Stock Market Archives

Global Stock Market Rally with US President Trump and Interest Rate Cut

Posted on November 8, 2024 Written by Dr Tee (Ein55)

Trump is back as new US president with the strongest political power (support of Senate + Congress + Fed), therefore able to enforce economic policies such as low tax rate (pro-business) and potentially end regional wars (Russia/Ukraine, Middle East) which are the sources of high inflation rates.

Global investors dislike uncertainties, therefore a clear win by Trump has helped US stock market achieved new high again. Even Singapore STI has reached last 17 years high (>3700 points) with strong performance of 3 major banks. Meanwhile, the Fed continues to cut interest rates (another 0.25% lower in Nov 2024) to stimulate the economy, money may flow from US to global markets for higher return.

At the same time, there is mixed impact on Asia stock markets, especially there is potential higher level of US-China trade war, therefore careful selection of stocks and sectors are critical. China recently has announced massive economic stimulus plans, the scale could be even higher to cope with emerging political economic crisis.

In Year 2025, global stock markets (US, Asia, Europe) may experience new waves of bullish run, especially with various new pro-business regulations by Trump and lower interest rates by the Fed. However, when global stock market reaches a high optimism level, a potential black swan may not be far away. Therefore, a smart investor (eg. Warren Buffett) would Sell High gradually, before Buy Low again during the next global financial crisis.

It is timely now to review own stock portfolio, making decisions (Buy / Hold / Sell / Wait / Shorting) ahead of majority. Ride the next global stock rally with Trump and US interest rate cut, supported by strong global economy.

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There are over 2000 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), Frasers Logistics & Commercial Trust (SGX: BUOU), Genting Singapore (SGX: G13), Hongkong Land (SGX: H78), Jardine Cycle & Carriage (SGX: C07), Jardine Matheson Holdings JMH (SGX: J36), 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 Integrated Commercial 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

View quick preview video below, Dr Tee will introduce 10 key stock investment strategies (股票投资十招) to be learned in 4hr free stock webinar:

Register Here (Dr Tee Free 4hr Stock Webinar): www.ein55.com

Filed Under: Market Cycle Investing, Stock Market Tagged: economy vs stock, global financial crisis, US Stocks

Next Global Stock Market Rally with US Interest Rate Cut (一波三折)

Posted on September 19, 2024 Written by Dr Tee (Ein55)

Are you excited by recent 0.5% interest cut by US Fed which may be a hidden market stimulation? US stocks (especially Dow Jones and S&P500) are near historical high, even Singapore STI is at last 6 years high >3600 points (having potential to break 2007 historical high if >3900 points, especially with stronger growth and recovery of STI which many are dividend stocks, not limited to SG REITs).

Current global stock markets are the most confusing to both long term investors and short term traders because past few decades of investment market relationship (eg. stocks vs bonds) are very different from past few years of market condition since 2020 pandemic.

A key difference is we have experienced hyper-inflation (9+%) which only happened 50 years ago in 1970s and 1980s. Over the past few decades, usually US interest rate is adjusted higher during bullish economy and stock market, cut to stimulate economy during recession. However, current market condition is closer to 1980s with hyper-inflation, US interest rate is adjusted higher to tame the hyper-inflation over 10+%. With lower inflation, then US interest rate is cut, indirectly stimulate US and global stock markets to higher level, with condition that there is no recession (eg. negative GDP growth rate).

There are 3 key supporting signals for US and global stock markets to continue the bull run (一波三折):
1) US inflation starts to fall from the peak of 9+%
2) Golden Cross for US inflation falls just below interest rate of 5+%
3) US interest rate starts to cut from the peak of 5+%

Key signals #1 and #2 (see image above) were highlighted by Dr Tee in earlier posts over the past 2 years, global stock markets, especially US stocks have shown significant appreciation since then. For readers who missed the boats, it is never too late as Key signal #3 just comes, the Fed has just start to cut interest rate by 0.5% from the peak of 5.5% in Sep 2024. In fact, early investors may follow Signal #2.5, meaning taking action >6 months ago, anticipating US will cut interest rate, especially after Signal #2 with strong confirmation of consistently lower inflation below the interest rate peak of 5+%.

A strong condition for Signal #3 is that US economy should experience soft landing, instead of hard landing as the past few decades, else interest rate cut may become a risky signal to save falling economy. Despite weaker US job market, historically it is still considered above average (below 5% unemployment rate) while inflation currently is at average (2.5%) of past few decades, there is no need to achieve ultimate goal of 2% as inflation would fluctuate (eg. between 1+% to 3+%) in a normal market.

Sectors which may benefit from US interest rate cut with growing economy (recovering stronger after soft landing) are across the board, eg. REITs, property stocks and dividend stocks (lower borrowing cost, implying more dividends expected with higher profits), technology stocks (lower borrowing cost for business expansion), industrial and most stocks (stronger business with more spending by consumers with bullish economy). Banks could have mixed effect, depending on natural of segment business, eg. interest income may fall due to lower NIM (Net Interest Margin) with lower interest rate, but volume of interest income may increase with more loans due to stronger economy, together with increasing non-interest income.

Therefore, key is to monitor the economic cycle and also stock market Optimism level (Be Greedy when others are Fearful; Be Fearful when others are Greedy). One day, a black swan may come, it is never too late to exit then or much earlier when global stock market is at high Optimism with shaky economy. It is timely now to review own stock portfolio, making decisions (Buy / Hold / Sell / Wait / Shorting) ahead of majority. Ride the next global stock rally with US interest rate cut, supported by strong global economy.

It is timely now to review own global stock portfolio, making decisions (Buy / Hold / Sell / Wait / Shorting), leveraging on market greed and fear.

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There are over 2000 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.

Register Here (Dr Tee Free 4hr Stock Webinar): www.ein55.com

Filed Under: Macroeconomy, Market Cycle Investing, Market Outlook, Stock Market Tagged: dividend stock, economy vs stock, growth stock, US Interest Rate

Bottom Fishing of Hong Kong and China Stock Markets (否极泰来)

Posted on May 20, 2024 Written by Dr Tee (Ein55)

Over the past few years, both Hong Kong and China stock markets have been bearish, under low Optimism level, many giant stocks (property, technology and nearly all sectors) are heavily discounted with over 50-70% price corrections.

However, it is not easy to “Buy Low” as the stock may get lower, an investor may end up selling lower with loss. Even Charlie Munger (business partner of Warren Buffett), has been trying to buy low several times for Alibaba when share prices falling down from $200+ to below $100, ending up stop loss when it exceeds risk tolerance level.

