6.15.90.9Retail 
8Starhill Global Reit (SGX: P40U)3.48.20.6RetailDefender
9United Hampshire US Reit (SGX: ODBU)4.1–0.789Retail 
10CapitaLand Commercial Trust (SGX: C61U)6.05.01.0OfficeDefender
11Elite Commercial REIT GBP (SGX: MXNU)––1.2Office 
12IREIT Global (SGX: UD1U)19.47.70.9OfficeMid-fielder
13Keppel Pacific Oak US REIT (SGX: CMOU)9.38.40.9Office 
14Keppel Reit (SGX: K71U)2.64.80.9OfficeDefender
15ManulifeReit USD (SGX: BTOU)3.87.21.0OfficeMid-fielder
16OUE Commercial Reit (SGX: TS0U)3.58.00.7Office 
17Prime US ReitUSD (SGX: OXMU)4.13.51.0Office 
18AIMS APAC Reit (SGX: O5RU)9.07.60.9Industrial 
19ARA LOGOS Logistics Trust (SGX: K2LU)-2.19.81.0Industrial 
20Ascendas Reit (SGX: A17U)7.44.41.5IndustrialDefender
21EC World Reit (SGX: BWCU)9.58.40.8Industrial 
22ESR-REIT (SGX: J91U)-0.19.71.0Industrial 
23Mapletree Industrial Trust (SGX: ME8U)10.34.61.6IndustrialMid-fielder
24Mapletree Logistics Trust (SGX: M44U)8.24.21.5IndustrialDefender
25Sabana Reit (SGX: M1GU)3.57.80.7Industrial 
26ARA Hospitality Trust USD (SGX: XZL)2.210.10.5Hospitality 
27Ascott Trust (SGX: HMN)5.17.20.8HospitalityStriker
28CDL Hospitality Trust (SGX: J85)6.18.20.7HospitalityStriker
29Eagle Hospitality Trust USD (SGX: LIW)18.225.30.2Hospitality 
30Far East Hospitality Trust (SGX: Q5T)3.67.20.6Hospitality 
31Frasers Hospitality Trust (SGX: ACV)3.48.90.7Hospitalit 
32First Reit (SGX: AW9U)5.712.10.7HealthcareStriker
33ParkwayLife Reit (SGX: C2PU)10.43.81.8HealthcareMid-fielder
34Cromwell Reit EUR (SGX: CNNU)8.38.90.9Diversified 
35Cromwell Reit SGD (SGX: CSFU)8.38.50.9Diversified 
36Frasers Logistics & Commercial Trust (SGX: BUOU)9.83.91.9DiversifiedMid-fielder
37Lendlease Reit (SGX: JYEU)––0.9Diversified 
38Mapletree Commercial Trust (SGX: N2IU)9.43.81.2DiversifiedMid-fielder
39Mapletree North Asia Commercial Trust (SGX: RW0U)2.67.70.7DiversifiedDefender
40Soilbuild Business Space Reit (SGX: SV3U)4.010.20.7Diversified 
41Suntec Reit (SGX: T82U)6.56.00.7Diversified 
42Keppel DC Reit (SGX: AJBU)5.73.12.2Data CenterMid-fielder
43Accordia Golf Trust (SGX: ADQU)-17.06.40.8Business Trust 
44Ascendas India Trust (SGX: CY6U)18.24.61.3Business TrustDefender
45Asian Pay Tv Trust (SGX: S7OU)1.87.40.2Business Trust 
46Dasin Retail Trust (SGX: CEDU)-1.98.20.6Business Trust 
47FSL Trust (SGX: D8DU)5.029.30.5Business Trust 
48HPH Trust SGD (SGX: P7VU)2.011.90.3Business Trust 
49HPH Trust USD (SGX: NS8U)2.012.60.3Business Trust 
50Keppel Infrastructure Trust (SGX: A7RU)2.97.02.1Business Trust 
51NetLink NBN Trust (SGX: CJLU)2.75.01.4Business TrustMid-fielder
52RHT HealthTrust (SGX: RF1U)–145.50.9Business Trust 

The risk (and also opportunity) of REITs are cyclic stock prices, therefore each global stock crisis could be good opportunity to Buy Low for giant Defender REITs, maximizing dividend yields with multiple entries if diversification is needed during uncertain Global Financial Crisis. For Mid-fielder stocks, alignment with price trends are important for trading (momentum and cyclic / swing trading).  Covid-19 pandemic would disrupt the stable distribution of rental income for some REITs (eg. Retail, Office, Industrial, Hospitality) with reduced or delayed dividend for 6-12 months but it has less impact on longer term investors who could hold longer than 1 year.

We may group 52 Singapore REITs and Business Trusts in the following 8 categories with 21 selected giant stocks in 3 main roles (Striker / Mid-fielder / Defender).

1) Retail REITs

There are 9 Retail REITs listed in Singapore (some with overseas business, eg. in China, Hong Kong and US):

BHG Retail Reit (SGX: BMGU), CapitaLand Mall Trust (SGX: C38U), CapitaLand Retail China Trust (SGX: AU8U), Frasers Centrepoint Trust (SGX: J69U), Lippo Malls Trust (SGX: D5IU), Sasseur Reit (SGX: CRPU), SPHREIT (SGX: SK6U), Starhill Global Reit (SGX: P40U), United Hampshire US Reit (SGX: ODBU).

Retail REITs are usually cyclic in nature, tenants occupancy rate and rental rate mainly follow economic cycles and strength of local economy. 4 Giant Retail REITs are good choices as Defenders to collect dividend income: CapitaLand Mall Trust (SGX: C38U), CapitaLand Retail China (SGX: AU8U), Frasers Centrepoint Trust (SGX: J69U), Starhill Global Reit (SGX: P40U).

2) Office REITs

There are 8 Office or Commercial REITs listed in Singapore (some with overseas business, eg. in US, UK and Europe):

CapitaLand Commercial Trust (SGX: C61U), Elite Commercial REIT (SGX: MXNU), IREIT Global (SGX: UD1U), Keppel Pacific Oak US REIT (SGX: CMOU), Keppel Reit (SGX: K71U), Manulife Reit (SGX: BTOU), OUE Commercial Reit (SGX: TS0U), Prime US Reit (SGX: OXMU).

