Winston's Investment Ideas 02 (Apr 10 - Jul 12)

[winston]

TOL as of March 13, 2011:-


Trading Break


As mentioned last week, it's time for me to take a trading break.

Hopefully, it will provide me with a more detached view of the market.

My postings will also not be so regular next week.


The week in review:-

1. Oil - US$100 from US$104 last week from US$98.23 the previous week. How will the shut-down of the refineries in Japan affect the price of crude ?

2. Gold - US$1422 from US$1430 last week from US$1409 the previous week. Will people be selling gold, to cover their losses in other assets ?

3. Other Commodities - How will the Japanese earthquake affect things ?

4. Shanghai Equities - 2936 from 2942 last week from 2879 the previous week. When is the next RRR or interest rate hike ? Resistance at 3015 ? Support at 2775 & 2675 ?

5. HK Equities - 23250 from 23409 last week from 23012 the previous week. Added to Rexlot.

6. Spore Equities- 3044 from 3061 last week from 3025 the previous week. No trade

7. US Equities- 1304 from 1321 last week from 1320 the previous week. Resistance at 1350 ? Support at 1275 and then 1235 ?

8. Japan Equities - 10254 from 10694 last week from 10527 the previous week. Range Low is around 8800. Resistance at 11,000 ? JPY @ 81.77 from 81.66 last week from 83.19 the previous week. The 52 week range is 80.335 to 94.985. How will the JPY react in view of the earthquake ?

9. Emerging Markets - Outflows ?

10. Middle East Contagion - Next planned protest in Saudi on March 20. Probably, a non-event now.

11. Europe - EUR @ 1.3903 from 1.3986 last week from 1.375 the previous week. No more European Contagion ?

12. USD - 76.70 from 76.40 last week from 77.27 the previous week.

13. Properties - Do you know why you are investing in a property now ?

14. Liquidity - Weaker. HKD @ 7.7877 from 7.7864 last week from 7.7934 the previous week. 52-week range is 7.750-7.807; HSI ADT has decreased to HK$73b from HK$76b last week from HK$68b the previous weak.

15. Sentiment - Weaker than last week

16. Economy - Is the market priced for perfection in the economy ?

17. Risk Management - Can your portfolio withstand a 15% correction in Equities, Commodities and Property prices ?

18. 1Q Window Dressing - Tail Wind for the market ?

19. Market Direction - Negative. But the US markets seems to have shrugged off the Japanese situation on Friday.

It has been a volatile few weeks. The Market Direction seems to be down. Yet, I have not been able to buy some Bear Puts. The inertia has caused me a lot of lost opportunity.

Why did I not pull the trigger and went ahead to buy those Bear Puts ? Is it because of the high leverage ? Is it because of the fear of losing ? Is it because of the danger inherent in those instruments ie. up to 40 times leverage ?

Anyway, I'm sure that the answers will come out when I'm on trading break. And finally, is this really a good time to be on a trading break, when the market is so volatile ?


The above is to help me crystallize my thinking. It's not a recommendation to Buy or Sell. Use the above comments at your own risk and please do also feel free to provide me with your kind thoughts and comments.

Please Note:-

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[kennynah]

good idea W... it is healthy to always take short trading breaks and be totally detached from the markets... rest is, sometimes, a very good panacea to trading intoxication

enjoy the spring...

[winston]

TOL as of March 20, 2011:-


Back to the Trenches


I have had a very good trading break and it's now back to the trenches.

What will next week hold ?

And what happened this week ?


The week in review:-

1. Oil - US$102 from US$100 last week from US$104 the previous week. Creeping higher

2. Gold - US$1419 from US$1422 last week from US$1430 the previous week. Didn't the "experts" say that the funds would be selling their gold to cover their losses in the other Asset Class ?

3. Other Commodities - How will this Japanese earthquake affect things ?

4. Shanghai Equities - 2909 from 2936 last week from 2942 the previous week. Just got another 50bp hike in the RRR. When is the next interest rate hike ? Resistance at 3015 ? Support at 2775 & 2675 ?

