Hong Kong Market Archives

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.

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.

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

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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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.

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:

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

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

4 Defensive Undervalue-Dividend-Stocks of Singapore and Hong Kong against Black Swans

Posted on July 6, 2022 Written by Dr Tee (Ein55)

In this Dr Tee 2hr video education (4 Defensive Undervalue Dividend Stocks), you will learn:
1) Interactive Impacts of 5 Potential Black Swans
– COVID19, High Inflation, Interest Rate Hike, Supply Chain Disruption, Russia-Ukraine War

2) Singapore and Hong Kong Stock Market Outlook
– Short term, medium term & long term

3) 4 Singapore and Hong Kong Defensive-Undervalue-Dividend Stocks:
– Singapore Index Fund: STI ETF (SGX: ES3 & G3B)
– Hong Kong Index Fund: HSI ETF (HKEX: 2800 & 2833)
– Singapore Property Giant Stock: Hongkong Land (SGX: H78)
– Hong Kong Giant Reit: Link Reit (HKEX: 0823)

4) Defensive Investing Strategies with Low Optimism Giant Stocks
– Kiasu Personality (Average Down)
– Kiasi Personality (Average Up)

5) Bonus / Q&A
– Jardine Cycle & Carriage (SGX: C07)
– Alibaba (HKEX: 9988 / NYSE: Baba)
– Impact of interest rates (HDB / Banks) on Property Market

Here is Dr Tee Free 2-hr Video Course. 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/U2JPD68YR94

Past readers could have profited with over 50% rally in share price if have taken actions during pandemic on similar giant stocks at low optimism level. No one could change the past but you could still change the future if taking action to learn now!

Investing with 30 STI Index Stocks (including Hongkong Land) is a defensive strategy, indirectly diversifying the risks among 30 large size businesses in Singapore.

Similarly, investing with 66 HSI Index Stocks (including Link Reit) is a defensive strategy (with additional protection of low optimism Hang Seng Index, leveraging on pandemic recovery and stimulus plans in China), indirectly diversifying the risks among 66 large size businesses in China / Hong Kong:

CKH HOLDINGS (HKEX: 1), CLP HOLDINGS (HKEX: 2), HK & CHINA GAS (HKEX: 3), HSBC HOLDINGS (HKEX: 5), POWER ASSETS (HKEX: 6), HANG SENG BANK (HKEX: 11), HENDERSON LAND (HKEX: 12), SHK PPT (HKEX: 16), NEW WORLD DEV (HKEX: 17), GALAXY ENT (HKEX: 27), MTR CORPORATION (HKEX: 66), HANG LUNG PPT (HKEX: 101), GEELY AUTO (HKEX: 175), ALI HEALTH (HKEX: 241), CITIC (HKEX: 267), WH GROUP (HKEX: 288), CHINA RES BEER (HKEX: 291), OOIL (HKEX: 316), SINOPEC CORP (HKEX: 386), HKEX (HKEX: 388), TECHTRONIC IND (HKEX: 669), CHINA OVERSEAS (HKEX: 688), TENCENT (HKEX: 700), CHINA UNICOM (HKEX: 762), LINK REIT (HKEX: 823), PETROCHINA (HKEX: 857), XINYI GLASS (HKEX: 868), ZHONGSHENG HLDG (HKEX: 881), CNOOC (HKEX: 883), CCB (HKEX: 939), CHINA MOBILE (HKEX: 941), LONGFOR GROUP (HKEX: 960), XINYI SOLAR (HKEX: 968), SMIC (HKEX: 981), LENOVO GROUP (HKEX: 992), CKI HOLDINGS (HKEX: 1038), HENGAN INT’L (HKEX: 1044), CSPC PHARMA (HKEX: 1093), CHINA RES LAND (HKEX: 1109), CK ASSET (HKEX: 1113), SINO BIOPHARM (HKEX: 1177), BYD COMPANY (HKEX: 1211), AIA (HKEX: 1299), CHINAHONGQIAO (HKEX: 1378), ICBC (HKEX: 1398), XIAOMI – W (HKEX: 1810), BUD APAC (HKEX: 1876), SANDS CHINA LTD (HKEX: 1928), WHARF REIC (HKEX: 1997), COUNTRY GARDEN (HKEX: 2007), ANTA SPORTS (HKEX: 2020), WUXI BIO (HKEX: 2269), SHENZHOU INTL (HKEX: 2313), PING AN (HKEX: 2318), MENGNIU DAIRY (HKEX: 2319), LI NING (HKEX: 2331), SUNNY OPTICAL (HKEX: 2382), BOC HONG KONG (HKEX: 2388), CHINA LIFE (HKEX: 2628), ENN ENERGY (HKEX: 2688), MEITUAN – W (HKEX: 3690), CM BANK (HKEX: 3968), BANK OF CHINA (HKEX: 3988), CG SERVICES (HKEX: 6098), HAIDILAO (HKEX: 6862), JD – SW (HKEX: 9618), NONGFU SPRING (HKEX: 9633), BABA – SW (HKEX: 9988), NTES – S (HKEX: 9999).

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:

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

Filed Under: Fundamental Analysis, Macroeconomy, Market Cycle Investing, Stock Market, Technical Analysis Tagged: defensive stock, dividend stock, Hong Kong Market, reit, undervalue stock

Top 4 Crisis Defender Dividend Stocks (抗压存股)

Posted on May 12, 2022 Written by Dr Tee (Ein55)

Global stock markets experienced mini dotcom bubble with over 30%-50% major correction in technology stocks, especially in US Nasdaq and Hong Kong. Both long term investors and short term traders are worried of high inflation over 8%, interest rate hike (may exceed 3% in 1 year), Russia-Ukraine War (higher commodity prices) which contribute to declining stock prices. A potential black swan may spread the fears in technology stocks to most sectors, resulting in a global financial crisis.

Instead of worrying about uncertain markets, a smart investor and trader may consider strong dividend giant stocks with protection by defensive sector business, a natural way to hedge against high inflation with interest rate hike while collecting growing passive incomes in a steady way.

In recent 13th Ein55 Charity Course on Global Dividend Stocks, we have raised fund of $21,700 for Tzu Chi Singapore to help needy families in Singapore. Under the spirit of charity, Dr Tee decides to share 4 defensive dividend stocks in 4 countries of 3 defensive sectors (banking & finance, utilities, oil & gas) with readers as defenders in current bearish stock markets (read each details in this article to fully understand on how to position in these giant stocks):

1) Singapore Dividend Bank Stock – OCBC Bank (SGX: O39)

2) Malaysia Dividend Bank Stock – Public Bank (Bursa: 1295)

3) Hong Kong Dividend Utility Stock – CK Infrastructure / CKI (HKEx: 1038)

4) US Dividend Oil & Gas Stock – Enterprise Products Partners (NYSE: EPD)

The best time to invest in global dividend 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). Dividend stock investing is not based on stock strategy (Buy & Hold for dividends) alone, may be integrated with cyclic investing (Buy Low Sell High), growth investing (Buy & Hold for capital gains), swing / momentum trading (Buy & Hold for short term / medium term gains), defensive investing and other Ein55 strategies.

However, not all the high dividend yield stocks (potential value trap) are suitable for dividend investing. A growing business in the past may not be sustainable during COVID-19 period and a dividend stock may not able to continue the payment of dividend. Similarly, even a dividend 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 dividend stocks from 3 promising sectors (banks, utilities, oil & gas) as defenders in 4 countries (Singapore, Malaysia, Hong Kong and US), understanding the business nature, investment clock and unique strategy.

1) Singapore Dividend Bank Stock – OCBC Bank (SGX: O39)

With rising interest rates globally, bank sector would earn more in interest income (mainly through higher net interest margin, NIM). With accelerated pandemic recovery, banks would also make more profits in non-interest incomes (eg. insurance, credit card, investment, fund management).

So, giant bank stocks usually are good choices for dividend stocks as defenders during bearish market but they could change position as a striker with higher capital gains when stock market is bullish.

OCBC has nearly 100 years of business with merging and acquisition of many banks, supported by major shareholder, Lee Family, as well as an important subsidiary (contributing to about 30% earnings of OCBC), Great Eastern (SGX: G07), an insurance giant stock which has over 100 years of proven operations. Both giant stocks have experienced numerous stock market “crisis” over the past decades, survival-of-the-fittest principle is fully demonstrated, not comparable by any new rising star or promising IPO stock with limited history.

OCBC has strong business performance, after 60% dividend cap during FY2020 is lifted, dividend yield is back to 4.5%, highest among the 3 major Singapore Banks (OCBC, DBS, UOB), partly due to more undervalue in share prices. Over the past 10 years, OCBC has increased dividends payment by 2.5X times, assuming similar performance in the next 10 years, dividend yield could increase to about 10% for long term investors.

OCBC is still at moderate low Ein55 Optimism (<50%) but recovering well from low in pandemic, aiming for Ein55 intrinsic value of about $13/share (about 8% potential upside in medium term) or over $15/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), but not for cyclic investing (near to fair price) nor trading when trend is still sideways.

OCBC Bank is an all-rounded stock but an investor or trader may need diversification over a portfolio of 10-20 giant stocks in 3 sectors of 3 countries, not to buy only 1 giant stock (concentration risk).