Office REITs are usually cyclic in nature, tenants occupancy rate and rental rate mainly follow economic cycles and strength of local economy. 4 Giant Office REITs are good choices, 2 as Defenders to collect dividend income: CapitaLand Commercial Trust (SGX: C61U) and Keppel Reit (SGX: K71U) and 2 as Mid-fielders (both capital gains and dividend income in medium term trading): Manulife Reit (SGX: BTOU) and IREIT Global (SGX: UD1U).

3) Industrial REITs

There are 8 Industrial REITs listed in Singapore (some with overseas business, eg. in China and Asia Pacific):

AIMS APAC Reit (SGX: O5RU), ARA LOGOS Logistics Trust (SGX: K2LU), Ascendas Reit (SGX: A17U), EC World Reit (SGX: BWCU), ESR-REIT (SGX: J91U), Mapletree Industrial Trust (SGX: ME8U), Mapletree Logistics Trust (SGX: M44U), Sabana Reit (SGX: M1GU).

Industrial REITs are usually cyclic in nature, tenants occupancy rate and rental rate mainly follow economic cycles and strength of local economy. 3 Giant Industrial REITs are good choices, 2 as Defenders to collect dividend income: Ascendas Reit (SGX: A17U) and Mapletree Logistics Trust (SGX: M44U) and 1 as Mid-fielder (both capital gains and dividend income in medium term): Mapletree Industrial Trust (SGX: ME8U).

4) Healthcare REITs

There are only 2 Healthcare REITs listed in Singapore (with local and overseas business, eg. in Indonesia, South Korea, Malaysia, Japan and), both are giant stocks:

First Reit (SGX: AW9U) as striker and ParkwayLife Reit (SGX: C2PU) as Mid-fielder.

Healthcare REITs are usually more defensive in rental business due to very long term agreement signed with tenants (hospitals which need stability in operation). First Reit used to be a Mid-fielder with strong growth but investors confidence are affected with bearish outlook of sponsor, Lippo Group, therefore new role as a Striker could be more suitable for crisis stock investing. Parkwaylife REIT is much more stable with support of strong sponsor, IHH Healthcare (SGX: Q0F) but dividend yield is limited, therefore more suitable as a Mid-fielder.

5) Diversified REITs

There are 8 Diversified REITs listed in Singapore (some with overseas business, eg. in China, Asia Pacific and Europe):

Cromwell Reit EUR (SGX: CNNU) / Cromwell Reit SGD (SGX: CSFU), Frasers Logistics & Commercial Trust (SGX: BUOU), Lendlease Reit (SGX: JYEU), Mapletree Commercial Trust (SGX: N2IU), Mapletree North Asia Commercial Trust (SGX: RW0U), Soilbuild Business Space REIT (SGX: SV3U), Suntec Reit (SGX: T82U).

Diversified REITs have different types of REITs within the REIT portfolio (eg. Office / industrial / retail, some are integrated of smaller REITs, eg. Frasers REITs, through Merging & Acquisition), therefore usually cyclic in nature, tenants occupancy rate and rental rate mainly follow economic cycles and strength of local economy. 3 Giant Industrial REITs are good choices, 1 as defender to collect dividend income: Mapletree NAC Trust (SGX: RW0U) and 2 as Mid-fielders (both capital gains and dividend income in medium term): Frasers L&C Trust (SGX: BUOU) and Mapletree Commercial Trust (SGX: N2IU.

6) Data Center REIT

There is only 1 Data Center REIT in Singapore (with business locally and globally), also a Mid-fielder Giant Stock: Keppel DC Reit (SGX: AJBU).

Technically, Mapletree Industrial Trust, MIT (SGX: ME8U) has partial business in Data Center as MIT has 40% ownership (another 60% by parent company, Mapletree Investment) of Mapletree Redwood Data Centre Trust (MRDCT) which has 14 data centers in US since 2017. So far, Mapletree group (Temasek as sponsor) has 4 REITs listed sequentially over the past decade. So, there is no surprise if MRDCT may be listed in future when business is more stable one day. Currently, an investor may invest indirectly through MIT, which is an Industrial REIT including partial business in Data Centers.

Data Center REITs are usually more defensive due to longer term agreement signed with tenants (could be local government and big companies with confidential customer identities due to sensitive nature of database) which may view stability and security as more important factors than cost of rental. With popularity in internet (driven further by 5G) and tremendous growth in database required globally, demand for data centers at safer locations / countries would be increasing.  Both Keppel DC Reit and MIT are younger REITs, more suitable to position as Mid-fielders, aiming mainly for capital gains (dividend is only a bonus), may evolve into growth investing in future.

7) Hospitality REIT

There are 6 Hospitality REITs (some with business overseas, eg. global hotels chain) which also have Business Trust to form Stapled Securities due to requirement of business model:

ARA Hospitality Trust USD (SGX: XZL), Ascott Trust (SGX: HMN), CDL Hospitality Trust (SGX: J85), Eagle Hospitality Trust USD (SGX: LIW), Far East Hospitality Trust (SGX: Q5T), Frasers Hospitality Trust (SGX: ACV)

Hospitality REITs are mostly considered as crisis sector (especially for hotel / resort business) due to Covid-19 pandemic, few international visitors during this period. Without strong sponsor, a REIT could be in trouble. Eagle HTrust is a good example, stock is suspended after less than 1 year of IPO (about 80% capital loss for a stock investor), with big losses in business, default of loan and additional sell down during Covid-19 crisis as last straw which breaks the camel’s back. Usually for a young IPO stock without stable business record, there is always a risk that business may not be sustainable. So, a proven REIT with higher price could be more valuable than a young REIT with lower price.

2 Giant Hospitality REITs may be considered, both as Strikers (crisis investing stocks) as they are supported by strong sponsors despite weak business during Covid-19: Ascott Trust (SGX: HMN) is supported by CapitaLand (SGX: C31), while CDL HTrust (SGX: J85) is supported by City Development (SGX: C09). An investor may need to wait for quarterly or semi-annual financial report to understand the real impact of Covid-19 during Q1-Q2/2020 on Hospitality REITs. There are other non-crisis REITs (or limited impact of Covid-19) which an investor may consider, there is no need to take risk on Striker stocks if it goes against the personality of investors who may aim for defensive investing with stable dividend income.

