Browsed by
Tag: community

Sucker Rally?

Sucker Rally?

Now’s a good time to take some profits.

This post was originally posted here. The writer, Willie Keng is a veteran community member and blogger on InvestingNote, with a username known as @Willie and has close to 120 followers.

Here’s why.

As far as I know about market rallies, my instinct tells me the rally will continue to go on.

I mean, money is flowing, people think we have seen the bottom.

Especially when you’re getting headlines like “Stocks Have Already Bottomed. How We know?”

The Dow has sneaked past the bear’s eyes.

And it’s already up 19%, from the bottom in earlier September. The S&P 500 is up 12% over the same period.

The Dow could possibly go back up past 36,000. The S&P 500 could possibly go back up past 4,000. But don’t take my word for it. I’m just plucking numbers from thin air.

I mean, what do I know about market predictions? I only (try to) collect great businesses.

What’s driving this bear market rally

First, in yesterday’s meeting, the Fed said they could slow down rate hikes (but more on that later), which is a good thing since this tells me actual inflation could have slowed down.

US mortgage rates have fallen, and other currencies are strengthening against the USD, which means capital is flowing back to emerging markets — or riskier assets.

I mean, the market can go from believing nothing will go wrong to believing that nothing will go right, in a flash. That’s Mr. Market. Well, at least that’s my reality of Mr. Market.

The kind of delusional optimism that will continue to push the rally on.

Or what it’s called – a sucker’s rally.

The same delusional optimism that a bold investor once said Tesla could reach $4,000 per shares in 2025.

Market cycles tend to average 33% down before they recover, some could take longer, some could be shorter – and we still have more room to go.
There are still places where they have yet to sort things out.

The UK is still in some sort of recession — fighting inflation and dealing with their fiscal deficits.

China is still dancing along theput your one leg in, one leg outcovid policy. In the most recent news, Shanghai has asked new arrivals to stay from public places for five days, starting today.

That means, people going to the 26 million populous city are barred for close to a week, including restaurants, shopping malls, supermarkets and even internet cafes.

Then, the war in Ukraine still rages on.

But what’s crucial here, tech companies, being the broader part of the S&P 500 index, have shown stunning numbers of job cuts:

  • Meta Platforms: 11,000 layoffs
  • Snap: 1,200 layoffs
  • Twitter: slashed by half
  • Alphabet: plans for 10,000 job cuts
  • Amazon: plans for 10,000 job cuts
  • Also, Apple has also stopped hiring

The thing is, when global companies freeze headcounts and cut budgets, these big companies are just getting started. What about the small businesses that drive the bulk of economies?

When businesses project gloomy time ahead, they cut spending. For consumers?

Instead of buying that thirteenth fridge, perhaps you might stick to just one.

Or perhaps just grab dinner from the hawker stall downstairs, instead of dining at Haidilao.

Well, it’s what’s looming on the horizon that could catch almost everyone by surprise.

“Most Federal Reserve officials say slower rate hike pace appropriate ‘soon’”

That’s what I got from this morning’s paper.

I wouldn’t take this as a sign of renewed optimism. At the end, it’s not how fast or how slow interest rates go up.

And who knows, the Fed could have rates go beyond 5%, since rate hikes have toppled the yield curve to a shape that doesn’t make sense for any bond analyst.

When the yield curve inverts, this is a warning signal (see red circles):

10-Year Treasury Constant Maturity  Minus 2-Year Treasury Constant Maturity
10-Year Treasury Constant Maturity Minus 2-Year Treasury Constant Maturity

Read More Read More

A simple Trading Strategy with a winning rate of 88.89%

A simple Trading Strategy with a winning rate of 88.89%

In today’s training, I’ll share a trading strategy with an 88.89% winning rate.

A simple Trading Strategy with a Winning rate of 88.89%

This post was originally posted here. The writer, Rayner Teo is a veteran community member and blogger on InvestingNote, with a username known as @Rayner and has close to 750 followers.

I’ll give you the following:

  • Exact trading rules
  • The performance matrix of this strategy
  • Examples
  • And much more

Are you excited?

Then let’s get started.

So first…

What is the strategy with a winning rate of 88.89%, and how does it work?

The core idea behind this trading strategy is that it’s a pullback stock trading strategy.

Why not a breakout, you may ask?

Because in the long run, the stock market is in a long-term uptrend as it tracks what the economy is doing.

The US Stock Market has been in a long-term uptrend since the 1900s because the US economy back in the 1900s compared to today has improved!

It’s the same thing for other stock markets in other parts of the world.

But here’s the thing…

Just because a market is in a long-term uptrend doesn’t mean it goes up in one straight line.

What do I mean?

In the short run, prices could go below their valuation because of panic selling and profit-taking.

These are often called “corrections.”