2) Malaysia Dividend Bank Stock – Public Bank (Bursa: 1295)

Similar as Singapore, Malaysia bank stocks also benefit from rising interest rates and reopening of economy, especially the international borders are widely opened to tourists.

Public Bank is one of a few remaining private banks (another is Hong Leong Bank, Bursa: 5819) in Malaysia with strong growing businesses. Public Bank is very prudent in expenses, staff cost is one of the lowest among the peers. It also has an insurance giant stock (LPI, Bursa: 8621) as subsidiary.

Relative to OCBC and peers in Singapore, Public Bank is moderate in dividend payment (about 3.3% dividend based on current share prices) but stronger in growth and high cyclic potential due to share prices heavily discounted over the past few years with lagging Malaysia economy.

Public Bank is still at moderate low Ein55 Optimism (<50%) but recovering well from low in pandemic, aiming for Ein55 intrinsic value of about $6/share (about 30% potential upside in medium term). The stock is well balanced, suitable for dividend investing (Buy & Hold for dividend), growth investing (Buy & Hold for capital gains), cyclic investing (Buy Low Sell High) and even trading when price is back to uptrend in short term.

Public Bank is an all-rounded stock but an investor or trader may need diversification over a portfolio of 10-20 giant stocks in 3 sectors of 3 countries, not to buy only 1 giant stock (concentration risk).

3) Hong Kong Dividend Utility Stock – CK Infrastructure / CKI (HKEx: 1038)

Utilities sector has defensive business (eg. power or water supplies with fixed rates for several years), therefore able to generate consistent dividends, even during a bearish stock market.

CKI is under CKH (HKEX: 1), both are Hang Seng Index component stocks with major sponsor, Li Ka-shing, the richest person in Hong Kong. CKI also owns Power Assets (HKEx: 6) and Hong Kong Electric, as well as global utilities businesses, contributing to dividend yield of 4.7% (based on current share prices), a defensive stock popular among Hong Kong investors, especially with bearish stock market driven by ATM (Alibaba / Tencent / Meituan) and other technology stocks.

CKI is still at low Ein55 Optimism (<25%) but recovering well from low in pandemic, aiming for Ein55 intrinsic value of about $80/share (about 60% potential upside in medium term). The stock is well balanced, suitable for dividend investing (Buy & Hold for dividend), growth investing (Buy & Hold for capital gains), cyclic investing (Buy Low Sell High) and even trading when price is back to uptrend in short term.

CKI is an all-rounded stock but an investor or trader may need diversification over a portfolio of 10-20 giant stocks in 3 sectors of 3 countries, not to buy only 1 giant stock (concentration risk).

4) US Dividend Oil & Gas Stock – Enterprise Products Partners (NYSE: EPD)

Oil & Gas sector usually has cyclic business but commodity prices at higher optimism are supporting the giant stocks in oil & gas with stronger business. EPD is a special oil & gas stock with defensive business in midstream sector on delivery of crude oil and natural gas. The earnings and cashflows are stable as business based on future contracts, less sensitive to volatile oil & gas prices.

Russia-Ukraine war has pushed the commodity prices to new high while demand for delivery of oil & gas would be more. Even when one day oil price may fall to lower optimism, EPD could still generate passive incomes which dividend payment has been consistent over the past few decades, currently dividend yield is 6.9% (about 4.3% net dividend yield after over 38% withholding tax to US government).

EPD is under MLP business model which can maximize dividend without corporate level tax, paying dividend 4 times each year, behaving like a REIT (both are required to pay 90% incomes as dividends to shareholders).

EPD is still at moderate low Ein55 Optimism (<50%) but recovering well from low in pandemic, aiming for Ein55 intrinsic value of about $30/share (about 30% potential upside in medium term). The stock is well balanced, suitable for dividend investing (Buy & Hold for dividend), growth investing (Buy & Hold for capital gains), cyclic investing (Buy Low Sell High) and even trading when price is back to uptrend in short term.

EPD is an all-rounded stock but an investor or trader may need diversification over a portfolio of 10-20 giant stocks in 3 sectors of 3 countries, not to buy only 1 giant stock (concentration risk).

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:

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

Filed Under: Commodity Market, Fundamental Analysis, Macroeconomy, Market Optimism, Stock Market Tagged: bank stock, Charity Course, dividend stock, Hong Kong Market, oil & gas, US Stocks

Oil & Gas Stocks (Singapore, US, Hong Kong) with 100% Profit (火上加油)

Posted on June 14, 2021 Written by Dr Tee (Ein55)

Crude oil crashed to negative price 1 year ago, how many of you dare to buy oil or related stocks when others were fearful? Everyone knows “Buy Low Sell High” is the secret to make money in investment but in practice, not many people able to pluck the low-hanging fruits.

In this article, you will learn from Dr Tee on Giant Oil & Stocks of 3 Countries (over 100% profits in the past 1 year) for longer term investing and / or short term trading with COVID-19 recovery stock rally. Bonus for readers who could read every word of the entire article, learning unique strategy to position in each giant stocks, including Ein55 Optimism level and Ein55 Intrinsic Value.

1) US Giant Oil & Gas Funds

Energy Sector SPDR Fund (NYSE ARCA: XLE) / US Oil Fund (NYSE ARCA: USO)

– 100% capital gains after oil price surged over 3 times in last 1 year

2) Singapore Giant Oil & Gas Stock: Union Gas Holdings (SGX: 1F2)

– over 100% profit since sharing in 5 months after sharing with Ein55 graduates & public webinars

3) Hong Kong / China Giant Oil & Gas Stock: Kunlun Energy Company (HKEX: 135)

– over 30% special dividend yield and over 20% capital gains since Ex-Dividend on 31 May 2021

Crude oil is a major commodity, therefore a giant by default (similar to property market which is also a form of commodity) as it is not possible for the world to live without energy supply. Crude oil experienced bearish market due to natural market cycle since Year 2014 when WTI crude oil prices fell from high optimism of over US$100/barrel to low optimism of US$20/barrel, even crashed to negative price (only for 1 day due to abnormal oil futures contract, mostly from USO oil fund) during pandemic in Apr 2020.

For cyclic giant such as crude oil and related Oil & Gas stocks, the entire market was reborn after the worst time of negative oil price. OPEC and non-OPEC oil producer countries learn to collaborate to stabilize the oil price during this crisis of century. Since then, oil price and related stocks start to rebound from low Ein55 Optimism but mainly limited to long term value investors. During recovery of pandemic over the past 1 year with more energy consumption (industries, transportation, household, etc), oil price and related stocks have gone up steadily, even approaching fair prices with mid Ein55 Optimism. With support of more short term traders who join the game recently (火上加油), oil and gas stocks are enjoying strong uptrend momentum in prices.

A giant stock may not need to be big in size, even a small company could be a giant stock. There are hundreds of Oil & Gas stocks globally but some could be junk stocks, Buy Low may become lower in share prices with declining businesses. Let’s study Global Giant Oil & Gas Stocks (following Dr Tee criteria), some are recovering from lower optimism in 3 global stock exchanges interested by readers:

1) US Giant Oil & Gas Funds

Energy Sector SPDR Fund (NYSE ARCA: XLE) / US Oil Fund (NYSE ARCA: USO)

There is no direct way of investing in crude oil market, some investors may consider either investing through oil futures fund, eg. United States Oil ETF (NYSE ACRA: USO) or Energy Sector SPDR Fund (NYSE ARCA: XLE).

USO oil fund applies rollover of WTI oil futures contracts to invest in oil indirectly. Due to Contango in most of the time over the past few years, USO has underperformed actual oil price due to the additional loss (reducing overall capital gains) when rollover to future contracts with higher prices. However, current oil futures is under Backwardation, rollover of monthly futures contracts with lower prices would give extra capital gains, therefore higher probability of winning for trading crude oil with USO.

During pandemic in Q2 2020, WTI fell to $20/barrel, an investor may apply average down strategy (see earlier educational article by Dr Tee during the worst time of pandemic: https://www.ein55.com/2020/03/10-bullets-of-crude-oil-uso-etf-investing/), even if following oil prices to $0 (excluding negative price), average entry price is only $10/barrel (average of $20 + $15 + $10 + $5 + $0), now is already over $70/barrel, over 7 times.

Even if an investor invested in WTI oil price at the highest price of low optimism level, $20/barrel, the corresponding USO fund price was about $33/unit (after 8 to 1 stock consolidation), current price is about $48/unit (with WTI price of about $70/barrel), nearly 50% capital gains (not comparable with actual 3X oil price gains from $20/barrel to $70/barrel, mainly due to USO huge loss during negative oil price and Contango period).

If reading most blogs or analysts reports during pandemic in Q2/2020 after negative oil price, most would write with hindsight that USO was in trouble, may even go bankrupt. Interest in Oil & Gas stocks was very low as well with so many bad news on crude oil market in the past. In fact, this was a perfect time for oil & gas giant stock investing, especially for a few with strong business, supported by dividend yield over 10% (only known to Ein55 graduates), possible for contrarian investing with average down strategy to Buy Low, collecting quarterly dividend while waiting for the light at the end of tunnel for stock recovery to Sell High one day (currently is only a fair price for crude oil and related giant stocks).

After 1 year later, for investors who could take action with calculated risk on USO (despite this is not perfect for oil investing) or Oil & Gas giant stocks, they are rewarded now. For those who are still thinking or analyzing today (when others are not fearful anymore on oil market), the upside is limited, unless following short term momentum trading.