8) Business Trusts

There are 10 pure Business Trusts listed in Singapore which dividend payments are not protected by law:

Accordia Golf Trust (SGX: ADQU), Ascendas India Trust (SGX: CY6U), Asian Pay Tv Trust (SGX: S7OU), Dasin Retail Trust (SGX: CEDU), FSL Trust (SGX: D8DU), HPH Trust SGD (SGX: P7VU), HPH Trust USD (SGX: NS8U), Keppel Infrastructure Trust (SGX: A7RU), NetLink NBN Trust (SGX: CJLU), RHT Health Trust (SGX: RF1U).

There are a few weak Business Trusts with very high dividend yield which are potential value traps, eg. FSL Trust (29% dividend yield). Dividend yield is always computed based on past dividend record and a high number could be derived due to weak business with very bearish share price. Buy Low may not able to Sell High for a junk stock as share prices would become lower. So, high dividend yield has to combine with a giant dividend stock or giant REIT (either Mid-fielder or Defender strategy), following Dr Tee criteria.

2 Giant Business Trusts with strong sponsors may be considered: Ascendas India Trust (SGX: CY6U) as a Defender (property trust in India) is supported by CapitaLand (SGX: C31), while NetLink NBN Trust (SGX: CJLU) as a Mid-fielder is supported by Singtel (SGX: Z74). Ascendas-iTrust is still property related, therefore even it is a Business Trust, asset quality is high. However for NetLink Trust, it is based on owner and operator of Singapore Fiber Network (prices regulated by authority, a form of monopoly) which technology may evolve in future, eg, towards 5G. So, close review of future technology and monitoring of financial performance are required. Therefore, young technology Business Trust of NetLink Trust, is more suitable for role as a Mid-fielder.

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There are 140 Property Stocks in Singapore excluding 52 REITs and Business Trusts (investor has to focus only on giant stocks for investing):
3Cnergy (SGX: 502), A-Smart (SGX: BQC), AEI^ (SGX: AWG), AIMS Property (SGX: BVP), APAC Realty (SGX: CLN), Abterra (SGX: L5I), Acromec (SGX: 43F), Amara (SGX: A34), Amcorp Global (SGX: S9B), AnnAik (SGX: A52), Astaka (SGX: 42S), BBR (SGX: KJ5), BRC Asia (SGX: BEC), BlackGoldNatural (SGX: 41H), Boldtek (SGX: 5VI), Bonvests (SGX: B28), Boustead (SGX: F9D), Boustead Projects (SGX: AVM), Bukit Sembawang (SGX: B61), Bund Center (SGX: BTE), CSC (SGX: C06), CapitaLand (SGX: C31), Casa (SGX: C04), Chemical Industries (SGX: C05), China Great Land (SGX: D50), China International (SGX: BEH), China Real Estate (SGX: 5RA), China Yuanbang (SGX: BCD), Chip Eng Seng (SGX: C29), City Development (SGX: C09), DISA (SGX: 532), Debao Property (SGX: BTF), ETC Singapore (SGX: 1C0), Edition (SGX: 5HG), EnGro Corporation (SGX: S44), Fraser and Neave F&N (SGX: F99), Far East Orchard (SGX: O10), Figtree (SGX: 5F4), First Sponsor (SGX: ADN), Fragrance (SGX: F31), Frasers Property (SGX: TQ5), GYP Properties (SGX: AWS), Gallant Venture (SGX: 5IG), Golden Energy (SGX: AUE), Goodland (SGX: 5PC), GuocoLand (SGX: F17), HL Global Enterprises (SGX: AVX), Hatten Land (SGX: PH0), Heeton (SGX: 5DP), Hiap Hoe (SGX: 5JK), Hiap Seng (SGX: 510), Ho Bee Land (SGX: H13), Hock Lian Seng (SGX: J2T), Hong Fok (SGX: H30), Hong Lai Huat (SGX: CTO), Hong Leong Asia (SGX: H22), Hongkong Land USD (SGX: H78), Hor Kew (SGX: BBP), Huationg Global (SGX: 41B), Hwa Hong (SGX: H19), IPC Corp (SGX: AZA), ISOTeam (SGX: 5WF), Imperium Crown (SGX: 5HT), Jasper Investments (SGX: FQ7), KOP (SGX: 5I1), KSH (SGX: ER0), Keong Hong (SGX: 5TT), Keppel Corp (SGX: BN4), Keppel Reit (SGX: K71U), King Wan (SGX: 554), Koh Brothers (SGX: K75), Koon (SGX: 5DL), Kori (SGX: 5VC), LHN (SGX: 41O), Ley Choon (SGX: Q0X), Lian Beng (SGX: L03), Low Keng Huat (SGX: F1E), Lum Chang (SGX: L19), MMP Resources (SGX: F3V), MYP (SGX: F86), Metro (SGX: M01), OIO (SGX: KUX), OKH Global (SGX: S3N), OKP (SGX: 5CF), OneApex (SGX: 5SY), Oxley (SGX: 5UX), PSL (SGX: BLL), Pacific Century (SGX: P15), Pacific Star Development (SGX: 1C5), Pan Hong (SGX: P36), Pavillon (SGX: 596), Perennial Holdings (SGX: 40S), Pollux Properties (SGX: 5AE), PropNex (SGX: OYY), Raffles Infrastructure (SGX: LUY), Regal International (SGX: UV1), Renaissance United (SGX: I11), Rich Capital (SGX: 5G4), Roxy-Pacific (SGX: E8Z), Ryobi Kiso (SGX: BDN), SHS (SGX: 566), SLB Development (SGX: 1J0), SP Corporation (SGX: AWE), Sasseur Reit (SGX: CRPU), Second Chance (SGX: 528), Sin Heng Mach (SGX: BKA), Sinarmas Land (SGX: A26), SingHaiyi (SGX: 5H0), SingHoldings (SGX: 5IC), Singapore-eDev (SGX: 40V), Sinjia Land (SGX: 5HH), Soilbuild Construction Group (SGX: S7P), Starland (SGX: 5UA), Straits Trading (SGX: S20), Swee Hong (SGX: QF6), Sysma (SGX: 5UO), TA (SGX: PA3), TTJ (SGX: K1Q), Tai Sin Electric (SGX: 500), Thakral (SGX: AWI), Thomson Medical Group (SGX: A50), Tiong Seng (SGX: BFI), Top Global (SGX: BHO), Tosei (SGX: S2D), Transcorp (SGX: T19), Tritech (SGX: 5G9), UIC (SGX: U06), UOA (SGX: EH5), UOL (SGX: U14), USP Group (SGX: BRS), Vibrant Group (SGX: BIP), Wee Hur (SGX: E3B), Wing Tai (SGX: W05), Yanlord Land (SGX: Z25), Yeo Hiap Seng (SGX: Y03), Ying Li International (SGX: 5DM), Yoma Strategic (SGX: Z59), Yongmao (SGX: BKX), Yongnam (SGX: AXB), Yorkshine (SGX: MR8).