The key is timing of entry for low optimism giant stocks, including Hong Kong Hang Seng Index (HSI ETF) and China Shanghai Index (A50 ETF), aligning to own unique personality. Contrarian investing (buying during bearish trend) requires careful selection of stocks (eg. defensive dividend stocks), strong mind control and money management (eg. averaging down with position sizing and diversification over a portfolio of 10-20 giant stocks).

Trend-following investing could be more suitable for retail investors, aiming for giant stocks with prices far below value (need to compute fair price), then waiting patiently for reversal signals from bear to bull again. Both Hong Kong and China have created double bottom pattern opportunities, first recovery was late 2022 when zero COVID policy has ended but then corrected again with economy slowdown to another low (eg. 15000 points for Hong Kong HSI), second recovery only happens recently after economic stimulus plans (eg. loosening of property market, lower mortgage rate, etc). HSI recovers again from 15000 points valley to above 17000 short term resistance (late Apr 2024), currently near to 20000 points.

For investors who miss the Hong Kong HSI 30% rally from 15000 to nearly 20000 points, may feel “missing the boat”, thinking it is too “high” now to buy. In fact, this is the mentality of “penny wise but pound foolish”, i.e. only considering the near term (tree) but missing the mid to long term (forest). Even for a short term trader, it is fine to Buy intermediate “High” Sell Higher following trend, while the “High” for a trader is actually still “Low” (despite not the lowest) for longer term investor. These perception differences are personality dependent, alignment of strategy with unique personality (eg. short / mid / long terms, cyclic / growth / dividend, contrarian / follow-trend, etc) is key for success in stock trading or investing.

Current global stock markets provide special advantages to both short term traders (eg. bullish US market with new historical high for S&P500 and Dow Jones to Buy High Sell Higher with Momentum Trading, aiming for US interest rate cut in year 2024) and long term investors (eg. bearish or lagging Asian market (Hong Kong / China / Singapore / Malaysia) to Buy Low Sell High with Cyclic Investing, supported by recent economic stimulus plans in China.

Register Here (Dr Tee Free 4hr Stock Webinar): www.ein55.com

Filed Under: Macroeconomy, Market Cycle Investing, Market Outlook, Stock Market, Technical Analysis, Uncategorized Tagged: china market, crisis stock investing, Hong Kong Market

Hidden Stock Opportunities in New Year of Dragon 2024 for Both Short Term Traders and Long Term Investors (卧虎藏龙)

Posted on February 1, 2024 Written by Dr Tee (Ein55)

As highlighted over 1 year ago, US inflation falling from the peak below the interest rate (5+%) was a golden cross for US stock market. Indeed, US stocks become very bullish, S&P500 achieving new high >5000 points recently, ideal for short term traders. At the same time, due to economy slowdown, both China and Hong Kong stock markets are in crisis, providing a rare opportunity for long term investors.

In the New Year of Dragon 2024, US inflation continues to decline (currently around 3+%) while market expecting the Fed would start to cut interest rates. Lower interest rate with strong economy would help to push up the bullish US stock market further as funds may move from bank deposits to stock market for quicker return. However, US stock market is more suitable for short term trading to Buy High Sell Higher (momentum trading / swing trading) until it reaches high Optimism level with a black swan one day. Technology giant stocks (not limited to AI) may gain more momentum with lower borrowing cost, aiming for Ver 2.0 technology bubble (Ver 1.0 was Year 2000 dotcom bubble). Bubble is friend for traders with condition that one has to know when to exit, not to hold as a long term investor when market may crash one day with >50% potential drawdown.

Usually global stock markets are aligned at country level to go up and down together, eg Japan, India, Taiwan, Indonesia, etc, are following US to higher Optimism level. However, due to political economy difference in each country, Asian stock market performs relatively weaker, especially for China and Hong Kong, suffering economy slowdown with weak investment markets (stock, bond, property, etc). This creates a golden opportunity for long term investor to Buy Low Sell High with condition that the stock portfolio is diversified over 10-20 giant stocks with strong businesses to survive and recover from stock crisis. Even for China / Hong Kong stocks at very attractive prices, entry requires consideration of 3 unique C.E.T. personalities:

1) C = Contrarian Investors (allows buying low with bearish prices),
2) E = Early Investors (entering with potential light at the end of tunnel, eg. market awaits massive stimulus plan from China),
3) T = Trend Investors (wait for stronger confirmation for bear transits into early bull).

At the same time, other stock exchanges (eg. Singapore and Malaysia, etc) are at moderate Optimism levels, stagnant with mixed performance. Careful selection of giant stocks would be a better choice than investing indices / ETF.

So, your stock performance in New Year 2024 may be like a “Dragon” or “Snake”, depending on your choice (eg. US stocks for short term trading, Asian stocks for long term investing) with alignment to your unique personality (short term, mid term, long term) and style of investing (growth, cyclic, dividend, undervalue, momentum, swing, etc).

It is timely now to review own stock portfolio, making decisions (Buy / Hold / Sell / Wait / Shorting) ahead of majority.
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There are over 2000 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.

Register Here (Dr Tee Free 4hr Stock Webinar): www.ein55.com

Filed Under: Market Cycle Investing, Market Outlook, Stock Market Tagged: crisis stock investing, long term investing, short-term trading

Trading Strategies for 4 Stages of Technology Stock Bubbles (趁势追击)

Posted on August 16, 2023 Written by Dr Tee (Ein55)

Many investors and traders like US technology stocks which could move up and down like a roller coaster with high potential gains in a shorter time. Similar to driving a car, despite there are many potential risks, a trained driver or stock trader could adopt best practices with experience for a smooth ride.

In general, there are 4 stages of technology stocks bubbles (see image above):
Stage 1
The first peak when technology stocks achieve high Ein55 Optimism > 75%, eg. during Year 2000 dotcom bubble and Year 2021 COVID online bubble.

Technology sector may not go through the entire 4 stages of bubbles. For example, for Year 2000 dotcom bubble, stock market crashed after Stage 1. For Stage 1, similar to surfing with a strong wave, trend-following position trading strategy with S.E.T. (Stop Loss / Entry / Target Prices) plan is key, buying with uptrend (eg. higher low higher high, breaking above critical resistance), sell / short selling with downtrend (eg. lower high lower low, breaking below critical support).

Stage 2
If it is a correction (eg. high inflation and interest rate hike in Year 2022), technology stocks would start to recover, eg Year 2023 has been recovering well with AI as the main driver.