An alternative to oil futures fund or giant stock investing is to invest in a portfolio of large cap stocks (may not be giant stocks), diversifying the unsystematic business risks. SPDR fund for Energy Sector Index (XLE) consists of big oil & gas companies such as Exxon Mobil (NYSE: XOM), Chevron (NYSE: CVX), Phillips 66 (NYSE: PSX), etc. These oil & gas stocks are too big to fail (although may not be true all the time but unlikely for all to go bankrupt together), having more reserves to last through the winter time with low Ein55 Optimism oil prices. XLE fund portfolio is supported by integrated oil businesses (upstream oil exploration, midstream oil delivery and storage, downstream oil refinery and processing).

When WTI oil price was $20/barrel, assuming an investor invested in XLE (was about $28/unit), potential capital gains so far is 100%, 2X with XLE at about $55/unit. XLE could be a better option than USO for longer term investing as it is supported indirectly by big Oil & Gas companies (may not be giant stocks, following Dr Tee criteria) with interests affected by oil prices. USO is fine for shorter term trading unless during Backwardation period with additional capital gains.

Current Brent or WTI crude oil price of $70+/barrel is still below the Ein55 Intrinsic Value of about $80+/barrel. When there is market greed (common for cyclic commodity market), there is further potential to go beyond $100+/barrel, especially with weaker US Dollar and strong global economy during pandemic recovery after global vaccination. If so, a smart investor would know when to exit, taking profits at high Ein55 Optimism, waiting for the next market cycle to profit from crude oil and related stocks again.

For conservative investors, it is fine to exit earlier with fair price (after Buy Low last time), converting Oil & Gas stocks to cash (as future investment opportunity fund) or Change Horse to other more defensive dividend giant stocks in the phase 2 (greedy market cycle) of stock market. Cash is King when used at the right time (usually during bearish market with low Ein55 Optimism such as Year 2020 pandemic), an investor has to know when to convert between stocks and cash.

2) Singapore Giant Oil & Gas Stock: Union Gas Holdings (SGX: 1F2)

There are only about 40 Oil & Gas giant stocks globally, excluding marginal giant stocks with familiar names such as Exxon Mobil (NYSE: XOM) and Keppel Corp (SGX: BN4). In fact, many Oil & Gas giant stocks are small and medium cap stocks, businesses have been growing steadily even with bearish WTI crude oil prices over the past 6 years, falling from $100/barrel to $20/barrel to negative prices. Value is what you get (barrel of crude oil) and price is what you pay, therefore abnormal negative price (seller has to pay to buyer) could not last over 1 day. It can be risky to invest in non-giant oil & gas stocks, especially in Singapore, Buy Low may get lower or even potentially going bankrupt in business, losing everything.

Union Gas is a young Oil & Gas Giant stock in Singapore (4 years after IPO) but having over 40 years of business in LPG (Liquefied Petroleum Gas), business performance has been excellent before and after IPO till now, potential to expand from Singapore to other Southeast Asian countries. Major shareholder (Teo family) has over 70% ownership, paying steady dividend to themselves and also to other shareholders. However, Union Gas share price was stagnant since IPO until last 1 year of pandemic (crisis as opportunity due to higher demand for LPG when people staying longer at home), starting to break above low optimism level of $0.30/share, going up steadily.

When Dr Tee assigned this homework to Ein55 Graduates in Jan 2021, main strategy was positioning for trading with entry share price at $0.53/share or above after each intermediate price breakout. The stock has gone up a few rounds over the past 5 months, trend-following trading may be applied, especially for giant stock at higher optimism with support by growing business in a promising sector with strong global economy. Based on current price of $1.10 on 14 June 2021 (another 10% rally today), it has doubled its share price with 100% profits.

Union Gas is both a growth stock for long term investing and momentum stock for short term trading. Dr Tee has used the same stock as case study in free 4hr monthly webinars (www.ein55.com) over the past few months, even a trader may enter halfway at $0.80+, potential gains so far is already over 30%. For shorter term trading of giant stocks, it is crucial to include S.E.T. (Stop Loss / Entry / Target Prices) in trading plan.

Union Gas is one of over 200 stocks in Singapore Catalist Market, mostly are penny stocks (many have weak business fundamentals), only 5 stocks have over $1/share price. However, some strong price penny stocks in the past may not be sustainable in future. For example, both UG Healthcare Corporation (SGX: 8K7) and Medtecs International Corporation (SGX: 546) from Catalist market were over $1/share, now back to penny stock (below $1/share) after the market greed has subsided for pandemic beneficiary stocks. Those speculators who chase after the high prices would suffer huge loss when the momentum is stopped one day.

In the last rally of global stock market, usually penny stocks including many junk stocks would go to higher optimism level, speculators may buy up (especially when stock prices rising over 2-10 times) without consideration of businesses, ignorant of price vs value. Sadly to say, this group of speculators (mainly applying tips strategy in action taking) may make some pocket money with over small gains of 10-20% but eventually may need to pay back over big losses of 50-90% to Mr Market when show hands at wrong time with more capitals in future trades of junk stocks with consideration of prices alone (happened several times before, including penny stock crisis many years ago with Blumont (SGX: A33), LionGold (SGX: A78), etc.

3) Hong Kong / China Giant Oil & Gas Stock: Kunlun Energy Company (HKEX: 135)

Kunlun Energy was a Temasek stock who was lucky to sell the stocks many years ago while the stock prices falling from peak of over $16/share in Year 2013 to $4/share during pandemic 2020. In fact, Kunlun Energy has been a little giant stock under giant parent company, PetroChina (HKEX: 857), No 2 largest Oil & Gas stock in the world. Kunlun is a small cap company with integrated LNG (Liquefied Natural Gas) businesses.

Kunlun Energy has strong business fundamental but share prices have been affected by bearish crude oil and natural gas prices. Natural gas usually is a byproduct of crude oil drilling, therefore both Oil & Gas stocks are strongly correlated in both businesses and share prices within similar sector, despite the applications are different. Even the future world may not need crude oil one day, becoming 100% green energy, still needs natural gas to produce electricity.

So, popularity of electric vehicles would not eliminate traditional energy sources of crude oil and natural gas. Buying technology giant stocks such as Tesla (NASDAQ: TSLA) is mainly investing in future (pretty picture with higher uncertainty), while buying Oil & Gas giant stocks, are based on proven current business (low-hanging fruits). An investor may make decision with known facts (which sometimes may last for decades, no need to predict into future which may not come within one’s lifetime.

Over the last 1 year of pandemic, Kunlun Energy recovers in share prices from $4/share to over $9/share with over 100% capital gains. Over the past few months, Dr Tee has shared Kunlun Energy with both Ein55 Graduates and monthly free 4hr public webinars (www.ein55.com), those who take actions recently could profit in both one-time special dividend yield of 32% (mainly due to disposal of an asset) and over 20% capital gains since Ex-Dividend on 31 May 2021 till now.

Kunlun Energy is still a momentum stock for trading, certain trading platform may not adjust for 32% dividend yield on 31 May 2021, then investor has to take note of the 30% price ($9 to $6) differences. It may also be considered for longer term investing (current price is still near to low Ein55 optimism level) with Ein55 Intrinsic Value nearly $18. However, this stock is highly cyclical, may not be suitable for low risk tolerance investor (even Temasek sold it in the last bearish cycle), despite business fundamental is excellent with strong sponsor (PetroChina), share price could fluctuate more than indices.

Volatility could be friend for traders while low optimism (price lower than value) could be friend for investors. So, an investor has to confirm PA (Personal Analysis), aligning the investing strategies with own unique personality (eg. short term trading or long term investing). PA is an anchor point to avoid drifting of position due to emotional stock market. “Copy and Paste” of other people’s best stocks or successes may not work without internalization.

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Due to sector rotation with weakening of USD, commodity market is recovering steadily from low optimism in last few years, now approaching mid optimism of fair value, attracting potential short term traders to follow the uptrend prices of commodity stocks (oil & gas, agricultural, precious metals, etc).

Value investor has option to enter these lower Ein55 Optimism stocks at much lower prices (Buy Low Sell High) with contrarian investing (supporting by high dividend yield). Short term traders would enter at much higher prices (Buy high sell higher), following trends.

Either long term investing or short term trading could make money in stocks. A common way could not make money is simply do nothing, waiting for inflation to depreciate the cash by -2% yearly which is sure loss over long term. Cash is King only when used at the right time, not keeping forever.

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:

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

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Filed Under: Commodity Market, Macroeconomy, Market Cycle Investing, Stock Market Tagged: commodity, crude oil, Hong Kong Market, oil & gas, temasek, US Stocks

Top 10 Global Luxury Giant Stocks (纸醉金迷)

Posted on June 5, 2021 Written by Dr Tee (Ein55)

We may still remember the Malaysia 1MDB news a few years ago on millions of ringgit worth of luxury products (handbags –Bijan / Hermes / Gucci, jewelry, watches – Rolex / Patek Philippe) discovered as “gifts” to a lucky family. In fact, smart investors could profit from these luxury products in a legal way with stock investing, leveraging on global rich people with extravagant spending.

In this article, you will learn from Dr Tee on Top 10 Global Luxury Giant Stocks of 4 Countries for longer term investing and / or short term trading with COVID-19 recovery stock rally. Bonus for readers who could read every word of the entire article, learning unique strategy to position in each giant luxury stocks, including Ein55 Optimism level and Ein55 Intrinsic Value.

