Winston's Investment Ideas 04 (Oct 15 - May 19)

Re: Winston's Investment Ideas 04 (Oct 15 - Jun 19)

Postby winston » Sun Mar 10, 2019 2:31 pm

TOL @ Mar 10, 2019

Big One.jpg


Beginning Of The Big One?

The markets have been down over the past few sessions.

Some of my friends are no longer so confident after chasing this rally. Others are still pretending to put up a brave front but are secretly hoping for a rebound so that they could sell.

I'm also starting to hear comments that this could be the beginning of the big one, similar to the time around last X'mas.

Intuitively, I think that this is not the beginning of the big one. The big boys still have some Cash and the Central Banksters still can lower rates and print money. Main Street is still not bleeding yet.

At the same time, if you a fan of "CANSLIM", you should be selling now as the "Market Direction" is not in your favor.

At this point in time, my gut feel is that there's still no catalyst for a strong plunge yet.

An earnings recession may be on the way but it may still take some time to arrive. Europe and China may be in trouble but that would also take a few months to materialize. The USD is still not that high and so are Oil prices.

This is barring a major natural catastrophe, a flash crash or any other unexpected sudden violent event.

Therefore, I may still continue to buy but the story must be a very convincing one.


Weekly Risk Management Progress Report:-
1. To Reduce Equities: No Progress (11% from 11% last week, of Liquid Assets);
Goal: Zero Equities before the next recession (2020-2021?)
2. To Diversify From Asian Equities: Progress (70% from 71% last week)
Goal: To reduce percentage of Asian Equities to 50%
3. To Buy Inverse ETFs and Puts - Waiting for "M" on charts.
Goal: To have a sizable short position going into the next recession
4. To Increase "USD/HKD/Gold" - No Progress ( at 28%)
Goal: To be in safe havens before next recession; (HKD may be repegged)
5. To Reduce Number Of Counters To 8: No Progress (11 from 11 counters last week). Goal: To focus on 5 to 10 counters that have convincing stories


Market Risk Indicators
1. Euphoria: 7 (Low: 1; High: 10) - FAANNG, ETFs; Margin Debts; SWFs; Central Banks; Fund Flows;
2. Credit Problems: 8 (Very Good: 1; Very Bad: 10) - Housing, Subprime Auto; Student Loans; Credit Cards; Junk Bonds; EM USD Loans;
3. Recession: 8 (Strong Economy: 1; Depression: 10) - GDP; Taxes; PMI; Housing; Auto; Retail; NAFTA; Trade War; 2019?;
4. Liquidity: 8 (Very Liquid: 1; Tight 10) - QE (Feds, ECB, BOJ, PBOC); Interest Rates; Rotation (Bonds); Asset Shrinkage 2018?; EM; Italy;
5. Inverted Yield: 7 (Low Inversion: 1; High Inversion: 10) - Rising Interest Rates; Slope; Inversion; US 10 Years < US 2 Years; Expecting 2019 to 2020
6. Valuation; 7 (Safe 1: PE15; Danger 10: PE30) - PE S&P 24, Nadsaq 26; Revenue; USD; Tax Reform; Deregulation
7. Geopolitical Issues: 8 (Peaceful: 1; War: 10) - Iran; South China Sea; Europe; Russia; Saudi Arabia
Total: 52 out of 70 (74%); (Safe: 50%; Danger: 80%)


Commodities: Mixed (Data from Commodities Live on March 09)

1. WTI Oil - Lower. US$55.98 from US$57.37 last week from US$57.51 two weeks ago; Support: US$43; US$34; Resistance: US$75, US$105
a. Trade Wars will reduce demand for Oil? -500k bpd?
b. Global Stockpiles: 2.5b barrels;
c. US SPR: 679m barrels (33 days); To sell 190m over 8 years.
d. US imports 8m bpd (Total demand of India and Japan combined);
e. China (4th largest producer; largest importer) - Reserve life: 10 to 6 years
f. China: Ban on Petrolchemical Cars in 5-10 years? Quotas?
g. IEA: Lowest amount of new discoveries; Supply shortage in 2020?
h. Saudi: Aramco's IPO 2021? -1.3m bpd (35% cut in supply)
i. China: SPR 51/90 days; 2019 imports to decrease?
j. Libya: -850k bpd; Brazil +200k bpd; Canada -325 bpd; Nigeria -300k bpd; Iraq -150k bpd; Kurdistan -350k bpd; US +1m bpd; russia -500k;
k. Venezeula: -1.2m bpd; Worst Case -2m bpd supply (50% cut by 2020)?
l. Iran: -0.7m bpd to -1.6m bpd by 1Q, 2019? 6 months exemption from Nov
m. Winter: lower demand for oil; Glut in US?
n. OPEC: Heavier Crude; More Processing;
o. US: Lighter Crude and Lower Sulphur; Glut in Gasoline
viewtopic.php?f=33&t=7550&start=210

2. Gold - Lower. US$1299 from US$1310 from US$1326
Support: $1150; $1050; Resistance: $1400
a. Global 33k tons; US 8k t; China 5k t; IMF 3k t; Germany 3k t
b. Electronics, Coins, Central Banks Reserve, Jewellery etc.
c. 250 oz of paper contract for every oz of physical gold holding on Comex
d. Output fell by 100 metric tons (3%), from 3,150 in 2015 to 3,050 in 2016
e. Demand increasing in Muslim countries as Gold is now a halal investment
f. Rising USD & Interest Rates, would not be good for gold
g. Gold only occupies 0.03% of US investments. In 1981, it was 8%
h: India Demand: Since 2010, down each year. 2017 (700t); 2020 (900t)
i. China Demand: Since 2013, decreased 33% from 940t to 630t last year
j. Global Demand: 2Q 2018: China +5%; India -8%;
k. Central Banks: +22% yoy; 33k tons; Russian, Turkey, Khazakhstan & India
l. U.S. government holds 260m ounces at book value of US$42m
m. China: Reserves 185m oz; 400m oz ground; Output decreased 6% yoy
n. Strong Selling by Gold ETFs
viewtopic.php?f=33&t=7589&p=202084#p202084

3. Silver - Lower. US$15.36 from US$15.47 from US$15.80
a. Support: US$16.10; US$15.20; Resistance: US$18.50; High: US$49
b. LED chips, Cell Phones, Nuclear Reactors, Photography, Solar Panels, RFID Chips, Semiconductors, Water Purification, Data Storage, Antibacterial products, Silver Coins, Jewelery
c. Demand: 1.2b ounces in 2015;
d. Supply: 0.9b ounces in 2015.
e. 4th year of deficit
f. 35% (7700 metric tons) for Electronics
g. 25% (5500 metric tons) for Bullions & Coins
h. India imports more Silver than the US
i. JPM has 67m ounces
j. High Gold/Siver Ratio: 50 t0 70; Currently 76, 50% higher than average
k, Production declining
l. Demand: 40% Investments / Speculation; 60% Industrial
m. About 1b ounces stored in China; 1 Year Production
n. How will US tariffs on Solar Panels affect silver prices?
viewtopic.php?f=33&t=7589&p=202084#p202084

4. Platinum - Lower; US$819 from US$868 from US$833
a. 28% for jewelry
b. 42% for diesel catalytic converters
c. Remainder for other industrial applications
d. Huge discount to Gold
e. Sixth year of deficit
f. 10 times more gold than platinum
g. Costlier to mine than gold as located deeper
h. Diesel cars losing market share
i. 70% of supply is from South Africa

6. Palladium - Lower; US$1472 from US$1487 from US$1451
a. Support: US$930; US$500; Resistance: $1600 (Citi)
b. Catalytic Converters (Petrol Cars), Electronics, Dentistry, Medicine, Hydrogen Purification, Chemicals, Groundwater Treatment, Jewelry and Fuel Cells
c. Auto industry consumes 80% of supply
d. Demand by Auto industry doubled in past 10 years
e. Growth Demand: 10% in 2019
f. Russia and South Africa produced 3/4 of the world's mined palladium supply.
g. 8th Annual supply deficit;
h. Vehicle: PALL; SPPP (Physical Platinum & Palladium)
i. US Auto Sales weak
j. China - Pollution Programs
k. Supply Deficit: 1m Ounces in 2019
l. Global Stockpiles: 10 to 18m ounces (2 Year Demand)
m. Julius Baer 2020 Target: $1000

7. Zinc - Lower; US$2717 from US$2798 from US$2703
a. Global Demand: +14% pa for past 4 years
b. Supply: 13.7 tons; Supply Deficit 1.2m tons;
b. Breakpoint: High US$4400 (2007); Low $1600 (Jan 2016)
d. Used to prevent rusting, zinc oxide (paints), brass (copper), coins, fertilizer
e. Zinc inventories at the LME have dropped to their lowest level since 2009
f. Vehicle: DB Base Metal (Zinc, Aluminum & Copper); MMG
viewtopic.php?f=33&t=367&start=208.

8. Copper - Lower; US$2.90 from US$2.96 from US$2.95
a. Higher inventories at LME
b. China - 50% of global consumption
c. China - Lower Power Grid demand
viewtopic.php?f=33&t=5598&p=215285#p215285

9. Uranium - Flat; US$28.00 from US$28.00 from US$28.70
a. Breakeven: US$40 per lb; Long-Term Contract - 2x Spot
b. Range: $20 (2005) to $136 (2008); 580% rise in two years
c. Global Supply: 158m lbs pa; 15% from decommisioned weapons
d. Global Demand: 190m lbs pa to 300m lbs pa (2030)
e. Stockpile: 1b lbs (till 2022?) ; Companies normally store 5 years supply
f. Japanese Demand: 3m lbs pa; Starting 21/54 reactors? Currently, only 9
g. No. of Nuclear plants: +8 pa for next 20 yrs, 440 to 595; Current 452
h. 56 new reactors being built; 481 planned;
i. China: 46 existing plants; Building 11; To build 177 more?
j. India: 22 existing nuclear plants; Building 5; To build 64 more?
k. 75% long-term contracts expiring between 2017-25
l. 200 European nuclear reactors will be shut down over the next 25 years
m. France: Reduce nuclear to 50% from 75% by 2025 and closure of 20
n. Apr 14, 2019: US requires 25% local production; Higher electricity cost
o. Kazakhtan reducing supply by 10% (40% of global production)
p. Competition: Natural Gas, Solar, Wind, Wave etc
q. US: Nuclear - 20% of electricity; 99/447 Plants; 25% drop by 2025; Two Year Moratorium on Closure
r. Supply: 50k tons; Demand: 68k tons; 2k tons enriched for weapons
s. 1b pounds to be purchased for long-term contracts over next 5-10 years
t. Average reactor needs around 650,000 pounds to run for a year
u. US: 100/420 reactors; Importing 95% uranium; Demand 50m lbs pa
v. Uranium from Sea Water; Viable at US$180/kg (US$80/lbs); Timing?
w. Glut at 15m pounds (23 reactors for 1 year)
x. Cameco mothballed McArthur River & Key Lake; 10% world's supply
y. Kazatomprom, world's second largest, cut production by 20% for 3 yrs
z. Russia banning export of Uranium?

11. Cobalt; Flat; $14.97 ($33,000/t) from $14.97 ($33,000/t) from $14.06 ($31,000/t); Low $10; High US$43
a. Electric Vehicles (8 kg), Smartphones (8 grams), Jet Engines; Gigafactories
b. Congo: Supplies >50% world's supply; Child Labor?
c. Demand: 8% to 10% pa
d. Shortage: 2022 and beyond
e. Cobalt Reduced EV is 5-10 years away? Musk: Reducing Cobalt in Tesla;
f. 2018: 1m EVs (10k tonnes); 2027: 27m ( 27m tonnes)
g. Glencore - stockpiling till June 2019 (radioactivity); 25% Global Supply
g. Target: 2018 - US$62,000/t; 2022 - US$44.000/t

12. If there's a crash, Commodities would not be spared
10. The strong USD is also not good for Commodities


Equities - Risk-Off (Data as of Saturday every week)

1. US Equities - Lower. 2743 from 2804 last week from 2793 two weeks ago
a. Support: 2320; Resistance: 2820; 3000; Fwd PE 16
b. No Trade
viewtopic.php?f=11&t=7643&start=200

2. HK Equities - Lower. 28228 from 28812 from 28816
a. Support: 24500, 23500; Resistance: 29000; 31200; 31600;
b. No Trade
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120

3. Shanghai Equities - Lower. 2970 from 2994 from 2804
a. Support: 2450; Resistance 2900; 3300; 3600
b. No Trade
viewtopic.php?f=10&t=7190&start=210

4. Spore Equities - Lower; 3196 from 3220 from 3270
a. Resistance 3850
b. Sold some HPL (Dont understand why Wheelock is pulling out of 68 Holdings)
viewtopic.php?f=10&t=6828&start=b110

5. Japan Equities - Lower. 21206 from 21603 from 21426
a. Forward PE 13
b. Support 19000; Resistance 25000
c. BOJ owns > half government bonds and 75% of ETFs
d. No trade
viewtopic.php?f=10&t=7138&start=200

6. Malaysian Equities; Lower; 1680 from 1701 from 1721
a. No trade
viewtopic.php?f=10&t=6292&start=30


Currencies- Risk-Off[b] (Data from XE.com on March 01)

1. USD to JPY - JPY Stronger; 111.13 from 111.87 last week from 110.87 two weeks ago
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Why is it a Safe Haven ?
e. Stronger Yen will not be good for Exports and Japanese Equities
viewtopic.php?f=32&t=4205&start=180

1a. 100 JPY to MYR - JPY Stronger; 3.68 vs 3.64

2. SGD to MYR - SGD Weaker; 3.0073 from 3.0126 from 3.0134
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Weaker; 0.7045 from 0.7108 from 0.7111
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
c. To diversify my AUD into what currency?
viewtopic.php?f=32&t=5256&start=130

4. AUD to SGD - AUD Weaker. 0.9574 from 0.9613 from 0.9622
a. The range is 0.98 (2016) to 1.36 (2012).
b. I would choose the AUD over the SGD

5. AUD to MYR - AUD Weaker. 2.8794 from 2.8961 from 2.8996
a. The range is 2.20 (2008) to 3.41 (2017)

6. EUR to USD - EUR Weaker. 1.1232 from 1.1374 from 1.1321
viewtopic.php?f=32&t=5523&start=100

7. USD to HKD - HKD Weaker. 7.8500 from 7.8487 from 7.8488
a. 52 week range is 7.7452 - 7.8530
b. USD Peg band: 7.75 to 7.85
c. Will they remove the peg to the USD during the next crisis?
d. Will China ask HK to depeg from the USD?
viewtopic.php?f=32&t=3529&start=40

8. USD to MYR:- MYR Weaker. 4.0874 from 4.0786 from 4.0776
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9. USD to SGD:-

9. USD to SGD:- SGD Weaker; 1.3591 from 1.3526 from 1.3531
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country
viewtopic.php?f=32&t=136&start=100

10. USD to CNY:- CNY Weaker; 6.7215 from 6.7048 from 6.7203
a. When is the right time to buy some CNY? How?
viewtopic.php?f=32&t=7720&start=90

11. GBP to USD:- GBP Weaker; 1.3015 from 1.3241 from 1.2975
a. Brexit; Politics;
viewtopic.php?f=32&t=333&start=80

12. GBP to MYR:- GBP Weaker; 5.3200 from 5.3953 from 5.2907

13. Dollar Index - USD Stronger; 97.36 from 96.27 from 96.76
viewtopic.php?f=32&t=7616&start=60


[b]Others


Sentiment - Complacent?

Headwinds
a. Derivatives (US$700t);
b. Debts (US$237t, 318% GDP);
c. Corporate Debt (US$50t); US Corp Debts (US$9t)
d. Institutional Investors (US$0.5t)
e. ETFs AUM (US$3.4t)
f. Bitcoin (US$200b)
g. US Pension Short-Fall: US$385b
h. NPLs at European Banks: EUR$1t
i. China's Bond Market: US$12t (third largest)
j. Private Client Cash Levels as a % of Total Assets: Record Low (10.4%)
k. Institutional Investors: lowest levels of cash for past 8 years; 1/3 high in 2016


Tailwinds
a. Low Interest Rates
b. Cash Sidelines (US$50t)
c. QE US$18t: US (US$4.5t), ECB (US$3.7t), Japan (US$4.4t) & China (US$5.1t)
d. Negative Yield Bonds (US$6t from US$10t)
e. US Foreign Funds Repatriation (US$2.5t)
f. Cash US Corporations (US$1t)
g. Cash Japanese Corporations (US$2t)
h. Buybacks
i. US Household Net Worth (US$90t)
j. EM Consumption
k. Private Equities: US$600b Cash

Risk Management:-
a. Global Diversification
b. Asset Class Diversification
c. Diversity of Industry & Company Exposure
d. Currency Hedging
e. Tactical Asset Allocation
f . Inverse ETFs and Put Warrants

HK Properties
a. Vacancy tax
b. 9000 vacant apartments
c. CLSA, UBS and Citi - Prices may drop 10% to 15% by end 2019
d. Rising Interest rates
e. Slowing Economy / Trade War
f. Depreciating Yuan
g. Weak Stock Markets
h. Justin Chiu (CK Asset): 10-20% drop; Outskirt Nanos (30% drop)

Spore Properties
a. 60,000 Units of Supply (7 years Supply of 6500 Homes per year )
b. Unsold residential units doubled to over 34,000 in 2018

Malaysian Properties
a. JPPH: Overhang - 30,115 units (2018) vs 20,304 (2017)
b. Overhang would be greater if Serviced Residence and SOHOs are included

China Properties
a. 20% of Urban Housing is vacant (65m homes)
b. In 2018, nationwide ASPs have climbed by 15% to a record high
c. Since 2015, Tier One cities have risen by 55%
d. Since 2015, Tier Two cities have risen by 35%
e. Government targeting annual increase of 7% to 10%

Yield on 10 Year US Treasuries - Lower; 2.63% from 2.73% last week from 2.68% two weeks ago
a. Resistance 3.3%

Yield on 2 Year Treasuries - Lower; 2.46% from 2.52% from 2.52%

Interest Rates:-
a. Expecting US Interest Rates to slowly rise over next 2 years
b. About US$9t or about 23% of the world’s bonds have negative yields
c. US Rate Hike: Two in 2019? One in 2020?
d. Argentina's Intertest Rate: 60%
e. Turkey's Interest Rate: 24%
f. Ukraine's Interest rate: 18%
viewtopic.php?f=16&t=7319&p=221670#p221670


JNK (SPDR Barclays High Yield Bond ETF) - Lower; 35.40 from 35.69 from 35.53

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Lower; 85.10 from 85.74 from 85.42

Baltic Dry Index - Lower; 657 from 658 from 630; Low 290; High 2330 (2013)


The above is to from 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 feel free to provide me with your kind thoughts and comments


Please Note:-

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Second Opinion - Please see the "Second Opinion" thread in the "Services for InvestIdeas Members" section, located just below the Miscellaneous Section.
viewtopic.php?f=26&t=3168

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It's all about "how much you made when you were right" & "how little you lost when you were wrong"
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winston
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Re: Winston's Investment Ideas 04 (Oct 15 - Jun 19)

Postby winston » Sun Mar 17, 2019 4:11 pm

TOL @ Mar 17, 2019

Time To Buy Boeing?