As pullback traders, we can take advantage of it.

Makes sense?

Let’s now go to the meat of this training guide…

Read More Read More

Is it Time to ‘Run Road’?

Is it Time to ‘Run Road’?

‘Run Road’ (or in Chinese known as 跑路) is a layman term to describe the act of ‘dropping everything and just run away.’

This post was originally posted here. The writer, Jun Yuan Lim is a veteran community member and blogger on InvestingNote, with a username known as @ljunyuan and has close to 2000 followers.

This is the exact scenario happening in the stock market right now, where many dumped their stocks out of extreme fear (that a recession is coming and their stocks could potentially lose even more) and in so doing, ended up burning a BIG hole in their pockets.

Question: Is this a sensible thing to do, and more importantly, for those who are still holding on (to your stocks), should you also follow the crowd to dump everything and ‘run’?

In this post, you’ll find my analysis about the current situation, outlook ahead, and also what I would do (both as a long-term investor, as well as a short-term swing trader):

Read More Read More

Index Trading Rally – Week 1: How Wil The HSI Perform? # Win Prizes Up To $5000 Now!

Index Trading Rally – Week 1: How Wil The HSI Perform? # Win Prizes Up To $5000 Now!

HSI is at currently in the red for the week – this means for previous days’ polls (61%, 64% respectively) the majority votes are correct!

Do you think 72% of this poll will be correct on the HSI closing lower today? 

Participate & win up to $5,000 worth of prizes in this online event here: https://bit.ly/INDEXTRALLY

Also, catch our Youtube Livestreams & stand to WIN $200 Capitaland Vouchers!

Week 1: HSI Trading Webinar with professional day trader & top-tier trading rep, Robin Ho here: https://lnkd.in/gKcckuTr


InvestingNote is the largest & most active community of investors & traders in Singapore & Malaysia. Find out more about us here.

Download our free app here:

apple
android

Also, join our telegram channel here: t.me/investingnoteofficial

We’re here to keep you in touch with the latest investing & stock-related news, happenings, and updates!

Boot Barn Holdings Inc. ($BOOT) – What You Need to Know about the Largest Lifestyle Retail Chain in the United States

Boot Barn Holdings Inc. ($BOOT) – What You Need to Know about the Largest Lifestyle Retail Chain in the United States

Founded since 1978, and currently with 273 stores in 36 states, Boot Barn Holdings Inc. (NYSE:BOOT) is currently United States’ largest lifestyle retail chain devoted to western and work-related footwear, apparel, and accessories.

This post was originally posted here. The writer, Lim Jun Yuan is a veteran community member and blogger on InvestingNote, with a username known as @ljunyuan and has close to 2000 followers.

Some of the brands (which Singaporeans are probably familiar with) you can find in the company’s retail and online stores include Carhartt, Dickies, Wrangler, and Timberland Pro.

In this post, you’ll learn about some of the key performances by the company over the past 8 years (between FY2014/15 and FY2021/22 – the company has a financial year ending every last Saturday of March), such as its financial performances and its debt profile. I’ll also be sharing whether or not the company’s current traded price is considered ‘cheap’ or ‘expensive’ based on its current vs. its 8-year valuation.

Let’s begin:

Total Revenue & Net Profit:

Read More Read More

Our First Business Trip To Malaysia!

Our First Business Trip To Malaysia!

No alternative text description for this image
KOL Gathering – We invited KOLs from Malaysia to have a gathering and networking session.

In 2020, we expanded our team and business in Malaysia. Since it was the beginning of the pandemic and our headquarters being in Singapore, we’ve only met most of our Malaysian team members virtually.

So, this is the first time both teams finally met in-person, after going through the many project developments and meetings over the last 2 years!

It was also a good opportunity to catch up with many of our Malaysian partners, prominent financial influencers and community members!

Key takeaways from the trip:

✅ Sincerity & groundwork are key pillars for building a sustainable community
✅ Understand the nuances of cultural differences – this increases communication chemistry
✅ Always find a good balance between work & fun!

Here’s a big thank you to our wonderful Malaysian teammates for hosting us for the week. Our team bonding activity at Genting was awesome!

p.s. everyone looked better in-person 😎

Read More Read More

TECFAST – An Almost Guaranteed 80% Upside?(Guestpost)

TECFAST – An Almost Guaranteed 80% Upside?(Guestpost)

TECFAST (0084) : An Almost Guaranteed 80% Upside?

This post was originally posted here. The writer, Teoh Tian Heng is a veteran community member and blogger on InvestingNote, with a username known as @thteoh58.

 

Dear investors, if you are reading the article, that means that you surely are not settling with a mere 10% to 15% rate of return per annum for your investments. I mean, who does?

Anyway, the article today will show you a qualitative and quantitative study on the business of TECFAST as well as the finances, as to how this company could be almost guaranteed to deliver a MINIMAL of 60% upside.