1) France Giant Luxury Stock: LVMH (EPA: MC), Hermes (EPA: RMS), Kering (EPA: KER)

2) US Giant Luxury Stock: Estee Lauder (NYSE: EL), PVH (NYSE: PVH)

3) Singapore Giant Luxury Stock: The Hour Glass (SGX: AGS), Cortina Holdings (SGX: C41)

4) HK Giant Luxury Stock: Chow Tai Fook (HKEx: 1929), Chow Sang Sang (HKEx: 116), Luk Fook (HKEx: 590)

Stocks with luxury products (eg. branded handbags, expensive gold jewelry, luxury watches, etc) are consumer discretionary stocks (纸醉金迷), usually following the economic cycle, very bullish during bull run (eg. last 1 year of pandemic recovery), very bearish during global financial crisis (eg. Q1 of 2020 pandemic, 2008-2009 subprime crisis, etc). Therefore, mastery of investment clock would help on cyclical luxury stocks to Buy Low Sell High.

However, there are some growth luxury giant stocks which are suitable with Buy Low and Hold long term strategy due to the fact that rich would become richer (sadly to say, may imply poor become poorer, especially those who don’t know investment, depending only on active income from 1 job) when global financial crisis is over. Therefore, the luxury product businesses of growth giant stocks could continue to grow for many decades, especially having a strong intangible asset of famous brands (status of rich people who are willing to pay more).

During COVID-19 pandemic, most luxury stocks suffer in businesses mainly due to temporary lower spending power of rich people and limited tourists who could be main customers in the past. With pandemic recovery (over last 1 year and likely for next 1 year) and availability of online purchases, both businesses and share prices of giant luxury stocks have been growing steadily. When international borders are fully opened one day after global vaccination of COVID-19, the business growth would be accelerated.

A giant stock may not need to be big in size, even a small company could be a giant stock. There are hundreds of luxury stocks globally but some could be junk stocks, Buy Low may become lower in share prices with declining businesses. Let’s study Top 10 Global Giant Luxury Stocks (following Dr Tee criteria), some are recovering from lower optimism in 4 global stock exchanges interested by readers:

1) France Giant Luxury Stock:

LVMH (EPA: MC), Hermes (EPA: RMS), Kering (EPA: KER)

Asian investors may not familiar with European stock market. In fact, France has the most famous luxury products brands in the world, many giant stocks are listed under Euronext Paris Stock Exchange (EPA) which is accessible to global investors. A smart investor would diversify investment over a portfolio of 10-20 global giant stocks in several countries, which may include No 6 largest economy in the world, France, which is famous for its people creativity (despite may not be as hardworking as Asian people).

LVMH (Moet Hennessy Louis Vuitton) is the world largest luxury product, including many famous brands such as Hennessy (wine), LV, Christian Dior, etc. The major shareholder, Bernard Arnault, recently becomes the World No 1 Richest person as LVMH share prices have outperformed No 2 (Jeff Bezos of Amazon) and No 3 (Elon Musk of Tesla). Ein55 Optimism level is over 80%, current price is far exceeding Ein55 Intrinsic value, more suitable with short term momentum trading strategy (Buy High Sell Higher), requiring S.E.T. (Stop Loss / Entry / Target Prices) trading plan.

Similar to LVMH, Hermes is also a family owned business but much smaller in business size, famous with luxury handbags (some rich people wives may have no resistance over them, becoming a collector with millions of dollars spent). However, Hermes is a much stronger growth stock than LVMH, business is so good that even LVMH was hoping to acquire it but mission failed many years ago. Ein55 Optimism level is near to 90%, suitable for both growth investing and momentum trading, but ideal entry point may be to wait for a global financial crisis, especially for longer term investors.

Dr Tee discussed both LVMH and Hermes as stock homework with Ein55 graduates about 2 years ago, even with over 30% share price correction during pandemic crisis, both stocks have achieved 70% potential gains so far. Both are excellent examples of growth stock investing, even if an investor did not sell during global stock crisis, growth giant stocks could recover faster to achieve a new high in future. The main enemy of an investor is usually oneself, especially when a giant stock with growing business is significantly corrected in share prices due to market fear.

Kering is No 4 largest luxury stock in the world, famous of brands such as Gucci, Yves Saint Laurent, etc. Kering is also strong in business but slower growth compared to Hermes and LVMH, more suitable with Buy Low Sell High strategy. Ein55 Optimism level is near to 80% with pandemic recovery, more suitable for short term trading.

In fact, short term performance of LVMH, Hermes and Kering are comparable (currently bullish trends) and aligned due to similar consumer discretionary sector (Level 2) and same country (Level 3). For both short term trading and long term investor, Level Analysis would help to improve probability of success, knowing the unique market cycles (bull / bear) of each sector and country.

Readers may read earlier article by Dr Tee for more details with Top 10 World Richest Persons stocks including LVMH:
https://www.ein55.com/2021/02/top-10-world-richest-giant-stocks/

2) US Giant Luxury Stock:

Estee Lauder (NYSE: EL), PVH (NYSE: PVH)

Estee Lauder is world No 2 largest luxury stock, famous of beauty products (cosmetics, fragrance, haircare, etc). It may be relatively easier to make money from ladies than men, therefore in a typical department store, men section is usually much smaller than lady section, mainly to maximize the business revenue.

Therefore, Ester Lauder is comparable with LVMH, also strong growth in business and share prices, recovering well after the correction during pandemic. Ein55 Optimism level is over 70%, more suitable for short term momentum trading, similar strategy as LVMH and Hermes.

PVH is world No 10 largest luxury stock, famous of brands such as Calvin Klein, Van Heusen, Tommy Hilfiger, etc. However, PVH business is affected much more than other giant stocks, was making a loss during 2020 pandemic year, recovery is also slower. PVH is more cyclical in nature, may be considered with Buy Low Sell High strategy. Ein55 Optimism level is still moderate low near to 30%, aiming for Ein55 Intrinsic Value of $170.

Despite global luxury giant stocks are from different countries, there is an alignment globally (Level 4) in businesses and share prices, especially with more online purchases without travelling, people from country A may purchase a luxury product from country B easily. Consumer discretionary sector with luxury products would follow economic cycles, higher growth during bullish economy, slower growth (or declining) during bearish economy.

Readers may read earlier articles by Dr Tee for more details of other US Giant Stocks:
https://www.ein55.com/tag/us-stocks/

3) Singapore Giant Luxury Stock:

The Hour Glass (SGX: AGS), Cortina Holdings (SGX: C41)

Hour Glass and Cortina are competitors, having very similar businesses, mainly in sales of luxury watches (eg. Rolex, Patek Philippe, Hublot, etc). For regular followers of Dr Tee education articles and videos (www.ein55.com/blog), you would not miss these 2 Singapore luxury giant stocks, Hour Glass and Cortina, at lower Ein55 Optimism levels when sharing during last 1 year of pandemic.

Both giant stocks are strong growth in businesses (cash rich companies), not significantly affected during pandemic (despite fewer tourists to Singapore). However, the strategy to position is very different for each stock. Hour Glass was having more discount a few months ago, when share price was near to 80 cents, Dr Tee discussed as stock homework with Ein55 graduates, also shared in earlier articles with readers, indicating Ein55 Intrinsic Value of $1.20 which is achieved recently, having 50% potential profits in a few months for readers who do own homework and take actions decisively. Despite the current price is near to its fair value, there is potential of higher price of over $1.60 if Hour Glass could attract institutional investors or supported by market greed to higher optimism level as its competitor, Cortina.

Cortina has much higher Ein55 Optimism level (over 90% currently), therefore the positioning over the past few months has been short term momentum trading, following trends to Buy High Sell Higher. Cortina is relatively an illiquid stock with less stock trading volume, therefore it could be very volatile (+/-10% price movement) on certain days. For stock analysis, instead of daily chart (certain days having 0 trading volume), it is clearer when viewing with weekly or monthly chart. Price trends of Cortina and Hour Glass are generally aligned but Cortina has appreciated much more than Hour Glass over the past 1 year.

For medium to long term investor, Hour Glass may be relatively more suitable than Cortina as Hour Glass has higher dividend yield (3-5%, depending on entry prices) and lower Ein55 Optimism level than Cortina. Recently, Hour Glass doubles the interim dividend from 2 cents (last year) to 4 cents (this year), higher dividend has helped to push up the share prices to a new historical high, also motivating Cortina to follow the same price trends. There is also good succession plan, Hour Glass business is passed from Henry Tay to his son (Michael Tay) who has been well trained in this luxury watch industry. So, a luxury watch may be a collection for decades but a smart investor may own “thousands” of watches by investing in Hour Glass or Cortina.

Hour Glass is 2 times larger than Cortina based on market cap but both are considered medium cap stocks, therefore may not be in the radar of institutional investors yet. Cortina has acquired Sincere Watch recently, business size is considered No 2 after Hour Glass for luxury watch market in Singapore. To benefit from the entire luxury watches market, major shareholder of Hour Glass, Henry Tay, is also the second largest shareholder of Cortina, which is a competitor of Hour Glass. A smart investor may learn from Henry Tay, sometimes may invest in a few competing giant stocks of any sector of interest If they are equally good.