Boeing.jpg


Boeing climbed from a low of about US$367 yesterday, to a high of about US$386, after it was reported by AFP that the software fix, would take weeks and not months.

So is it time to buy Boeing?

The Pessimists are saying that Boeing will incur costs from:-
1. Disrupted services (US$360,000 per plane per month); 350 jets in global fleets (US$126m per month; Max US$1b?)
2. Lawsuits arising from the two crashes
3. Delays in deliveries of the jets (including storage of two new planes everyday); US$2.b per month but can be recouped once they start selling the planes again (if they can sell it again)
4. Any modifications for the aircraft
5. Consumers choosing to fly other type of airplanes

However, the Optimists are saying the following:-
1. The software upgrade will only take weeks not months; Reported by AFP
2. Boeing carries enough insurance coverage for catastrophic crashes caused by manufacturing defects.
3. Boeing is trading at an attractive valuation (Fwd PE 18 versus EPS growth of 25%)
4. China would be buying Boeing Planes to reduce the Trade Deficit between China and the US
5. Boeing is also in the Defence business
6. The loss in market cap (US$32b?) far exceeds the US$1b expected cost incurred

Anyway, I have bought some Boeing, hoping that this is a temporary issue and it can be fixed with a software update, as well as a pilot overide function with additional training for the pilots.

However, I'm very aware that I could be very wrong and am catching a falling knife. Therefore, I have only a normal position size and I also have a "Trailing Mental Stop Loss".


Weekly Risk Management Progress Report:-
1. To Monitor Exposure To Equities: Safe (12% from 11% last week, of Liquid Assets);
Goal: Zero Equities before the next recession (2020-2021?); Maximum 35%
2. To Diversify From Asian Equities: Progress (65% from 70% last week)
Goal: To reduce percentage of Asian Equities to 50%
3. To Buy Inverse ETFs and Puts - Waiting for "M" on charts.
Goal: To have a sizable short position going into the next recession
4. To Increase "USD/HKD/Gold" - No Progress ( at 28%)
Goal: To be in safe havens before next recession; (HKD may be repegged)
5. To Reduce Number Of Counters to 10: Worse (13 from 11 counters last week).
Goal: To focus on only about 10 counters that have convincing stories


Market Risk Indicators
1. Euphoria: 7 (Low: 1; High: 10) - FAANNG, ETFs; Margin Debts; SWFs; Central Banks; Fund Flows;
2. Credit Problems: 8 (Very Good: 1; Very Bad: 10) - Housing, Subprime Auto; Student Loans; Credit Cards; Junk Bonds; EM USD Loans;
3. Recession: 8 (Strong Economy: 1; Depression: 10) - GDP; Taxes; PMI; Housing; Auto; Retail; NAFTA; Trade War; 2019?;
4. Liquidity: 8 (Very Liquid: 1; Tight 10) - QE (Feds, ECB, BOJ, PBOC); Interest Rates; Rotation (Bonds); Asset Shrinkage 2018?; EM; Italy;
5. Inverted Yield: 7 (Low Inversion: 1; High Inversion: 10) - Rising Interest Rates; Slope; Inversion; US 10 Years < US 2 Years; Expecting 2019 to 2020
6. Valuation; 7 (Safe 1: PE15; Danger 10: PE30) - PE S&P 24, Nadsaq 26; Revenue; USD; Tax Reform; Deregulation
7. Geopolitical Issues: 8 (Peaceful: 1; War: 10) - Iran; South China Sea; Europe; Russia; Saudi Arabia
Total: 52 out of 70 (74%); (Safe: 50%; Danger: 80%)


Commodities: Mixed (Data from Commodities Live on March 15)

1. WTI Oil - Lower. US$57.84 from US$55.98 last week from US$57.37 two weeks ago;
Support: US$43; US$34; Resistance: US$75, US$105
a. Trade Wars will reduce demand for Oil? -500k bpd?
b. Global Stockpiles: 2.5b barrels;
c. US SPR: 679m barrels (33 days); To sell 190m barrels over 8 years.
d. US imports 8m bpd (Total demand of India and Japan combined);
e. China (4th largest producer; largest importer) - Reserve life: 10 to 6 years
f. China: Ban on Petrolchemical Cars in 5-10 years? Quotas?
g. IEA: Lowest amount of new discoveries; Supply shortage in 2020?
h. Saudi: Aramco's IPO 2021? -1.3m bpd (35% cut in supply)
i. China: SPR 51/90 days; 2019 imports to decrease?
j. Libya: -850k bpd; Brazil +200k bpd; Canada -325 bpd; Nigeria -300k bpd; Iraq -150k bpd; Kurdistan -350k bpd; US +1m bpd; russia -500k;
k. Venezeula: -1.2m bpd; Worst Case -2m bpd supply (50% cut by 2020)?
l. Iran: -0.7m bpd to -1.6m bpd by 1Q, 2019? 6 months exemption from Nov
m. Winter: lower demand for oil; Glut in US?
n. OPEC: Heavier Crude; More Processing;
o. US: Lighter Crude and Lower Sulphur; Glut in Gasoline
viewtopic.php?f=33&t=7550&start=210

2. Gold - Higher. US$1303 from US$1299 from US$1310
Support: $1150; $1050; Resistance: $1400
a. Global 33k tons; US 8k t; China 5k t; IMF 3k t; Germany 3k t
b. Electronics, Coins, Central Banks Reserve, Jewellery etc.
c. 250 oz of paper contract for every oz of physical gold holding on Comex
d. Output fell by 100 metric tons (3%), from 3,150 in 2015 to 3,050 in 2016
e. Demand increasing in Muslim countries as Gold is now a halal investment
f. Rising USD & Interest Rates, would not be good for gold
g. Gold only occupies 0.03% of US investments. In 1981, it was 8%
h: India Demand: Since 2010, down each year. 2017 (700t); 2020 (900t)
i. China Demand: Since 2013, decreased 33% from 940t to 630t last year
j. Global Demand: 2Q 2018: China +5%; India -8%;
k. Central Banks: +22% yoy; 33k tons; Russian, Turkey, Khazakhstan & India
l. U.S. government holds 260m ounces at book value of US$42m
m. China: Reserves 185m oz; 400m oz ground; Output decreased 6% yoy
n. Strong Selling by Gold ETFs
viewtopic.php?f=33&t=7589&p=202084#p202084

3. Silver - Flat. US$15.34 from US$15.36 from US$15.47
a. Support: US$16.10; US$15.20; Resistance: US$18.50; High: US$49
b. LED chips, Cell Phones, Nuclear Reactors, Photography, Solar Panels, RFID Chips, Semiconductors, Water Purification, Data Storage, Antibacterial products, Silver Coins, Jewelery
c. Demand: 1.2b ounces in 2015;
d. Supply: 0.9b ounces in 2015.
e. 4th year of deficit
f. 35% (7700 metric tons) for Electronics
g. 25% (5500 metric tons) for Bullions & Coins
h. India imports more Silver than the US
i. JPM has 67m ounces
j. High Gold/Siver Ratio: 50 t0 70; Currently 76, 50% higher than average
k, Production declining
l. Demand: 40% Investments / Speculation; 60% Industrial
m. About 1b ounces stored in China; 1 Year Production
n. How will US tariffs on Solar Panels affect silver prices?
viewtopic.php?f=33&t=7589&p=202084#p202084

4. Platinum - Higher; US$830 from US$819 from $868; Vested
a. 28% for jewelry
b. 42% for diesel catalytic converters
c. Remainder for other industrial applications
d. Huge discount to Gold
e. Sixth year of deficit
f. 10 times more gold than platinum
g. Costlier to mine than gold as located deeper
h. Diesel cars losing market share
i. 70% of supply is from South Africa

6. Palladium - Higher; US$1517 from US$1472 from US$1487
a. Support: US$930; US$500; Resistance: $1600 (Citi)
b. Catalytic Converters (Petrol Cars), Electronics, Dentistry, Medicine, Hydrogen Purification, Chemicals, Groundwater Treatment, Jewelry and Fuel Cells
c. Auto industry consumes 80% of supply
d. Demand by Auto industry doubled in past 10 years
e. Growth Demand: 10% in 2019
f. Russia and South Africa produced 3/4 of the world's mined palladium supply.
g. 8th Annual supply deficit;
h. Vehicle: PALL; SPPP (Physical Platinum & Palladium)
i. US Auto Sales weak
j. China - Pollution Programs
k. Supply Deficit: 1m Ounces in 2019
l. Global Stockpiles: 10 to 18m ounces (2 Year Demand)
m. Julius Baer 2020 Target: $1000

7. Zinc - Higher; US$2786 from US$2717 from US$2798
a. Global Demand: +14% pa for past 4 years
b. Supply: 13.7 tons; Supply Deficit 1.2m tons;
b. Breakpoint: High US$4400 (2007); Low $1600 (Jan 2016)
d. Used to prevent rusting, zinc oxide (paints), brass (copper), coins, fertilizer
e. Zinc inventories at the LME have dropped to their lowest level since 2009
f. Vehicle: DB Base Metal (Zinc, Aluminum & Copper); MMG
viewtopic.php?f=33&t=367&start=208.

8. Copper - Flat; US$2.90 from US$2.90 from US$2.96
a. Higher inventories at LME
b. China - 50% of global consumption
c. China - Lower Power Grid demand
viewtopic.php?f=33&t=5598&p=215285#p215285

9. Uranium - Flat; US$27.50 from US$28.00 from US$28.00
a. Breakeven: US$40 per lb; Long-Term Contract - 2x Spot
b. Range: $20 (2005) to $136 (2008); 580% rise in two years
c. Global Supply: 158m lbs pa; 15% from decommisioned weapons
d. Global Demand: 190m lbs pa to 300m lbs pa (2030)
e. Stockpile: 1b lbs (till 2022?) ; Companies normally store 5 years supply
f. Japanese Demand: 3m lbs pa; Starting 21/54 reactors? Currently, only 9
g. No. of Nuclear plants: +8 pa for next 20 yrs, 440 to 595; Current 452
h. 56 new reactors being built; 481 planned;
i. China: 46 existing plants; Building 11; To build 177 more?
j. India: 22 existing nuclear plants; Building 5; To build 64 more?
k. 75% long-term contracts expiring between 2017-25
l. 200 European nuclear reactors will be shut down over the next 25 years
m. France: Reduce nuclear to 50% from 75% by 2025 and closure of 20
n. Apr 14, 2019: US requires 25% local production; Higher electricity cost
o. Kazakhtan reducing supply by 10% (40% of global production)
p. Competition: Natural Gas, Solar, Wind, Wave etc
q. US: Nuclear - 20% of electricity; 99/447 Plants; 25% drop by 2025; Two Year Moratorium on Closure
r. Supply: 50k tons; Demand: 68k tons; 2k tons enriched for weapons
s. 1b pounds to be purchased for long-term contracts over next 5-10 years
t. Average reactor needs around 650,000 pounds to run for a year
u. US: 100/420 reactors; Importing 95% uranium; Demand 50m lbs pa
v. Uranium from Sea Water; Viable at US$180/kg (US$80/lbs); Timing?
w. Glut at 15m pounds (23 reactors for 1 year)
x. Cameco mothballed McArthur River & Key Lake; 10% world's supply
y. Kazatomprom, world's second largest, cut production by 20% for 3 yrs
z. Russia banning export of Uranium?

11. Cobalt; Flat; $14.97 ($33,000/t) from $14.97 ($33,000/t) from $14.97 ($33,000/t); Low $10; High US$43
a. Electric Vehicles (8 kg), Smartphones (8 grams), Jet Engines; Gigafactories
b. Congo: Supplies >50% world's supply; Child Labor?
c. Demand: 8% to 10% pa
d. Shortage: 2022 and beyond
e. Cobalt Reduced EV is 5-10 years away? Musk: Reducing Cobalt in Tesla;
f. 2018: 1m EVs (10k tonnes); 2027: 27m ( 27m tonnes)
g. Glencore - stockpiling till June 2019 (radioactivity); 25% Global Supply
g. Target: 2018 - US$62,000/t; 2022 - US$44.000/t


Equities - Risk-On (Data as of Saturday every week)

1. US Equities - Lower. 2743 from 2804 last week from 2793 two weeks ago
a. Support: 2320; Resistance: 2820; 3000; Fwd PE 16
b. Bought Boeing (BA)
viewtopic.php?f=11&t=7643&start=200

2. HK Equities - Higher. 29012 from 28228 from 28812
a. Support: 24500, 23500; Resistance: 31200; 31600;
b. No Trade
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120

3. Shanghai Equities - Higher. 3022 from 2970 from 2994
a. Support: 2450; Resistance 2900; 3300; 3600
b. No Trade
viewtopic.php?f=10&t=7190&start=210

4. Spore Equities - Higher; 3200 from 3196 from 3220
a. Resistance 3850
b. Sold some HPL (Dont understand why Wheelock is pulling out of 68 Holdings)
viewtopic.php?f=10&t=6828&start=b110

5. Japan Equities - Higher. 21451 from 21206 from 21603
a. Forward PE 13
b. Support 19000; Resistance 25000
c. BOJ owns > half government bonds and 75% of ETFs
d. No trade
viewtopic.php?f=10&t=7138&start=200

6. Malaysian Equities; Higher; 1681 from 1680 from 1701
a. Bought Genting Berhad
viewtopic.php?f=10&t=6292&start=30


Currencies- Risk-Off (Data from XE.com on March 01)

1. USD to JPY - JPY Weaker; 111.50 from 111.13 last week from 111.87 two weeks ago
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Why is it a Safe Haven ?
e. QE Infinity?
viewtopic.php?f=32&t=4205&start=180

1a. 100 JPY to MYR - JPY Weaker; 3.63 from 3.68 vs 3.64

2. SGD to MYR - SGD Stronger; 3.0171 from 3.0073 from 3.0126
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Stronger; 0.7084 from 0.7045 from 0.7108
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
c. To diversify my AUD into what currency?
viewtopic.php?f=32&t=5256&start=130

4. AUD to SGD - AUD Stronger. 0.9587 from 0.9574 from 0.9613
a. The range is 0.98 (2016) to 1.36 (2012).
b. I would choose the AUD over the SGD

5. AUD to MYR - AUD Stronger. 2.8924 from 2.8794 from 2.8961
a. The range is 2.20 (2008) to 3.41 (2017)

6. EUR to USD - EUR Stronger. 1.1328 from 1.1232 from 1.1374
viewtopic.php?f=32&t=5523&start=100

7. USD to HKD - HKD Stronger. 7.8499 from 7.8500 from 7.8487
a. 52 week range is 7.7452 - 7.8530
b. USD Peg band: 7.75 to 7.85
c. Will they remove the peg to the USD during the next crisis?
d. Will China ask HK to depeg from the USD?
viewtopic.php?f=32&t=3529&start=40

8. USD to MYR:- MYR Stronger. 4.0837 from 4.0874 from 4.0786
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9. USD to SGD:-

9. USD to SGD:- SGD Stronger; 1.3533 from 1.3591 from 1.3526
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country
viewtopic.php?f=32&t=136&start=100

10. USD to CNY:- CNY Stronger; 6.7136 from 6.7215 from 6.7048
a. When is the right time to buy some CNY? How?
viewtopic.php?f=32&t=7720&start=90

11. GBP to USD:- GBP Stronger; 1.3274 from 1.3015 from 1.3241
a. Brexit; Politics;
viewtopic.php?f=32&t=333&start=80

12. GBP to MYR:- GBP Stronger; 5.4202 from 5.3200 from 5.3953

13. Dollar Index - USD Weaker; 96.58 from 97.36 from 96.27
viewtopic.php?f=32&t=7616&start=60


Others

Sentiment - Complacent?