Not all Singapore REITs or Business Trusts are giant stocks, some could be junk stocks (eg. making losses or asking investors for reserved passive incomes through rights issues). Even for a giant stock, it requires at least yearly review with Dr Tee criteria to ensure it is still a giant stock or a change in strategy may be required (eg. crisis stock investing with Striker role if there is any potential high risk). Similarly, those stocks which are not highlighted in this article, some could be marginal giant stocks, may obtain the giant stock title one day, which worth longer term investing or trading.

Although there are 21 giant REITs and Business Trusts listed in this article (3 roles of Striker / Mid-fielder / Defender), not all stocks are suitable for everyone. A REIT investor has to further select the right type of giant stock to align with own personality to be successful in short trading, medium term investing or long term investing, knowing What to Buy, When to Buy / Sell.

Ideally, a smart investor should form a dream team stock portfolio (striker / mid-fielder / defender) with 10-20 giant stocks from over 3 sectors and 3 countries.  REIT sector may contribute 1-2 stocks while it is important to diversify with more sectors (eg. Healthcare, Banking & Finance, F&B, Technology, Oil & Gas, Property / non-REIT, etc).

Since some REITs have overseas business, knowledge of Forex (eg. USD/SGD, SGD/IDR, etc) would be critical.  A qualified REIT investor should also understand property market cycle, macroeconomy behavior, integrating with dividend investing or growth investing or cyclic / momentum trading.

Drop by Dr Tee free 4hr investment course to learn how to position in global giant stocks with 10 unique stock investing strategies, knowing What to Buy, When to Buy/Sell.

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8 Glove Stocks & 6 Sectors Profit in COVID-19 (易如反掌)

Posted on June 1, 2020 Written by
Crisis glove stocks Top Glove Hartalega Kossan Supermax Riverstone Covid-19

In this article, you will learn 8 glove manufacturer stocks in Singapore and Malaysia and 6 other sectors which could profit from Covid-19 crisis, each requiring unique stock strategies for investing or trading.

1) Top Glove (SGX: BVA) / (Bursa: 7113) – Singapore / Malaysia Giant Glove Stock

2) Hartalega (Bursa: 5168) – Malaysia Giant Glove Stock

3) Kossan (Bursa: 7153) – Malaysia Giant Glove Stock

4) SuperMax (Bursa: 7106) – Malaysia Giant Glove Stock

5) Riverstone (SGX: AP4) – Singapore Giant Glove Stock

6) Comfort Gloves (Bursa: 2127) – Malaysia Glove Stock

7) Careplus (Bursa: 0163) – Malaysia Glove Stock

8) Rubberex (Bursa: 7803) – Malaysia Glove Stock

Crisis is opportunity for stock investing, especially true for glove manufacturers during Covid-19 crisis as demand for gloves are surging. In the past 1 decade, glove stocks are in the best time of era, strong growing business supported by 4 main factors:

1) Growing economy – higher manufacturing needs, especially glove is consumable (cheap but frequently used / replaced), recurring income.

2) Pandemic – higher healthcare needs, including Covid-19, H1N1 and other virus outbreaks.

3) Lower cost – especially for latex glove as rubber price has been low optimism due to bearish global commodity market. Thailand and Malaysia are rubber main producers, supplying to factories of these glove manufacturers within the same countries, saving more cost.

4) Stronger USD – forex becomes advantage for glove manufacturers as local expenses are mostly paid in ringgit but customers are based from overseas (world), therefore collecting payment (incomes) in USD which is stronger relative to ringgit. Of course, this advantage may become a weakness in future when USD becomes weaker.

Fundamentally, Covid-19 crisis helps to improve the business of these glove stocks, Q1/2020 financial results are even stronger than previous year. A strong fundamental business when encounter high demand due to market greed (which may be due to fear), the share price could be speculated higher.

Strong Fundamental + Market Greed = Positive Speculation

[Higher Sales + Stronger (USD/MYR) – Lower Cost] + Higher Greed (Pandemic Fear) = Higher Share Price

Indeed, all of these 8 glove stocks have surged more than 2 times in share prices over the past few months of Covid-19 pandemic. However, the current prices are at high optimism, mainly suitable for very short term momentum trading (Buy High Sell Higher). 

Top Glove (listed in both Singapore and Malaysia), Hartalega, Kossan and SuperMax are considered the Big Four of glove manufacturers in Malaysia, all are giant stocks (based on Dr Tee criteria), will be discussed in further.  Riverstone is a smaller player (listed in Singapore) but having strong business fundamental, will have more comments as well later. As for other 3 glove stocks (Comfort Gloves, Careplus, Rubberex) which are smaller in size, only have stronger business over the past 5 years (likely due to leftover demand, competing with lower prices or niche market), mainly suitable for short term trading, not a giant stock.

So, we will elaborate here mainly on 5 giant glove stocks (Top Glove, Hartalega, Kossan, SuperMax, Riverstone) which may be considered for both longer term investing (when correcting below a fair price with holding power) and short term trading (following S.E.T. trading rule – Stop Loss / Entry / Target Prices).

1) Top Glove (SGX: BVA) / (Bursa: 7113) – Singapore / Malaysia Giant Glove Stock

Top Glove is the world’s largest rubber glove manufacturer with many types of latex and nitrile gloves from manufacturing facilities in Malaysia, Thailand and China. Founder and major shareholder is Lim Wee Chai (27% ownership), also the No 14 richest person in Malaysia (Forbes’ List), supported mainly by rising share prices over the 2 past decades (share price goes up over 500 times since IPO till now). Top Glove has become 1 of 30 KLCI component stock, showing its business strength.

Top Glove has dual listing in Malaysia Bursa (longer history) and Singapore SGX. The relative stock performance are aligned but due to different group of investors, short term share price in SGX (BVA) is even more bullish than in Bursa (7113). Fundamentally, each share (SGX or Bursa) is the same but short term share price may not be due to difference of forex (SGD/MYR) alone.