For small or medium cap giant stock, it is easier for share prices to move up (or down) as shares are exchanging hands within a smaller group of investors, especially when majority of shares are controlled by a few major shareholders. For example, major shareholder of Hour Glass, Henry Tay, recently adding a small percentage of own shares (known insider trading) but this is sufficient to support Hour Glass above $1/share. A smart investor would diversify over a portfolio of giant stocks with small cap <$100M (higher potential), medium cap $100M – $1B (good balance of potential and stability) and large cap >$1B (more stability).

Readers may read earlier articles (during pandemic with lower Ein55 Optimism level) by Dr Tee for more details with Singapore Growth Stocks including Hour Glass and Cortina:
https://www.ein55.com/tag/growth-stock/

4) HK Giant Luxury Stock:

Chow Tai Fook (HKEx: 1929), Chow Sang Sang (HKEx: 116), Luk Fook (HKEx: 590)

Before pandemic, some readers who travel often to Hong Kong may remember these famous jewelry shops along shopping streets: Chow Tai Fook (周大福), Chow Sang Sang (周生生) and Luk Fook (六福), which are all giant luxury stocks, making money from both local residents and overseas tourists. However, there are many luxury stocks (jewelry, watches, etc) listed in Hong Kong Stock Exchange, not all are giant stocks.

Businesses of all these 3 Hong Kong luxury giant stocks were affected, not only during the last 1 year of pandemic. In fact, even before pandemic, despite growing gold price since Year 2015, jewelry market in Hong Kong has been declining over the years, partly because the number of mainland China tourists to Hong Kong is declining with local political differences. The activists in Hong Kong over the past few years (before pandemic) have further slowdown the demand of this luxury product market.

After the enhancement of local Hong Kong law against potential activists, these 3 luxury giant stocks have started to grow gradually in businesses, supported by pandemic recovery. These 3 giant stocks have very similar trends in businesses (same sector) and share prices (same stock market) in short to medium terms. Relatively, Chow Tai Fook (world No 9 largest luxury stock) is the strongest among 3 stocks on business recovery during pandemic, short term share price is also more bullish than Chow Sang Sang and Luk Fook.

In general, Chow Sang Sang and Luk Fook are still at low Ein55 Optimism levels (less than 25%), aiming for Ein55 Intrinsic Values of about $30 (Chow Sang Sang) and $60 (Luk Fook) respectively, may be considered for cyclic investing or short term trading. They are average quality of crisis stocks due to relatively weaker businesses. Major leader of sector, Chow Tai Fook, is more suitable for trend-following short term trading.

Readers may read earlier articles by Dr Tee for more details of other Hong Kong Giant Stocks:
https://www.ein55.com/tag/hong-kong-market/

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It is easy to know “Buy Low Sell High” is universal secret to profit in most investment. However, most people dare not buy when share price of giant stocks fall to very low optimism (due to lack of visibility of how low is low). Similarly, some people may not buy when share prices of giant stocks go to very high optimism (despite possible to do short term trading). Eventually, some may buy junk stocks during speculative trading, making money for first few times, losing more in later trading when adding more position due to “confidence” of winning in the past.

It shows the importance for retail investors to master stock trading and investment skills, not only knowing but able to take actions (Buy / Hold / Sell / Wait / Shorting). Readers who could spend time to read until here is an achievement, continue the momentum to learn and apply further in stock investment after mastery of skills.

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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.

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

Filed Under: Market Cycle Investing, Market Outlook, Stock Market, Technical Analysis, Value Investing Tagged: growth stock, Hong Kong Market, luxury stocks, US Stocks

Dr Tee Video Education: Divergence of Stock and Economy (股票与经济：背道而驰之谜)

Posted on May 16, 2020 Written by Dr Tee (Ein55)

In this Dr Tee 2-hr video education (Mystery of Divergence in Stock and Economy ), you will learn:
1) How to position with different direction in global stock and economy.
2) Master 3 key economic indicators for global economy (US, Singapore, China, Europe).
3) Mixed signals in investment clock of global stock markets, comparing US, Singapore, Hong Kong & China.
4) Technical Analysis of Coronavirus by country with stage of virus life cycle and estimated ending period.
5) Defensive Investing Strategies during Stock Crisis.

Here is English Version of Dr Tee Video Course (Chinese version is also available as Dr Tee is bilingual). Enjoy and give your comments for improvement. You may subscribe to Dr Tee Youtube channel (Ein Tee) for future Dr Tee video talks. Collect 3 extra bonuses here.

English Video: https://youtu.be/Gs3tsbncBS4

在这Dr Tee 90分钟教育视频（股票与经济：背道而驰之谜），您可学习：
1）学习定位全球股票与经济各奔东西。
2）掌握三大经济指标，把脉环球经济（美国、新加坡、中国、欧洲）。
3）各国新冠病毒技术分析：疫情周期，预估结束点。
4）投资时钟的交叉讯号（短期、中期、长期）：全球、美国、新加坡、香港、中国。
5）危机入市的防御性投资策略。

这儿是 Dr Tee 华语视频（英语视频也已完成，Dr Tee 双语皆行）。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。这里得额外三红利。

Chinese Video (华语视频): https://youtu.be/uaPHWaRFuEM

This defensive investing strategy may be applied to 30 Singapore STI index component stocks (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).

This powerful strategy can be extended to global giant stocks including 30 Malaysia Bursa KLCI index component stocks (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 (7113) TOP GLOVE CORPORATION BHD.

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 Tagged: china market, coronavirus stock market, economy, economy vs stock, Hong Kong Market, market outlook, Singapore Market, stock market crisis, US Market, video education

5 Stages of Stock Market Patient in Pandemic (心中有数)

Posted on May 7, 2020 Written by Dr Tee (Ein55)

stock market Singapore US Hong Kong China Europe Germany World Coronavirus

Global stock market so far has experienced 6 months of Covid-19 pandemic (Dec 2019 – May 2020), struggling between greed and fear, falling badly (20-40%) during initial fear of Coronavirus, then V-shape recovery (recover more than half of earlier correction) with support of unlimited QE or stimulus plans by global government, currently uncertain (gradual sideways stock movement) due to uncertain ending of global Coronavirus (especially for US) with worry of historical worst monthly economic data since Great Depression 1929 may become a norm beyond recovery.

There is a mismatch among stock market, world economy and Coronavirus conditions. Main reason is stock market is forward looking (usually a few months ahead of time), past or current news (eg. Coronavirus condition) or predictable outcome (eg. worst economic data during lockdown) has been considered in stock prices.

China is the first country to start and end Coronavirus, restarting economy gradually now, serving as leading indicator for the world (eg. Korea, Europe, US, Singapore, etc, which hope to restart economy as well). World is following similar footsteps of China for both Coronavirus cycle (start, peak to end / minimal), stock market cycle (down and up) and economy cycle (down and possibly up). Likely scenario for world economy and stock market would be 5-Stages models, similar to a patient:

1) Early Symptom (Start of Coronavirus Pandemic), Dec 2019 – Jan 2020

During the initial phase of Coronavirus outbreak, the stock market was not fearful due to limited spreading to the world (mostly concentrated in China) and world economy is still not affected. So, the stock correction was limited, mainly within infected Asia countries in Dec 2019 – Jan 2020. US controls over 50% of stock value, was not affected in this period, even achieving high optimism in stock market in Jan 2020.

2) Heart Attack (Lockdown), Feb-Mar 2020

When Coronavirus was spread to Europe and US, which contributes greatly to world stock market, there was a crash (20-40% stock correction) in Feb – Mar 2020 for global stock market, mainly due to the fear with stock market at higher optimism before the pandemic was declared. The global stock crisis was complicated by crude oil price war between OPEC (Saudi) and non-OPEC (Russia), extending the fear from stock market to oil market.

Most of the countries in the world started to under lockdown to stop the spreading of Covid-19, the fear of people and business (not able to operate) is similar to a patient under heart attack without blood supply, falling down suddenly, not able to function at all. Global government have to do blood (cash) transfusion to save the patient (local economy), eg. supporting the salary of employees, giving loans to business in crisis sectors (transportation, F&B, consumer, etc).

3) Wake up from Coma (First light at the end of tunnel), Mar 2020

After experiencing the worst month and worst day (23 Mar 2020), global stock market started to recover, similar to a patient wake up from 1 month of coma, seeing hope in future. There was still no real proof of economy recovery (in fact, still bad) and Coronavirus was still severe but since there was no new fear factor (thanks to world news agency and social media for effort in spreading all possible bad news each day), stock market responded ahead of time with a reversal, hopeful of future, especially with support of local government.

No one is able to predict the future, but stock market prices could reflect the consensus of global stock investors after struggling between greed and fear. However, the price trend was not smooth, especially for daily stock market which was still volatile.

4) Initial Recovery (Economy Support), Apr-May 2020

Despite Q1/2020 economy data is poor (predictable due to global lockdown for about 2 months for each country), the global stock market experienced V-shape recovery in Apr 2020, as there is clearer light at the end of tunnel, less daily new cases of Coronavirus infection in most countries (US and world are stable at peak cases, having high chance to improve in condition) and more government subsidies for business and individual with financial crisis.