5. HK Equities- 22300 from 23250 last week from 23409 the previous week. No trade

6. Spore Equities- 2936 from 3044 last week from 3061 the previous week. No trade

7. US Equities- 1279 from 1304 last week from 1321 the previous week. Resistance at 1350 ? Support at 1275 and then 1235 ?

8. Japan Equities - 9207 from 10254 last week from 10694 the previous week. Range Low is around 8800. Resistance at 11,000 ?

9. JPY @ 80.56 from 81.77 last week from 81.66 the previous week. The 52 week range is 76.57 to 94.98. The high Yen will probably weigh on the Nikkei for a while.

10. Emerging Markets - For the sixth time in the past eight weeks, investors pulled more than $2 billion from emerging markets equity funds. More than $23 billion has been redeemed from the funds year-to-date.

11. Middle East Contagion - Next planned protest in Saudi today, March 20. And would this Libya crisis escalate into something bigger now that the West is involved ?

12. Europe - EUR @ 1.4168 from 1.3903 last week from 1.3986 the previous week. Do you understand why the EUR is so strong ? No more European Contagion ?

13. USD - Weaker. 75.83 from 76.70 last week from 76.40 the previous week.

14. Properties - Does property normally go down like an escalor or elevator ?

15. Liquidity - Weaker. HKD @ 7.8006 from 7.7877 last week from 7.7864 he previous week. 52-week range is 7.750-7.807.

16. Sentiment - Weaker than last week

17. Economy - US improving slowly. So what ?

18. Risk Management - Too late to sell. Too early to buy.

19. 1Q Window Dressing - One more week

20. Market Direction - Negative but it's not the end of the world .... yet.


An insight that I got while taking my trading break, is that we tend to focus only on news that support our point of view.

Example: If we have a bearish view, we tend to focus and magnify those negative news and vice-versa.

The challenge then is to be able to also listen to the other point of views and then make an informed decision. Many times, I have glossed over useful information because they did not support my own impression of things..


The above is to help me crystallize my thinking. It's not a recommendation to Buy or Sell. Use the above comments at your own risk and please do also feel free to provide me with your kind thoughts and comments.

Please Note:-

Support the forum button - If you have benefited from the ideas in the forum but have not participated in the discussions, we would appreciate your kind support to defray the expenses of maintaining the forum.

Private Messages ( PM ) - Please do check your Inbox for any PMs. The Inbox is located on the top left hand corner of the Index Page.

Second Opinion - Please see the "Second Opinion" thread in the "Services for InvestIdeas Members" section, located just below the Miscellaneous Section.

Active Topics - Do you know that there's an "Active Topics" button? It's located on the top left hand corner of the Index Page.

[winston]

TOL as of March 27, 2011:-


Separating the Facts from the Impressions


With the volatility in the market, it's time to remind myself, to try to separate the Facts from the Impressions.

Not too long ago, there was an outflow of funds. Now, there's actually an inflow of funds.

Not too long ago, everyone was selling Japan. Now, they are actually buying Japan again.

Not too long ago, Oil was dropping because of Japan. Now, it's rising again on the Middle-East..

Not too long ago, the S&P 500 was in correction mode. Now, it's rallying again.

So are you still living with Impressions from not too long ago or have you accepted the latest Facts and are trading accordingly ?



The week in review:-

1. Oil - US$106 from US$102 last week from US$100 the previous week. Stronger than expected.

2. Gold - US$1425 from US$1419 last week from US$1422 the previous week. I think Gold can continue to grind higher as long as there's no collapse in the other Asset Class

3. Other Commodities - Silver at 31 year high

4. Shanghai Equities - 2978 from 2909 last week from 2936 the previous week. When is the next interest rate hike ? Resistance at 3015 ? Support at 2775 & 2675 ?