Stage 2 has weaker trend than Stage 1, focusing more on recovery wave, usually stock prices need to break above certain patterns (eg. resistance of a double bottom neckline, etc) to sustain its recovery. Short term to mid term cyclic trading may be considered. If Stage 2 could not exceed the last high of Stage 1, then it may form a risky pattern (eg. Head & Shoulders, etc), therefore it is safer to trader than to invest in technology stocks with higher optimism level.

Stage 3
It is possible (although seldom) for technology stocks to achieve another new high than the peak of Stage 1 bubble. If inflation could fall down consistently below 3% while global economy is intact, US technology stocks may continue to recover. However, it may take time, especially No 2 economy, China is getting weaker, would affect global / US economy indirectly. Inflation may be stagnant around 3% +/- 1% for mid term until an economic crisis, only then it may fall down further.

Strategy for Stage 3 is focusing on shorter term trading with positioning sizing, leveraging on market momentum to trade uptrend.

Stage 4
This is the ultimate bubble (may or may not come), much higher peak than Stage 1 with high Ein55 Optimism >75%, mainly driven by stock market greed. The strategy is similar to Stage 1 but closer monitoring (daily) is required.

Besides uptrend trading, an experienced trader may also consider to short sell the market when it is falling down below critical support from high optimism level, potentially gaining from the crash of stock market which may be induced by the next black swan.

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Technology giant stocks are mostly major component stocks of indices, therefore the movement of NASDAQ index (mostly technology stocks, popular ETF is QQQ, 3X of Nasdaq) is also aligned with S&P500 index (500 largest US stocks, popular ETF is SPY). When market is bearish, there are also inverse ETFs for traders who don’t know how to short sell but more suitable for shorter term trading.

In additional to indices, a trader may also consider technology giant stocks, eg. leader (world largest company) is Apple (Nasdaq: AAPL), already passing Stages 1 & 2, approaching Stage 3 (but fail to create new resistance above $200).

The current bull run for technology stocks is still intact. However, during each correction, a trader may need to exit first, reenter when trend is reversed to uptrend or when a new high is created.

At the same time, for longer term investors who have invested in technology giant stocks or indices (eg. S&P500 or Nasdaq), may also consider to switch to short term investing (choosing stocks like an investor, buy/sell like a trader) during uncertain high optimism level, no need to take any major risk against potential black swans (eg. China economy slowdown, escalation of Russian-Ukraine war, etc) which stock market may fall more than 50% when the bubble is burst.

In summary, a smart investor or trader would leverage on technology stock bubbles (Stages 1-4) but adjusting the strategy accordingly (eg. shorter term trading with higher optimism level). Stock bubble could be the best friend for trader (trend-following trading with greed) and investor (crisis investing after the market crash with fear).

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There are over 2000 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.

Register Here (Dr Tee Free 4hr Stock Webinar): www.ein55.com

Filed Under: Market Outlook, Stock Market, Technical Analysis Tagged: technology stock, technology stock bubble, US Stocks

5 Glove Giant Stocks Recovering from Crisis (孤掌难鸣)

Posted on May 19, 2023 Written by Dr Tee (Ein55)

During the first year of pandemic in 2020, due to extraordinary demand for gloves, both the sales (>3X) and net profits (>5X) have set record high for glove manufacturers, supported by higher volume and higher selling prices, driving share prices to over 5-10 times compared to pre-pandemic. However, the quick return has invited many smaller players, supply more than demand when fear of COVID was fading over the past 2 years, glove stocks suffer big drops of both sales and income to about 10-20% of peak performances, even lower than pre-pandemic, driving the share prices like a roller-coaster, this time to less than 10% of peak prices.

In this article, you will learn 5 glove giant stocks in Singapore and Malaysia benefit from recovering in cyclic business in post-pandemic with over 2X upside potential of share prices, 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

“Crisis is Opportunity‘, a golden investing rule but only true if the stock prices are falling to low Optimism while business is still intact or having high chance to recover. For glove stocks, due to cyclic business induced by pandemic (孤掌难鸣), despite some are still making losses now, demand for glove will be back sooner or later, especially when smaller players could not survive through the cold winter, demand will be more than supply again (currently many glove manufacturers only produce less than 50% capacity).

Buy Low may lower before an investor could Sell High in future, no one could predict the lowest/highest points for stock prices or businesses. Therefore, it is more practical to Buy Low enough, having patience to hold and then Sell High enough one day, integrating with several key indicators for business and stock price reversal. Crisis investing requires diversification over a portfolio of 10-20 giant stocks over several sectors and countries, alignment with own personality (eg. short / mid / long term) is key for success.

The largest glove stock, Top Glove, takes the lead to announce recently that ASP (Average Selling Price) of glove will be adjusted higher. Other competitors would follow the same trend of market leader, when glove selling prices are higher, when demand may be increasing in the next 1 year with more sales (glove also has expiry dates, inventory will be exhausted), likely they would report profits again, even if only aiming for target of pre-pandemic in 2019, both the sales and share prices could have 2X upside potential.

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 be discussed as well.

In recent 15th Ein55 Charity Course (6 May 2023) on Global Discounted NAV Stocks, we have raised fund of $16,300 for Tzu Chi Singapore to help needy families in Singapore. Under the spirit of charity, Dr Tee decides to share 5 glove stocks discussed (SuperMax is an undervalue stock with stock price much less than discounted asset value) with readers as strikers in post-pandemic with light at the end of tunnel for glove industry (read each details in this article to fully understand on how to position in these giant stocks).

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), was No 14 richest person in Malaysia (Forbes’ List), but ranking drops significantly with share prices from nearly RM10 to less than RM1 at one time.

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) can be slightly different from 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, especially ringgit has been weaker over the past few years.

Due to low optimism in share price but weaker business (may turn around to positive in about 1 year), Top Glove may be considered as a striker stock (aiming for high potential capital gains with little or no dividend support) for short term / medium term trading with condition the share prices (Bursa: 7113) has to stay above RM1 as critical support (SGX BVA will be S$0.30 with 0.33 exchange rate for SGD/MYR).

Minimum target could be 2X for trading (RM2) but if there is any global uncertainty with stock price below RM1, a trader may need to exit with stop loss (eg. 5-10%), minimizing risk of Buy Low get lower. If the cyclic business is recovering well over the next years, then the stock may be position as “mid-fielder” stock for longer term holding for both growth in capital gains and dividend payments, then the fair price target would be >RM3 of its Ein55 intrinsic value. Before the hot summer with greed, an investor or trader has to endure through winter time of reversal from bear to bull.