Qualitative Studies

TECFAST (or the “Company”) had an elaborate plan as to what, and when to venture into the oil and gas business. Dated 6th November 2020, we noticed that there is an LOI between Fast Energy Sdn Bhd (“FESB”), a wholly owned subsidiary of TECFAST and Zillion Oil Timor LDA. This marks the very beginning of journey for TECFAST to enjoy the recovery of busy offshore activities as well as the recovering oil price.

However, the LOI does not show any materialized information. It was until 15th March 2021 that the Company starts to deliver on what they promised.

Dated 15th March 2021, the Company had entered into a supply agreement between FESB and Wise Marine Pte Ltd (“Wise Marine”) – one of the largest ship management services players in Singapore, with a total contract value of RM2,222,856,000.00. With this size of a contract, it is normal for investor to treat it as some “not realistic”. Hence, the reflect in share price upon the announcement.

A deeper study into a contract would note that FESB would supply up to 30,000 metric tonnes of low sulphur fuel oil, low sulphur marine gasoil and high sulphur fuel oil per month to Wise Marine. The marine gasoil or fuel oil are collectively known as Marine Gas Oil (“MGO”). MGO are mainly used to power offshore transportation vehicles, such as oil tank, vessels, bunker ship and so forth. It is also interesting to point out that whatever FESB was selling to Wise Marine are based on a certain premium on top of the costs, are more commonly known as the “Cost-Plus” basis. This does not mean that FESB will never suffer losses, but as long as MGO prices are stable or on an uptrend, TECFAST as the holding company, would be the beneficiary of it.

A reference on Singapore Mogas 95 Unleaded Futures could see that since July 2020, the prices of MGOs are increasing on a steadfast trend.

Read More Read More

Koda – Clear surge in furnishing spending trend(guestpost)

Koda – Clear surge in furnishing spending trend(guestpost)

Koda – Clear beneficiary of the surge in home furnishing spending trend (1 Jun 21)

This post was originally posted here. The writer, Ernest Lim is a veteran community member and blogger on InvestingNote, with a username known as @el15 and has 500+ followers.

Since 20 Aug 2020, Avarga has more than doubled from $0.146 to close $0.305 on 1 Jun 2021. Avarga’s strength is likely attributed to its 69.7% stake in Taiga (Taiga is Canada’s largest wholesale distributor of building materials, such as lumber, panels, doors, engineered wood, roofing and others). Taiga’s business has been flourishing due to the strength in home furnishings and the housing market in Canada and US.

By extension, Koda may be another proxy to benefit from the surge in home furnishing spending trend. It is noteworthy that Koda is an Original Design Manufacturer / Original Equipment Manufacturer to its customers in North America. In fact, customers in the North America region constitute approximately 55% of its FY20 revenue. Its forte is in home furniture, and it is possibly the largest dining room furniture exporter in Southeast Asia. Home furnishing seems to be in demand as consumers stay at home and have more disposable income to spend (rather than travel) to improve their homes.

In fact, Koda’s 1HFY21 revenue and net profit jump 16% to US$39.6m and US$4.8m respectively on good demand for furniture.

Given this promising backdrop, it may be timely to take a closer look into Koda. I have the privilege of meeting Mr Joshua Koh, CEO of Commune Lifestyle Pte Ltd and Mr Kenny Zhang, CFO of Koda (“Management”) for a 1-1 discussion over Koda / Commune’s operations and prospects via Zoom. The below is my personal interpretation of my discussion with Koda’s management and my own inferences from Koda’s announcements on SGX.

 Koda’s & Commune’s background

Koda was established in 1972 by Mr Koh Teng Kwee. It started by producing wooden TV and speaker cabinets. Since its inception, Koda has progressed from being an Original Equipment Manufacturer (OEM) to an Original Design Manufacturer (ODM). Its forte is in home furniture, and it is possibly the largest dining room furniture exporter in Southeast Asia.

Besides its ODM business, Koda established Commune Lifestyle Pte Ltd in 2011. This is their in-house brand and managed by the 3rd generation of the founding Koh family. Commune has presence in Singapore, Malaysia, China, Philippines, and Hong Kong. Readers can refer to the respective websites for more information on Koda (click HERE) and Commune (click HERE).

Koda has been listed on SGX since 18 Jan 2002.

 What is so interesting about Koda?

Outlook continues to be bright

Based on 1HFY21 results (financial year ends in June), management continues to see encouraging growth in their export orders and they expect the capacity utilisation rates for our key factories to remain consistently optimal. This is attributed to generally higher demand for furniture arising from work-from-home arrangements.

Their recent proposed acquisition of Land Use Right and a factory building in Long An Province, Vietnam (see announcement dated 25 Mar 2021) to expand their production capacity corroborates the positive momentum that they are seeing in their business.