Headwinds
a. Derivatives (US$700t);
b. Debts (US$237t, 318% GDP);
c. Corporate Debt (US$50t); US Corp Debts (US$9t)
d. Institutional Investors (US$0.5t)
e. ETFs AUM (US$3.4t)
f. Bitcoin (US$200b)
g. US Pension Short-Fall: US$385b
h. NPLs at European Banks: EUR$1t
i. China's Bond Market: US$12t (third largest)
j. Private Client Cash Levels as a % of Total Assets: Record Low (10.4%)
k. Institutional Investors: lowest levels of cash for past 8 years; 1/3 high in 2016


Tailwinds
a. Low Interest Rates
b. Cash Sidelines (US$50t)
c. QE US$18t: US (US$4.5t), ECB (US$3.7t), Japan (US$4.4t) & China (US$5.1t)
d. Negative Yield Bonds (US$6t from US$10t)
e. US Foreign Funds Repatriation (US$2.5t)
f. Cash US Corporations (US$1t)
g. Cash Japanese Corporations (US$2t)
h. Buybacks
i. US Household Net Worth (US$90t)
j. EM Consumption
k. Private Equities: US$600b Cash

Risk Management:-
a. Global Diversification
b. Asset Class Diversification
c. Diversity of Industry & Company Exposure
d. Currency Hedging
e. Tactical Asset Allocation
f . Inverse ETFs and Put Warrants

HK Properties
a. Vacancy tax
b. 9000 vacant apartments
c. CLSA, UBS and Citi - Prices may drop 10% to 15% by end 2019
d. Rising Interest rates
e. Slowing Economy / Trade War
f. Depreciating Yuan
g. Weak Stock Markets
h. Justin Chiu (CK Asset): 10-20% drop; Outskirt Nanos (30% drop)

Spore Properties
a. 60,000 Units of Supply (7 years Supply of 6500 Homes per year )
b. Unsold residential units doubled to over 34,000 in 2018

Malaysian Properties
a. JPPH: Overhang - 30,115 units (2018) vs 20,304 (2017)
b. Overhang would be greater if Serviced Residence and SOHOs are included

China Properties
a. 20% of Urban Housing is vacant (65m homes)
b. In 2018, nationwide ASPs have climbed by 15% to a record high
c. Since 2015, Tier One cities have risen by 55%
d. Since 2015, Tier Two cities have risen by 35%
e. Government targeting annual increase of 7% to 10%

Yield on 10 Year US Treasuries - Lower; 2.59% from 2.63% last week from 2.73% two weeks ago
a. Resistance 3.3%

Yield on 2 Year Treasuries - Lower; 2.44% from 2.46% from 2.52%

Interest Rates:-
a. Expecting US Interest Rates to slowly rise over next 2 years
b. About US$9t or about 23% of the world’s bonds have negative yields
c. US Rate Hike: Two in 2019? One in 2020?
d. Argentina's Intertest Rate: 60%
e. Turkey's Interest Rate: 24%
f. Ukraine's Interest rate: 18%
viewtopic.php?f=16&t=7319&p=221670#p221670


JNK (SPDR Barclays High Yield Bond ETF) - Higher; 35.66 from 35.40 from 35.69

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Higher; 85.78 from 85.10 from 85.74

Baltic Dry Index - Higher; 730 from 657 from 658; Low 290; High 2330 (2013)


The above is to from 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 feel free to provide me with your kind thoughts and comments


Please Note:-

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Second Opinion - Please see the "Second Opinion" thread in the "Services for InvestIdeas Members" section, located just below the Miscellaneous Section.
viewtopic.php?f=26&t=3168

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winston
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Re: Winston's Investment Ideas 04 (Oct 15 - Jun 19)

Postby winston » Sun Mar 24, 2019 5:54 pm

TOL @ Mar 24, 2019

complacency.png


Do Not Be Too Complacent

The Dow dropped 460 points on Friday.

So is this the beginning of the big one or is it a buying opportunity?

Intuitively, I do not think that this is the big one yet. However, this rout could last a few more days. Therefore, it may be a bit more prudent to wait for prices to stabilise first, before doing any buying.

At the same time, over the past few weeks, we have seen a number of warning signs:-
1. The Feds did a U-turn and said that they are no longer hiking in 2019. In addition, they would be removing the QT program by Sept 2019
2. Shorting Europe is now supposedly a very crowded trade
3. China: Bonds defaulting, higher unemployment
4. Fedex: Global growth slowing
5. German Bonds are now negative again
6. Yield on 10 Year Treasuries have dropped from 3.26% to 2.44%
7. Yield Inversion: Three-month Treasury bills and 10-year Notes fell below zero for the first time since 2007

However, the talking heads on TV are still bullish and the so called "strategists" at various Newsletters are still asking you to buy.

And if I recalled things correctly, these "experts" were also asking you to buy in late November 2018, just before the big plunge in the markets.

As for myself, I have been reducing my exposure to Equities over the past few months. I now only have a 10% exposure to Equities, down from about 45% a few months ago.

However, if this is the beginning of the big one, even a 10% exposure is still 10% too much.

For the next two weeks, it's not likely that I will be doing much buying unless there is a very steep drop in price and that the counter has a very convincing story.


Weekly Risk Management Progress Report:-
1. To Monitor Exposure To Equities: Safe (10% from 12% last week, of Liquid Assets);
Goal: Zero Equities before the next recession (2020-2021?); Maximum 45%;
2. To Diversify From Asian Equities: Worse (82% from 65% last week)
Goal: To reduce percentage of Asian Equities to 50%
3. To Buy Inverse ETFs and Puts - Waiting for "M" on charts.
Goal: To have a sizable short position going into the next recession
4. To Increase "USD/HKD/Gold" - No Progress ( at 28%)
Goal: To be in the safe havens before next recession; (HKD may be repegged)
5. To Reduce Number Of Counters to 10: Progress (11 from 13 counters last week).
Goal: To focus on only about 10 counters that have convincing stories


Market Risk Indicators
1. Euphoria: 7 (Low: 1; High: 10) - FAANNG, ETFs; Margin Debts; SWFs; Central Banks; Fund Flows;
2. Credit Problems: 8 (Very Good: 1; Very Bad: 10) - Housing, Subprime Auto; Student Loans; Credit Cards; Junk Bonds; EM USD Loans;
3. Recession: 8 (Strong Economy: 1; Depression: 10) - GDP; Taxes; PMI; Housing; Auto; Retail; NAFTA; Trade War; 2019?;
4. Liquidity: 8 (Very Liquid: 1; Tight 10) - QE (Feds, ECB, BOJ, PBOC); Interest Rates; Rotation (Bonds); Asset Shrinkage 2018?; EM; Italy;
5. Inverted Yield: 7 (Low Inversion: 1; High Inversion: 10) - Rising Interest Rates; Slope; Inversion; US 10 Years < US 2 Years; Expecting 2019 to 2020
6. Valuation; 7 (Safe 1: PE15; Danger 10: PE30) - PE S&P 24, Nadsaq 26; Revenue; USD; Tax Reform; Deregulation
7. Geopolitical Issues: 8 (Peaceful: 1; War: 10) - Iran; South China Sea; Europe; Russia; Saudi Arabia
Total: 52 out of 70 (74%); (Safe: 50%; Danger: 80%)


Commodities: Risk On (Data from Commodities Live on March 23 @ 2pm)

1. WTI Oil - Higher. US$58.97 from US$57.84 last week from US$55.98 two weeks ago;
Support: US$43; US$34; Resistance: US$75, US$105
a. Trade Wars will reduce demand for Oil? -500k bpd?
b. Global Stockpiles: 2.5b barrels;
c. US SPR: 679m barrels (33 days); To sell 190m barrels over 8 years.
d. US imports 8m bpd (Total demand of India and Japan combined);
e. China (4th largest producer; largest importer) - Reserve life: Dropped from 10 to 6 years
f. China: Ban on Petrochemical Cars in 5-10 years? Quotas?
g. IEA: Lowest amount of new discoveries; Supply shortage in 2020?
h. Saudi: Aramco's IPO 2021? -1.3m bpd (35% cut in supply)
i. China: SPR 51/90 days; 2019 imports to decrease?
j. Libya: -850k bpd; Brazil +200k bpd; Canada -325 bpd; Nigeria -300k bpd; Iraq -150k bpd; Kurdistan -350k bpd; US +1m bpd; russia -500k;
k. Venezeula: -1.2m bpd; Worst Case -2m bpd supply (50% cut by 2020)?
l. Iran: -0.7m bpd to -1.6m bpd by 1Q, 2019? 6 months exemption from Nov; Expiring in April 2019
m. Winter: lower demand for oil; Glut in US?
n. OPEC: Heavier Crude; More Processing;
o. US: Lighter Crude and Lower Sulphur; Glut in Gasoline
p. EV: -350k bpd?
q. US Summer Driving coming up
viewtopic.php?f=33&t=7550&start=210

2. Gold - Higher. US$1313 from US$1303 from US$1299
Support: $1150; $1050; Resistance: $1400
a. Global 33k tons; US 8k t; China 5k t; IMF 3k t; Germany 3k t
b. Electronics, Coins, Central Banks Reserve, Jewellery etc.
c. 250 oz of paper contract for every oz of physical gold holding on Comex
d. Output fell by 100 metric tons (3%), from 3,150 in 2015 to 3,050 in 2016
e. Demand increasing in Muslim countries as Gold is now a halal investment
f. Rising USD & Interest Rates, would not be good for gold
g. Gold only occupies 0.03% of US investments. In 1981, it was 8%
h: India Demand: Since 2010, down each year. 2017 (700t); 2020 (900t)
i. China Demand: Since 2013, decreased 33% from 940t to 630t last year
j. Global Demand: 2Q 2018: China +5%; India -8%;
k. Central Banks: +22% yoy; 33k tons; Russian, Turkey, Khazakhstan & India
l. U.S. government holds 260m ounces at book value of only US$42m
m. China: Reserves 185m oz; 400m oz ground; Output decreased 6% yoy
n. Strong Selling by Gold ETFs
viewtopic.php?f=33&t=7589&p=202084#p202084

3. Silver - Higher. US$15.44 from US$15.34 from US$15.36
a. Support: US$16.10; US$15.20; Resistance: US$18.50; High: US$49
b. LED chips, Cell Phones, Nuclear Reactors, Photography, Solar Panels, RFID Chips, Semiconductors, Water Purification, Data Storage, Antibacterial products, Silver Coins, Jewelery
c. Demand: 1.2b ounces in 2015;
d. Supply: 0.9b ounces in 2015.
e. 4th year of deficit
f. 35% (7700 metric tons) for Electronics
g. 25% (5500 metric tons) for Bullions & Coins
h. India imports more Silver than the US
i. JPM has 67m ounces
j. High Gold/Siver Ratio: 50 t0 70; Currently 76, 50% higher than average
k, Production declining
l. Demand: 40% Investments / Speculation; 60% Industrial
m. About 1b ounces stored in China; 1 Year Production
n. How will US tariffs on Solar Panels affect silver prices?
viewtopic.php?f=33&t=7589&p=202084#p202084

4. Platinum - Higher; US$848 from US$830 from US$819; Vested
a. 28% for jewelry
b. 42% for diesel catalytic converters
c. Remainder for other industrial applications
d. Huge discount to Gold
e. Sixth year of deficit
f. 10 times more gold than platinum
g. Costlier to mine than gold as located deeper
h. Diesel cars losing market share
i. 70% of supply is from South Africa

6. Palladium - Higher; US$1520 from US$1517 from US$1472
a. Support: US$930; US$500; Resistance: $1600 (Citi)
b. Catalytic Converters (Petrol Cars), Electronics, Dentistry, Medicine, Hydrogen Purification, Chemicals, Groundwater Treatment, Jewelry and Fuel Cells
c. Auto industry consumes 80% of supply
d. Demand by Auto industry doubled in past 10 years
e. Growth Demand: 10% in 2019
f. Russia and South Africa produced 3/4 of the world's mined palladium supply.
g. 8th Annual supply deficit;
h. Vehicle: PALL; SPPP (Physical Platinum & Palladium)
i. US Auto Sales weak
j. China - Pollution Programs
k. Supply Deficit: 1m Ounces in 2019
l. Global Stockpiles: 10 to 18m ounces (2 Year Demand)
m. Julius Baer 2020 Target: $1000

7. Zinc - Higher; US$2820 from US$2786 from US$2717
a. Global Demand: +14% pa for past 4 years
b. Supply: 13.7 tons; Supply Deficit 1.2m tons;
b. Breakpoint: High US$4400 (2007); Low $1600 (Jan 2016)
d. Used to prevent rusting, zinc oxide (paints), brass (copper), coins, fertilizer
e. Zinc inventories at the LME have dropped to their lowest level since 2009
f. Vehicle: DB Base Metal (Zinc, Aluminum & Copper); MMG
viewtopic.php?f=33&t=367&start=208.

8. Copper - Lower; US$2.85 from US$2.90 from US$2.90
a. Higher inventories at LME
b. China - 50% of global consumption
c. China - Lower Power Grid demand
viewtopic.php?f=33&t=5598&p=215285#p215285

9. Uranium - Lower; US$26.05 from US$27.50 from US$28.00
a. Breakeven: US$40 per lb; Long-Term Contract - 2x Spot
b. Range: $20 (2005) to $136 (2008); 580% rise in two years
c. Global Supply: 158m lbs pa; 15% from decommisioned weapons
d. Global Demand: 190m lbs pa to 300m lbs pa (2030)
e. Stockpile: 1b lbs (till 2022?) ; Companies normally store 5 years supply
f. Japanese Demand: 3m lbs pa; Starting 21/54 reactors? Currently, only 9
g. No. of Nuclear plants: +8 pa for next 20 yrs, 440 to 595; Current 452
h. 56 new reactors being built; 481 planned;
i. China: 46 existing plants; Building 11; To build 177 more?
j. India: 22 existing nuclear plants; Building 5; To build 64 more?
k. 75% long-term contracts expiring between 2017-25
l. 200 European nuclear reactors will be shut down over the next 25 years
m. France: Reduce nuclear to 50% from 75% by 2025 and closure of 20
n. Apr 14, 2019: US requires 25% local production; Higher electricity cost
o. Kazakhtan reducing supply by 10% (40% of global production)
p. Competition: Natural Gas, Solar, Wind, Wave etc
q. US: Nuclear - 20% of electricity; 99/447 Plants; 25% drop by 2025; Two Year Moratorium on Closure
r. Supply: 50k tons; Demand: 68k tons; 2k tons enriched for weapons
s. 1b pounds to be purchased for long-term contracts over next 5-10 years
t. Average reactor needs around 650,000 pounds to run for a year
u. US: 100/420 reactors; Importing 95% uranium; Demand 50m lbs pa
v. Uranium from Sea Water; Viable at US$180/kg (US$80/lbs); Timing?
w. Glut at 15m pounds (23 reactors for 1 year)
x. Cameco mothballed McArthur River & Key Lake; 10% world's supply
y. Kazatomprom, world's second largest, cut production by 20% for 3 yrs
z. Russia banning export of Uranium?

11. Cobalt - Lower; $13.61 ($30,000/t) from $14.97 ($33,000/t) from $14.97 ($33,000/t); Low $10; High US$43
a. Electric Vehicles (8 kg), Smartphones (8 grams), Jet Engines; Gigafactories
b. Congo: Supplies >50% world's supply; Child Labor?
c. Demand: 8% to 10% pa
d. Shortage: 2022 and beyond
e. Cobalt Reduced EV is 5-10 years away? Musk: Reducing Cobalt in Tesla;
f. 2018: 1m EVs (10k tonnes); 2027: 27m ( 27m tonnes)
g. Glencore - stockpiling till June 2019 (radioactivity); 25% Global Supply
g. Target: 2018 - US$62,000/t; 2022 - US$44.000/t


Equities - Risk-On (Data as of Saturday every week)

1. US Equities - Higher. 2801 from 2743 last week from 2804 two weeks ago
a. Support: 2320; Resistance: 2820; 2940; 3000; Fwd PE 16
b. Sold Electronic Arts (EA); Reached Target; Rose 8% on Thursday;
c. Sold Boeing (BA); Weak Market Direction
viewtopic.php?f=11&t=7643&start=200

2. HK Equities - Higher. 29012 from 28228 from 28812
a. Support: 24500, 23500; Resistance: 31200; 31600;
b. No Trade; No Convincing Stories
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120

3. Shanghai Equities - Higher. 3104 from 3022 from 2970
a. Support: 2450; Resistance 2900; 3300; 3600
b. No Trade; No Convincing Stories
viewtopic.php?f=10&t=7190&start=210

4. Spore Equities - Higher; 3200 from 3196 from 3220
a. Resistance 3850
b. No Trade; No Convincing Stories
viewtopic.php?f=10&t=6828&start=b110

5. Japan Equities - Higher. 21627 from 21451 from 21206
a. Forward PE 13
b. Support 19000; Resistance 25000
c. BOJ owns > half government bonds and 75% of ETFs
d. No Trade; No Convincing Stories
viewtopic.php?f=10&t=7138&start=200

6. Malaysian Equities; Flat; 1681 from 1680 from 1701
a. No Trade; No Convincing Stories
viewtopic.php?f=10&t=6292&start=30


Currencies- Risk-On (Data from XE.com on March 22 @ 4.15pm)

1. USD to JPY - JPY Stronger; 110.76 from 111.50 last week from 111.13 two weeks ago
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Why is it a Safe Haven ?
e. QE Infinity?
viewtopic.php?f=32&t=4205&start=180

1a. 100 JPY to MYR - JPY Stronger; 3.66 from 3.63 from 3.68 vs 3.64

2. SGD to MYR - SGD Weaker; 3.0058 from 3.0171 from 3.0073
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Stronger; 0.7111 from 0.7084 from 0.7045
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
c. To diversify my AUD into what currency?
viewtopic.php?f=32&t=5256&start=130

4. AUD to SGD - AUD Stronger. 0.9593 from 0.9587 from 0.9574
a. The range is 0.98 (2016) to 1.36 (2012)
b. I would choose the AUD over the SGD

5. AUD to MYR - AUD Weaker. 2.8836 from 2.8924 from 2.8794
a. The range is 2.20 (2008) to 3.41 (2017)

6. EUR to USD - EUR Stronger. 1.1371 from 1.1328 from 1.1232
viewtopic.php?f=32&t=5523&start=100

7. USD to HKD - HKD Stronger. 7.8474 from 7.8499 from 7.8500
a. 52 week range is 7.7452 - 7.8530
b. USD Peg band: 7.75 to 7.85
c. Will they remove the peg to the USD during the next crisis?
d. Will China ask HK to depeg from the USD?
viewtopic.php?f=32&t=3529&start=40

8. USD to MYR:- MYR Stronger. 4.0568 from 4.0837 from 4.0874
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9. USD to SGD:-

9. USD to SGD:- SGD Stronger; 1.3492 from 1.3533 from 1.3591
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country
viewtopic.php?f=32&t=136&start=100

10. USD to CNY:- CNY Stronger; 6.7043 from 6.7136 from 6.7215
a. When is the right time to buy some CNY? How?
viewtopic.php?f=32&t=7720&start=90

11. GBP to USD:- GBP Weaker; 1.3136 from 1.3274 from 1.3015
a. Brexit; Politics;
viewtopic.php?f=32&t=333&start=80

12. GBP to MYR:- GBP Weaker; 5.3275 from 5.4202 from 5.3200

13. Dollar Index - USD Weaker; 96.32 from 96.58 from 97.36
viewtopic.php?f=32&t=7616&start=60


Others

Sentiment - Complacent?