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), was the No 9 richest person in Malaysia (Forbes’ List), also drop in ranking with falling of share price from about RM20 to RM2.

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.

Similar to Top Glove, Hartalega is more suitable for crisis recovering trading but critical price support is RM2 (compared to RM1 of Top Glove). Even with weaker quarterly results recently, the share price did not fall further, supported above RM2 instead, a sign of market confidence. Top Glove and Hartalega has strong correlation in share prices of about 1:2, therefore when one stock starts to move in certain direction, another stock would follow, especially if it is glove industry or general market trend. For short term trading, Top Glove is stronger than Hartalega, therefore recently Hartalega has been catching up with lagging prices above RM2.

Stock market usually is 6-12 months ahead of economy or company business, therefore positioning in either glove leader (Top Glove or Hartalega) has additional protection of stronger companies while bottom fishing to Buy Low, ideally following S.E.T. (Stop Loss / Entry / Target) for short term trading plan, monitoring future business and Ein55 Optimism level for longer term investing.

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). Kossan is a strong growth stock (supported by growing businesses with strong cash flow), performance is stronger than the main competitor, Top Glove. Kossan has low 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.

Again, similar strategies as Top Glove to position Kossan at low Optimism level, except critical price support is higher at RM1.25 (trading above this level is relatively safer), compared to RM1 support of Top Glove.

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

SuperMax is a leading medical / latex gloves manufacturer. SuperMax has additional protection of having undervalue asset more than its share price, useful consideration if a company may be in crisis, may not go bankrupt easily.

Again, similar strategies as Top Glove to position SuperMax at low Optimism level, except critical price support is slightly lower at RM0.90 (trading above this level is relatively safer), compared to RM1 support of Top Glove.

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, therefore the business is relatively stronger than other major players during post-pandemic.

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.

Riverstone is also low Optimism level but positioning different from other 4 glove giant stocks. Since Riverstone did not fall as much as other glove giant stocks (mainly supported by stronger business), it is the only glove giant stock has not recovered yet to overcome S$0.65 resistance (to become future price support for trading). Riverstone may be considered for longer term investing (not for short term trading currently) with business trend affected by both glove industry (healthcare needs) and country economy (eg industrial needs).

Register Here (Dr Tee Free 4hr Stock Webinar): www.ein55.com

Filed Under: Market Outlook, Stock Market Tagged: Charity Course, crisis stock, glove stock, Malaysia Stocks

3 Exit Strategies When Crisis Stock Becomes Profits (Tianjin Da Ren Tang)(丰收季节)

Posted on April 17, 2023 Written by Dr Tee (Ein55)

With strong recovery of China / Hong Kong stocks after ending of zero COVID policy and strong rebound of US technology stocks with consistently lower inflation rates, some giant stocks surge to new historical high in share prices. This is a good problem to have for stock investor or trader when there are high capital gains (eg. more than 2 times).

Knowing What to Buy and When to Buy help to start the investing journey at the right time and right direction. However, knowing When to Sell (take profits) or How Long to Hold with alignment to own personality is the ultimate plan.

Let’s learn from Dr Tee on 3 Exit Strategies When a crisis stock becomes highly profitable (丰收季节). A recent Dr Tee Graduate success of a giant stock, Tianjin Pharmaceutical Da Ren Tang (SGX: T14 / China Shanghai: 600329) is applied as an example.

Congratulations to readers who may have taken action on Tianjin Da Ren Tang (strong fundamental China healthcare giant stock, dual listing in SGX and China) mentioned in Dr Tee articles on 2 Oct 2020 ($0.79 share price, Cyclic & Dividend investing), 31 Aug 2021 ($1.32 share price, Growth / Dividend investing) and 17 Feb 2023 ($1.30 share price, Growth / Momentum trading), as well as recent public webinar on 25 Mar 2023 ($1.39 share price, Momentum trading). Current share price (17 Apr 2023) is $2.26, exceeding the Ein55 intrinsic value of $1.50 mentioned, aiming for >$2.50 high Ein55 Optimism price with more greed recently.

Dr Tee graduates were assigned homework on this stock in May 2020 ($0.68 share price, low Ein55 Optimism level for Cyclic + Growth + Dividend + Undervalue investing, see chart below) and again in July 2021 ($1.20 share price), not only share price has climbed up with over 3X capital gains ($0.68 to $2.26), also enjoying an enormous dividend yield = (dividend / price) = ($0.17/$0.68) = 25%, after dividend payments have grown 4X over the 3 years, supported by strong earnings (>70% business is Traditional Chinese Medicine, remaining is western medicine, etc).

Unlike other business (eg. technology / glove) which may have huge earnings surge during the first 2 years of pandemic (then suffer when both earnings and share prices are corrected post pandemic as the high business growth is not sustainable), Tianjin Da Ren Tang has been consistent and sustainable in business growth before / during / post pandemic. With ending of zero COVID policy in China, Tianjin Da Ren Tang enjoys the free ride together to higher Ein55 Optimism level, exceeding intrinsic value (about $1.50) and driven by market greed recently towards high Ein55 Optimism >$2.50.

The stock formerly was named Tianjin Zhongxin, after change in major shareholder, later renamed to Tianjin Da Ren Tang, partly to reflect its true historical value for the past century (eg. comparable with the same TCM school of more famous Beijing Tong Ren Tang). Tianjin Da Ren Tang is relatively less well known to global investors (unlike other Top 10 largest TCM or healthcare stocks in China) which makes it significantly undervalue, especially for dual listed stock in SGX vs China (eg. on 4 Nov 2022, share price was US$1/share in SGX but RMB 28.26 / 6.87 = US$ 4.11), about 4X price difference in the past, but Tianjin Da Ren Tang in SGX catches up recently to narrow down the gap with China listed stock to (40.08 / 6.87) / 2.26 = 2.6 times on 17 Apr 2023.

Even so, it is still over 2X difference between SGX and Shanghai listed stock, therefore there have been some speculations that SGX listed stock (about 1/3 total shares) may be acquired one day. In fact, when there was a change in major shareholder a few years ago, due to regulation, a low-ball offer (less than US$1) was proposed but this was just for formality, “acquisition” was not successful. In fact, Tianjin shares in SG are mostly owned by retail investors, major shareholders (who own 2/3 shares in China) would need to buy up significantly (relative to 2.6X difference of China stock) if the stock may be acquired to delist one day.