Margins are likely to be steady amid strong demand

Notwithstanding the rise in costs from timber, fabric, metal frame, foam, and shipping etc, Koda believes that they should be able to maintain their current gross profit margins (“GPM”) of around 30 – 32%. This is because firstly it can pass on such costs to the customers amid strong demand. Secondly, their Commune business has GPM of around 50%. As this segment grows and becomes more significant, it may even be able to raise its overall GPM to above 30 – 32%.

Read More Read More

Future Insurance Policy Illustrated Investment Rate Reduced(guestpost)

Future Insurance Policy Illustrated Investment Rate Reduced(guestpost)

Future Insurance Policy Illustrated Investment Rate to be reduced to 4.25% and 3.00% from 4.75% and 3.25%.

This post was originally posted here. The writer, Kyith Ng is a veteran community member and blogger on InvestingNote, with a username known as @kyith and has 1,000+ followers.

Last week, we received an announcement that with effect from 1st July 2021, the policy illustrated investment rate (PIRR) will be lowered from 4.7% to 4.25% and 3.25% to 3.00% respectively.

What is Your Policy’s Illustrated Investment Rate (PIRR)?

Some of your insurance policies accumulate cash values. You contribute additional capital, on top of insurance charges to it.

The insurance companies will take your capital and invest in a participating fund. You can see this partipating fund as a pool of stocks, bonds, cash, property investments managed by a group of managers, much like your unit trust, hedge fund with a certain mandate.

 The performance of this participating fund’s return determines how much cash value is accumulated.

Typically, endowment planslimited whole life plans are the kind of policies whose cash value is tied to the performance of the participating fund.

Term plans do not accumulate values so they are not impacted by this illustrated investment rate in any way. Investment-linked policies (ILP) performance is tied to the underlying unitt trust chosen and therefore are not affected by this. Universal life policy returns are typically determined by crediting rate or a hybrid benchmark for those indexed link, so they are less affected by this as well.

The following extracts are taken from a policy’s benefits illustration:

You can see that there are two investment rate of return provided to illustrate to you how much value your policy will accumulate in due time.

One is a optimistic rate (4.75% a year) the other is conservative (3.25% a year)

This is for illustrative purpose. It does not mean that the eventual investment return will fall between 3.25% and 4.75%.

 Here are the actual historical investment return of different insurance companies:

You will notice that year to year, the investment return varies.

Read More Read More

Learning to Die with Zero. The Last Check Must Bounce (guestpost)

Learning to Die with Zero. The Last Check Must Bounce (guestpost)

My friend Christopher Ng recommended to his reader to read this book by Bill Perkins called Die with Zero.

I do not know whether it is a good book or not but I think it might be thought provoking enough for me to read it.

Die with Zero sought to answer a core question we all seek:

What’s the best way to allocate our life energy before we die?

This post was originally posted here. The writer, Kyith Ng is a veteran community member and blogger on InvestingNote, with a username known as @kyith and has 1,000+ followers.

When Bill released this book, I also heard many interviews that he did to promote his book. This book… might be the book to help re-calibrate my thinking. After doing so much research on how much a person need to accumulate so that they won’t run out of money in retirement, we need a book to teach us not to spend all our time accumulating.

Is this a good book? Personally, I find it hard to connect with.

In this article, I list out some of the notable takeaways from Bill Perkins.

Consumption Smoothing

The first concept that Bill explained was consumption smoothing. Bill took a page out of a time when he started working not too long ago. Back then, he was very thrifty and extremely proud about it.

However his boss, who is a partner at the company he worked for was astonished he was saving so much.

 “Are you a f***ing idiot? To save that money?”

It was a slap across Bill’s face.

 His boss Joe Farrel said: “You came here to make millions, ” he said. “Your earning power is going to happen! Do you think you’ll only make 18 thousand a year for the rest of your life?”

In his boss’s mind, Bill would eventually made much more than that.

He could certainly spend today and not save this sum of money.

It was a life-changing moment for Bill as it cracked his head open to new ideas about how to balance his earnings and spending.

If we look at our income chart over the years, it should be upward sloping. Due to our experience over time, we should earn more.

If we know that, we should be able to spend a greater percentage of our income today because eventually, we will make more and our savings rate will go down, but the savings in the future will make up for the higher consumption today.

We will basically transfer money from years of abundance into the leaner years.

What is difficult to connect for a lot of people is how much higher would your salary be in the future?

To use myself as an example, some of my peers are currently director of security while others are still a team lead in a small company.

If we smoothed out our income, the director of security and the team lead would be totally different.

I get the idea but I think whether it is sensible for us to do that or not is subjective.

Investing in Experiences

Your life is the sum of your experiences.

Read More Read More