Top Glove is a strong growth stock (supported by growing businesses with strong cash flow) but highly leveraged (high debt) to expand its capability further, strengthening its position as world’s largest glove manufacturer. Scale of economy is also a form of economic moat, position as bigger player could help to lower down the unit cost, therefore increase the profit margin.

Due to high optimism in share price, Top Glove may be considered as a mid-fielder stock (aiming for high capital gains with little dividend yield as bonus). It may also be considered for very short term momentum trading despite share price is speculated (Buy High Sell Higher strategy).

2) Hartalega (Bursa: 5168) – Malaysia Giant Glove Stock

Hartalega is the world’s largest nitrile glove manufacturer. Founder and major shareholder is Kuan Kam Hon (about 50% ownership with family), also the No 9 richest person in Malaysia (Forbes’ List), supported mainly by rising share prices over the past decade (share price goes up nearly 100 times since IPO till now). Hartalega has become 1 of 30 KLCI component stock, showing its business strength.

Hartalega main product of nitrile glove has higher profit margin compared to latex (rubber) glove. However, this profitable product segment also attracts many competitors, therefore the high growth of Hartalega is getting slower, now is more aligned (sustainable rate) with other major competitors, sharing the big pie of glove industries.

Hartalega is a strong growth stock (supported by growing businesses with strong cash flow) with lower debt level (having potential to expand further with more leveraging if needed). Scale of economy is also a form of economic moat, position as bigger player (nitrile glove) could help to lower down the unit cost, therefore increase the profit margin.

Due to high optimism in share price, Hartalega may be considered as a mid-fielder stock (aiming for high capital gains with little dividend yield as bonus). It may also be considered for very short term momentum trading despite share price is speculated (Buy High Sell Higher strategy).

3) Kossan (Bursa: 7153) – Malaysia Giant Glove Stock

Kossan is the world’s second largest glove manufacturer (technical rubber products, medical gloves, cleanroom products, etc). Founder and major shareholder is Lim Kuang Sia (about 50% ownership), was in 2017 Forbes’ List for Malaysia No 30 richest person, supported mainly by rising share prices over the past 2 decades (share price goes up about 60 times since IPO till now).

Kossan is a strong growth stock (supported by growing businesses with strong cash flow), performance is comparable with the main competitor, Top Glove. Kossan has moderate debt level, having potential to expand further with more leveraging if needed. The glove industry is big enough for major players to share the big global pie of growing demand for gloves in manufacturing and healthcare sectors.

Due to moderate high optimism in share price (compared to other 4 giant glove stocks at high optimism), Kossan has more upside potential, may be considered as a mid-fielder stock (aiming for high capital gains). It may also be considered for very short term momentum trading despite share price is speculated (Buy High Sell Higher strategy).

4) SuperMax (Bursa: 7106) – Malaysia Giant Glove Stock

SuperMax is a leading medical / latex gloves manufacturer. Founder and major shareholder is Thai Kim Sim (about 40% ownership together with wife) who was charged with insider trading in Year 2017. However, this negative news does not stop investors from supporting SuperMax, share price goes up about 60 times over the past 2 decades. During Covid-19 pandemic, SuperMax share price is the most bullish among 5 giant stocks, surging over 5 times in a few months time.

Among 5 giant glove stocks, SuperMax has relatively weaker business (but still a giant stock), earning has been declining despite growing revenue, indicating weaker profit margin which is not comparable with other competitors. Due to very high optimism in share price, SuperMax is more speculative in short term. For longer term investing, other 4 giant stocks are relatively safer for consideration. 

5) Riverstone (SGX: AP4) – Singapore Giant Glove Stock

Among 5 giant glove stocks, Riverstone is the smallest player but it has its niche market. Riverstone manufactures cleanroom glove (eg. hard disk drive and semiconductor) and healthcare gloves. Founder and major shareholder is Wong Teek Son (about 50% ownership), also the No 44 richest person in Malaysia (Forbes’ List), supported mainly by rising share prices over the past decade (share price goes up nearly 20 times since IPO till now).

Riverstone is a Malaysia company but stock is listed in Singapore, therefore the share price potential is also partially affected by Singapore stock market. Choice of stock exchange for listing does not affect the company fundamental (same share ownership) but due to different characteristic of global investors in each stock exchange (eg. US, Hong Kong, Singapore, Malaysia), etc, would make a big difference in share prices which is the ultimate goal for a company to be listed.  As a result, certain stock exchange is more popular of IPO stocks but may not be fundamentally strong.  So, a stock investor has to consider a stock or even stock exchange, aligning with own personality and strategy, either on long term investing or short term trading.

Riverstone is a strong growth stock (supported by growing businesses with strong cash flow), a small player with potential to expand further with more leveraging if needed (current debt level is very low). A giant stock is not determined by its business size, if Riverstone could remain highly profitable within its niche market (also a form of economic moat), it can be a good stock investment.

Due to high optimism in share price, Riverstone may be considered as a mid-fielder stock (aiming for high capital gains with little dividend yield as bonus). It may also be considered for very short term momentum trading despite share price is speculated (Buy High Sell Higher strategy).

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Top Glove and Riverstone are not 30 STI index component stocks but they are much stronger than most of these blue chip stocks in Singapore (investor has to focus only on giant stocks for investing):
DBS Bank (SGX: D05), Singtel (SGX: Z74), OCBC Bank (SGX: O39), UOB Bank (SGX: U11), Wilmar International (SGX: F34), Jardine Matheson Holdings JMH (SGX: J36), Jardine Strategic Holdings JSH (SGX: J37), Thai Beverage (SGX: Y92), CapitaLand (SGX: C31), Ascendas Reit (SGX: A17U), Singapore Airlines (SGX: C6L), ST Engineering (SGX: S63), Keppel Corp (SGX: BN4), Singapore Exchange (SGX: S68), Hongkong Land (SGX: H78), Genting Singapore (SGX: G13), Mapletree Logistics Trust (SGX: M44U), Jardine Cycle & Carriage (SGX: C07), Mapletree Industrial Trust (SGX: ME8U), City Development (SGX: C09), CapitaLand Mall Trust (SGX: C38U), CapitaLand Commercial Trust (SGX: C61U), Mapletree Commercial Trust (SGX: N2IU), Dairy Farm International (SGX: D01), UOL (SGX: U14), Venture Corporation (SGX: V03), YZJ Shipbldg SGD (SGX: BS6), Sembcorp Industries (SGX: U96), SATS (SGX: S58), ComfortDelGro (SGX: C52).