By right, both 1/3 SGX stock and 2/3 China Shanghai stock should have close to 1:1 share price since stock value is the same. Therefore, the earlier 4X undervalue of SGX listed of Tianjin Da Ren Tang has make it an excellent dividend stock, especially its dividend is doubled during recent announcement on 31 Mar 2023, together with 2X in earlier 2 years, total of 4X dividend growth in 4 years, resulting in an unbelievable 25% dividend yield for medium term investors who could take action 3 years ago ($0.68 in May 2020 for Dr Tee graduates).

While celebrating the success for Tianjin Da Ren Tang with 3X Capital Gains and 25% Dividend Yield, an investor or trader may worry when to exit. If sell too early, one may regret as stock may goes up further to higher Ein55 Optimism level driven by greed and social media publicity. If sell too late, the rally may be over, corrected back to square one, less profitable. Therefore, even making profits could be a headache, although it is a good problem to have.

Let’s apply 3 Exit Strategies of Dr Tee with LOFTP (Level / Optimism / Fundamental / Technical / Personal) Strategies to take profits. This is not limited to Tianjin Da Ren Tang (one has to make own decision aligning to own personality), may be applied to any giant stock with profits gained so far.

1) Contrarian Sell (Counter-trend)
Similar to “Buy Low” at Low Optimism with bearish prices, a contrarian investor may sell at High Optimism (eg. >$2.50 for Tianjin Da Ren Tang) with bullish uptrend prices (counter trend). Contrarian is against the majority, eg Buy when others were fearful 3 years ago during pandemic and Sell when others are greedy one day (eg. current market).

However, this strategy requires to know where is Low or High (eg. need knowledge of Ein55 Optimism with intrinsic value of a stock), else Buy Low may get lower (worst may go bankrupt for a junk stock with weak business), Sell High may get higher (>2-10X). A useful finetuning strategy is selling progressively (eg. sell 10% share whenever price is up by 10%, selling 100% when it is up by 100% or 2X). This is similar to an investor who “Average Down” (entry in batches) to Buy Low a few years ago. The weakness of this method is potential profits could be limited with progressive sell, balanced by the benefits of multiple more predictable exit points.

A special smart strategy is to sell 50% shares whenever stock price is 2X (eg. Tianjin Da Ren Tang from $0.68 to $1.36, or from $1 to $2, exit price depending on entry prices X2). This way, the initial capital of an investor is recovered (assuming commission and dividends are neglected), this would give confidence to an investor to take higher risk to hold longer time for the remaining 50% shares, aiming for even higher prices as psychologically, the investor knows that one will not make a loss anymore when 50% profits are taken with 2X prices, even a company may go bankrupt in future.

Assuming there is a good problem to have, share price goes up by another 2X after selling 50%, then an investor may sell 50% of remaining 50% = 25% when share price is 4X (eg. Tianjin Da Ren Tang from $0.68 to $2.72). Continue to sell 50% each time on remaining shares if any stock may become rocket high next time (eg. buy IFAST stock last time during pandemic at $1, sell 50% when come to $2, sell 25% when come to $4, sell 12.25% when come to $8, only left 12.25% shares today, else IFAST stock is corrected to below $5 currently if buy & hold till today).

2) Follow-trend Sell
Many retail investors and traders are more suitable for trend-following trading, eg. Buy a stock (low or fair or high price) with support of stronger uptrend prices. Similarly, they feel “safer” or more comfortable to sell when trend is reversed from uptrend to downtrend. This requires knowledge of share price reversal, eg. application of Technical Analysis, however one may regret after selling as the signal could be too fast, eg. taking 10% profits but stock may continue to go up over 2X, unless the traders continue to buy back again in future to follow the uptrend.

A more practical trend-following is to define own personality first, eg. short term, medium term or long term. This way, one may identify the right indicator to sell (aligned to earlier buy signal). A simple but smart strategy is to apply a trailing stop with X% correction during uptrend price, short term trader may sell when it corrects down by 5-10% one day (eg. Sell if Tianjin Da Ren Tang drops by 10% or around $0.22), medium term trader may wait for 10-20% (eg. Sell if Tianjin Da Ren Tang drops by 20% or around $0.44), long term investor may even able to tolerate >20-30% (acceptable since they have hold with over 2-3X capital gains).

Alternatively, a trader may finetune with any systematic trading system (eg. moving averages crossover, MACD, stochastic, breakout of support/resistance, etc), daily, weekly or monthly, following own personality (buy & sell every few weeks, months or years). Success trend-following is when the system matches own personality, else it would be a failure (eg. feeling of selling too early or too late).

Personality is usually ignored by investors / traders, especially for beginners, who simply busy looking for the “secret method” to make money in stocks. Ein55 Optimism has considered effects of personality in both Buy / Sell signals, integrating with LOFTP strategies.

3) No Sell (Hold)
In fact, the last exit option is not to exit at all, which may be holding for long term or lifetime, especially when business is intact, still growing consistently each year. It means an investor may ignore the share prices volatility or even stock crisis, mainly monitoring the business performance (eg. earnings, revenue, cashflow and many other key fundamental indicators from 3 financial statements).

By the way, Tianjin Da Ren Tang is a very cyclic stock (eg. price could drop over 60% during past stock crisis, partly due to cyclic China and SG stock markets), may not be suitable for Buy and Hold strategy, unless it may evolve from cyclic to growth and dividend investing over time. With recent strong dividend growth (despite recent 2X dividend growth may not be sustainable as this is not supported by 2X earnings, only up by >10% earnings, share prices is mainly driven up due to large gap between SG and China listed stock, as well as market greed), it starts to evolve gradually.

For Buy & Hold long term or lifetime, an investor may need 10-20 giant stocks in a portfolio (eg. 50% dividend stocks + 50% growth stocks) for diversification. Stock price (usually cyclic) may not always reflect business fundamental (even it continues to grow). If 25% dividend yield may be sustainable (may not be unless Tianjin Da Ren Tang continues to grow >10% in earnings each year), then an investor has an option to hold a stock as it only takes 4 years of dividend x 25% yearly to recover the initial capital with holding of stocks. Current dividend yield for Tianjin Da Ren Tang is 8% (still high relative to other dividend stocks) based on current share price >$2.

