KLCI is now at 19x trailing PE.

https://www.bloomberg.com/quote/FBMKLCI:IND

Historical average is around 16x (exact is depending on how far back you go).

During end March, the index was at 14+x PE. Still not super cheap but there were some pretty good deals in individual stocks that I managed to pick up.

Of course, I was getting ready for market to fall further to 2008 levels of PE of below 10x. That would mean KLCI around 1000. Would have bet the farm if that happened. But it didn't.

As for now, globally I think markets are priced for a V shape recovery. Meaning 2021 is full recovery.

Whether this happens or not, who knows for sure. But, as you said earlier, we need to keep an open mind right?

This post has been edited by Cubalagi: Jun 7 2020, 11:08 AM

Poor TS..

I do enjoy this thread. It s a reminder of the Bear and that is always a good reminder. So I like thank TS for this thread. 👍

Of course, I completely disagree with his approach, which to me can't be called investing. If one was strongly bearish for the past 1.5 years, there were many ways to earn good returns by capitalizing that view.

Interest rates dropping are good for Treasuries. Price go up.

Many investors do buy Treasuries for capital gains, mostly institutional types, but I also use the same type of strategy. I am using Trasury ETFs. It's pretty good $$$ at low risk.

This post has been edited by Cubalagi: Jun 12 2020, 07:44 AM

Junk bonds are not Treasuries. It's more equity like in behavior with higher risks and returns. (However, with the Fed buying junk bond etfs, the downside is pretty much capped for US junk bonds).

There are basically 3 categories Treasuries, Investment Grade and Junk (also called High Yield).

My biggest bond position is currently ABF Singapore Bond Fund, which is Singapore govt treasuries. Basically, super safe bonds.

https://www.bloomberg.com/quote/SBIF:SP

The dividend is probably like 1+% only now and is payable end Dec. But capital appreciation YTD is 6.5%. Not bad for less than 6 months in a "safe" investment. Compare that with the STI which is still - 16% year to date.

I do think price has topped though, and I'm reducing. But there could be more upside if the global recession lingers. Definitely can jump if economy gets worse and US go negative rates. So I will still keep a big chunk to hedge for that possibility.

The risk is the world economy get better fast and interest rates start to go up. Then the capital gains can evoporate and might even have capital loss. However, most economists don't see interest rates going up anytime soon.

But since we can never really tell the future, it's good to be diversified.

This post has been edited by Cubalagi: Jun 12 2020, 01:15 PM

I think that's a real possibility. Buy the dip in any corrections..


30% potential upside. TS can still catch it.. 😆

For individual investors, single bonds are usually buy and hold till maturity. Usually only institutions actively trade single bonds.

But nowadays, with ETFs, both institutions and investors can trade bonds rather effeciently and realize capital gains. ETFs like TLT and HYG in the US are popular with institutions and retail.

I also hold single bond, which I intend to hold till maturity. But since last year I started to diversify and invest into bond etfs to take advantage of the falling interest rate trend. So I got decent capital gains. It's not a get rich product tho..

This post has been edited by Cubalagi: Jun 13 2020, 06:13 PM

U probably got it at a premium. Nominal value 100, but banks sold to you at 101. So at maturity, u only get back 100. It's like the banks hidden sales charge.

There will be more volatility ahead, but I think it is very unlikely we will hit the March lows. That's 1207 points for KLCI, 2208 for STI and 2191 for S&P500.

I agree No 4 is something to watch out for. If US congress pass another stimulus by end of next month, it will be party time.

And a correction will be good and will be your second chance to enter. Look at oil & copper prices and baltic dry index, all trending up.

Since you mentioned Malakof, you could have reused the same strategy this time and made decent gains now. Malakof is in fixed IPP contract, waste management (Alam Flora) and water production (Middle East). All critical services.

Malakof share price dropped to 0.65 at its lowest in March. As at last week Friday, its back to 0.90 where was its peak earlier this year before the Covid MCO. On top of that, it paid cash dividends of 0.0411 early this month.

This means a gain of 0.2911 or nearly 45% total return from 0.65 sen. In 3 months..

But of course you missed it...

This post has been edited by Cubalagi: Jun 22 2020, 12:14 AM

1MDB is history, money already paid back to Malaysia.🤣 Anyway, Malakof has nothing to do with 1MDB in the first place. I have this in my portfolio as a dividend play, and March was a good chance to top up and increase my yield.

What I have been buying of late though are Singapore equities, which is still cheap, and also added more Gold.

This month, I hv trimmed/reduce positions from the well performing ones. Proceeds put in some lagging counters and rdt in cash waiting for more correction.

On KLCI sub indices there areany KLSmall Cap, KL Mid gap, energy, reits etc but I don't know any free sources that gave free historical numbers.

Give to you haha.. U will just put in savings account! 😆

Bulls are back!

Right now Im keeping an eye out on US covid-19 death rates. It's been falling, despite the big jumps in infections. So that's helping the market. But death numbers tend to lag, so if there is a jump, then fears will return.

Secondly is that the US helicopter money from CARES Act will expire by end of July. If this is replaced by another round of stimulus, it will be quite bullish.

On Malaysian front, I will keep an eye out on BNM MPC meeting next week, whether there will be another interest rate cut. I think they will hold and wait and see the impact of earlier cuts and stimulus. But you never know, and BNM has room to cut.

Lastly Singapore elections end of next week, which should be anothet landslide for PAP.

I give you more bearish news..

IMF says that Asian economy won't recover from the economic damage of Covid-19 even by year 2022.

https://www.bloomberg.com/news/articles/202...nd=premium-asia

Yup, they have FANG. We have gloves.

TS still researching..


How come? Must be u bought SPx in Feb this year?

Next week should be start of more exciting times for US. Earnings season will start and later part of the month there will be talks of further stimulus. On top of this, you have the recent huge spike of covid-19 cases.

This post has been edited by Cubalagi: Jul 5 2020, 11:16 AM

LOL. My fav thread in lowyat investment forum. Is back.. 🤣

Happy New Year everyone, esp TS!

Hope for an even better year next year.