The daily global stock market prices start to cross above 20 days moving averages, the first technical indicator to show at least technical rebound in share prices. This helps to motivate more global traders to start entering stock market again. The stock market (bullish for short term) is deviated from monthly economic data (bearish for short term, eg. GDP, PMI, unemployment rates, etc). Eventually the gap between stock and economy would be narrower after clearer signals on Coronavirus condition, especially whether it may end in summer 2020.

5) Full Recovery / Economy Restart, Jun 2020 and beyond

When economy is restarted for each country (started for China and Korea, some EU countries, more countries in the world including Singapore will follow), due to low economic monthly data during lockdown period, there would be strong month-to-month relative rebound. Statistics could be an illusion as comparison is between 2 sets of data at 2 conditions (eg. before/after crisis, before/after economy restart, etc), therefore would generate a dramatic difference.

The key is whether a patient could fully recover to function normally. Similarly, whether global stock market could back to full strength again, depends on whether global Coronavirus may end or fade away in summer (hottest period, higher chance to end the pandemic). If yes, economy could be restarted smoothly, global investor confidence could be restored, injured business could recover in a few quarters, even airlines could start to fly again (lower capacity but able to survive on its own).

If not, Coronavirus may continue for another 1 more year until an effective vaccine is developed or more deadly strain may come back in next winter, then the world would need to struggle with slower economy recovery. when dragging over 1 year, world economy may end up similar to Great Depression 1929 as there is limited financial assistance could be given by local government. Although US has “unlimited” QE but this may be a time bomb for bigger future crisis with high national debt.

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There is no need to predict the future which is not predictable in nature. A long term investor could protect oneself with a strong portfolio of 10-20 giant stocks, ideally some could provide stable passive income with dividend to last through winter time and some are supported by growing business (eg. technology, healthcare, etc) which are not affected much by pandemic crisis.

For counter-trend investor, multiple entries strategies may be applied for capital allocation (eg. 10 x 10%, 5 x 20%, 3 x 33%, etc) to take advantage of each major correction in giant stock prices at low optimism due to market fear. A follow-trend trader could also benefit from stock crisis by following the stock market trend (eg. clearer reversal signal from bear to bull, trading timeframe based on personality), protected by S.E.T. (Stop Loss, Entry, Target Prices) plan with position sizing. As for follow-trend investor, one may integrate giant stocks selection with timing to buy/sell aligned with trading (trend-following), to have the best of 2 worlds (fundamental and technical).

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, Stock Market Tagged: china market, coronavirus, Europe Market, Hong Kong Market, market outlook, Singapore Market, stock market crisis, US Market

5 Cheung Kong Super Hong Kong Stocks (长江一号)

Posted on April 27, 2020 Written by Dr Tee (Ein55)

Cheung Kong Stock CKH CKI CKA Power Assets Fortune Reit HKEx HPH Trust

Sir Li Ka-Shing (李嘉诚) is the richest person in Hong Kong for decades, earning a nickname of “Superman Li” for his reputation in the business world. He was born in 1928 in Chao Zhou (潮州) of China (Dr Tee visited there several years ago, Li Ka-Shing donated a lot of money to his hometown), therefore 92 years old so far. Technically he has retired but mentally never stop working for 1 day, still an advisor to his children and his beloved Cheung Kong Holdings.

Cheung Kong Group is famous initially as a property company, then expanding over the decades, becoming a multinational conglomerate with diversified businesses. CK parent stock is assigned #1 stock ticker in HKEx stock exchange (长江一号), showing its strength as a Hong Kong blue chip giant stock. In Year 2015, there is a major restructuring of Cheung Kong, merging with Hutchison Whampoa, forming a new company Cheung Kong Holdings (registered in Bermuda, could be due to long term planning) with 2 main companies with 2 stocks:

CK Hutchison (CKH) – (HKEx: 1) – For non-property related business

CK Assets (CKA) – (HKEx: 1113) – For proper related business

This way, it is clearer to investors on choices of investment based on these 2 divisions. However, the reorganization has affected the long term analysis of Cheung Kong as there are significant relocation of assets between 2 divisions of companies. Therefore, it is a born of 2 “new” companies with 5 years of history in integrated business reporting but share price of CKH is much longer due to its extension of former parent stock, providing additional references on share prices. It is important for a smart investor to analyze each segment of business for both CK companies before making decision of which stock to invest.

In fact, CK Holdings have at least 11 stocks listed within the group (only 5 highlighted ones are giant stocks):

1) CK Hutchison (CKH) – (HKEx: 1) – CK Parent Giant Stock (Non-property Division)

2) CK Infrastructure (CKI) – (HKEx: 1038) – Utility Parent Giant Stock

3) Power Assets (PA) – (HKEx: 6) – Utility Subsidiary Giant Stock

4) CK Life Sciences – (HKEx: 775) – Biotechnology Stock

5) Tom Group – (HKEx: 2383) – Chinese language media stock

6) HPH Trust – (SGX: P7VU) – Port Trust Stock

7) Husky Energy – (TSE: HSE) – Energy stock listed in Canada

8) CK Assets (CKA) – (HKEx: 1113) – CK Parent Giant Stock (Property Division)

9) Fortune Reit – (HKEx: 778) – CK Giant Reit

10) Hui Xian REIT – (HKEx: 87001) – CK Reit

11) Prosperity REIT – (HKEx: 808) – CK Reit

Out of 10 CK stocks, there are 4 giant stocks included in 50 Hang Seng Index component stocks: CKH, CKA, CKI and PA. So, technically Superman Li could move Hong Kong stock market (about 4%). This is similar to “rival” Jardine Group, could move Singapore Straits Times Index (about 15%) with 5 component stocks. In 1980s, Li Ka-shing was aiming to “invest” more in Hongkong Land of Jardine Group but was defeated by cross-shareholding structure of Jardine (another long story, read Dr Tee earlier article on Jardine Group of 7 giant stocks).

Not all the 10 CK stocks are strong based on Dr Tee giant stock criteria. There is only 1 more giant CK subsidiary stock, Fortune Reit is a giant Reit (formerly dual listing, after delisting from SGX, now only listed in HKEx).

So, additional comments will be given below on these 5 giant CK stocks from different businesses. An investor may select either the parent group (CKH or CKA) if want to consider average of entire group business (non-property vs property) as if a fund, or focusing on smaller individual stock of subsidiaries (CKI, PA, Fortune Reit) on specific business segment.

1) CK Hutchison (CKH) – (HKEx: 1) – CK Parent Giant Stock (Non-property Division)

CK Hutchison has 5 main business segments in non-property division. Investing in CKH stock means investing in all business segments.

1.1) Port

The port businesses are relatively stable in the past but Coronavirus crisis in Year 2020 would affect the results for Year 2020. HPH trust (not a giant stock with limited business potential) is only a small part of CK port business.

1.2) Retail

Major business is Watson for health and beauty (15794 stores with 12 brands worldwide). Business growth in China and Asia are faster than in western world. This is consumer related business, therefore Coronavirus would seriously affect the business for a few quarters. Temasek is also a shareholder for Watson, was planning to sell it.

1.3) Infrastructure / Utilities

This is main passive income generator for CKH. More details later under discussions of subsidiary giant stocks CK Infrastructure and Power Assets.

1.4) Telecommunication

This segment of business is growing in general, having mixed performance in different countries. It is a more defensive business.

1.5) Energy / Investment / Others

Energy segment is making losses while other remaining business is less significant to contributing to entire group.

CKH business (non-property) is not as defensive as CKA (property), therefore over the past 5 years since the group reorganization, share price has been dropping to nearly to 1/3 from peak of $120 to $45. Despite the Price to Book (PB) ratio is 0.5 but the asset is non-property, not as high quality. The main investing advantage for CKH is low optimism level < 25%, aligning to global stock crisis (following economic cycles) but it could suffer in business during Coronavirus crisis due to global lockdown.

Dividend yield of 5.7% is attractive but investors may need to prepare for potential 50% cut as the worst case scenario (despite CKH has good track record of consistent dividend payment) during the winter time of CKH business, implying 3% yield which is still better than holding cash with 1% interest for cash deposit in bank. CKH has significant business in Europe, when economy is restarted, CKH quarterly business performance would improve gradually.

2) CK Infrastructure (CKI) – (HKEx: 1038) – Utility Parent Giant Stock

3) Power Assets (PA) – (HKEx: 6) – Utility Subsidiary Giant Stock

Both CKI and PA stocks may be studied together as CKH owns CKI, then CKI owns PA, all inter-related, just different ways of grouping. So, an investor may decide investing in parent company or subsidiary business specifically in utilities.

CKI has many global businesses of infrastructures and utilities (electricity, water, gas), holding strategic asset of certain countries and cities (eg. main electricity supplier of London). Power Assets invests mainly in electricity, eg. providing partial electricity supply to Hong Kong, duopoly with another giant electricity stock, China Light and Power, CLP (HKEx: 2). Readers may guess if CKH could get HKEx stock ticker #1, CLP could get stock ticker #2, implying it is another blue chip stock with proven history (if there is a chance, we may share further on CLP or other monopoly stocks in future).

Utilities business are defensive as people may not need to shop during Coronavirus pandemic or global financial crisis but they still need basic usages of electricity, water and gas. So, utilities or infrastructure related stocks usually show their strength during economic crisis as defensive stocks which could still pay dividend with steady cash flow generated, then gradual capital gains in longer term with recovery and subsequent growth of economy.