Headwinds
a. Derivatives (US$700t);
b. Debts (US$237t, 318% GDP);
c. Corporate Debt (US$50t); US Corp Debts (US$9t)
d. Institutional Investors (US$0.5t)
e. ETFs AUM (US$3.4t)
f. Bitcoin (US$200b)
g. US Pension Short-Fall: US$385b
h. NPLs at European Banks: EUR$1t
i. China's Bond Market: US$12t (third largest)
j. Private Client Cash Levels as a % of Total Assets: Record Low (10.4%)
k. Institutional Investors: lowest levels of cash for past 8 years; 1/3 high in 2016


Tailwinds
a. Low Interest Rates
b. Cash Sidelines (US$50t)
c. QE US$18t: US (US$4.5t), ECB (US$3.7t), Japan (US$4.4t) & China (US$5.1t)
d. Negative Yield Bonds (US$6t from US$10t)
e. US Foreign Funds Repatriation (US$2.5t)
f. Cash US Corporations (US$1t)
g. Cash Japanese Corporations (US$2t)
h. Buybacks
i. US Household Net Worth (US$90t)
j. EM Consumption
k. Private Equities: US$600b Cash

Risk Management:-
a. Global Diversification
b. Asset Class Diversification
c. Diversity of Industry & Company Exposure
d. Currency Hedging
e. Tactical Asset Allocation
f . Inverse ETFs and Put Warrants

HK Properties
a. Vacancy tax
b. 9000 vacant apartments
c. CLSA, UBS and Citi - Prices may drop 10% to 15% by end 2019
d. Rising Interest rates
e. Slowing Economy / Trade War
f. Depreciating Yuan
g. Weak Stock Markets
h. Justin Chiu (CK Asset): 10-20% drop; Outskirt Nanos (30% drop)

Spore Properties
a. 60,000 Units of Supply (7 years Supply of 6500 Homes per year )
b. Unsold residential units doubled to over 34,000 in 2018

Malaysian Properties
a. JPPH: Overhang - 30,115 units (2018) vs 20,304 (2017)
b. Overhang would be greater if Serviced Residence and SOHOs are included

China Properties
a. 20% of Urban Housing is vacant (65m homes)
b. In 2018, nationwide ASPs have climbed by 15% to a record high
c. Since 2015, Tier One cities have risen by 55%
d. Since 2015, Tier Two cities have risen by 35%
e. Government targeting annual increase of 7% to 10%

Yield on 10 Year US Treasuries - Lower; 2.44% from 2.59% last week from 2.63% two weeks ago
a. Resistance 3.3%

Yield on 2 Year Treasuries - Lower; 2.32% from 2.44% last week from 2.46%

Interest Rates:-
a. Expecting US Interest Rates to slowly rise over next 2 years
b. About US$9t or about 23% of the world’s bonds have negative yields
c. US Rate Hike: None in 2019?
d. Argentina's Intertest Rate: 60%
e. Turkey's Interest Rate: 24%
f. Ukraine's Interest rate: 18%
viewtopic.php?f=16&t=7319&p=221670#p221670


JNK (SPDR Barclays High Yield Bond ETF) - Higher; 35.71 from 35.66 from 35.40

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Higher; 85.84 from 85.78 from 85.10

Baltic Dry Index - Lower; 690 from 730 from 657; Low 290; High 2330 (2013)


The above is to from 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 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.

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viewtopic.php?f=26&t=3168

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It's all about "how much you made when you were right" & "how little you lost when you were wrong"
User avatar
winston
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Re: Winston's Investment Ideas 04 (Oct 15 - Jun 19)

Postby winston » Sun Mar 31, 2019 4:04 pm

TOL @ Mar 31, 2019

april.jpg


New Money From The New Month

It's a new month again and new money would be flowing into the markets again.

Therefore, we should get at least one spike in the US markets next week.

As for the HK, China and Japanese markets, I'm not sure whether the fund managers have already spent their new money in advance, as the markets there were very strong, going into the end of the quarter. However, that rally could also be due to Window Dressing activities.

As for the next few weeks, we have the following:-
1. Brexit
2. Opec Meeting on April 18
3. US-China Trade Discussions

I have been taking a "Trading Break" and it's likely that I will not be doing much trading next week too.

I have also not found any convincing story and I do not like to chase after a strong rally.

A "Trading Break" also helps me:-
1. To have a detached view of the market
2. To have a fresh look at things and
3. How I want to trade over the next few weeks


Weekly Risk Management Progress Report:-
1. To Monitor Exposure To Equities: Safe (11% from 10% last week, of Liquid Assets);
Goal: Zero Equities before the next recession (2020-2021?); Maximum 45%;
2. To Diversify From Asian Equities: Progress (73% from 82% last week)
Goal: To reduce percentage of Asian Equities to around 50%
3. To Buy Inverse ETFs and Puts - Waiting for "M" on charts.
Goal: To have a sizable short position going into the next recession
4. To Increase "USD/HKD/Gold" - No Progress ( at 28%)
Goal: To be in the safe havens before next recession; (HKD may be repegged)
5. To Reduce Number Of Counters to 10: Worse (12 from 11 last week).
Goal: To focus on only about 10 counters that have convincing stories


Market Risk Indicators
1. Euphoria: 7 (Low: 1; High: 10) - FAANNG, ETFs; Margin Debts; SWFs; Central Banks; Fund Flows;
2. Credit Problems: 8 (Very Good: 1; Very Bad: 10) - Housing, Subprime Auto; Student Loans; Credit Cards; Junk Bonds; EM USD Loans;
3. Recession: 8 (Strong Economy: 1; Depression: 10) - GDP; Taxes; PMI; Housing; Auto; Retail; NAFTA; Trade War; 2019?;
4. Liquidity: 8 (Very Liquid: 1; Tight 10) - QE (Feds, ECB, BOJ, PBOC); Interest Rates; Rotation (Bonds); Asset Shrinkage 2018?; EM; Italy;
5. Inverted Yield: 7 (Low Inversion: 1; High Inversion: 10) - Rising Interest Rates; Slope; Inversion; US 10 Years < US 2 Years; Expecting 2019 to 2020
6. Valuation; 7 (Safe 1: PE15; Danger 10: PE30) - PE S&P 24, Nadsaq 26; Revenue; USD; Tax Reform; Deregulation
7. Geopolitical Issues: 8 (Peaceful: 1; War: 10) - Iran; South China Sea; Europe; Russia; Saudi Arabia
Total: 52 out of 70 (74%); (Safe: 50%; Danger: 80%)


Commodities: Risk On (Data from Commodities Live on March 30 @ 10.30am)

1. WTI Oil - Higher. US$60.20 from US$58.97 last week from US$57.84 two weeks ago;
Support: US$43; US$34; Resistance: US$75, US$105
a. Trade Wars will reduce demand for Oil? -500k bpd?
b. Global Stockpiles: 2.5b barrels;
c. US SPR: 679m barrels (33 days); To sell 190m barrels over 8 years.
d. US imports 8m bpd (Total demand of India and Japan combined);
e. China (4th largest producer; largest importer) - Reserve life: Dropped from 10 to 6 years
f. China: Ban on Petrochemical Cars in 5-10 years? Quotas?
g. IEA: Lowest amount of new discoveries; Supply shortage in 2020?
h. Saudi: Aramco's IPO 2021? -1.3m bpd (35% cut in supply)
i. China: SPR 51/90 days; 2019 imports to decrease?
j. Libya: -850k bpd; Brazil +200k bpd; Canada -325 bpd; Nigeria -300k bpd; Iraq -150k bpd; Kurdistan -350k bpd; US +1m bpd; russia -500k;
k. Venezeula: -1.2m bpd; Worst Case -2m bpd supply (50% cut by 2020)?
l. Iran: -0.7m bpd to -1.6m bpd by 1Q, 2019? 6 months exemption from Nov; Expiring in April 2019
m. Winter: lower demand for oil; Glut in US?
n. OPEC: Heavier Crude; More Processing;
o. US: Lighter Crude and Lower Sulphur; Glut in Gasoline
p. EV: -350k bpd?
q. US Summer Driving coming up
viewtopic.php?f=33&t=7550&start=210

2. Gold - Lower. US$1297 from US$1313 from US$1303
Support: $1150; $1050; Resistance: $1400
a. Global 33k tons; US 8k t; China 5k t; IMF 3k t; Germany 3k t
b. Electronics, Coins, Central Banks Reserve, Jewellery etc.
c. 250 oz of paper contract for every oz of physical gold holding on Comex
d. Output fell by 100 metric tons (3%), from 3,150 in 2015 to 3,050 in 2016
e. Demand increasing in Muslim countries as Gold is now a halal investment
f. Rising USD & Interest Rates, would not be good for gold
g. Gold only occupies 0.03% of US investments. In 1981, it was 8%
h: India Demand: Since 2010, down each year. 2017 (700t); 2020 (900t)
i. China Demand: Since 2013, decreased 33% from 940t to 630t last year
j. Global Demand: 2Q 2018: China +5%; India -8%;
k. Central Banks: +22% yoy; 33k tons; Russian, Turkey, Khazakhstan & India
l. U.S. government holds 260m ounces at book value of only US$42m
m. China: Reserves 185m oz; 400m oz ground; Output decreased 6% yoy
n. Strong Selling by Gold ETFs
viewtopic.php?f=33&t=7589&p=202084#p202084

3. Silver - Lower. US$15.10 from US$15.44 from US$15.34
a. Support: US$16.10; US$15.20; Resistance: US$18.50; High: US$49
b. LED chips, Cell Phones, Nuclear Reactors, Photography, Solar Panels, RFID Chips, Semiconductors, Water Purification, Data Storage, Antibacterial products, Silver Coins, Jewelery
c. Demand: 1.2b ounces in 2015;
d. Supply: 0.9b ounces in 2015.
e. 4th year of deficit
f. 35% (7700 metric tons) for Electronics
g. 25% (5500 metric tons) for Bullions & Coins
h. India imports more Silver than the US
i. JPM has 67m ounces
j. High Gold/Siver Ratio: 50 t0 70; Currently 76, 50% higher than average
k, Production declining
l. Demand: 40% Investments / Speculation; 60% Industrial
m. About 1b ounces stored in China; 1 Year Production
n. How will US tariffs on Solar Panels affect silver prices?
viewtopic.php?f=33&t=7589&p=202084#p202084

4. Platinum - Higher; US$853 from US$848 from US$830; Vested
a. 28% for jewelry
b. 42% for diesel catalytic converters
c. Remainder for other industrial applications
d. Huge discount to Gold
e. Sixth year of deficit
f. 10 times more gold than platinum
g. Costlier to mine than gold as located deeper
h. Diesel cars losing market share
i. 70% of supply is from South Africa

6. Palladium - Lower; US$1354 from US$1520 from US$1517
a. Support: US$940; US$500; Resistance: $1600 (Citi)
b. Catalytic Converters (Petrol Cars), Electronics, Dentistry, Medicine, Hydrogen Purification, Chemicals, Groundwater Treatment, Jewelry and Fuel Cells
c. Auto industry consumes 80% of supply
d. Demand by Auto industry doubled in past 10 years
e. Growth Demand: 10% in 2019
f. Russia and South Africa produced 3/4 of the world's mined palladium supply.
g. 8th Annual supply deficit;
h. Vehicle: PALL; SPPP (Physical Platinum & Palladium)
i. US Auto Sales weak
j. China - Pollution Programs
k. Supply Deficit: 1m Ounces in 2019
l. Global Stockpiles: 10 to 18m ounces (2 Year Demand)
m. Julius Baer 2020 Target: $1000

7. Zinc - Higher; US$2911 from US$2820 from US$2786
a. Global Demand: +14% pa for past 4 years
b. Supply: 13.7 tons; Supply Deficit 1.2m tons;
b. Breakpoint: High US$4400 (2007); Low $1600 (Jan 2016)
d. Used to prevent rusting, zinc oxide (paints), brass (copper), coins, fertilizer
e. Zinc inventories at the LME have dropped to their lowest level since 2009
f. Vehicle: DB Base Metal (Zinc, Aluminum & Copper); MMG
viewtopic.php?f=33&t=367&start=208.

8. Copper - Higher; US$2.93 from US$2.85 from US$2.90
a. Higher inventories at LME
b. China - 50% of global consumption
c. China - Lower Power Grid demand
viewtopic.php?f=33&t=5598&p=215285#p215285

9. Uranium - Lower; US$25.75 from US$26.05 from US$27.50
a. Breakeven: US$40 per lb; Long-Term Contract - 2x Spot
b. Range: $20 (2005) to $136 (2008); 580% rise in two years
c. Global Supply: 158m lbs pa; 15% from decommisioned weapons
d. Global Demand: 190m lbs pa to 300m lbs pa (2030)
e. Stockpile: 1b lbs (till 2022?) ; Companies normally store 5 years supply
f. Japanese Demand: 3m lbs pa; Starting 21/54 reactors? Currently, only 9
g. No. of Nuclear plants: +8 pa for next 20 yrs, 440 to 595; Current 452
h. 56 new reactors being built; 481 planned;
i. China: 46 existing plants; Building 11; To build 177 more?
j. India: 22 existing nuclear plants; Building 5; To build 64 more?
k. 75% long-term contracts expiring between 2017-25
l. 200 European nuclear reactors will be shut down over the next 25 years
m. France: Reduce nuclear to 50% from 75% by 2025 and closure of 20
n. Apr 14, 2019: US requires 25% local production; Higher electricity cost
o. Kazakhtan reducing supply by 10% (40% of global production)
p. Competition: Natural Gas, Solar, Wind, Wave etc
q. US: Nuclear - 20% of electricity; 99/447 Plants; 25% drop by 2025; Two Year Moratorium on Closure
r. Supply: 50k tons; Demand: 68k tons; 2k tons enriched for weapons
s. 1b pounds to be purchased for long-term contracts over next 5-10 years
t. Average reactor needs around 650,000 pounds to run for a year
u. US: 100/420 reactors; Importing 95% uranium; Demand 50m lbs pa
v. Uranium from Sea Water; Viable at US$180/kg (US$80/lbs); Timing?
w. Glut at 15m pounds (23 reactors for 1 year)
x. Cameco mothballed McArthur River & Key Lake; 10% world's supply
y. Kazatomprom, world's second largest, cut production by 20% for 3 yrs
z. Russia banning export of Uranium?

11. Cobalt - Flat; $13.61 ($30,000/t) from $13.61 ($30,000/t) from $14.97 ($33,000/t); Low $10; High US$43
a. Electric Vehicles (8 kg), Smartphones (8 grams), Jet Engines; Gigafactories
b. Congo: Supplies >50% world's supply; Child Labor?
c. Demand: 8% to 10% pa
d. Shortage: 2022 and beyond
e. Cobalt Reduced EV is 5-10 years away? Musk: Reducing Cobalt in Tesla;
f. 2018: 1m EVs (10k tonnes); 2027: 27m ( 27m tonnes)
g. Glencore - stockpiling till June 2019 (radioactivity); 25% Global Supply
g. Target: 2018 - US$62,000/t; 2022 - US$44.000/t


Equities - Mixed (Data as of Saturday every week)

1. US Equities - Higher. 2815 from 2801 last week from 2743 two weeks ago
a. Support: 2320; Resistance: 2820; 2940; 3000; Fwd PE 16
b. Bought Weibo (WB)
viewtopic.php?f=11&t=7643&start=200

2. HK Equities - Flat. 29051 from 29012 from 28228
a. Support: 24500, 23500; Resistance: 31200; 31600;
b. No Trade; No Convincing Stories
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120

3. Shanghai Equities - Lower. 3091 from 3104 from 3022
a. Support: 2450; Resistance 2900; 3300; 3600
b. No Trade; No Convincing Stories
viewtopic.php?f=10&t=7190&start=210

4. Spore Equities - Higher; 3213 from 3200 from 3196
a. Resistance 3850
b. Sold some HPL
viewtopic.php?f=10&t=6828&start=b110

5. Japan Equities - Lower. 21206 from 21627 from 21451
a. Forward PE 13
b. Support 19000; Resistance 25000
c. BOJ owns > half government bonds and 75% of ETFs
d. No Trade; No Convincing Stories
viewtopic.php?f=10&t=7138&start=200

6. Malaysian Equities; Lower; 1644 from 1681 from 1680
a. Added to Genting Berhad
viewtopic.php?f=10&t=6292&start=30


Currencies- Mixed (Data from XE.com on March 29 @ 9.30pm)

1. USD to JPY - JPY Weaker; 110.81 from 110.76 last week from 111.50 two weeks ago
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Why is it a Safe Haven ?
e. QE Infinity?
viewtopic.php?f=32&t=4205&start=180

1a. 100 JPY to MYR - JPY Stronger; 3.68 from 3.66 from 3.63

2. SGD to MYR - SGD Stronger; 3.0126 from 3.0058 from 3.0171
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Weaker; 0.7097 from 0.7111 from 0.7084
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
c. To diversify my AUD into what currency?
viewtopic.php?f=32&t=5256&start=130

4. AUD to SGD - AUD Stronger. 0.9612 from 0.9593 from 0.9587
a. The range is 0.98 (2016) to 1.36 (2012)
b. I would choose the AUD over the SGD

5. AUD to MYR - AUD Stronger. 2.8956 from 2.8836 from 2.8924
a. The range is 2.20 (2008) to 3.41 (2017)

6. EUR to USD - EUR Weaker. 1.1233 from 1.1371 from 1.1328
viewtopic.php?f=32&t=5523&start=100

7. USD to HKD - HKD Weaker. 7.8502 from 7.8474 from 7.8499
a. 52 week range is 7.7452 - 7.8530
b. USD Peg band: 7.75 to 7.85
c. Will they remove the peg to the USD during the next crisis?
d. Will China ask HK to depeg from the USD?
viewtopic.php?f=32&t=3529&start=40

8. USD to MYR:- MYR Weaker. 4.0804 from 4.0568 from 4.0837
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9. USD to SGD:-

9. USD to SGD:- SGD Weaker; 1.3544 from 1.3492 from 1.3533
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country
viewtopic.php?f=32&t=136&start=100

10. USD to CNY:- CNY Weaker; 6.7077 from 6.7043 from 6.7136
a. When is the right time to buy some CNY? How?
viewtopic.php?f=32&t=7720&start=90

11. GBP to USD:- GBP Weaker; 1.3073 from 1.3136 from 1.3274
a. Brexit; Politics;
viewtopic.php?f=32&t=333&start=80

12. GBP to MYR:- GBP Stronger; 5.3346 from 5.3275 from 5.4202

13. Dollar Index - USD Stronger; 97.11 from 96.32 from 96.58
viewtopic.php?f=32&t=7616&start=60


Others

Sentiment - Complacent?