5. HK Equities- 23159 from 22300 last week from 23250 the previous week. Sold Rexlot & China Shenghua. Bought Sinofert & Real Gold

6. Spore Equities- 3071 from 2936 last week from 3044 the previous week. No trade

7. US Equities- 1314 from 1279 last week from 1304 the previous week. Stronger than expected. Window-Dressing ? Resistance at 1350 ? Support at 1275 and then 1235 ?

8. Japan Equities - 9536 from 9207 last week from 10254 the previous week. Range Low is around 8800. Resistance at 11,000 ? Still waiting for a good entry point.

9) JPY @ 81.13 from 80.56 last week from 81.77 the previous week. The 52 week range is 76.25 to 94.98. When will the high Yen bring the Nikkei down ?

10. Emerging Markets - Inflows

11. Middle East Contagion - Do you really think that the Saudi Arabia will collapse ?

12. Europe - EUR @ 1.4075 from 1.4168 last week from 1.3903 the previous week. Will Portugal starts things rolling this time ?

13. USD - Stronger. 76.38 from 75.83 last week from 76.70 the previous week.

14. Properties - Which is the path of least resistance ? A 10% rise or a 10% drop ?

15. Liquidity - Stronger. HKD @ 7.7957 from 7.8006 last week from 7.7877 the previous week. 52-week range is 7.750-7.807;

16. Sentiment - Stronger than last week

17. Economies of Developed Markets - Does it feel like a recovery to you ?

18. Risk Management - Need to reduce my Asian exposure, especially in China & S'pore

19. 1Q Window Dressing - Winding down

20. Market Direction - Stronger than last week.


This is another tough week to trade. I was expecting things to be weak but it rallied strongly.

So I took the opporunity to reduce some positions. However, my itchy fingers then went out to put on some new positions again

Anyway, I think that the week's rally is due to Window Dressing and things will wind down late next week. Therefore, it's still better to be a bit careful.

Or am I still living with Impressions from two weeks ago and have not accepted the latest Facts ?


The above is to help me crystallize my thinking. It's not a recommendation to Buy or Sell. Use the above comments at your own risk and please do also feel free to provide me with your kind thoughts and comments.


Please Note:-

Support the forum button - If you have benefited from the ideas in the forum but have not participated in the discussions, we would appreciate your kind support to defray the expenses of maintaining the forum.

Private Messages ( PM ) - Please do check your Inbox for any PMs. The Inbox is located on the top left hand corner of the Index Page.

Second Opinion - Please see the "Second Opinion" thread in the "Services for InvestIdeas Members" section, located just below the Miscellaneous Section.

Active Topics - Do you know that there's an "Active Topics" button? It's located on the top left hand corner of the Index Page.

[winston]

TOL as of Apr 3, 2011:-


Window Dressing is Over

It was a great week for Equities.

That was despite the Middle East crisis, Portugal downgrade, Japanese radiation, high Oil prices, China's continued tightening, high raw material prices etc.

And if you have been closely following the action on some of the counters, you would also have noticed the "mystery buyers" supporting some of the counters.

Anyway, Window Dressing is now over. So can the party continue ?


The week in review:-

1. Oil - US$108 from US$106 last week from US$102 the previous week. Stronger than expected. Oil supposedly will run out in less than 50 years. Luckily, there's now a Japanese car that can supposedly run on water. You can read more on it, in the "Automobile" thread, located in the "Business Sectors & Industries" section.

2. Gold - US$1429 from US$1425 last week from US$1419 the previous week. I bought some gold shares this week, raising my exposure to gold to 9% of my portfolio.

3. Other Commodities - When will high commodity prices affect margins and encourage substitutes ?

4. Shanghai Equities - 2967 from 2978 last week from 2909 the previous week. Chinese Market closed on Monday & Tuesday. When is the next RRR ot interest rate hike ? Resistance at 3015 ? Support at 2775 & 2675 ?