Some investors may be envy of owners of these 5 giant stocks which most founders are Top 50 richest persons in Malaysia. In fact, the easiest way to get very rich may not be through a business. Rather, it is through stock market with a growing business to support the rising share prices which could be over 10-100 times in wealth after IPO (易如反掌). This is the reason why for successful businesses, most of the founders plan to list the stock at certain point of time.

Since all 5 glove giant stocks are mostly controlled (over 50% shares ownership) by founders and families, a key consideration for long term investing is on succession plan to either second generation or capable professionals. A smart retail stock investor has to review a giant stock yearly or even quarterly to ensure it is still a giant stock before continuing the long term support. A sector may not be bullish all the time, including glove industry as profitable business usually would attract many potential competitors which would reduce the profit margins with lower price, lower sales or higher cost.

Here is a list of 30 Malaysia Bursa KLCI Index component stocks which may be considered (investor has to focus only on giant stocks for investing):
CIMB (Bursa: 1023) CIMB GROUP HOLDINGS BERHAD, DIALOG (Bursa: 7277) DIALOG GROUP BERHAD, DIGI (Bursa: 6947) DIGI.COM BERHAD, GENM (Bursa: 4715) GENTING MALAYSIA BERHAD, GENTING (Bursa: 3182) GENTING BERHAD, HAPSENG (Bursa: 3034) HAP SENG CONSOLIDATED BERHAD, HARTA (Bursa: 5168) HARTALEGA HOLDINGS BERHAD, HLBANK (Bursa: 5819) HONG LEONG BANK BERHAD, HLFG (Bursa: 1082) HONG LEONG FINANCIAL GROUP BERHAD, IHH (Bursa: 5225) IHH HEALTHCARE BERHAD, IOICORP (1961) IOI CORPORATION BERHAD, KLCC (Bursa: 5235SS) KLCC PROPERTY HOLDINGS BERHAD, KLK (Bursa: 2445) KUALA LUMPUR KEPONG BERHAD, MAXIS (Bursa: 6012) MAXIS BERHAD, MAYBANK (Bursa: 1155) MALAYAN BANKING BERHAD, MISC (Bursa: 3816) MISC BERHAD, NESTLE (Bursa: 4707) NESTLE MALAYSIA BERHAD, PBBANK (Bursa: 1295) PUBLIC BANK BERHAD, PCHEM (Bursa: 5183) PETRONAS CHEMICALS GROUP BERHAD, PETDAG (Bursa: 5681) PETRONAS DAGANGAN BHD, PETGAS (Bursa: 6033) PETRONAS GAS BERHAD, PMETAL (Bursa: 8869) PRESS METAL ALUMINIUM HOLDINGS BERHAD, PPB (Bursa: 4065) PPB GROUP BERHAD, RHBBANK (Bursa: 1066) RHB BANK BERHAD, SIME (Bursa: 4197) SIME DARBY BERHAD, SIMEPLT (Bursa: 5285) SIME DARBY PLANTATION BERHAD, TENAGA (Bursa: 5347) TENAGA NASIONAL BHD, TM (Bursa: 4863) TELEKOM MALAYSIA BERHAD, TOPGLOV (Bursa: 7113) TOP GLOVE CORPORATION BHD.

Covid-19 could be a crisis for most sectors but there are still few sectors could remain profitable or having less impact than overall economy. Besides glove stocks, there are 6 other sectors which may be considered for stock investing during pandemic:

1) Supermarket stocks – eg. Sheng Siong (SGX: OV8), Dairy Farm International (SGX: D01), Wal-Mart (NYSE: WMT), Costco (NASDAQ: COST). etc. NTUC Fairprice is not publicly listed but it has limited private shares for members of NTUC Fairprice, paying about 6% yearly dividend yield. Those supermarket stocks with online business would have more advantages during pandemic.

2) Telco / 5G stocks – eg. Singtel (SGX: Z74), Apple (NASDAQ: AAPL), Xiaomi (HKEx: 1810), AT&T (NYSE: T), Verizon (NYSE: VZ), etc.

3) Semiconductor / Technology stocks – eg. Micro-mechanics (SGX: 5DD), UMS Holdings (SGX: 558), AEM (SGX: AWX), Frencken (SGX: E28), TSMC (NYSE: TSM), Intel (NASDAQ: INTC), AMD (NASDAQ: AMD), Nvidia (NASDAQ: NVDA), Qualcomm (NASDAQ: QCOM), Broadcom (NASDAQ: AVGO), etc.

4) Online / Software stocks – eg. BAT-FAANG stocks: Baidu (NASDAQ: BIDU), Alibaba (NYSE: BABA) / (HKEx: 9988), Tencent (HKEx: 0700), Facebook (NASDAQ: FB), Amazon (NASDAQ: AMZN), Apple (NASDAQ: AAPL), Netflix (NASDAQ: NFLX), Google / Alphabet (NASDAQ: GOOGL), etc.

5) Healthcare stocks – eg. 3M (NYSE: MMM), Gilead Sciences (NASDAQ: GILD), Raffles Medical Group (SGX: BSL), Q&M Dental Group (SGX: QC7), IHH Healthcare (SGX: Q0F), etc.

6) Stock Index ETF or stocks – eg. stronger defenders of major stock indices (STI, KLCI, DJI, S&P 500, MSCI, etc). STI ETF (SGX: ES3) / (SGX: G3B) or STI index component stocks with stronger businesses: DBS Bank (SGX: D05), OCBC Bank (SGX: O39), UOB Bank (SGX: U11), Singapore Exchange (SGX: S68), ST Engineering (SGX: S63), CapitaLand Mall Trust (SGX, C38U), Mapletree Commercial Trust (SGX: N2IU), Mapletree Logistics Trust (SGX: M44U), Jardine Matheson Holdings JMH (SGX: J36), Jardine Strategic Holdings JSH (SGX: J37), etc.

A stock investor may study Q1-Q2 / 2020 financial reports to compare the global giant stocks relatively to understand impact of Covid-19 for 3 group of stocks during pandemic with 3 unique stock strategies:

1) Profitable stocks – trading at higher prices with momentum trading (similar to glove stocks, Buy High Sell Higher strategy).

2) Defensive stocks – stable business with some price correction, collecting higher dividend yield or gradual growth in share prices (Buy Low and Hold strategy).