Headwinds
a. Derivatives (US$700t);
b. Debts (US$237t, 318% GDP);
c. Corporate Debt (US$50t); US Corp Debts (US$9t)
d. Institutional Investors (US$0.5t)
e. ETFs AUM (US$3.4t)
f. Bitcoin (US$200b)
g. US Pension Short-Fall: US$385b
h. NPLs at European Banks: EUR$1t
i. China's Bond Market: US$12t (third largest)
j. Private Client Cash Levels as a % of Total Assets: Record Low (10.4%)
k. Institutional Investors: lowest levels of cash for past 8 years; 1/3 high in 2016


Tailwinds
a. Low Interest Rates
b. Cash Sidelines (US$50t)
c. QE US$18t: US (US$4.5t), ECB (US$3.7t), Japan (US$4.4t) & China (US$5.1t)
d. Negative Yield Bonds (US$6t from US$10t)
e. US Foreign Funds Repatriation (US$2.5t)
f. Cash US Corporations (US$1t)
g. Cash Japanese Corporations (US$2t)
h. Buybacks
i. US Household Net Worth (US$90t)
j. EM Consumption
k. Private Equities: US$600b Cash

Risk Management:-
a. Global Diversification
b. Asset Class Diversification
c. Diversity of Industry & Company Exposure
d. Currency Hedging
e. Tactical Asset Allocation
f . Inverse ETFs and Put Warrants

HK Properties
a. Vacancy tax
b. 9000 vacant apartments
c. CLSA, UBS and Citi - Prices may drop 10% to 15% by end 2019
d. Rising Interest rates
e. Slowing Economy / Trade War
f. Depreciating Yuan
g. Weak Stock Markets
h. Justin Chiu (CK Asset): 10-20% drop; Outskirt Nanos (30% drop)

Spore Properties
a. 60,000 Units of Supply (7 years Supply of 6500 Homes per year )
b. Unsold residential units doubled to over 34,000 in 2018

Malaysian Properties
a. JPPH: Overhang - 30,115 units (2018) vs 20,304 (2017)
b. Overhang would be greater if Serviced Residence and SOHOs are included

China Properties
a. 20% of Urban Housing is vacant (65m homes)
b. In 2018, nationwide ASPs have climbed by 15% to a record high
c. Since 2015, Tier One cities have risen by 55%
d. Since 2015, Tier Two cities have risen by 35%
e. Government targeting annual increase of 7% to 10%

Yield on 10 Year US Treasuries - Lower; 2.41% from 2.44% last week from 2.59% two weeks ago
a. Resistance 3.3%

Yield on 2 Year Treasuries - Lower; 2.26% from 2.32% last week from 2.44% two weeks ago.

Interest Rates:-
a. Expecting US Interest Rates to slowly rise over next 2 years
b. About US$9t or about 23% of the world’s bonds have negative yields
c. US Rate Hike: None in 2019?
d. Argentina's Intertest Rate: 60%
e. Turkey's Interest Rate: 24%
f. Ukraine's Interest rate: 18%
viewtopic.php?f=16&t=7319&p=221670#p221670


JNK (SPDR Barclays High Yield Bond ETF) - Higher; 35.97 from 35.71 from 35.66

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Higher; 86.47 from 85.84 from 85.78

Baltic Dry Index - Flat; 689 from 690 from 730; Low 290; High 2330 (2013)


The above is to from 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 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.

Second Opinion - Please see the "Second Opinion" thread in the "Services for InvestIdeas Members" section, located just below the Miscellaneous Section.
viewtopic.php?f=26&t=3168

Active Topics - Do you know that there's an "Active Topics" button? It's located on the top left hand corner of the Index
You do not have the required permissions to view the files attached to this post.
It's all about "how much you made when you were right" & "how little you lost when you were wrong"
User avatar
winston
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Joined: Wed May 07, 2008 9:28 am

Re: Winston's Investment Ideas 04 (Oct 15 - Jun 19)

Postby winston » Mon Apr 08, 2019 5:56 pm

TOL @ April 8, 2019

Cherry Blossom.jpg


Trading Break

As mentioned last week, I was away on a Trading Break.

It was a good getaway with the family in Japan, for their Cherry Blossom.

I was still watching the market actions as I had a wifi machine with me but did refrained from any trading.

On the horizon, we have:-
1. Apr 18: OPEC Meeting
2. Brexit: Probably Non-event
3. Tun M Visit to China: ECRL in exchange for Palm Oil purchase?
4. US Earnings Season

Weekly Risk Management Progress Report:-
1. To Monitor Exposure To Equities: Safe (11% from 10% last week, of Liquid Assets);
Goal: Zero Equities before the next recession (2020-2021?); Maximum 45%;
2. To Diversify From Asian Equities: Progress (73% from 82% last week)
Goal: To reduce percentage of Asian Equities to around 50%
3. To Buy Inverse ETFs and Puts - Waiting for "M" on charts.
Goal: To have a sizable short position going into the next recession
4. To Increase "USD/HKD/Gold" - No Progress ( at 28%)
Goal: To be in the safe havens before next recession; (HKD may be repegged)
5. To Reduce Number Of Counters to 10: Worse (12 from 11 last week).
Goal: To focus on only about 10 counters that have convincing stories


Market Risk Indicators
1. Euphoria: 7 (Low: 1; High: 10) - FAANNG, ETFs; Margin Debts; SWFs; Central Banks; Fund Flows;
2. Credit Problems: 8 (Very Good: 1; Very Bad: 10) - Housing, Subprime Auto; Student Loans; Credit Cards; Junk Bonds; EM USD Loans;
3. Recession: 8 (Strong Economy: 1; Depression: 10) - GDP; Taxes; PMI; Housing; Auto; Retail; NAFTA; Trade War; 2019?;
4. Liquidity: 8 (Very Liquid: 1; Tight 10) - QE (Feds, ECB, BOJ, PBOC); Interest Rates; Rotation (Bonds); Asset Shrinkage 2018?; EM; Italy;
5. Inverted Yield: 7 (Low Inversion: 1; High Inversion: 10) - Rising Interest Rates; Slope; Inversion; US 10 Years < US 2 Years; Expecting 2019 to 2020
6. Valuation; 7 (Safe 1: PE15; Danger 10: PE30) - PE S&P 24, Nadsaq 26; Revenue; USD; Tax Reform; Deregulation
7. Geopolitical Issues: 8 (Peaceful: 1; War: 10) - Iran; South China Sea; Europe; Russia; Saudi Arabia
Total: 52 out of 70 (74%); (Safe: 50%; Danger: 80%)


Commodities: Risk On (Data from Commodities Live on April 8 @ 5.00 pm)

1. WTI Oil - Higher. US$63.38 from US$60.20 last week from US$58.97 two weeks ago;
Support: US$43; US$34; Resistance: US$75, US$105
a. Trade Wars will reduce demand for Oil? -500k bpd?
b. Global Stockpiles: 2.5b barrels;
c. US SPR: 679m barrels (33 days); To sell 190m barrels over 8 years.
d. US imports 8m bpd (Total demand of India and Japan combined);
e. China (4th largest producer; largest importer) - Reserve life: Dropped from 10 to 6 years
f. China: Ban on Petrochemical Cars in 5-10 years? Quotas?
g. IEA: Lowest amount of new discoveries; Supply shortage in 2020?
h. Saudi: Aramco's IPO 2021? -1.3m bpd (35% cut in supply)
i. China: SPR 51/90 days; 2019 imports to decrease?
j. Libya: -850k bpd; Brazil +200k bpd; Canada -325 bpd; Nigeria -300k bpd; Iraq -150k bpd; Kurdistan -350k bpd; US +1m bpd; russia -500k;
k. Venezeula: -1.2m bpd; Worst Case -2m bpd supply (50% cut by 2020)?
l. Iran: -0.7m bpd to -1.6m bpd by 1Q, 2019? 6 months exemption from Nov; Expiring in April 2019
m. Winter: lower demand for oil; Glut in US?
n. OPEC: Heavier Crude; More Processing;
o. US: Lighter Crude and Lower Sulphur; Glut in Gasoline
p. EV: -350k bpd?
q. US Summer Driving coming up
viewtopic.php?f=33&t=7550&start=210

2. Gold - Higher. US$1302 from US$1297 from US$1313
Support: $1150; $1050; Resistance: $1400
a. Global 33k tons; US 8k t; China 5k t; IMF 3k t; Germany 3k t
b. Electronics, Coins, Central Banks Reserve, Jewellery etc.
c. 250 oz of paper contract for every oz of physical gold holding on Comex
d. Output fell by 100 metric tons (3%), from 3,150 in 2015 to 3,050 in 2016
e. Demand increasing in Muslim countries as Gold is now a halal investment
f. Rising USD & Interest Rates, would not be good for gold
g. Gold only occupies 0.03% of US investments. In 1981, it was 8%
h: India Demand: Since 2010, down each year. 2017 (700t); 2020 (900t)
i. China Demand: Since 2013, decreased 33% from 940t to 630t last year
j. Global Demand: 2Q 2018: China +5%; India -8%;
k. Central Banks: +22% yoy; 33k tons; Russian, Turkey, Khazakhstan & India
l. U.S. government holds 260m ounces at book value of only US$42m
m. China: Reserves 185m oz; 400m oz ground; Output decreased 6% yoy
n. Strong Selling by Gold ETFs
viewtopic.php?f=33&t=7589&p=202084#p202084

3. Silver - Flat. US$15.12 from US$15.10 from US$15.44
a. Support: US$16.10; US$15.20; Resistance: US$18.50; High: US$49
b. LED chips, Cell Phones, Nuclear Reactors, Photography, Solar Panels, RFID Chips, Semiconductors, Water Purification, Data Storage, Antibacterial products, Silver Coins, Jewelery
c. Demand: 1.2b ounces in 2015;
d. Supply: 0.9b ounces in 2015.
e. 4th year of deficit
f. 35% (7700 metric tons) for Electronics
g. 25% (5500 metric tons) for Bullions & Coins
h. India imports more Silver than the US
i. JPM has 67m ounces
j. High Gold/Siver Ratio: 50 t0 70; Currently 76, 50% higher than average
k, Production declining
l. Demand: 40% Investments / Speculation; 60% Industrial
m. About 1b ounces stored in China; 1 Year Production
n. How will US tariffs on Solar Panels affect silver prices?
viewtopic.php?f=33&t=7589&p=202084#p202084

4. Platinum - Higher; US$915 from US$853 from US$848; Vested
a. 28% for jewelry
b. 42% for diesel catalytic converters
c. Remainder for other industrial applications
d. Huge discount to Gold
e. Sixth year of deficit
f. 10 times more gold than platinum
g. Costlier to mine than gold as located deeper
h. Diesel cars losing market share
i. 70% of supply is from South Africa

6. Palladium - Flat; US$1353 from US$1354 from US$1520
a. Support: US$940; US$500; Resistance: $1600 (Citi)
b. Catalytic Converters (Petrol Cars), Electronics, Dentistry, Medicine, Hydrogen Purification, Chemicals, Groundwater Treatment, Jewelry and Fuel Cells
c. Auto industry consumes 80% of supply
d. Demand by Auto industry doubled in past 10 years
e. Growth Demand: 10% in 2019
f. Russia and South Africa produced 3/4 of the world's mined palladium supply.
g. 8th Annual supply deficit;
h. Vehicle: PALL; SPPP (Physical Platinum & Palladium)
i. US Auto Sales weak
j. China - Pollution Programs
k. Supply Deficit: 1m Ounces in 2019
l. Global Stockpiles: 10 to 18m ounces (2 Year Demand)
m. Julius Baer 2020 Target: $1000

7. Zinc - Lower; US$2896 from US$2911 from US$2820
a. Global Demand: +14% pa for past 4 years
b. Supply: 13.7 tons; Supply Deficit 1.2m tons;
b. Breakpoint: High US$4400 (2007); Low $1600 (Jan 2016)
d. Used to prevent rusting, zinc oxide (paints), brass (copper), coins, fertilizer
e. Zinc inventories at the LME have dropped to their lowest level since 2009
f. Vehicle: DB Base Metal (Zinc, Aluminum & Copper); MMG
viewtopic.php?f=33&t=367&start=208.

8. Copper - Flat; US$2.92 from US$2.93 from US$2.85
a. Higher inventories at LME
b. China - 50% of global consumption
c. China - Lower Power Grid demand
viewtopic.php?f=33&t=5598&p=215285#p215285

9. Uranium - Flat; US$25.75 from US$25.75 from US$26.05
a. Breakeven: US$40 per lb; Long-Term Contract - 2x Spot
b. Range: $20 (2005) to $136 (2008); 580% rise in two years
c. Global Supply: 158m lbs pa; 15% from decommisioned weapons
d. Global Demand: 190m lbs pa to 300m lbs pa (2030)
e. Stockpile: 1b lbs (till 2022?) ; Companies normally store 5 years supply
f. Japanese Demand: 3m lbs pa; Starting 21/54 reactors? Currently, only 9
g. No. of Nuclear plants: +8 pa for next 20 yrs, 440 to 595; Current 452
h. 56 new reactors being built; 481 planned;
i. China: 46 existing plants; Building 11; To build 177 more?
j. India: 22 existing nuclear plants; Building 5; To build 64 more?
k. 75% long-term contracts expiring between 2017-25
l. 200 European nuclear reactors will be shut down over the next 25 years
m. France: Reduce nuclear to 50% from 75% by 2025 and closure of 20
n. Apr 14, 2019: US requires 25% local production; Higher electricity cost
o. Kazakhtan reducing supply by 10% (40% of global production)
p. Competition: Natural Gas, Solar, Wind, Wave etc
q. US: Nuclear - 20% of electricity; 99/447 Plants; 25% drop by 2025; Two Year Moratorium on Closure
r. Supply: 50k tons; Demand: 68k tons; 2k tons enriched for weapons
s. 1b pounds to be purchased for long-term contracts over next 5-10 years
t. Average reactor needs around 650,000 pounds to run for a year
u. US: 100/420 reactors; Importing 95% uranium; Demand 50m lbs pa
v. Uranium from Sea Water; Viable at US$180/kg (US$80/lbs); Timing?
w. Glut at 15m pounds (23 reactors for 1 year)
x. Cameco mothballed McArthur River & Key Lake; 10% world's supply
y. Kazatomprom, world's second largest, cut production by 20% for 3 yrs
z. Russia banning export of Uranium?

11. Cobalt - Higher; $14.52 ($32,000/t) from $13.61 ($30,000/t) from $13.61 ($30,000/t); Low $10; High US$43
a. Electric Vehicles (8 kg), Smartphones (8 grams), Jet Engines; Gigafactories
b. Congo: Supplies >50% world's supply; Child Labor?
c. Demand: 8% to 10% pa
d. Shortage: 2022 and beyond
e. Cobalt Reduced EV is 5-10 years away? Musk: Reducing Cobalt in Tesla;
f. 2018: 1m EVs (10k tonnes); 2027: 27m ( 27m tonnes)
g. Glencore - stockpiling till June 2019 (radioactivity); 25% Global Supply
g. Target: 2018 - US$62,000/t; 2022 - US$44.000/t


Equities - Risk On (Data as of Saturday every week)

1. US Equities - Higher. 2893 from 2815 last week from 2801 two weeks ago
a. Support: 2320; Resistance: 2820; 2940; 3000; Fwd PE 16
b. No Trade
viewtopic.php?f=11&t=7643&start=200

2. HK Equities - Higher. 29937 from 29051 from 29012
a. Support: 24500, 23500; Resistance: 31200; 31600;
b. No Trade; No Convincing Stories
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120

3. Shanghai Equities - Higher. 3243 from 3091 from 3104
a. Support: 2450; Resistance 2900; 3300; 3600
b. No Trade; No Convincing Stories
viewtopic.php?f=10&t=7190&start=210

4. Spore Equities - Higher; 3306 from 3213 from 3200
a. Resistance 3850
b. No Trade
viewtopic.php?f=10&t=6828&start=b110

5. Japan Equities - Higher. 21806 from 21206 from 21627
a. Forward PE 13
b. Support 19000; Resistance 25000
c. BOJ owns > half government bonds and 75% of ETFs
d. No Trade; No Convincing Stories
viewtopic.php?f=10&t=7138&start=200

6. Malaysian Equities; Lower; 1642 from 1644 from 1681
a. Bought Ann Joo
viewtopic.php?f=10&t=6292&start=30


Currencies- Mixed (Data from XE.com on April 8 @ 5.30pm)

1. USD to JPY - JPY Weaker; 111.46 from 110.81 last week from 110.76 two weeks ago
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Why is it a Safe Haven ?
e. QE Infinity?
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Stronger; 3.022 from 3.0126 from 3.0058
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Stronger; 0.7102 from 0.7097 from 0.7111
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
c. To diversify my AUD into what currency?
viewtopic.php?f=32&t=5256&start=130

4. AUD to SGD - AUD Stronger. 0.9632 from 0.9612 from 0.9593
a. The range is 0.98 (2016) to 1.36 (2012)
b. I would choose the AUD over the SGD

5. AUD to MYR - AUD Stronger. 2.9106 from 2.8956 from 2.8836
a. The range is 2.20 (2008) to 3.41 (2017)

6. EUR to USD - EUR Flat. 1.1235 from 1.1233 from 1.1371
viewtopic.php?f=32&t=5523&start=100

7. USD to HKD - HKD Stronger. 7.8478 from 7.8502 from 7.8474
a. 52 week range is 7.7452 - 7.8530
b. USD Peg band: 7.75 to 7.85
c. Will they remove the peg to the USD during the next crisis?
d. Will China ask HK to depeg from the USD?
viewtopic.php?f=32&t=3529&start=40

8. USD to MYR:- MYR Weaker. 4.0985 from 4.0804 from 4.0568
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9. USD to SGD:-

9. USD to SGD:- SGD Weaker; 1.3562 from 1.3544 from 1.3492
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country
viewtopic.php?f=32&t=136&start=100

10. USD to CNY:- CNY Weaker; 6.7201 from 6.7077 from 6.7043
a. When is the right time to buy some CNY? How?
viewtopic.php?f=32&t=7720&start=90

11. GBP to USD:- GBP Weaker; 1.3051 from 1.3073 from 1.3136
a. Brexit; Politics;
viewtopic.php?f=32&t=333&start=80

12. GBP to MYR:- GBP Stronger; 5.3486 from 5.3346 from 5.3275

13. Dollar Index - USD Stronger; 97.26 from 97.11 from 96.32
viewtopic.php?f=32&t=7616&start=60


Others

Sentiment - Complacent?