In general, both CKI and PA are having close performance in stocks, prices have dropped by half over the past 5 years (more defensive than parent stock CKH which dropped to nearly 1/3 from the peak price), dividend payment has been stable due to defensive industry, current dividend yield is over 5%. The main “risk” of both stocks is bearish price trend over the past few years (despite at lower optimism level, buy low may still get lower in prices), not so much on business risks (minimal), therefore investors who are reluctant to catch the falling knife in prices, may wait for uptrend in prices, sacrificing passive income (dividend yield) with higher price to exchange for confirmation in price reversal to bullish range.

4) CK Assets (CKA) – (HKEx: 1113) – CK Parent Giant Stock (Property Division)

CK Assets are property-based businesses, listed as a new stock, therefore only having 5 years of share price history so far which are more defensive than CKH (dropping to 1/3), but price is cyclic in nature, dropping to half price. Price to Book (PB) ratio is also coming to a new low of 0.5, having 50% safety margin for high quality asset of property.

However, Hong Kong property market (about 20 years for 1 market cycle) has been at high optimism after the average prices gone up by 4 times over the past 2 decades. Therefore, property stocks in Hong Kong in longer term, may suffer “loss” in valuation due to lower property prices if there are any crisis related to China or Hong Kong property bubble. CKA at current price is 50% discount but “rival” property stock, Hongkong Land has 75% discount with PB around 0.25. So, after relative comparison with peers, CKA 50% discount in price may not be excellent. In fact, there are many other property giant stocks in Hong Kong which are “cheap and good”, readers may learn from Dr Tee to explore more in future.

5) Fortune Reit – (HKEx: 778) – CK Giant Reit

There are 3 REITs listed from CKA parent group: Prosperity Reit and Hui Xian Reit are relatively weaker, so we focus only in Fortune Reit. Previously, Fortune Reit has dual listing in both HKEx and SGX but now only left HKEx. There is little difference to Singapore investors as there is no capital gain tax nor dividend withholding tax for Hong Kong stocks, except HKD/SGD is currently at high optimism (HKD is pegged to USD, similar trend for USD/SGD), future potential forex loss (when USD or HKD is depreciated vs SGD) could be compensated by dividend and capital gains of Hong Kong or US stock.

Fortune Reit drops over 40% in share price over the past 2 months of global stock crisis, resulting in high dividend yield of 7.4% with consistent dividend payout of its REIT portfolio. Risks of Coronavirus is minimized as China / Hong Kong conditions are much better than the rest of the world. Social unrest (eg. Hong Kong protesters last year) is also a lower risk now. The REIT is protected by Price-to-Book (PB) ratio of 0.4, rare for a strong REIT with 60% discount, implying under the worst case scenario, even if the company goes bankrupt, investors could still get back the capital (unlike other investors would suffer permanent loss buying stocks with low quality assets). Usually PB is not a strong criteria for REIT, consistent rental collection from tenants is more important which Fortune Reit has a good track record. The REIT manager is also another familiar name: ARA Asset Management, used to be a giant stock with good reputation in Singapore but delisted several years ago (not surprise as this company is too good to share in long term with the public).

In short, investing in Fortune Reit could receive the protection from sponsor, CK Group, in addition to 60% safety margin in share price to property asset value. REIT (rental payment) could be more predictable than property-based business (eg. parent company CKA) which may suffer when property value declines. For a reit, even property value may decline, rental won’t fall as much, especially if located in strategic places with higher populations.

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If you could read until this line, it means that you are a serious investor as Dr Tee has spend half a day to write this article, you only need less than 30 min to read but need a few more days to digest to align the right CK stocks (1 of the 5 giant stocks) to your own personality. Each of the 5 CK giant stocks has its own pros and cons, may not be suitable for everyone. Overall, they all are at low optimism < 25%, implying higher potential for longer term investors. Their main “risks” may not be on business (Coronavirus could affect for Year 2020 but may not for long term), but more on bearish stock price trends since the group reorganization in 2015 till now. Global investors still try to find a sweet spot of balance between price and value for the “new” CK group of stocks.

Cheung Kong has been blue chip stocks for decades in Hong Kong, paying consistent dividend despite bearish stock prices or fluctuation in businesses. The main intangible “asset” of CK Group could be Li Ka-Shing, a trusted icon of CK for decades. Despite Mr Li has retired, he has transferred his business and investment knowledge to his 2 sons, Victor Li (taking over his empire of CK business) and Richard Li (inheriting most of his cash to start own business beyond CK Group). This way, 2 “tigers” won’t be in same jungle (only 1 main decision maker), smart move by a father with far vision to minimize potential family conflicts in the same business.

So, if readers may not have the same wisdom as Li Ka-Shing on investing, we may leverage on him through investing in CK group of giant stocks at lower optimism prices. Li family are unlikely to sell their stocks, therefore they would work day and night for you to grow the business as they are major shareholders (interest is aligned). Better still, readers may contribute no effort except just capital for investment at the right price (ability to press the button when seeing the signal with strategy aligning to own personality), Li family could then work for you for another generation until Victor Li may retire one day as well or passing to the third generation. Of course, you may then sell the stocks for capital gains one day or transfer the stock to your own second generation to keep.

If readers worry Li Ka-Shing may go bankrupt during global financial crisis (he went through at least 9 times over his 92 years of life experience), then smart investor may look for Top 10 richest persons in the world (Li Ka-Shing is only the 30th richest in the world), investing in their best stocks with stronger business than CK Group, forming a portfolio of Top 10 richest person’s giant stocks as a dream team portfolio. Of course, you may not get a good discount in share prices when their businesses are very strong now, therefore stock “crisis” is usually a good opportunity to own some of these giant stocks with growing businesses.

Li Ka-shing stocks are stronger than many 50 Hang Seng HSI index component stocks or 30 STI index component stocks (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).

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Are you interested to invest in giant stocks of Warren Buffett, Bill Gates and Jeff Bezos? Learn from Dr Tee Free 4hr investment course to master how to take advantage of global giant stocks and funds, know What to Buy, When to Buy / Sell. Leverage on investment education to grow your wealth in a safer way.

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Filed Under: Market Cycle Investing, Market Optimism, Stock Market Tagged: Cheung Kong, CKA, CKH, CKI, defensive stock, dividend stock, Fortune Reit, growth stock, HKEx, Hong Kong Market, li ka-shing portfolio, Power Assets, Property, Property Stocks, reit, telco stocks, undervalue stock, utility stocks, Watson

7 Jardine King of Singapore Stocks (狮城股王)

Posted on April 10, 2020 Written by Dr Tee (Ein55)

Jardine Group SGX Jardine Matheson J36 Jardine Strategic Holding J36 Jardine Cycle & Carriage C07 Astra Asii Mandarin Oriental Hotel M04 Hongkong Land H78 Dairy Farm D01 Singapore Stocks Creative Technology C76 Berkshire BRK NYSE Sheng Siong OV8

Jardine Group is not just a company, it is a giant group with nearly 200 years of business history (started in 1832, then controlled by Keswick family for many generations till now). Jardine group of companies cover many industries, eg. engineering, automotive, properties, hotel, supermarkets, etc.

Jardine group has 7 giant stocks (Jardine Matheson, Jardine Strategic, Jardine Cycle & Carriage, Astra, Hongkong Land, Dairy Farm, Mandarin Oriental Hotel), all are falling to very low optimism (mostly with optimism <10%) over the past 2 months of global stock crisis. Since 5 of Jardine giant stocks (except Mandarin Oriental Hotel and Astra International – listed in Indonesia) are 30 STI component stocks (contributing to about 15% weightage), it has the strongest influence to Singapore stock exchange, more than individual stock of 3 major banks (DBS, OCBC, UOB) and Singtel.

There are 30 STI index component stocks including 5 Jardine stocks (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).

6 Jardine stocks listed in Singapore Stock Exchange are secondary listing (primary listing in London Stock Exchange) and traded in USD (currently at high optimism vs SGD). USD usually performs better in bear market (safe haven), weaker during bull market, the longer term forex disadvantage of USD/SGD (about -2%/year USD depreciation) could be compensated by higher growth of 10+%/year of Jardine stock prices.

So, let’s learn to position in 7 Jardine stocks, all are giant stocks based on Dr Tee criteria but each Jardine stock has different characteristic, which may be considered for different personality of investors.

1) Jardine Matheson Holding – JMH (SGX: J36)

2) Jardine Strategic Holding – JSH (SGX: J37)

Jardine Matheson Holding, JMH is “King” of Singapore stocks (狮城股王), the highest share price in Singapore stock market history. JMH share price was peak around US$70/share a few months ago, before falling by 30% during Coronavirus crisis to about US$50/share. It is costly to invest even with minimum of 100 shares per lot (price in USD) = $50 x 1.43 (USD/SGD) x 100 = S$7150.

Highest stock price may not be always a giant stock, although most of the time, high stock prices are giant stocks, higher prices due to growing business over the decades. For example, world’s most expensive stock, Berkshire Hathaway (NYSE: BRK) managed by Warren Buffett, 1 share alone could be US$344,000 (nearly S$500k, could buy a 5-room HDB flat), currently selling at discount of US$290,000 (for details of Berkshire stock, refer to free eBook by Dr Tee on global Top 10 stocks).