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Filed Under: Market Cycle Investing, Stock Market, Technical Analysis, Value Investing Tagged: china stocks, crisis stock, cyclic investing stock, growth stock, High Dividend Stocks

Contrarian Investing for Singapore and Hong Kong Giant Dividend Stocks (独孤求败)

Posted on March 3, 2023 Written by Dr Tee (Ein55)

Contrarian investing is a unique stock strategy (eg. Buy Low Sell High) which goes against the majority or popular views as usually the big winner in an emotional stock market is minority. However, there are both hidden risks and opportunities of this strategy if not aligned properly with own personality, “honey” may become “poison” for an investor.

Let’s learn the 6 key factors of contrarian investing from Dr Tee, then applying in 2 Singapore and Hong Kong dividend giant stocks:
1) Singapore Dividend Giant Stock: Hongkong Land (SGX: H78)
2) Hong Kong Dividend Giant Reit: Link Reit (HKEX: 0823)

The best example of contrarian investor is probably Warren Buffett who believes in “Be Greedy when others are Fearful. Be Fearful when others are Greedy” (独孤求败). He has practiced this method for decades to “Buy Low Sell High” or “Buy Fair price and Hold”, proven to work for him. However, knowing does not mean the same strategy may be suitable for you.

Here are 6 key factors for contrarian investing to work:
1) Value of a company should come first before considering to buy at lower price with contrarian investing of any stock. In order to minimize the chances of “Buy Low get Lower”, a strong defensive and growing business with wide moat should be the core pillar, not just based on price alone.

2) Contrarian investing is more suitable for mid term and long term investor. As Warren Buffett said, “Stock behaves like a weighing machine in longer term”, meaning price eventually follows strength of business fundamental while “stock is like a voting machine in shorter term” (emotional prices regardless of business). It is possible (although rare) for short term investor to apply contrarian trading but this is mainly for those traders who are willing to integrate trading with long term investing, eg. when buying at 10% dip (near intermediate price support), willing to hold longer term if share price could not recover in short term with over 10% gains.

3) Timing of entry/exit for contrarian investors is usually against the majority (mass market, usually following price trends). For example, when a stock is bearish in share price (while business is intact), a contrarian investor would start to plan for entry. However, Buy Low may get lower (even for stocks with strong businesses) in a bearish market, therefore a contrarian investor may consider “Average Down” strategy, eg. entry with batches (5 x 20%) or (2 x 50%), etc. When Dr Tee Optimism strategies (Long Term / Mid Term) could be integrated, the positioning would be more systematic. Alternatively, a contrarian investor may wait for the bearish (downtrend) price to at least go sideways (eg. buying near or above strong price support) if not willing to wait for stronger price reversal to uptrend (trend-follower).

4) Alignment with Level Analysis, eg. Level 2 (Sector), Level 3 (Country) and Level 4 (World), is crucial for Contrarian Investor, eg. Buy Low during low Optimism (<25%) with Global Financial Crisis, Sell High during high Optimism (>75%) with historical best economic and stock performances. With such alignment, usually law makers of each country may provide additional support (eg. QE or printing money) during financial crisis, easier for stock to recover. Similarly, a government may cool down the stock market when economy is overheated, especially with high inflation (eg. interest rate hike).

5) Dividend giant stocks would help a contrarian investor to generate passive incomes (eg. >5-10+% dividend yield) during the difficulty time. Eg. over the past 1 year of global tech stocks correction, when growth stocks do not grow in share prices, an investor may suffer capital loss (if holding growth stocks with 0 dividend) or zero / little return (if holding cash).

6) Regardless how confident is an investor on any stock or business (including giant stock), there are always potential unsystematic risks which could be beyond the control, although it may be rare but it is never zero risk. Therefore, it is prudent to diversify over 10-20 giant stocks as a portfolio or through a giant index ETF. Even when a stock may fall to $0 or business goes bankrupt, the potential maximum capital loss of portfolio is limited to only 5-10%. Eg. if there is a portfolio of 20 dividend giant stocks with 5% dividend yield, it could generate $5 from every $100 investment yearly, therefore even if 1/20 stock may disappear ($5 loss) under very rare condition, the dividend yield ($5) could be sufficient to balance the risk of holding in long term.

Similarly, a contrarian investor would also Sell in an overheated stock market with over 75% Optimism while most trend-following traders would think this is the best time for trading. So, whether contrarian investing is “honey” (eg. Buy Low Sell High) or “poison” (eg. Buy Low Get Lower), it depends on how much integration of 6 factors above to own unique personality (eg. short term / medium term / long term). There is no best strategy in the world for stock investing but one has to find the most suitable one for own personality (eg. contrarian vs trend-following, long term investing vs short term trading, fundamental vs technical, etc).

Let’s apply contrarian investing on these 2 Singapore and Hong Kong dividend giant stocks:

1) Singapore Dividend Giant Stock: Hongkong Land (SGX: H78)

Hongkong Land has nearly 100 years of business record in property market, part of Jardine Group with about 200 years of history in China. Due to slowing Hong Kong economy and property market (especially during last 3 years of pandemic), Hongkong land share price has dropped by half over the past 5-7 years from peak price of $8+ to low prices of about $4+.

The share prices have even dropped below $4 during 2020 and 2022, the 2 worse times of pandemic in Hong Kong / China, recovering and supporting above $4 resistance (becoming support currently). A contrarian investor may consider Hongkong Land stock below $5, averaging down if needed if falling to $4.50, $4 or below. Assuming the stock may go bearish or sideways, an investor may collect about 5% dividend yield currently (higher yield if share price bought is lower), higher than Singapore Savings Bond of 3% interest (purely passive income, no potential capital gain).

More importantly, Hongkong Land has 2/3 investment properties (mostly collecting rental in Hong Kong / Singapore / China, behaving like a Reit with strong rental business) and 1/3 development properties (mostly in China, having a mega project with $4 Billions investment in West Bund of Shanghai). China / HK has ended zero COVID policy, Hongkong Land business is expected to recover strongly (especially for development projects in China) with this Level 3 (country) alignment of policy.

Hongkong Land is still at low Ein55 Optimism (<25%) but recovering well from correction in China pandemic 2022, aiming for Ein55 intrinsic value of about $8+/share or over $10/share when market emotion may be greedy again. The stock is well balanced, could be suitable for dividend investing (Buy & Hold for dividend), growth investing (Buy & Hold for capital gains), cyclic investing (Buy Low Sell High) but not for trading (downtrend for short term). Hongkong Land is not a Reit but having the stability as a Reit with strong business (value), therefore may be considered for contrarian investing by some investors.