3) Crisis stocks – business disrupted by Covid-19 but no major risk (eg. bankruptcy), buying at low optimism price with cyclic investing or trading (Buy Low Sell High strategy).

Drop by Dr Tee free 4hr investment course to learn how to position in global giant stocks with 10 unique stock investing strategies, knowing What to Buy, When to Buy/Sell.

Learn further from Dr Tee valuable 7hr Online Course, both English (How to Discover Giant Stocks) and Chinese (价值投资法: 探测强巨股) options, specially for learners who prefer to master stock investment strategies of over 100 global giant stocks at the comfort of home.

You are invited to join Dr Tee private investment forum (educational platform, no commercial is allowed) to learn more investment knowledge, interacting with over 9000 members.

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25 MSCI Singapore & 30 STI Stocks (仙人指路)

Posted on May 30, 2020 Written by
30 STI Index Component Stocks New MSCI Singapore

Both MSCI Singapore Index (SiMSCI, 25 stocks) and Straits Times Index (STI, 30 stocks) are important guidance for Singapore stock investors on “Good” stocks for investing. In this article, you will learn on how to invest in index stocks in a right way. MSCI Singapore Index has recently removed 4 blue chip stocks (which are also 30 STI component stocks) from the list:

1) ComfortDelGro (SGX: C52)

2) SATS (SGX: S58)

3) Sembcorp Industries (SGX: U96)

4) Singapore Press Holdings, SPH (SGX: T39)

and adding only 1 stock as replacement: Mapletree Logistics Trust, MLT (SGX: M44U), a giant Singapore REIT, which is also 30 STI component stock.

MSCI Singapore Index component stock selection criteria is stricter than STI index (only based on trading market capitalization, a weaker blue chip stock with high trading volume may still stay) although most of the component stocks of both indices are similar.

Comfortdelgro (taxi business) and SATS (airlines sector) are affected by recent Covid-19 crisis, having good chance to come back again to MSCI Singapore when sector crisis is over, business could recover to support reversal of share prices with higher trading volume.

Sembcorp Industries (utility sector) has weaker business, especially in Oil & Gas sector with subsidiary stock, Sembcorp Marine (SGX: S51) which has losing business due to bearish crude oil market. Similarly, SPH (newspaper/media & property businesses) has declining press business over the past decade, supported mainly by property business (including subsidiary SPH Reit, SGX: SK6U). For both Sembcorp Industries and SPH, they are harder to come back again to MSCI Singapore Index as it would take a long term for overall business to recover again.

These 4 blue chip stocks delisted from MSCI Singapore Index may not be delisted from 30 STI in near future as they still have high trading volume, despite bearish share prices.  CapitaCom Trust – CCT (SGX: C61U) will be the next to be delisted from 30 STI when it is merged with CapitaMall Trust – CMT (SGX: C38U) around June 2020. If so, the 5 reserve stocks of STI in waiting list are:

1) Mapletree Industrial Trust (SGX: ME8U)

2) Suntec REIT (SGX: T82U)

3) Keppel REIT (SGX: K71U)

4) Keppel DC REIT (SGX: AJBU)

5) Netlink NBN Trust (SGX: CJLU)

These 5 emerging STI stocks (dividend-based stocks, all are REITs / Business Trust) are selected purely based on trading market capitalization (trading price x trading volume). Therefore, not all are giant REITs (based on Dr Tee giant criteria). Stock investors who follow either 30 STI or 25 MSCI Singapore Index component stocks may not invest in high quality stocks.

Below are the 30 STI component stocks based on the last price traded (29 May 2020), sorted by trading market cap (share price x volume) from low to high (selection criteria for 30 STI is the Top 30 stocks with the highest values).

Despite DairyFarm and ThaiBev have stronger business fundamental than most 30 STI stocks, they have the lowest trading market cap, therefore having higher risk of being delisted in future.  The earlier 4 blue chip stocks which are delisted from MSCI Singapore Index are relatively “safe” in 30 STI due to high trading volume, despite weaker business with bearish share prices. From stock investing perspective, it does not make sense at all but this is the rule of the game.

NoNameTickerLast $VolumeTrading Market Cap
1Dairy Farm International(SGX: D01)4.221,9638,282
2Thai Beverage(SGX: Y92)0.6318,77411,827
3Hongkong Land(SGX: H78)3.765,77021,694
4Jardine Strategic Holdings JSH(SGX: J37)19.951,08921,730
5UOL(SGX: U14)6.844,21828,850
6Venture Corporation(SGX: V03)15.31,96830,105
7Genting Singapore(SGX: G13)0.78541,44132,531
8City Development(SGX: C09)7.694,42434,018
9Jardine Cycle & Carriage(SGX: C07)21.861,57534,427
10YZJ Shipbldg SGD(SGX: BS6)0.9439,56037,187
11ST Engineering(SGX: S63)3.1912,02938,373
12Wilmar International(SGX: F34)3.9812,23148,681
13CapitaLand Commercial Trust(SGX: C61U)1.7528,11349,197
14CapitaLand(SGX: C31)2.8917,75151,301
15Keppel Corp(SGX: BN4)5.9110,23160,466
16Singapore Airlines(SGX: C6L)3.8216,55163,225
17Jardine Matheson Holdings JMH(SGX: J36)40.151,58663,697
18Mapletree Commercial Trust(SGX: N2IU)243,28386,567
19CapitaLand Mall Trust(SGX: C38U)2.0355,627112,924
20OCBC Bank(SGX: O39)8.5513,772117,751
21Ascendas Reit(SGX: A17U)3.1338,228119,653
22Singapore Exchange(SGX: S68)8.2815,306126,734
23DBS Bank(SGX: D05)19.477,941154,613
24Sembcorp Industries(SGX: U96)1.36115,462157,028
25Singtel(SGX: Z74)2.4971,375177,724
26SPH(SGX: T39)1.28205,814263,442
27UOB Bank(SGX: U11)19.513,724267,622
28SATS(SGX: S58)2.66102,907273,732
29ComfortDelGro(SGX: C52)1.44255,744368,272
30Mapletree Logistics Trust(SGX: M44U)2.05314,294644,303

Since trading market capitalization is insufficient, a stock investor should include minimum 3 key Fundamental Criteria for 3 types of stocks: Growth / Dividend / Undervalue:
1) ROE (a criteria for growth stocks, eg. ROE > 5%),
2) Dividend Yield, DY (a criteria for dividend stocks, eg. DY > 5%),
3) Price-to-Book (PB) ratio, Price/NAV (a criteria for undervalue stocks, eg. PB < 1).

