IME STOCK PORTFOLIO UPDATE

Quick update for our IME Portfolio

Added KANGER (0170) to our portfolio.

Purchased 6800 units at RM0.315.

Invested amount is RM2142.00

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Cheers and Happy Investing

UNDERVALUED COUNTRY FOR INVESTING, IS THERE ANY LEFT?

I came across an interesting article from Morningstar UK published on the 11th of August 2014 that talks about identifying countries stocks which are still undervalued at that point of time. The countries fair value are rated according to Morningstar's own quantitative price/fair value [ratio] at the country level. Readers please don't ask me how Mornigstar does the calculation as I have no idea either.

The point is to identify countries with stocks that are still undervalued for investors to invest in at that point of time. The good thing is that instead of reading the post, the people at Morningstar were nice enough to illustrate their entire post into a single diagram as shown below:

Undervalued Countries
(Click to Enlarge)

As clearly shown, the lower the value the more undervalued the country is and vice versa. 

Let me just list down these countries from most undervalued to most overvalued as of 11th August 2014:

• Russia (-6.4)
• Brazil (-5.5)
• Australia (-1.2)
• China (-1.1)
• UK (-0.5)
• Chile (0.4)
• Japan (0.5)
• South Korea (1.2)
• France (1.7)
• Mexico (4.1)
• South Africa (4.3)
• New Zealand (4.6)
• Germany (5.1)
• Canada (5.2)
• United States (5.3)
• Sweden (5.5)
• Portugal (5.7)
• Spain (6.4)
• Norway (6.5)
• Finland (8.6)
• India (9.6)

Now the interesting point here is to see how the indices of these undervalued countries have performed ever since the article was published on the 11th of August 2014 (Approximately 8 months plus ago)

I shall be showing the performance of indexes of Brazil, Australia, China, UK, Japan and South Korea. Unfortunately Russia, Chile and France are left out as there are no mutual funds available to invest in these countries from Malaysia. 

Performance of Undervalued Indexes:

BRAZIL

IBOVESPA (Sao Paulo Stock Exchange)

Index : IBOVESPA

Period : 11 Aug 2014 to 22 Apr 2015

Gain/Loss : -1.72%

AUSTRALIA

ASX 200 (Australia Stock Exchange)

Index : ASX 200

Period : 11 Aug 2014 to 22 Apr 2015

Gain/Loss : +7.40%

CHINA

SSE CI (Shanghai Stock Exchange)

Index : SSE CI

Period : 11 Aug 2014 to 22 Apr 2015

Gain/Loss : +100.44%

UK

FTSE 100 (UK)

Index : FTSE 100

Period : 11 Aug 2014 to 22 Apr 2015

Gain/Loss : +7.02%

JAPAN

NIKKEI 225 (Japan)

Index : Nikkei 225

Period : 11 Aug 2014 to 22 Apr 2015

Gain/Loss : +36.24%

SOUTH KOREA

KOSPI CI (South Korea)

Index : KOSPI

Period : 11 Aug 2014 to 22 Apr 2015

Gain/Loss : +5.55%

Summary:

Ranking based on gains made from 11 Aug 2014 to 22 April 2015 for the above indexes are:

1. China (+100.44%)
2. Japan (+36.24%)
3. Australia (+7.40%)
4. UK (+7.02%)
5. South Korea (+5.55%)
6. Brazil (-1.72%)

For many of us, China and Japan have probably fallen into the Overvalued category as of date. At the same time it is easy to assume that there are opportunities for investment in Australia, UK, South Korea and Brazil as the gains are still single digits or negative in the case of Brazil.

On the other hand, if you look at a wider horizon, you may see an opportunity for further gains in the China equity market. China's SSE for example is still 1500 points away from the highs of 2007 as shown below:

Opportunity for growth in SSE

The same opportunity of gain might not apply for Japan's Nikkei which has just hit an all time high 15 year high as shown below:

Nikkei breaching 20,000 points

In a nutshell, we cannot simple assume that a coutry that has made large gain will not continue to do so. At the same time, we might want to find out why some indexes fail to take off. Are there issues in that particular country that makes it unattractive for investors? 

Hence, it is advisable for an investor like you to do further research and read up on the economic outlook of these countries before investing. Remember every effort and time you spent goes toward helping you to make better judgement and decisions!

Cheers and Happy Investing!

Helping You To Invest : 
Would you like the option of investing into unit trust funds with the following benefits:

1. Invest into any fund at only 2% Sales Charge (instead of the 5-6% as charged by Agents)?
2. No exit fees.
3. Have full control over your investment (buy, sell and manage your investment without the need to to through agents)?
4. Enjoy the option to invest in a vast variety of funds (>200 funds), thereby allowing you to invest in different countries and sectors!

Then drop me an email at shanesee03@gmail.com to find out more!

TENCENT HOLDINGS.....DRIVING THE HONG KONG EQUITY MARKET!

Just a short sharing which has relevance with my previous post on "Invest In Hong Kong Equities And Stand To Make More Than 30% Return".

I read with interest an article posted in TheStar yesterday. Despite being a small article, the heading "China's Tencent hits US$200bil market cap for the first time" caught my attention immediately as I recalled seeing the company's name somewhere.

So I read the article as shared below (for your reading convenience) :

Tencent Holdings Hits US$200 billion market cap!

The portion (highlighted in the red box) once again mentioned that the recent surge in Hong Kong listed stocks such as Tencent Holdings was largely due to the influx of funds from China. The article also states that it is expected more money to come pouring into Hong Kong*

*Take caution that the "Expect more money going into Hong Kong" claim is posted by the article. I'm in no situation to tell you whether it is still early or it is too late to invest into Hong Kong. That decision to invests into Hong Kong or not lies in your own effort to do sufficient amount of research and due diligence before investing.

Now I mentioned earlier that the name Tencent Holdings looked pretty familiar and so I did some checking again. Lo behold, I discovered that Tencent Holding is one of the key holdings of the the fund that allocates more then 90% of its fund size into Hong Kong Equity market.  

As a matter of fact, Tencent Holding is the top holding of this fund at 10.63% as shown below:

Fund Holdings taken from the Fund Factsheet

As an investor whom has also invested in this fund since 2014, I am more then happy to give credit the Fund's Fund Manager for having the foresight to invest into Tencent Holdings even before the influx of China money started. Kudos and well done!

Cheers and  Happy Investing!

P/S : Like to know more about this fund? Feel free to drop me an email at shanesee03@gmail.com
P/P/S : I am unable to disclose the name of this fund as it would be deemed bias by other fund houses. So stop accusing me of being a salesman or creating a gimmick. What I am sharing are facts, and my honest opinions.
P/P/P/S : The fund has so far returned me a handsome +50% gain since investing into it from 2014.