5. HK Equities- 23802 from 23159 last week from 22300 the previous week.
Sold Sinofert. Added to Real Gold. Traded Rexlot

6. Spore Equities- 3126 from 3071 last week from 2936 the previous week.
Sold Guthrie

7. US Equities- 1332 from 1314 last week from 1279 the previous week. Stronger than expected. Resistance at 1350 ? Support at 1275 and then 1235 ?

8. Japan Equities - 9708 from 9536 last week from 9207 the previous week. Range Low is around 8800. Resistance at 11,000 ? Still waiting for a good entry point.

9) JPY @ 84.065 from 81.13 last week from 80.56 the previous week. Big drop in the Yen. The 52 week range is 76.25 to 94.98. Will the weak Yen now spur a rally on the Nikkei ?

10. Emerging Markets - Inflows

11. Middle East Contagion - What Contagion ?

12. Europe - EUR @ 1.4236 from 1.4075 last week from 1.4168 the previous week. The "experts" seems to believe that Portugal can be contained and it will not spread to Spain and the rest. As long as they fall slowly, it should be ok.

13. USD - Stronger. 76.08 from 76.38 last week from 75.83 the previous week.

14. Properties - Mortgage rates are already rising in HK and China

15. Liquidity - Stronger. HKD @ 7.7781 from 7.7957 last week from 7.8006 the previous week. 52-week range is 7.750-7.807;

16. Sentiment - Stronger than last week but is it because of Window Dressing ?

17. Economies of Developed Markets - Does it feel like a recovery to you ?

18. Risk Management - Why do I have this feeling that a "Splash Crash" is just around the corner ? And can my portfolio really withstand a "Splash Crash" ?

19. Market Direction - Stronger than last week but I think that it is because of Window Dressing.

Anyway, there could also be some new money from a new month too but once that's deployed, will there be any more new money coming into the market ?

How about the money from Bonds ? How about the US$4t Cash from the Corporations ?

And are the money from Bonds and the Corporations, that stupid, to be buying after such a huge rally ?

Therefore, it may be safe to buy on any dips, with the money from Bonds and the Corporations, providing the tail-winds.

However, that does not mean that the market will not correct first, in view of the various head-winds eg. Middle East Crisis, China's tightening & slowdown, European Contagion, High Commodity Prices, Earnings Downgrade, Japanese Radiation etc.


The above is to help me crystallize my thinking. It's not a recommendation to Buy or Sell. Use the above comments at your own risk and please do also feel free to provide me with your kind thoughts and comments.


Please Note:-

Support the forum button - If you have benefited from the ideas in the forum but have not participated in the discussions, we would appreciate your kind support to defray the expenses of maintaining the forum.

Private Messages ( PM ) - Please do check your Inbox for any PMs. The Inbox is located on the top left hand corner of the Index Page.

Second Opinion - Please see the "Second Opinion" thread in the "Services for InvestIdeas Members" section, located just below the Miscellaneous Section.

Active Topics - Do you know that there's an "Active Topics" button? It's located on the top left hand corner of the Index Page.

[Chinaman]

Boss W,
I see good in commodities in the future......
Thinking of parking some $ in commodities area..got 5% return happy liao.
Dun trust bank all are suckers, hence forex out for me.

Can share some idea or strategy or maybe be my fun mgr, win 10% fee loose my money u got nothing, hehe.

Commodity is another ways to hedge inflation....why i worry inflation??? cos cash rich leh, sold my ppty 3 mths ago. proceed came in liao.
My spouse ask me to throw back into ppty but sell high buy back lagi high...

[winston]

Hi Chinaman,


1) Splash Crash - I'm very worried about a Splash Crash where Properties, Equities, Commodities and some Currencies, all collapsed at the same time.

I dont know what will trigger the Splash Crash but financial markets are too inter-linked nowadays. And a sudden contraction in Liquidity will trigger a very big crash. In such a scenario, even Gold would be sold off ..