For investors with limited capital, not able to diversify over 10-20 dividend giant stocks, Singapore STI index has 30 stocks (including Hongkong Land) with 4% dividend yield, may be considered for contrarian investing but not ideal at current near fair price (40+% Optimism), may need to wait till the next Global Financial Crisis to buy STI at low.

2) Hong Kong Dividend Giant Reit: Link Reit (HKEX: 0823)

Link Reit is the largest reit in Asia and Hong Kong. It has rental business in Hong Kong, China and overseas including Singapore (recently 5% portfolio with acquisition of Jurong Point and partial Thomson Plaza). Most of the properties (including carpark business) are defensive in nature with over 10% rental reversion (critical for dividend growth over time). Due to slowing Hong Kong economy and property market (especially during last 3 years of pandemic), Link Reit share price has dropped by half over the past few years from peak price of $80+ to low prices of about $40+.

The share prices have even dropped below $40 during 2022, second major wave of pandemic in Hong Kong / China, then recovering and supporting above $60 resistance (becoming support). However, recent rights issue has corrected the share price further with over 10% below TERP (theoretical ex-rights price) of $59.70. Rights issue is a positive move the raise fund for overseas expansion but it is viewed negatively by the market (some retail investors may not like to top up extra money to invest in stocks). A contrarian investor may consider Link Reit below $60 (considering rights as a gift with extra 30% discount while value or business remains intact), averaging down if needed if falling to $50, $40 or below. Assuming the stock may go bearish or sideways, an investor may collect about 5.7% dividend yield currently (higher yield if share price bought is lower).

The latest rights issue is considered Ver 3.0 expansion for Link Reit to global market (mainly asia pacific including Australia, Singapore, etc), in addition to Ver 1.0 expansion (locally in Hong Kong) and Ver 2.0 expansion (China). Each version of plan is about a decade plan, critical for Link Reit to remain competitive and growing in a sustainable way. The portfolio can be expanded further with more yield accretive assets globally, allowing dividend yield of entire Reit portfolio to grow further. However, it takes time for both business growth (Version 3.0) and share price growth.

Link Reit is still at low Ein55 Optimism (<25%) but recovering well from correction in China pandemic 2022 (but suffering from “normal” market fear of rights issues), aiming for Ein55 intrinsic value of about $100/share or over $120/share when market emotion may be greedy again. The stock is well balanced, may be suitable for dividend investing (Buy & Hold for dividend), growth investing (Buy & Hold for capital gains), cyclic investing (Buy Low Sell High) but not for trading (downtrend for short term).

For investors with limited capital, not able to diversify over 10-20 dividend giant stocks, Hong Kong HSI (Hang Seng index) has over 60 stocks (including Link Reit) with 3% dividend yield, may also be considered for contrarian investing as Optimism is also low (<25%), aligning with Link Reit.

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Filed Under: Fundamental Analysis, Market Cycle Investing, Stock Market Tagged: crisis stock, High Dividend Stocks, Hong Kong Market, reit

Top 4 Crisis Defender Growth Stocks (一飞冲天)

Posted on February 17, 2023 Written by Dr Tee (Ein55)

Global stock markets experienced mini bear last year with over 30% major correction in stocks, following by strong recovery in Year 2023, especially for US and Hong Kong giant stocks, supported by declining US inflation and ending of zero COVID policy in China / Hong Kong with full reopening of borders.

Instead of worrying about uncertain markets, a smart investor and trader may consider strong growth giant stocks (一飞冲天) with protection by strong growing business, a natural way to hedge against high inflation with interest rate hike while accumulating capital gains in a steady way with global pandemic recovery.

In recent 14th Ein55 Charity Course (5 Nov 2022) on Global Growth Stocks, we have raised fund of $17,000 for Tzu Chi Singapore to help needy families in Singapore. Under the spirit of charity, Dr Tee decides to share 4 defensive growth stocks in 4 countries of 4 growing sectors (pharmaceutical, agricultural, insurance and consumer discretionary) with readers as strikers in current early bullish stock markets (read each details in this article to fully understand on how to position in these giant stocks):

1) Singapore Growth Pharmaceutical Stock – TJ DaRenTang (SGX: T14)

2) Malaysia Growth Agricultural Stock – QL Resources (Bursa: 7084)

3) Hong Kong Growth Insurance Stock – Ping An Insurance (HKEx: 2318)

4) US Growth Consumer Discretionary Stock – Nike (NYSE: NKE)

The best time to invest in global growth giant stocks is always during global stock crisis (eg. Year 2020-2021 during pandemic, 2008—2009 during subprime crisis, etc), not only able to maximize the dividend yield (due to lower entry share price), also could have higher potential of capital gains (when market cycle moves from fear in low optimism to greed in high optimism). Growth stock investing is not based on stock strategy (Buy & Hold for capital gains) alone, may be integrated with cyclic investing (Buy Low Sell High), dividend investing (Buy & Hold for dividends), swing / momentum trading (Buy & Hold for short term / medium term gains), defensive investing and other Ein55 strategies.

However, not all the high growth stocks (potential value trap) are suitable for growth investing. A growing business in the past may not be sustainable during or after COVID-19 period and a growth stock may not able to continue the same rate of growth. Similarly, even a growth stock may have strong and sustainable business but if share prices is bearish due to emotional stock market or declining sector, it may not be a good choice for investors to Buy Low (prices may get lower in short term), integration with trading or alignment with promising sectors would help for a smooth entry.

Fundamental Analysis alone is not sufficient, a low PB or low PE or high dividend yield stock may be a value trap as this may be the result of lower share price with weakening businesses. Therefore, deeper analysis is required with LOFTP (Level, Optimism, Fundamental, Technical, Personal Analysis) Strategies.

Let’s learn these 4 giant growth stocks from 4 promising sectors (pharmaceutical, agricultural, insurance and consumer discretionary) as defenders in 4 countries (Singapore, Malaysia, Hong Kong and US), understanding the business nature, investment clock and unique strategy.

1) Singapore Growth Pharmaceutical Stock – TJ DaRenTang (SGX: T14)

During and even after COVID-19 period, TJ DaRenTang (Tianjin ZhongXin) consistently achieves outstanding growing pharmaceutical business (about 70% in TCM, Traditional Chinese Medicine). It has many patents and unique / popular products which a strong moat for future growth.

The stock is dual-listing, 1/3 in SGX (T14) and 2/3 in China SSEC (600329). Comparing using the same currency USD, China-listed stock is 4X higher price than Singapore-listed stock, resulting in Singapore stock (T14) is more valuable (from investing perspective) with 6% dividend yield with current stock price.