Headwinds
a. Derivatives (US$700t);
b. Debts (US$237t, 318% GDP);
c. Corporate Debt (US$50t); US Corp Debts (US$9t)
d. Institutional Investors (US$0.5t)
e. ETFs AUM (US$3.4t)
f. Bitcoin (US$200b)
g. US Pension Short-Fall: US$385b
h. NPLs at European Banks: EUR$1t
i. China's Bond Market: US$12t (third largest)
j. Private Client Cash Levels as a % of Total Assets: Record Low (10.4%)
k. Institutional Investors: lowest levels of cash for past 8 years; 1/3 high in 2016


Tailwinds
a. Low Interest Rates
b. Cash Sidelines (US$50t)
c. QE US$18t: US (US$4.5t), ECB (US$3.7t), Japan (US$4.4t) & China (US$5.1t)
d. Negative Yield Bonds (US$6t from US$10t)
e. US Foreign Funds Repatriation (US$2.5t)
f. Cash US Corporations (US$1t)
g. Cash Japanese Corporations (US$2t)
h. Buybacks
i. US Household Net Worth (US$90t)
j. EM Consumption
k. Private Equities: US$600b Cash

Risk Management:-
a. Global Diversification
b. Asset Class Diversification
c. Diversity of Industry & Company Exposure
d. Currency Hedging
e. Tactical Asset Allocation
f . Inverse ETFs and Put Warrants

HK Properties
a. Vacancy tax
b. 9000 vacant apartments
c. CLSA, UBS and Citi - Prices may drop 10% to 15% by end 2019
d. Rising Interest rates
e. Slowing Economy / Trade War
f. Depreciating Yuan
g. Weak Stock Markets
h. Justin Chiu (CK Asset): 10-20% drop; Outskirt Nanos (30% drop)

Spore Properties
a. 60,000 Units of Supply (7 years Supply of 6500 Homes per year )
b. Unsold residential units doubled to over 34,000 in 2018

Malaysian Properties
a. JPPH: Overhang - 30,115 units (2018) vs 20,304 (2017)
b. Overhang would be greater if Serviced Residence and SOHOs are included

China Properties
a. 20% of Urban Housing is vacant (65m homes)
b. In 2018, nationwide ASPs have climbed by 15% to a record high
c. Since 2015, Tier One cities have risen by 55%
d. Since 2015, Tier Two cities have risen by 35%
e. Government targeting annual increase of 7% to 10%

Yield on 10 Year US Treasuries - Higher; 2.50% from 2.41% last week from 2.44% two weeks ago
a. Resistance 3.3%

Yield on 2 Year Treasuries - Higher; 2.34% from 2.26% last week from 2.32% two weeks ago.

Interest Rates:-
a. Expecting US Interest Rates to slowly rise over next 2 years
b. About US$9t or about 23% of the world’s bonds have negative yields
c. US Rate Hike: None in 2019?
d. Argentina's Intertest Rate: 60%
e. Turkey's Interest Rate: 24%
f. Ukraine's Interest rate: 18%
viewtopic.php?f=16&t=7319&p=221670#p221670


JNK (SPDR Barclays High Yield Bond ETF) - Flat; 35.97 from 35.97 from 35.71

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Flat; 86.43 from 86.47 from 85.84

Baltic Dry Index - Higher; 711 from 689 from 690; Low 290; High 2330 (2013)


The above is to from 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 feel free to provide me with your kind thoughts and comments


Please Note:-

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Second Opinion - Please see the "Second Opinion" thread in the "Services for InvestIdeas Members" section, located just below the Miscellaneous Section.
viewtopic.php?f=26&t=3168

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User avatar
winston
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Re: Winston's Investment Ideas 04 (Oct 15 - Jun 19)

Postby winston » Sun Apr 14, 2019 3:01 pm

TOL @ April 14, 2019

Earnings.jpg


US Earnings Season

Over the past few days, the "experts" on TV, have been talking about the upcoming US earnings season and how it could be the catalyst for the markets to move higher.

They also mentioned that expectations going into the Earnings season is very low and it would be very easy to exceed expectations this season.

Intuitively, I think that the situation may be a bit different this time. This is because we have had a very good quarter and people are now looking for an excuse to take some profits.

If earnings does really exceed expectations, I think that the people would be selling on the news, instead of chasing the rally, especially when you are selling at higher prices.

My position has not really changed. I think that the market is a bit overbought and is due for a correction (not crash).

I do not quite understand why people would want to be chasing the rally despite the various warning signs of a global slowdown.

Maybe it's the "machines" that are buying and not real people.

Or maybe they think that the Central Banksters would be able to print more money or lower interest rates further.

Whatever the reason, I'm feeling a bit uncomfortable and have started to take some profits and to further reduce my exposure to Equities.

It's timely to recall what Sun Tzu had said about war: "The time to plan for war is when everything is very peaceful".

Applying that to the markets, while things are rosy now, it's time to:-
1. Raise Cash
2. Reduce Exposure to Equities
3. Monitor Position Size
4. Monitor Asset Allocation
5. Monitor Currency Risk
6. Monitor Sector Risk
etc.


Weekly Risk Management Progress Report:-
1. To Monitor Exposure To Equities: Safe (8% from 11% last week, of Liquid Assets);
Goal: Zero Equities before the next recession (2020-2021?); Maximum 45%;
2. To Diversify From Asian Equities: Progress (77% from 73% last week)
Goal: To reduce percentage of Asian Equities to around 50%
3. To Buy Inverse ETFs and Puts - Waiting for "M" on charts.
Goal: To have a sizable short position going into the next recession
4. To Increase "USD/HKD/Gold" - No Progress ( at 28%)
Goal: To be in the safe havens before next recession; (HKD may be repegged)
5. To Reduce Number Of Counters to 10: Worse (11 from 12 last week).
Goal: To focus on only about 10 counters that have convincing stories


Market Risk Indicators
1. Euphoria: 7 (Low: 1; High: 10) - FAANNG, ETFs; Margin Debts; SWFs; Central Banks; Fund Flows;
2. Credit Problems: 8 (Very Good: 1; Very Bad: 10) - Housing, Subprime Auto; Student Loans; Credit Cards; Junk Bonds; EM USD Loans;
3. Recession: 8 (Strong Economy: 1; Depression: 10) - GDP; Taxes; PMI; Housing; Auto; Retail; NAFTA; Trade War; 2019?;
4. Liquidity: 8 (Very Liquid: 1; Tight 10) - QE (Feds, ECB, BOJ, PBOC); Interest Rates; Rotation (Bonds); Asset Shrinkage 2018?; EM; Italy;
5. Inverted Yield: 7 (Low Inversion: 1; High Inversion: 10) - Rising Interest Rates; Slope; Inversion; US 10 Years < US 2 Years; Expecting 2019 to 2020
6. Valuation; 7 (Safe 1: PE15; Danger 10: PE30) - PE S&P 24, Nadsaq 26; Revenue; USD; Tax Reform; Deregulation
7. Geopolitical Issues: 8 (Peaceful: 1; War: 10) - Iran; South China Sea; Europe; Russia; Saudi Arabia
Total: 52 out of 70 (74%); (Safe: 50%; Danger: 80%)


Commodities: Risk On (Data from Commodities Live on April 8 @ 5.00 pm)

1. WTI Oil - Higher. US$63.80 from US$63.38 last week from US$60.20 two weeks ago;
Support: US$43; US$34; Resistance: US$75, US$105
a. Trade Wars will reduce demand for Oil? -500k bpd?
b. Global Stockpiles: 2.5b barrels;
c. US SPR: 679m barrels (33 days); To sell 190m barrels over 8 years.
d. US imports 8m bpd (Total demand of India and Japan combined);
e. China (4th largest producer; largest importer) - Reserve life: Dropped from 10 to 6 years
f. China: Ban on Petrochemical Cars in 5-10 years? Quotas?
g. IEA: Lowest amount of new discoveries; Supply shortage in 2020?
h. Saudi: Aramco's IPO 2021? -1.3m bpd (35% cut in supply)
i. China: SPR 51/90 days; 2019 imports to decrease?
j. Libya: -850k bpd; Brazil +200k bpd; Canada -325 bpd; Nigeria -300k bpd; Iraq -150k bpd; Kurdistan -350k bpd; US +1m bpd; russia -500k;
k. Venezeula: -1.2m bpd; Worst Case -2m bpd supply (50% cut by 2020)?
l. Iran: -0.7m bpd to -1.6m bpd by 1Q, 2019? 6 months exemption from Nov; Expiring in April 2019
m. Winter: lower demand for oil; Glut in US?
n. OPEC: Heavier Crude; More Processing;
o. US: Lighter Crude and Lower Sulphur; Glut in Gasoline
p. EV: -350k bpd?
q. US Summer Driving coming up
viewtopic.php?f=33&t=7550&start=210

2. Gold - Lower. US$1294 from US$1302 from US$1297
Support: $1150; $1050; Resistance: $1400
a. Global 33k tons; US 8k t; China 5k t; IMF 3k t; Germany 3k t
b. Electronics, Coins, Central Banks Reserve, Jewellery etc.
c. 250 oz of paper contract for every oz of physical gold holding on Comex
d. Output fell by 100 metric tons (3%), from 3,150 in 2015 to 3,050 in 2016
e. Demand increasing in Muslim countries as Gold is now a halal investment
f. Rising USD & Interest Rates, would not be good for gold
g. Gold only occupies 0.03% of US investments. In 1981, it was 8%
h: India Demand: Since 2010, down each year. 2017 (700t); 2020 (900t)
i. China Demand: Since 2013, decreased 33% from 940t to 630t last year
j. Global Demand: 2Q 2018: China +5%; India -8%;
k. Central Banks: +22% yoy; 33k tons; Russian, Turkey, Khazakhstan & India
l. U.S. government holds 260m ounces at book value of only US$42m
m. China: Reserves 185m oz; 400m oz ground; Output decreased 6% yoy
n. Strong Selling by Gold ETFs
viewtopic.php?f=33&t=7589&p=202084#p202084

3. Silver - Lower. US$14.93 from US$15.12 from US$15.10
a. Support: US$16.10; US$15.20; Resistance: US$18.50; High: US$49
b. LED chips, Cell Phones, Nuclear Reactors, Photography, Solar Panels, RFID Chips, Semiconductors, Water Purification, Data Storage, Antibacterial products, Silver Coins, Jewelery
c. Demand: 1.2b ounces in 2015;
d. Supply: 0.9b ounces in 2015.
e. 4th year of deficit
f. 35% (7700 metric tons) for Electronics
g. 25% (5500 metric tons) for Bullions & Coins
h. India imports more Silver than the US
i. JPM has 67m ounces
j. High Gold/Siver Ratio: 50 t0 70; Currently 76, 50% higher than average
k, Production declining
l. Demand: 40% Investments / Speculation; 60% Industrial
m. About 1b ounces stored in China; 1 Year Production
n. How will US tariffs on Solar Panels affect silver prices?
viewtopic.php?f=33&t=7589&p=202084#p202084

4. Platinum - Lower; US$895 from US$915 from US$853; Vested
a. 28% for jewelry
b. 42% for diesel catalytic converters
c. Remainder for other industrial applications
d. Huge discount to Gold
e. Sixth year of deficit
f. 10 times more gold than platinum
g. Costlier to mine than gold as located deeper
h. Diesel cars losing market share
i. 70% of supply is from South Africa

6. Palladium - Lower; US$1345 from US$1353 from US$1354;
a. Support: US$940; US$500; Resistance: $1600 (Citi)
b. Catalytic Converters (Petrol Cars), Electronics, Dentistry, Medicine, Hydrogen Purification, Chemicals, Groundwater Treatment, Jewelry and Fuel Cells
c. Auto industry consumes 80% of supply
d. Demand by Auto industry doubled in past 10 years
e. Growth Demand: 10% in 2019
f. Russia and South Africa produced 3/4 of the world's mined palladium supply.
g. 8th Annual supply deficit;
h. Vehicle: PALL; SPPP (Physical Platinum & Palladium)
i. US Auto Sales weak
j. China - Pollution Programs
k. Supply Deficit: 1m Ounces in 2019
l. Global Stockpiles: 10 to 18m ounces (2 Year Demand)
m. Julius Baer 2020 Target: $1000

7. Zinc - Higher; US$2924 from US$2896 from US$2911
a. Global Demand: +14% pa for past 4 years
b. Supply: 13.7 tons; Supply Deficit 1.2m tons;
b. Breakpoint: High US$4400 (2007); Low $1600 (Jan 2016)
d. Used to prevent rusting, zinc oxide (paints), brass (copper), coins, fertilizer
e. Zinc inventories at the LME have dropped to their lowest level since 2009
f. Vehicle: DB Base Metal (Zinc, Aluminum & Copper); MMG
viewtopic.php?f=33&t=367&start=208.

8. Copper - Flat; US$2.94 from US$2.92 from US$2.93
a. Higher inventories at LME
b. China - 50% of global consumption
c. China - Lower Power Grid demand
viewtopic.php?f=33&t=5598&p=215285#p215285

9. Uranium - Flat; US$25.85 from US$25.75 from US$25.75
a. Breakeven: US$40 per lb; Long-Term Contract - 2x Spot
b. Range: $20 (2005) to $136 (2008); 580% rise in two years
c. Global Supply: 158m lbs pa; 15% from decommisioned weapons
d. Global Demand: 190m lbs pa to 300m lbs pa (2030)
e. Stockpile: 1b lbs (till 2022?) ; Companies normally store 5 years supply
f. Japanese Demand: 3m lbs pa; Starting 21/54 reactors? Currently, only 9
g. No. of Nuclear plants: +8 pa for next 20 yrs, 440 to 595; Current 452
h. 56 new reactors being built; 481 planned;
i. China: 46 existing plants; Building 11; To build 177 more?
j. India: 22 existing nuclear plants; Building 5; To build 64 more?
k. 75% long-term contracts expiring between 2017-25
l. 200 European nuclear reactors will be shut down over the next 25 years
m. France: Reduce nuclear to 50% from 75% by 2025 and closure of 20
n. Apr 14, 2019: US requires 25% local production; Higher electricity cost
o. Kazakhtan reducing supply by 10% (40% of global production)
p. Competition: Natural Gas, Solar, Wind, Wave etc
q. US: Nuclear - 20% of electricity; 99/447 Plants; 25% drop by 2025; Two Year Moratorium on Closure
r. Supply: 50k tons; Demand: 68k tons; 2k tons enriched for weapons
s. 1b pounds to be purchased for long-term contracts over next 5-10 years
t. Average reactor needs around 650,000 pounds to run for a year
u. US: 100/420 reactors; Importing 95% uranium; Demand 50m lbs pa
v. Uranium from Sea Water; Viable at US$180/kg (US$80/lbs); Timing?
w. Glut at 15m pounds (23 reactors for 1 year)
x. Cameco mothballed McArthur River & Key Lake; 10% world's supply
y. Kazatomprom, world's second largest, cut production by 20% for 3 yrs
z. Russia banning export of Uranium?