The former Singapore stock king was Creative Technology (SGX: C76) with over S$60/share peak stock price recorded in year 2000 dotcom bubble. After the burst of technology bubble, not only stock price in crisis, Creative Technology also lost the giant stock title, company is no longer growing, share prices declining for 20 years till as low as $1/share. Therefore, long term investing requires monitoring of business fundamental, otherwise buy low may get lower over time, suffering huge capital loss. A common mistake for beginner in stock investing is usually buy a famous brand of stock at historical low price or 5-10 years low, assuming the price may recover in future which may not because future business is the key.

Similarly, during Coronavirus crisis, some sectors are badly affected (eg, airlines, F&B, hotel, etc), an investor needs to review whether the business with losses (more than 90% drop in revenue) could last with cash or net asset available. After the crisis is over, could the business recover quickly?

Jardine Strategic Holding, JSH is sibling of JMH, both are owning each other, a special cross-holding structure which could prevent hostile takeover. See another article of this topic: https://www.ein55.com/2017/03/jardine-group-uob-group-cross-holding-stock-network/

Both JMH and JSH stock performance are very close in longer term (eg over 10 years). Investing in either JMH or JSH is as if investing in Jardine fund of stocks with most the Jardine businesses. JMH has average of 1% higher dividend yield than JSH but JSH has average of about 1% higher yearly growth in share price than JMH, so effect is about the same. More details of JMH in earlier article: https://www.ein55.com/2016/04/choose-stocks-grow-30-times-price/

Both JMH and JSH are considered cyclic growth stocks, need to position with optimism less than 25%, best during global stock crisis or global financial crisis. Due to cyclic nature of these 2 stocks with minimal dividend for protection, it is more suitable for investing during recovery phase of stock crisis, avoid buying low get lower. When positioned right at significant low optimism in a severe global stock crisis, JMH and/or JSH may be considered for longer term holding due to high growth but need to monitor its cyclic businesses to certify that they are giant stocks (based on Dr Tee criteria) as this title of giant stock is not forever, eg. Creative Technology lost this title about 20 years ago.

“Buy Low” could only have chance to “Sell High” in longer term with condition that it is a giant stock. If not, “Buy Low” may become “Lower” in prices.

3) Jardine Cycle & Carriage – JCC (SGX: C07)

4) Astra International (IDX: ASii)

Jardine Cycle & Carriage, JCC is only a subsidiary of JSH but itself is already a giant automotive stock (familiar car brands: Mercedes-Benz, Toyota, Honda and Kia). JCC also owns Indonesian automotive giant stock, Astra International (listed in Indonesia Stock Exchange).

JMH owns JSH, JSH owns JCC, JCC owns Astra. So, it is as if 4 levels of stock connection but stock performances are close. JMH and JSH could be considered together (either one). Similarly, JCC and Astra may be considered together through JCC (if easier to invest in Singapore stock than Indonesian stock, Astra).

JCC is a dividend growth giant stock (not for Astra), suitable for investing during low optimism stock market, protected by nearly 6% dividend yield (assuming car business drops during crisis, 50% cut in dividend still has about 3% dividend yield left, more than 1% bank interest rate for cash). When crisis is over, likely the growing business will justify for normal distribution of dividend. However, since it is not a REIT (by law needs to distribute 90% taxable income to shareholders as dividend), the company has the right to choose not to give dividend. Over the past 10 years, JCC has record of giving around 3% dividend yield, current high dividend yield of nearly 6% is mainly due to price dropped by about 50% over the past few months of global stock crisis, therefore dividend yield is doubled from 3 to 6%.

If one believes the Coronavirus crisis or any future crisis are unlikely to stop people from buying cars more than 1 year (eg. could not get out of home for 1 year to view the cars in showroom), then crisis in JCC stock prices could be an opportunity. However, for Q1-Q2/2020 with less shoppers due to global lockdown, there could be temporary drop in business which may be justified by 50% discount in share price.

5) Hongkong Land (SGX: H78)

Hongkong Land is a well-known property stock, owning grade-A commercial properties in both Hong Kong central and Singapore marina area. There are quite a few past articles by Dr Tee on Hongkong Land (https://www.ein55.com/tag/hongkong-land/), mainly an undervalue property stock. However, over the past few years, buy low may get lower as Hongkong Land is not only following Jardine group, also affected by Level 2 property sector (Hong Kong / Singapore) and Level 3 stock property, as well as political economy (eg. over 100 days of Hong Kong protesters last year before Coronavirus crisis).

Among all the 7 Jardine giant stocks, Hongkong Land is the “safest” due to property asset selling at over 70% discount (price to book ratio, PB, is less than 0.3). The high dividend yield of 5% (eg from property rental) is a bonus for long term investor of Hongkong Land, providing passive income (even if 5% dividend yield is cut by half for next 12 months, still suitable as defender), no issue even if “crisis” of any form (protester, virus, etc) may last more than 5 years. During Coronavirus crisis, tenants of property could lose money due to less shoppers but landlord (Hongkong Land) still could collect stable rental.

Mid-term risk of Hongkong Land could be high property valuation in Hong Kong may not be sustainable if the average 20 years property cycle of Hong Kong falls from high optimism. So far Coronavirus only affects global stock markets and badly affect business of certain sectors, but not yet on property sector. Even so, long term outlook for Hong Kong and Singapore property sectors are steady gradual growth as a country surrounded by sea with limited land but nearly unlimited future population (both has the top 10 highest population density in the world with growing economy for decades) would support the growing property prices in decades to come.

In short, investing in Hongkong Land stock is an investment in Singapore and Hong Kong countries through as integrated stock and property markets.

6) Mandarin Oriental Hotel (SGX: M04)

Mandarin Oriental Hotel is not only a hotel in Singapore, it has many hotels globally. During Coronavirus crisis, hotel (hospitality sector) is badly affected. So, investor needs to monitor Q1 and Q2/2020 results of Mandarin Oriental Hotel before making decision.

Mandarin Oriental Hotel is a marginal giant stock, the weakest among 7 Jardine stocks. Even before Coronavirus crisis, business fundamental has been declining. Despite 60% discount in hotel asset with PB of 0.4, Mandarin Oriental Hotel is not as valuable as Hongkong Land.

For short term or mid-term cyclic trading strategy, this stock may be considered if there is a strong reversal in price trend, especially when Coronavirus condition may improve but risk is relatively higher than other 6 Jardine stocks.

7) Dairy Farm International (SGX: D01)

Dairy Farm is famous of its supermarket and consumer business (Wellcome, Cold Storage, Seven Eleven, IDEA, etc) in Hong Kong, Singapore and regional countries. During Coronavirus period, supermarket business should perform better (see how crowded when lockdown was announced) as is a consumer staples business, people still need to eat and drink, if they could not go out from home.

However, before Coronavirus crisis, Dairy Farm only has average business performance. It even sells some its seven eleven stores. It has stable dividend payment record, about 4% yield currently, possible to position as midfielder role. Competitor supermarket stock, Sheng Siong (SGX: OV8) performs better than Dairy Farm for business and stock prices. Sheng Siong has recovered the “losses” in stock prices as business is doing too good during Coronavirus period. Sheng Siong is only a young giant stock but does well in the current global stock crisis, having potential to be a true giant stock in future with more proven record.

Therefore, not all sectors are affected by the same crisis. Investor may explore stocks with stable businesses, leveraging on market fear to ask for over 20% discount in those growth stocks. Crisis is Opportunity when stock prices fall due to fear but business is still strong. Crisis is crisis when stock prices fall mainly due to weaker business.

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In summary, all 7 Jardine stocks are giant stocks at low optimism. However, the stock prices have been bearish for a few years, undervalue asset becomes more undervalue each year. Therefore, these Jardine stocks may not possible for traders without strong holding power as buy low may get lower in short term to medium term, unless there is a clear reversal in stock prices to uptrend again.

For long term investors who apply undervalue investing may consider Hongkong Land and Jardine Cycle & carriage stocks which pay over 5% dividend yield (but assume this amount may be cut by 50%). For very conservative investor, Hongkong Land with over 70% discount in asset value (PB < 0.3) is another strong consideration, even if Hongkong Land could not survive the unlikely Great Depression (<5% chance it may happen), investors may not lose the capital due to high safety of margin.

Strategies for investing in Jardine group is similar as other giant stocks at low optimism, multiple entries, eg 1, 3 or 5 “bullets” of capital, first entry at low optimism < 25%, subsequently optional entries could be either downtrend (5-10% lower, average down for investing) counter-trend investing or uptrend (5-10% higher, average high for trading) follow-trend trading if optimism is still less than 25%. It is fine if only 1 “bullet” (1 entry) is triggered (eg. stock market has V-shape recovery), future may follow short term or mid term trading for actions, to be reviewed again.

Sharing above for 7 Jardine stocks are for educational purpose (almost spend 1 day of Dr Tee valuable time writing this long article, hope it is an useful reference for readers). Please make your own decision with independent thinking. If you could read until this sentence, implying you have the determination to learn and apply stock investing.

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Filed Under: Stock Market Tagged: ASii, Astra, Berkshire, Blue Chip Stocks, Dairy Farm, dividend stock, growth stock, Hong Kong Market, Hongkong Land, hotel, jardine, Jardine Cycle & Carriage, Jardine Matheson, Jardine Strategic Holding, Mandarin Oriental Hotel, NYSE, Property, Property Stocks, SGX, Sheng Siong, Transportation, undervalue stock, warren buffett

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