Sunday, 20 November 2016

We have forgotten - Asian Financial Crisis

I guess most of us only remembered the last Great Financial Crisis, starting with the housing toxic securities which the bubble finally burst in 2008/2009. How many of us still remembered the Asian Financial Crisis and how it started. This site here has documented the entire timeline and events if you are interested. Why am I writing this out of the blue.

In the past weeks, after Trump won the US Presidential Election, the USD has strengthened and the regional currencies weakened. Some Asean countries' currencies (Malaysia, Philippines) have dropped in a terrifying speed. Looking back, in 1997, as we all know by now, the AFC was started from Thailand due to the crashed in it's currency by as much as 20%, and situation were further aggravated by the huge infrastructure spending. 

Last week, we witnessed the Malaysian Ringgit devalued about 33% from a norm range of RM3.3 against the USD, and Philippines Peso devalued about 14% from a norm range of PHP43.6 against the USD. Similarly to 1997, these 2 countries were also spending lots of money on their infrastructure. 

Historical events can be an important learning lessons for all of us(that's if you learned something from it), however it does not mean that the same event will happen again(hopefully). But if it does, we should be more prepared this time to capitalise on it. In a lighter note, it's time for more shopping in our neighbourhood country☺.

Sunday, 13 November 2016

These high yield blue chips performed well during the US Presidential Election week

It has been an interesting week, but for some, it has been a roller-coaster feeling, the market was behaving erratically during the Presidential Election day and the day after. I was hopping that the market will react drastically downwards so that I can capitalised on it, similar to my purchase of HSBC during the week of BRexit. But as we all know by now, the market crawled back and cover what was lost earlier.

One of the STI component stock I noticed moved against the tide and market. On 9Nov, when the entire market was corrected, the price of this blue chip was resilient and moved upwards. This stock is Yangzijiang.

This stock moved up with huge volumes on the few days of the US presidential election when most of the market is correcting downwards. Is this going to be a reversal of the downward trend for YZJ? Do note the gap between the 50MA and 200MA is still huge, but what's the harm in collecting the about 5.5% dividend while waiting.

The other stock is one of our local bank, DBS. 
We have read many times that if the interest rates is raised, one of the sector to benefit from it, will be the banking sector. This could be one of the reason why investors are making the plunged now to buy the stock. From the chart, can DBS pierce through the $16.2 resistance and continue in a upward trend?

Let me know your analysis of these 2 stocks.

I am long on both stocks.