11. Cobalt - Higher; $15.42 ($34,000/t) from $14.52 ($32,000/t) from $13.61 ($30,000/t) from $13.61 ($30,000/t); Low $10; High US$43
a. Electric Vehicles (8 kg), Smartphones (8 grams), Jet Engines; Gigafactories
b. Congo: Supplies >50% world's supply; Child Labor?
c. Demand: 8% to 10% pa
d. Shortage: 2022 and beyond
e. Cobalt Reduced EV is 5-10 years away? Musk: Reducing Cobalt in Tesla;
f. 2018: 1m EVs (10k tonnes); 2027: 27m ( 27m tonnes)
g. Glencore - stockpiling till June 2019 (radioactivity); 25% Global Supply
g. Target: 2018 - US$62,000/t; 2022 - US$44.000/t


Equities - Mixed (Data as of Saturday every week)

1. US Equities - Higher. 2907 from 2893 last week from 2815 two weeks ago
a. Support: 2320; Resistance: 2820; 2940; 3000; Fwd PE 16
b. Sold Weibo (WB)
c. Traded Electronic Arts (EA)
viewtopic.php?f=11&t=7643&start=200

2. HK Equities - Flat. 29910 from 29937 from 29051
a. Support: 24500, 23500; Resistance: 31200; 31600;
b. Sold Cosco Shipping (1919)
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120

3. Shanghai Equities - Lower. 3189 from 3243 from 3091
a. Support: 2450; Resistance 2900; 3300; 3600
b. No Trade; No Convincing Stories
viewtopic.php?f=10&t=7190&start=210

4. Spore Equities - Higher; 3332 from 3306 from 3213
a. Resistance 3850
b. Bought Best World
c. Sold some HPL
viewtopic.php?f=10&t=6828&start=b110

5. Japan Equities - Higher. 21871 from 21806 from 21206
a. Forward PE 13
b. Support 19000; Resistance 25000
c. BOJ owns > half government bonds and 75% of ETFs
d. No Trade; No Convincing Stories
viewtopic.php?f=10&t=7138&start=200

6. Malaysian Equities; Lower; 1630 from 1642 from 1644
a. Sold Ann Joo
viewtopic.php?f=10&t=6292&start=30


Currencies- Risk-On (Data from XE.com on April 8 @ 5.30pm)

1. USD to JPY - JPY Weaker; 112.03 from 111.46 last week from 110.81 two weeks ago
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Why is it a Safe Haven ?
e. QE Infinity?
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Stronger; 3.0421 from 3.0220 from 3.0127
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Stronger; 0.7169 from 0.7102 from 0.7097
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
c. To diversify my AUD into what currency?
viewtopic.php?f=32&t=5256&start=130

4. AUD to SGD - AUD Stronger. 0.9700 from 0.9632 from 0.9612
a. The range is 0.98 (2016) to 1.36 (2012)
b. I would choose the AUD over the SGD

5. AUD to MYR - AUD Stronger. 2.9509 from 2.9106 from 2.8956
a. The range is 2.20 (2008) to 3.41 (2017)

6. EUR to USD - EUR Stronger. 1.1318 from 1.1235 from 1.1233
viewtopic.php?f=32&t=5523&start=100

7. USD to HKD - HKD Stronger. 7.8426 from 7.8478 from 7.8502
a. 52 week range is 7.7452 - 7.8530
b. USD Peg band: 7.75 to 7.85
c. Will they remove the peg to the USD during the next crisis?
d. Will China ask HK to depeg from the USD?
viewtopic.php?f=32&t=3529&start=40

8. USD to MYR:- MYR Weaker. 4.1157 from 4.0985 from 4.0804
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9. USD to SGD:-

9. USD to SGD:- SGD Stronger; 1.3530 from 1.3562 from 1.3544
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country
viewtopic.php?f=32&t=136&start=100

10. USD to CNY:- CNY Stronger; 6.7037 from 6.7201 from 6.7077
a. When is the right time to buy some CNY? How?
viewtopic.php?f=32&t=7720&start=90

11. GBP to USD:- GBP Stronger; 1.3073 from 1.3051 from 1.3073
a. Brexit; Politics;
viewtopic.php?f=32&t=333&start=80

12. GBP to MYR:- GBP Stronger; 5.3801 from 5.3486 from 5.3346

13. Dollar Index - USD Stronger; 97.26 from 97.11 from 96.32
viewtopic.php?f=32&t=7616&start=60


Others

Sentiment - Complacent?

Headwinds
a. Derivatives (US$700t);
b. Debts (US$237t, 318% GDP);
c. Corporate Debt (US$50t); US Corp Debts (US$9t)
d. Institutional Investors (US$0.5t)
e. ETFs AUM (US$3.4t)
f. Bitcoin (US$200b)
g. US Pension Short-Fall: US$385b
h. NPLs at European Banks: EUR$1t
i. China's Bond Market: US$12t (third largest)
j. Private Client Cash Levels as a % of Total Assets: Record Low (10.4%)
k. Institutional Investors: lowest levels of cash for past 8 years; 1/3 high in 2016


Tailwinds
a. Low Interest Rates
b. Cash Sidelines (US$50t)
c. QE US$18t: US (US$4.5t), ECB (US$3.7t), Japan (US$4.4t) & China (US$5.1t)
d. Negative Yield Bonds (US$6t from US$10t)
e. US Foreign Funds Repatriation (US$2.5t)
f. Cash US Corporations (US$1t)
g. Cash Japanese Corporations (US$2t)
h. Buybacks
i. US Household Net Worth (US$90t)
j. EM Consumption
k. Private Equities: US$600b Cash

Risk Management:-
a. Global Diversification
b. Asset Class Diversification
c. Diversity of Industry & Company Exposure
d. Currency Hedging
e. Tactical Asset Allocation
f . Inverse ETFs and Put Warrants

HK Properties
a. Vacancy tax
b. 9000 vacant apartments
c. CLSA, UBS and Citi - Prices may drop 10% to 15% by end 2019
d. Rising Interest rates
e. Slowing Economy / Trade War
f. Depreciating Yuan
g. Weak Stock Markets
h. Justin Chiu (CK Asset): 10-20% drop; Outskirt Nanos (30% drop)

Spore Properties
a. 60,000 Units of Supply (7 years Supply of 6500 Homes per year )
b. Unsold residential units doubled to over 34,000 in 2018

Malaysian Properties
a. JPPH: Overhang - 30,115 units (2018) vs 20,304 (2017)
b. Overhang would be greater if Serviced Residence and SOHOs are included

China Properties
a. 20% of Urban Housing is vacant (65m homes)
b. In 2018, nationwide ASPs have climbed by 15% to a record high
c. Since 2015, Tier One cities have risen by 55%
d. Since 2015, Tier Two cities have risen by 35%
e. Government targeting annual increase of 7% to 10%

Yield on 10 Year US Treasuries - Higher; 2.57% from 2.50% last week from 2.41% two weeks ago
a. Resistance 3.3%

Yield on 2 Year Treasuries - Higher; 2.39% from 2.34% last week from 2.26% two weeks ago.

Interest Rates:-
a. Expecting US Interest Rates to slowly rise over next 2 years
b. About US$9t or about 23% of the world’s bonds have negative yields
c. US Rate Hike: None in 2019?
d. Argentina's Intertest Rate: 60%
e. Turkey's Interest Rate: 24%
f. Ukraine's Interest rate: 18%
viewtopic.php?f=16&t=7319&p=221670#p221670


JNK (SPDR Barclays High Yield Bond ETF) - Higher; 36.22 from 35.97 from 35.97

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Higher; 86.96 from 86.43 from 86.47

Baltic Dry Index - Higher; 726 from 711 from 689; Low 290; High 2330 (2013)


The above is to from 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 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.

Second Opinion - Please see the "Second Opinion" thread in the "Services for InvestIdeas Members" section, located just below the Miscellaneous Section.
viewtopic.php?f=26&t=3168

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It's all about "how much you made when you were right" & "how little you lost when you were wrong"
User avatar
winston
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Re: Winston's Investment Ideas 04 (Oct 15 - Jun 19)

Postby winston » Sun Apr 21, 2019 9:01 am

TOL @ April 21, 2019

Horsemen.jpg


The 4 Horsemen Of Losses

As the markets have not been going anywhere, it's timely to remind myself of the 4 Horsemen of Losses ie. Ignorance, Arrogance, Fear and Greed.


1. Ignorance: Lack of Knowledge or Information

Example: Buying the shares in a company just a few days before earnings announcement and NOT knowing that there is an upcoming earnings announcement.

Losing money due to ignorance means not doing the required homework.

And in this internet age, there's just no excuse for being ignorant.


2. Arrogance: A way of thinking or behaving, that comes from believing that you are better or smarter

Example: Buying the shares of a company just a day before the earnings announcement and thinking that you are so smart that you are able to analyse and predict the outcome of the earnings announcement, when there are thousands of analysts and full-time investors, who probably have more information than you.

Losing money due to Arrogance probably means that you constantly believed that the market is wrong and that you are right.

And it may also means that you are consistently averaging down on your losing positions, thus setting yourself up for catastrophic losses, if that investment does go to zero.

Arrogant people will have to learn things the hard way. And if they do make money, they think that it's due to their Analysis and not just plain Luck.

By the way, I do know of someone who would intentionally encourage arrogant people to make a trade where the probability is very high that the arrogant guy would lose money, just to teach him a lesson in humility.

Arrogant people do have a habit of telling you of their winning trades (even when you did not ask them about it) but quietly not mention their huge losses.


3. Fear: Feeling induced by perceived danger which causes a change in behavior, such as fleeing, hiding, or freezing from perceived traumatic events.

Example: Selling your shares into a plunge instead of waiting for the technical rebound.

If you want to panic, do it early. If you are not able to get out early, then wait for the 50% technical rebound to get out.


4. Greed: Excessive or rapacious desire especially for possessions.

Example: Trying to catch the falling knives on the first day of the plunge instead of waiting for the knives to hit the floor first.

Cheap can become cheaper. Always know what the Value is, not just the Price.


Again the above is to remind myself of the 4 Horsemen of Losses. It's not to boost my ego that I'm such a perfect trader as I know that I'm not. I still make stupid trading mistakes till today.

Learning from the losses of others are much cheaper than having to learn from your own losses. However, some people will just have to learn things the hard way.


Weekly Risk Management Progress Report:-
1. To Monitor Exposure To Equities: Safe (9% from 8% last week, of Liquid Assets);
Goal: Zero Equities before the next recession (2020-2021?); Maximum 45%;
2. To Diversify From Asian Equities: Progress (65% from 77% last week)
Goal: To reduce percentage of Asian Equities to around 50%
3. To Buy Inverse ETFs and Puts - Waiting for "M" on charts.
Goal: To have a sizable short position going into the next recession
4. To Increase "USD/HKD/Gold" - No Progress ( at 28%)
Goal: To be in the safe havens before next recession; (HKD may be repegged)
5. To Reduce Number Of Counters to 10: No Progress(11 from 11 last week).
Goal: To focus on only about 10 counters that have convincing stories


Market Risk Indicators
1. Euphoria: 7 (Low: 1; High: 10) - FAANNG, ETFs; Margin Debts; SWFs; Central Banks; Fund Flows;
2. Credit Problems: 8 (Very Good: 1; Very Bad: 10) - Housing, Subprime Auto; Student Loans; Credit Cards; Junk Bonds; EM USD Loans;
3. Recession: 8 (Strong Economy: 1; Depression: 10) - GDP; Taxes; PMI; Housing; Auto; Retail; NAFTA; Trade War; 2019?;
4. Liquidity: 8 (Very Liquid: 1; Tight 10) - QE (Feds, ECB, BOJ, PBOC); Interest Rates; Rotation (Bonds); Asset Shrinkage 2018?; EM; Italy;
5. Inverted Yield: 7 (Low Inversion: 1; High Inversion: 10) - Rising Interest Rates; Slope; Inversion; US 10 Years < US 2 Years; Expecting 2019 to 2020
6. Valuation; 7 (Safe 1: PE15; Danger 10: PE30) - PE S&P 24, Nadsaq 26; Revenue; USD; Tax Reform; Deregulation
7. Geopolitical Issues: 8 (Peaceful: 1; War: 10) - Iran; South China Sea; Europe; Russia; Saudi Arabia
Total: 52 out of 70 (74%); (Safe: 50%; Danger: 80%)


Commodities: Risk On (Data from Commodities Live on April 8 @ 5.00 pm)

1. WTI Oil - Higher. US$64.00 from US$63.80 last week from US$63.38 two weeks ago;
Support: US$43; US$34; Resistance: US$75, US$105
a. Trade Wars will reduce demand for Oil? -500k bpd?
b. Global Stockpiles: 2.5b barrels;
c. US SPR: 679m barrels (33 days); To sell 190m barrels over 8 years.
d. US imports 8m bpd (Total demand of India and Japan combined);
e. China (4th largest producer; largest importer) - Reserve life: Dropped from 10 to 6 years
f. China: Ban on Petrochemical Cars in 5-10 years? Quotas?
g. IEA: Lowest amount of new discoveries; Supply shortage in 2020?
h. Saudi: Aramco's IPO 2021? -1.3m bpd (35% cut in supply)
i. China: SPR 51/90 days; 2019 imports to decrease?
j. Libya: -850k bpd; Brazil +200k bpd; Canada -325 bpd; Nigeria -300k bpd; Iraq -150k bpd; Kurdistan -350k bpd; US +1m bpd; russia -500k;
k. Venezeula: -1.2m bpd; Worst Case -2m bpd supply (50% cut by 2020)?
l. Iran: -0.7m bpd to -1.6m bpd by 1Q, 2019? 6 months exemption from Nov; Expiring in April 2019
m. US Summer Driving season
n. OPEC: Heavier Crude; More Processing;
o. US: Lighter Crude and Lower Sulphur; Glut in Gasoline
p. EV: -350k bpd?
viewtopic.php?f=33&t=7550&start=210

2. Gold - Lower. US$1278 from US$1294 from US$1302
Support: $1150; $1050; Resistance: $1400
a. Global 33k tons; US 8k t; China 5k t; IMF 3k t; Germany 3k t
b. Electronics, Coins, Central Banks Reserve, Jewellery etc.
c. 250 oz of paper contract for every oz of physical gold holding on Comex
d. Output fell by 100 metric tons (3%), from 3,150 in 2015 to 3,050 in 2016
e. Demand from Muslim countries as Gold is now a halal investment
f. Rising USD & Interest Rates, would not be good for gold
g. Gold only occupies 0.03% of US investments. In 1981, it was 8%
h: India Demand: Since 2010, down each year. 2017 (700t); 2020 (900t)
i. China Demand: Since 2013, decreased 33% from 940t to 630t last year
j. Global Demand: 2Q 2018: China +5%; India -8%;
k. Central Banks: +22% yoy; 33k tons; Russian, Turkey, Khazakhstan & India
l. U.S. government holds 260m ounces at book value of only US$42m
m. China: Reserves 185m oz; 400m oz ground; Output decreased 6% yoy
n. Strong Selling by Gold ETFs
viewtopic.php?f=33&t=7589&p=202084#p202084

3. Silver - Higher. US$14.97 from US$14.93 from US$15.12
a. Support: US$16.10; US$15.20; Resistance: US$18.50; High: US$49
b. LED chips, Cell Phones, Nuclear Reactors, Photography, Solar Panels, RFID Chips, Semiconductors, Water Purification, Data Storage, Antibacterial products, Silver Coins, Jewelery
c. Demand: 1.2b ounces in 2015;
d. Supply: 0.9b ounces in 2015.
e. 4th year of deficit
f. 35% (7700 metric tons) for Electronics
g. 25% (5500 metric tons) for Bullions & Coins
h. India imports more Silver than the US
i. JPM has 67m ounces
j. High Gold/Siver Ratio: 50 t0 70; Currently 76, 50% higher than average
k, Production declining
l. Demand: 40% Investments / Speculation; 60% Industrial
m. About 1b ounces stored in China; 1 Year Production
n. How will US tariffs on Solar Panels affect silver prices?
viewtopic.php?f=33&t=7589&p=202084#p202084

4. Platinum - Higher; US$907 from US$895 from US$915; Vested
a. 28% for jewelry
b. 42% for diesel catalytic converters
c. Remainder for other industrial applications
d. Huge discount to Gold
e. Sixth year of deficit
f. 10 times more gold than platinum
g. Costlier to mine than gold as located deeper
h. Diesel cars losing market share
i. 70% of supply is from South Africa

6. Palladium - Higher; US$1410 from US$1345 from US$1353;
a. Support: US$940; US$500; Resistance: $1600 (Citi)
b. Catalytic Converters (Petrol Cars), Electronics, Dentistry, Medicine, Hydrogen Purification, Chemicals, Groundwater Treatment, Jewelry and Fuel Cells
c. Auto industry consumes 80% of supply
d. Demand by Auto industry doubled in past 10 years
e. Growth Demand: 10% in 2019
f. Russia and South Africa produced 3/4 of the world's mined palladium supply.
g. 8th Annual supply deficit;
h. Vehicle: PALL; SPPP (Physical Platinum & Palladium)
i. US Auto Sales weak
j. China - Pollution Programs
k. Supply Deficit: 1m Ounces in 2019
l. Global Stockpiles: 10 to 18m ounces (2 Year Demand)
m. Julius Baer 2020 Target: $1000

7. Zinc - Lower; US$2794 from US$2924 from US$2896
a. Global Demand: +14% pa for past 4 years
b. Supply: 13.7 tons; Supply Deficit 1.2m tons;
b. Breakpoint: High US$4400 (2007); Low $1600 (Jan 2016)
d. Used to prevent rusting, zinc oxide (paints), brass (copper), coins, fertilizer
e. Zinc inventories at the LME have dropped to their lowest level since 2009
f. Vehicle: DB Base Metal (Zinc, Aluminum & Copper); MMG
viewtopic.php?f=33&t=367&start=208.

8. Copper - Flat; US$2.92 from US$2.94 from US$2.92
a. Higher inventories at LME
b. China - 50% of global consumption
c. China - Lower Power Grid demand
viewtopic.php?f=33&t=5598&p=215285#p215285

9. Uranium - Flat; US$25.90 from US$25.85 from US$25.75
a. Breakeven: US$40 per lb; Long-Term Contract - 2x Spot
b. Range: $20 (2005) to $136 (2008); 580% rise in two years
c. Global Supply: 158m lbs pa; 15% from decommisioned weapons
d. Global Demand: 190m lbs pa to 300m lbs pa (2030)
e. Stockpile: 1b lbs (till 2022?) ; Companies normally store 5 years supply
f. Japanese Demand: 3m lbs pa; Starting 21/54 reactors? Currently, only 9
g. No. of Nuclear plants: +8 pa for next 20 yrs, 440 to 595; Current 452
h. 56 new reactors being built; 481 planned;
i. China: 46 existing plants; Building 11; To build 177 more?
j. India: 22 existing nuclear plants; Building 5; To build 64 more?
k. 75% long-term contracts expiring between 2017-25
l. 200 European nuclear reactors will be shut down over the next 25 years
m. France: Reduce nuclear to 50% from 75% by 2025 and closure of 20
n. Apr 14, 2019: US requires 25% local production; Higher electricity cost
o. Kazakhtan reducing supply by 10% (40% of global production)
p. Competition: Natural Gas, Solar, Wind, Wave etc
q. US: Nuclear - 20% of electricity; 99/447 Plants; 25% drop by 2025; Two Year Moratorium on Closure
r. Supply: 50k tons; Demand: 68k tons; 2k tons enriched for weapons
s. 1b pounds to be purchased for long-term contracts over next 5-10 years
t. Average reactor needs around 650,000 pounds to run for a year
u. US: 100/420 reactors; Importing 95% uranium; Demand 50m lbs pa
v. Uranium from Sea Water; Viable at US$180/kg (US$80/lbs); Timing?
w. Glut at 15m pounds (23 reactors for 1 year)
x. Cameco mothballed McArthur River & Key Lake; 10% world's supply
y. Kazatomprom, world's second largest, cut production by 20% for 3 yrs
z. Russia banning export of Uranium?