In each of the category, additional stock criteria has to be included to ensure they are giant stocks (based on Dr Tee criteria). For example, SPH has 8.6% dividend yield, it does not mean it is a good dividend stock as this high yield is generated with declining dividend and low share prices, driven by weaker business fundamental which is a value trap.

No) Stock (Ticker): ROE (Div Yield %) PB = Price/NAV
1) Ascendas Reit (SGX: A17U) 7.4% (4.4%) 1.5
2) CapitaLand Commercial Trust (SGX: C61U) 6.0% (5.1%) 1.0
3) CapitaLand (SGX: C31) 8.8% (4.1%) 0.6
4) CapitaLand Mall Trust (SGX: C38U) 9.0% (5.9%) 1.0
5) City Development (SGX: C09) 5.2% (1.0%) 0.7
6) ComfortDelGro (SGX: C52) 10.2% (6.8%) 1.2
7) Dairy Farm International (SGX: D01) 26.8% (5.0%) 4.7
8) DBS Bank (SGX: D05) 12.3% (6.4%) 1.0
9) Genting Singapore (SGX: G13) 8.5% (5.1%) 1.2
10) Hongkong Land (SGX: H78) 0.5% (5.9%) 0.2
11) Jardine Cycle & Carriage (SGX: C07) 12.8% (5.4%) 0.9
12) Jardine Matheson Holdings JMH (SGX: J36) 9.4% (4.3%) 1.0
13) Jardine Strategic Holdings JSH (SGX: J37) 6.1% (1.8%) 0.6
14) Keppel Corp (SGX: BN4) 6.3% (3.4%) 1.0
15) Mapletree Commercial Trust (SGX: N2IU) 9.4% (4.0%) 1.1
16) Mapletree Logistics Trust (SGX: M44U) 8.2% (4.0%) 1.6
17) OCBC Bank (SGX: O39) 10.3% (6.2%) 0.8
18) SATS (SGX: S58) 15.1% (7.1%) 1.8
19) Sembcorp Industries (SGX: U96) 3.1% (3.7%) 0.4
20) Singapore Exchange (SGX: S68) 35.9% (3.6%) 8.2
21) Singapore Airlines (SGX: C6L) -1.4% (0.8%) 0.8
22) Singtel (SGX: Z74) 4.0% (4.9%) 1.5
23) SPH (SGX: T39) 5.8% (8.6%) 0.6
24) ST Engineering (SGX: S63) 26.0% (4.7%) 4.5
25) Thai Beverage (SGX: Y92) 20.1% (3.4%) 2.7
26) UOB Bank (SGX: U11) 11.0% (5.6%) 0.9
27) UOL (SGX: U14) 4.8% (2.6%) 0.6
28) Venture Corporation (SGX: V03) 14.5% (4.6%) 1.8
29) Wilmar International (SGX: F34) 7.7% (3.1%) 1.1
30) Yangzijiang (SGX: BS6) 10.0% (4.8%) 0.6

For a stock to be listed in 30 STI or even 25 MSCI Singapore Index (to be reviewed quarterly), it implies more support from global investors, especially for institutional investors who view index as key guidance (仙人指路). However, the stock selection criteria based on trading market cap is insufficient, therefore a smart investor should select 10-20 global giant stocks over 3 sectors and 3 countries (eg. Singapore, US, Hong Kong or any country with growing economy), forming own fund (no management fee is needed).

Choice of global stock market is important on type of giant stocks (Defenders / Mid-fielders / Strikers), as well as personality of investor (eg. long term investing or short term trading). Defender stocks aim for dividend collection, Striker stocks are more for quicker return (eg. trading momentum stocks) while Mid-fielder stocks is a well-balance between capital gains and moderate dividends.

1) Singapore stock market is more suitable for dividend stocks (eg. Singapore REITs) but growth is limited with defensive strategy alone. Global stock crisis is a good opportunity to pick up some strong giant dividend stocks with high dividend yield. High dividend yield

2) US stock market is more suitable for growth stocks (investing) or momentum stocks (trading) but minimal dividend to protect investors during correction. An investor may focus on stocks with strong business fundamental as a form of protection. A trader may need to monitor the price trends, following S.E.T. (Stop Loss / Entry / Target Prices) trading plan.

3) Hong Kong stock market has a good mix of dividend and growth stocks but become center of political power fighting between US and China, therefore prices are more volatile which may be suitable for those higher risk tolerance investors and traders.

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“Sell in May and Go Away” happen again for Singapore (STI Index) and Hong Kong (HSI) Index stock markets for Year 2020. A reason for month of May (Q2) to be bearish could be due to final dividend given in Q2, some investors start to sell after the harvest or the share prices drop after significant dividends are given out, especially when there are news of uncertain financial markets.

Singapore and Hong Kong have many good dividend giant stocks. Price correction after Ex-Dividend is common, especially when combine with this psychological barrier in May. Dividend is just a bonus, more important is Capital Gains for a giant dividend stock.

For US and other global stock markets (eg. Malaysia, Germany, Japan, Taiwan, etc.), mostly have positive gains in May 2020. In fact, US S&P 500 Index is recovering above critical resistance of 3000 points again, an important milestone to support short term trading, especially with Buy High Sell Higher trading strategy. US Nasdaq Index is above 9000 points, challenging the new historical of 10000 points, supported by bullish technology sector of stocks.

Therefore, a stock investor or trader needs to equip with more skills to profit in current global stock market. Start learning 5 essential LOFTP Strategies (Level / Optimism / Fundamental / Technical / Personal Analysis).

Drop by Dr Tee free 4hr investment course to learn how to position in global giant stocks with 10 unique stock investing strategies, knowing What to Buy, When to Buy/Sell.

Learn further from Dr Tee valuable 7hr Online Course, both English (How to Discover Giant Stocks) and Chinese (价值投资法: 探测强巨股) options, specially for learners who prefer to master stock investment strategies of over 100 global giant stocks at the comfort of home.

You are invited to join Dr Tee private investment forum (educational platform, no commercial is allowed) to learn more investment knowledge, interacting with over 9000 members.

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Filed Under: Fundamental Analysis, Market Outlook, Stock Market, Technical Analysis, Value Investing Tagged: , , , , , ,
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