2) Cash - Therefore, I think it's better to stay in Cash for a while and buy after any crash. However, you may have to let inflation eat into the cash a bit and maybe for a few years ..


3) Singapre Risk - As you may noticed, I have also been diversifying my assets away from Singapore into other parts of Asia. If something does happen to Singapore, I dont want to take a big hit on my portfolio ....

Example: If something similar to the Gulf Oil Spill, Australian Flood or Japanese Earthquake, has happened in Singapore, it will take many years for Singapore to recover.

Dont ask me what can happen to Singapore. I did not foresee the Pan-Electric Crash, Black Monday, AFC, SARS, Subprime etc.

And I also dont want to frighten you by telling you about my theory about how a big earthquake in Indonesia can affect the reclaimed lands in Spore or the possibility of the two Casinoes being possible targets of extremists or an Opposition Shock Win ( it has happened in Taiwan, Korea, Malaysia, Japan, Thailand etc ) etc etc ... ooops

Take care,
Winston

[Chinaman]

U kena, Pan-Electric Crash huh...dat mean we are same age grp leh...my share certificate frame up still lying in 1 of my drawers.....That cunning Tan Koon Chuan came out from changi resort went straight to China now big time in Hainanese Island, a very smart guy indeed, dat why Ms Penny so loyal to him (old cow eat young grass)

Opposition Shock Win ( it has happened in Taiwan, Korea, Malaysia, Japan, Thailand etc ) ...wow swee, i will be more happy than touching lottery.....how abt oldman up lorry..will market crash? cos no 1 can escape death, his 1 way board pass is getting nearer, this is logic...most likely he cannot last until next term...

Bro W, I did park some fund in HK stock market (5%)......SG stocks market quite substantial in term of amount...CPF (aro 200k, half of the amt kena locked in by minimum sum)....of cos 70% in ppty, hehe...quite unbalance hor but most of my gain came from the later.

But based-on our age at most we can see 1 more crash....and i m very sure definitely there will be a crash in some part of the world we dunno where and when only? The current world market is very fragile.

[iam802]

..

But based-on our age at most we can see 1 more crash....and i m very sure definitely there will be a crash in some part of the world we dunno where and when only? The current world market is very fragile.

I'm surprised...only 1 more crash.

From 1997 to 2007-8...we have 3 crashes

[Chinaman]

..

But based-on our age at most we can see 1 more crash....and i m very sure definitely there will be a crash in some part of the world we dunno where and when only? The current world market is very fragile.

I'm surprised...only 1 more crash.

From 1997 to 2007-8...we have 3 crashes

Let recall:
1. 1985 SG 1st recession...me got pay cut...my sister ask me to buy Leedon hgt only 360K for a 1400 sq ft 3 bedders, but salary below 2k bank dun lend me $, cpf gone to HDB flat, so LL.
2. 1997 Asian crisis.....me dip in ppty, nose bleeding but lucky my spouse exhausted all her CFPF money to help me to 'tong' to redeem the loan in full otherwise rental cant cover mthly installation still have to fork out thousand plus
3. 2000 tech bubble burst...... loss 72k, now see share frighten liao.
4. 2003 SAR.....bot 2 units,low end LH units..now more than 100% profit of purchase price
5. 2008/09 US Subprime....bot a low end FH ppty, but sold after 11 mths make 25% profit of purchase price.
------------------------------
6. 2011- Papies loss 1/3 majority in GE (who said? my aging crystals ball hope so but usually not accurate one )

hehe, me life span short hor....let say another 20 yrs to go, cannot be 1 crash leh but wat i am thinking is after 1 more crash wash hand dun invest anymore liao...carefree, nothing to be binded too.....
my sifu said , if you win better stop and get out dun come back again...after all nowadays very forgetful (absent minded) not sharp and respond slow, hard to make money from stock ...... if one left 20 yrs to breath oxygen, 2.5k expenses per mth..i think 1 million should enough.