TJ DaRenTang is still at moderate low Ein55 Optimism (<50%) but recovering well from correction in China pandemic 2022, aiming for Ein55 intrinsic value of about $1.50/share or over $2.50/share when market emotion may be greedy again. The stock is well balanced, suitable for dividend investing (Buy & Hold for dividend), growth investing (Buy & Hold for capital gains) and trading (uptrend in short term), but not for cyclic investing (near to fair price).

Since the stock was shared on 5 Nov 2022 (about $1) during charity course, the share price has surged about 30% over the past 3 months.

2) Malaysia Growth Agricultural Stock – QL Resources (Bursa: 7084)

QL Resources is a major producer for eggs / chicken, during high inflation period in 2021-2022, unlike most commodity stocks, it suffered major correction in business due to price cap by Malaysia government for eggs / chicken. As a result, the past high growth is slowed down, then starts to grow again over the past few quarters with support of other growing divisions (marine products, palm oil and Family Mart operations).

QL Resources is still at low Ein55 Optimism (<25%) but recovering well from the worst time of eggs business, aiming for Ein55 intrinsic value of about $7.50/share or over $9/share when market emotion may be greedy again. The stock is more suitable for growth investing (Buy & Hold for capital gains) and trading (uptrend in short term).

Since the stock was shared on 5 Nov 2022 (breaking above critical $5 resistance) during charity course, the share price has climbed up about 20% over the past 3 months.

3) Hong Kong Growth Insurance Stock – Ping An Insurance (HKEx: 2318)

Over the past 3 years of pandemic, Ping An Insurance (business in China) has declined by about 1/3 but the price corrected by 2/3, aligning with the fear of Hong Kong stock market (Hang Seng Index was halved from the peak), providing a rare investing opportunity.

Ping An is undervalue, despite higher gearing ratio, core business in insurance is still defensive in nature. The parent company (Ping An) is much stronger than other subsidiaries (businesses not as good).

Ping An is still at low Ein55 Optimism (<25%) but recovering well from correction in last 3 years of pandemic, aiming for Ein55 intrinsic value of about $100/share or over $150/share when market emotion may be greedy again. The stock is all-rounded, suitable for dividend investing (Buy & Hold for dividend, 5% dividend yield currently), growth investing (Buy & Hold for capital gains), trading (uptrend in short term) and cyclic investing (Buy Low Sell High).

Since the stock was shared on 5 Nov 2022 (about $35) during charity course, the share price is nearly doubled over the past 3 months. There is still significant upside potential, mainly due to over-correction in share price over the past 3 years.

4) US Growth Consumer Discretionary Stock – Nike (NYSE: NKE)

Nike has the largest global market share for sports shoes and related products (following by Adidas and Puma). It has many popular products which a strong moat for future growth under consumer discretionary market.

Nike is still at moderate low Ein55 Optimism (<50%) but recovering well from US stock crisis in 2022, aiming for Ein55 intrinsic value of about $150/share or over $180/share when market emotion may be greedy again. The stock is more suitable for growth investing (Buy & Hold for capital gains) and trading (uptrend in short term).

Since the stock was shared on 5 Nov 2022 (about $96, later breaking above critical $100 resistance) during charity course, the share price has surged about 35% over the past 3 months.

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Filed Under: Fundamental Analysis, Market Cycle Investing, Market Outlook, Stock Market Tagged: Charity Course, dividend stock, growth stock

Hidden Stock Opportunities in New Year of Rabbit 2023

Posted on January 9, 2023 Written by Dr Tee (Ein55)

Global inflations have started to decline from peak of decades high, especially for US (from 9.1% to 7.1% currently. aiming below 5% in near future). Historically, proven lower inflation would help to limit the interest rate hike which would be a relief (especially for technology stocks) for global investors. A smart investor may not wait until news to confirm such trend, able to take action earlier (with assistance of reversal signals to bull, not all stocks are suitable to consider now) than majority who may be still worrying about recession.

US stock market is not as weak as shown by S&P 500 stock index. In fact, most of the sectors are recovering well, except for technology and consumer discretionary. However, since most of the large cap stocks (top 10 of S&P 500) are technology stocks, therefore the index has been weak, mainly due to bearish Nasdaq stock market. However, there are few thousands of other stocks in US which are non-technology which may be considered earlier by investors or traders. Eventually, even technology stocks in US would follow HK/China stocks to recover strongly, especially when there is more consistent drop in inflations over the next few months.

Inflation rate is a lagging indicator based on CPI (Consumer Price Index) over the past 1 year. In fact, monthly and quarterly CPI has been declining significantly but yearly CPI difference (which is the standard inflation) only starts to show reversal in the past few months. When inflation starts to “confirm” dropping below an acceptable level by the Fed, it may be too late for most investors to enjoy the free lunch. Despite the hidden fact of declining inflations, the Fed could not be soft in its tone as lower CPI would help to create bigger safety margin to avoid future reversal of inflations to a new high, especially the US job market is extremely strong (3.5% unemployment rate, the lowest level over the past 50 years). When global stock investors start to make money again in investment, they may continue to spend more money (higher inflation), therefore it is wise to scare them to be more prudent in spending next time.
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With recent relaxation of COVID policy in China (full reopening of border), Hong Kong / China stock markets have been soaring (Hong Kong Hang Seng Index has jumped over 30% in the past few months while some individual giant Hong Kong stocks have started to recover over 50% in share price as if there is no tomorrow). As mentioned over the past 1 year, even a smart investor may not know the true market bottom, simple averaging down strategy below low optimism may be applied on HSI index while collecting 3% yearly dividend (comparable with Singapore Savings Bonds which has no capital gains, a popular choice for many retail investors, not knowing it is a loss in long term by investing below high inflation of 5% in Singapore).

One day, a true global financial crisis would still come (even if 2022 technology bubble and Hong Kong/China stock crisis due to zero COVID policy are only market corrections). However, an investor could not worry everyday that “sky would fall down”, as if worrying of suffocation, therefore refuse to eat (因噎废食) which is not reasonable. A better option is to be flexible, integrating short term trend-following trading with long term growth / dividend investing, taking calculated risks while others are still fearful.

It is timely now to review own stock portfolio, making decisions (Buy / Hold / Sell / Wait / Shorting) ahead of majority.

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Filed Under: Macroeconomy, Market Cycle Investing, Market Outlook, Stock Market, Uncategorized

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