11. Cobalt - Higher; $16.10 (US$35500/t) from $15.42 ($34,000/t) from $14.52 ($32,000/t); Low $10; High US$43
a. Electric Vehicles (8 kg), Smartphones (8 grams), Jet Engines; Gigafactories
b. Congo: Supplies >50% world's supply; Child Labor?
c. Demand: 8% to 10% pa
d. Shortage: 2022 and beyond
e. Cobalt Reduced EV is 5-10 years away? Musk: Reducing Cobalt in Tesla;
f. 2018: 1m EVs (10k tonnes); 2027: 27m ( 27m tonnes)
g. Glencore - stockpiling till June 2019 (radioactivity); 25% Global Supply
g. Target: 2018 - US$62,000/t; 2022 - US$44.000/t


Equities - Risk-On (Data as of Saturday every week)

1. US Equities - Flat. 2905 from 2907 last week from 2893 two weeks ago
a. Support: 2320; Resistance: 2940; 3000; Fwd PE 16
b. Bought Electronic Arts (EA)
viewtopic.php?f=11&t=7643&start=200

2. HK Equities - Flat. 29963 from 29910 from 29937
a. Support: 24500, 23500; Resistance: 31200; 31600;
b. No Trade
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120

3. Shanghai Equities - Higher. 3271 from 3189 from 3243
a. Support: 2450; Resistance 3300; 3600
b. No Trade; No Convincing Stories
viewtopic.php?f=10&t=7190&start=210

4. Spore Equities - Higher; 3348 from 3332 from 3306
a. Resistance 3850
b. Sold Best World
c. Sold some HPL
viewtopic.php?f=10&t=6828&start=b110

5. Japan Equities - Higher. 22201 from 21871 from 21806
a. Forward PE 13
b. Support 19000; Resistance 25000
c. BOJ owns > half government bonds and 75% of ETFs
d. No Trade; No Convincing Stories
viewtopic.php?f=10&t=7138&start=200

6. Malaysian Equities; Lower; 1622 from 1630 from 1642
a. Bought Genting Malaysia
b. Bought Genting Berhad
viewtopic.php?f=10&t=6292&start=30


Currencies- Mixed (Data from XE.com on April 20 @ 5.30pm)

1. USD to JPY - JPY Stronger; 111.92 from 112.03 last week from 111.46 two weeks ago
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Why is it a Safe Haven ?
e. QE Infinity?
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Stronger; 3.0506 from 3.0421 from 3.0220
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Weaker; 0.7153 from 0.7169 from 0.7102
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
c. To diversify my AUD into what currency?
viewtopic.php?f=32&t=5256&start=130

4. AUD to SGD - AUD Weaker. 0.9691 from 0.9700 from 0.9632
a. The range is 0.98 (2016) to 1.36 (2012)
b. I would choose the AUD over the SGD

5. AUD to MYR - AUD Stronger. 2.9566 from 2.9509 from 2.9106
a. The range is 2.20 (2008) to 3.41 (2017)

6. EUR to USD - EUR Weaker. 1.1245 from 1.1318 from 1.1235
viewtopic.php?f=32&t=5523&start=100

7. USD to HKD - HKD Weaker. 7.8436 from 7.8426 from 7.8478
a. 52 week range is 7.7452 - 7.8530
b. USD Peg band: 7.75 to 7.85
c. Will they remove the peg to the USD during the next crisis?
d. Will China ask HK to depeg from the USD?
viewtopic.php?f=32&t=3529&start=40

8. USD to MYR:- MYR Weaker. 4.1336 from 4.1157 from 4.0985
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9. USD to SGD:-

9. USD to SGD:- SGD Weaker; 1.3548 from 1.3530 from 1.3562
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country
viewtopic.php?f=32&t=136&start=100

10. USD to CNY:- CNY Weaker; 6.7042 from 6.7037 from 6.7201
a. When is the right time to buy some CNY? How?
viewtopic.php?f=32&t=7720&start=90

11. GBP to USD:- GBP Weaker; 1.2997 from 1.3073 from 1.3051
a. Brexit; Politics;
viewtopic.php?f=32&t=333&start=80

12. GBP to MYR:- GBP Weaker; 5.3717 from 5.3801 from 5.3486

13. Dollar Index - USD Stronger; 97.38 from 97.26 from 97.11
viewtopic.php?f=32&t=7616&start=60


Others

Sentiment - Complacent?

Headwinds
a. Derivatives (US$700t);
b. Debts (US$237t, 318% GDP);
c. Corporate Debt (US$50t); US Corp Debts (US$9t)
d. Institutional Investors (US$0.5t)
e. ETFs AUM (US$3.4t)
f. Bitcoin (US$200b)
g. US Pension Short-Fall: US$385b
h. NPLs at European Banks: EUR$1t
i. China's Bond Market: US$12t (third largest)
j. Private Client Cash Levels as a % of Total Assets: Record Low (10.4%)
k. Institutional Investors: lowest levels of cash for past 8 years; 1/3 high in 2016


Tailwinds
a. Low Interest Rates
b. Cash Sidelines (US$50t)
c. QE US$18t: US (US$4.5t), ECB (US$3.7t), Japan (US$4.4t) & China (US$5.1t)
d. Negative Yield Bonds (US$6t from US$10t)
e. US Foreign Funds Repatriation (US$2.5t)
f. Cash US Corporations (US$1t)
g. Cash Japanese Corporations (US$2t)
h. Buybacks
i. US Household Net Worth (US$90t)
j. EM Consumption
k. Private Equities: US$600b Cash

Risk Management:-
a. Global Diversification
b. Asset Class Diversification
c. Diversity of Industry & Company Exposure
d. Currency Hedging
e. Tactical Asset Allocation
f . Inverse ETFs and Put Warrants

HK Properties
a. Vacancy tax
b. 9000 vacant apartments
c. CLSA, UBS and Citi - Prices may drop 10% to 15% by end 2019
d. Rising Interest rates
e. Slowing Economy / Trade War
f. Depreciating Yuan
g. Weak Stock Markets
h. Justin Chiu (CK Asset): 10-20% drop; Outskirt Nanos (30% drop)

Spore Properties
a. 60,000 Units of Supply (7 years Supply of 6500 Homes per year )
b. Unsold residential units doubled to over 34,000 in 2018

Malaysian Properties
a. JPPH: Overhang - 30,115 units (2018) vs 20,304 (2017)
b. Overhang would be greater if Serviced Residence and SOHOs are included

China Properties
a. 20% of Urban Housing is vacant (65m homes)
b. In 2018, nationwide ASPs have climbed by 15% to a record high
c. Since 2015, Tier One cities have risen by 55%
d. Since 2015, Tier Two cities have risen by 35%
e. Government targeting annual increase of 7% to 10%

Yield on 10 Year US Treasuries - Lower; 2.56% from 2.57% last week from 2.50% two weeks ago
a. Resistance 3.3%

Yield on 2 Year Treasuries - Lower; 2.38% from 2.39% last week from 2.34% two weeks ago.

Interest Rates:-
a. Expecting US Interest Rates to slowly rise over next 2 years
b. About US$9t or about 23% of the world’s bonds have negative yields
c. US Rate Hike: None in 2019?
d. Argentina's Intertest Rate: 60%
e. Turkey's Interest Rate: 24%
f. Ukraine's Interest rate: 18%
viewtopic.php?f=16&t=7319&p=221670#p221670


JNK (SPDR Barclays High Yield Bond ETF) - Lower; 36.14 from 36.22 from 35.97

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Lower; 86.68 from 86.96 from 86.43

Baltic Dry Index - Higher; 790 from 726 from 711; Low 290; High 2330 (2013)


The above is to from 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 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.

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viewtopic.php?f=26&t=3168

Active Topics - Do you know that there's an "Active Topics" button? It's located on the top left hand corner of the Index
You do not have the required permissions to view the files attached to this post.
It's all about "how much you made when you were right" & "how little you lost when you were wrong"
User avatar
winston
Billionaire Boss
 
Posts: 118539
Joined: Wed May 07, 2008 9:28 am

Re: Winston's Investment Ideas 04 (Oct 15 - Jun 19)

Postby winston » Sun Apr 28, 2019 3:00 pm

TOL @ April 28, 2019

Sell In May.jpg


Sell In May & Go Away?

The Markets have not really gone anywhere over the past 2-3 weeks.

Are we now facing a "resistance" or are we "plateauing" before it rises again, possibly when Trump and Xi meets in June?

Intuitively, I think that we are now facing a "resistance" as it's widely expected that the US and China would be signing something in June.

However, the damage has already being done. Businesses are no longer expanding and world trade is declining.

Bond yields have also decreased due to the huge amount of money that's moving to the sidelines.

Very soon, the Central Banksters will have to start printing money again.

In view of the above, I'm no longer chasing things and if I do buy, there's a need for a very convincing story.

BTW, if they do not handle Iran and Venezeula well, that could be the catalyst to bring the current "house of cards" down.

At the same time, I need to remind myself that the current "goldilocks" scenario may go on much longer than I can be solvent, so it may not pay to be too pessimistic either.

It's a probably a stock-picker's market now and staying disciplined is probably the right approach in this type of market.


Weekly Risk Management Progress Report:-
1. To Monitor Exposure To Equities: Safe (10% from 9% last week, of Liquid Assets);
Goal: Zero Equities before the next recession (2020-2021?); Maximum 45%;
2. To Diversify From Asian Equities: Worse (67% from 65% last week)
Goal: To reduce percentage of Asian Equities to around 50%
3. To Buy Inverse ETFs and Puts - Waiting for "M" on charts.
Goal: To have a sizable short position going into the next recession
4. To Increase "USD/HKD/Gold" - No Progress ( at 28%)
Goal: To be in the safe havens before next recession; (HKD may be repegged)
5. To Reduce Number Of Counters to 10: No Progress(11 from 11 last week).
Goal: To focus on only about 10 counters that have convincing stories


Market Risk Indicators
1. Euphoria: 7 (Low: 1; High: 10) - FAANNG, ETFs; Margin Debts; SWFs; Central Banks; Fund Flows;
2. Credit Problems: 8 (Very Good: 1; Very Bad: 10) - Housing, Subprime Auto; Student Loans; Credit Cards; Junk Bonds; EM USD Loans;
3. Recession: 8 (Strong Economy: 1; Depression: 10) - GDP; Taxes; PMI; Housing; Auto; Retail; NAFTA; Trade War; 2019?;
4. Liquidity: 8 (Very Liquid: 1; Tight 10) - QE (Feds, ECB, BOJ, PBOC); Interest Rates; Rotation (Bonds); Asset Shrinkage 2018?; EM; Italy;
5. Inverted Yield: 7 (Low Inversion: 1; High Inversion: 10) - Rising Interest Rates; Slope; Inversion; US 10 Years < US 2 Years; Expecting 2019 to 2020
6. Valuation; 7 (Safe 1: PE15; Danger 10: PE30) - PE S&P 24, Nadsaq 26; Revenue; USD; Tax Reform; Deregulation
7. Geopolitical Issues: 8 (Peaceful: 1; War: 10) - Iran; South China Sea; Europe; Russia; Saudi Arabia
Total: 52 out of 70 (74%); (Safe: 50%; Danger: 80%)


Commodities: Risk Off (Data from Commodities Live on April 26 @ 9.00 pm)

1. WTI Oil - Flat. US$63.99 from US$64.00 last week from US$63.80 two weeks ago;
Support: US$43; US$34; Resistance: US$75, US$105
a. Trade Wars will reduce demand for Oil? -500k bpd?
b. Global Stockpiles: 2.5b barrels;
c. US SPR: 679m barrels (33 days); To sell 190m barrels over 8 years.
d. US imports 8m bpd (Total demand of India and Japan combined);
e. China (4th largest producer; largest importer) - Reserve life: Dropped from 10 to 6 years
f. China: Ban on Petrochemical Cars in 5-10 years? Quotas?
g. IEA: Lowest amount of new discoveries; Supply shortage in 2020?
h. Saudi: Aramco's IPO 2021? -1.3m bpd (35% cut in supply)
i. China: SPR 51/90 days; 2019 imports to decrease?
j. Libya: -850k bpd; Brazil +200k bpd; Canada -325 bpd; Nigeria -300k bpd; Iraq -150k bpd; Kurdistan -350k bpd; US +1m bpd; russia -500k;
k. Venezeula: -1.2m bpd; Worst Case -2m bpd supply (50% cut by 2020)?
l. Iran: -2.3m bpd ?
m. US Summer Driving season
n. OPEC: Heavier Crude; More Processing;
o. US: Lighter Crude and Lower Sulphur; Glut in Gasoline
p. EV: -350k bpd?
viewtopic.php?f=33&t=7550&start=210

2. Gold - Higher. US$1286 from US$1278 from US$1294
Support: $1240; $1150; $1050; Resistance: $1400
a. Global 33k tons; US 8k t; China 5k t; IMF 3k t; Germany 3k t
b. Electronics, Coins, Central Banks Reserve, Jewellery etc.
c. 250 oz of paper contract for every oz of physical gold holding on Comex
d. Output fell by 100 metric tons (3%), from 3,150 in 2015 to 3,050 in 2016
e. Demand from Muslim countries as Gold is now a halal investment
f. Rising USD & Interest Rates, would not be good for gold
g. Gold only occupies 0.03% of US investments. In 1981, it was 8%
h: India Demand: Since 2010, down each year. 2017 (700t); 2020 (900t)
i. China Demand: Since 2013, decreased 33% from 940t to 630t last year
j. Global Demand: 2Q 2018: China +5%; India -8%;
k. Central Banks: +22% yoy; 33k tons; Russian, Turkey, Khazakhstan & India
l. U.S. government holds 260m ounces at book value of only US$42m
m. China: Reserves 185m oz; 400m oz ground; Output decreased 6% yoy
n. Strong Selling by Gold ETFs
viewtopic.php?f=33&t=7589&p=202084#p202084

3. Silver - Higher. US$15.02 from US$14.97 from US$14.93
a. Support: US$16.10; US$15.20; Resistance: US$18.50; High: US$49
b. LED chips, Cell Phones, Nuclear Reactors, Photography, Solar Panels, RFID Chips, Semiconductors, Water Purification, Data Storage, Antibacterial products, Silver Coins, Jewelery
c. Demand: 1.2b ounces in 2015;
d. Supply: 0.9b ounces in 2015.
e. 4th year of deficit
f. 35% (7700 metric tons) for Electronics
g. 25% (5500 metric tons) for Bullions & Coins
h. India imports more Silver than the US
i. JPM has 67m ounces
j. High Gold/Siver Ratio: 50 t0 70; Currently 76, 50% higher than average
k, Production declining
l. Demand: 40% Investments / Speculation; 60% Industrial
m. About 1b ounces stored in China; 1 Year Production
n. How will US tariffs on Solar Panels affect silver prices?
viewtopic.php?f=33&t=7589&p=202084#p202084

4. Platinum - Lower; US$895 from US$907 from US$895; Vested
a. 28% for jewelry
b. 42% for diesel catalytic converters
c. Remainder for other industrial applications
d. Huge discount to Gold
e. Sixth year of deficit
f. 10 times more gold than platinum
g. Costlier to mine than gold as located deeper
h. Diesel cars losing market share
i. 70% of supply is from South Africa

6. Palladium - Higher; US$1426 from US$1410 from US$1345;
a. Support: US$940; US$500; Resistance: $1600 (Citi)
b. Catalytic Converters (Petrol Cars), Electronics, Dentistry, Medicine, Hydrogen Purification, Chemicals, Groundwater Treatment, Jewelry and Fuel Cells
c. Auto industry consumes 80% of supply
d. Demand by Auto industry doubled in past 10 years
e. Growth Demand: 10% in 2019
f. Russia and South Africa produced 3/4 of the world's mined palladium supply.
g. 8th Annual supply deficit;
h. Vehicle: PALL; SPPP (Physical Platinum & Palladium)
i. US Auto Sales weak
j. China - Pollution Programs
k. Supply Deficit: 1m Ounces in 2019
l. Global Stockpiles: 10 to 18m ounces (2 Year Demand)
m. Julius Baer 2020 Target: $1000

7. Zinc - Lower; US$2780 from US$2794 from US$2924
a. Global Demand: +14% pa for past 4 years
b. Supply: 13.7 tons; Supply Deficit 1.2m tons;
b. Breakpoint: High US$4400 (2007); Low $1600 (Jan 2016)
d. Used to prevent rusting, zinc oxide (paints), brass (copper), coins, fertilizer
e. Zinc inventories at the LME have dropped to their lowest level since 2009
f. Vehicle: DB Base Metal (Zinc, Aluminum & Copper); MMG
viewtopic.php?f=33&t=367&start=208.

8. Copper - Lower; US$2.88 from US$2.92 from US$2.94
a. Higher inventories at LME
b. China - 50% of global consumption
c. China - Lower Power Grid demand
viewtopic.php?f=33&t=5598&p=215285#p215285

9. Uranium - Flat; US$25.40 from US$25.90 from US$25.85
a. Breakeven: US$40 per lb; Long-Term Contract - 2x Spot
b. Range: $20 (2005) to $136 (2008); 580% rise in two years
c. Global Supply: 158m lbs pa; 15% from decommisioned weapons
d. Global Demand: 190m lbs pa to 300m lbs pa (2030)
e. Stockpile: 1b lbs (till 2022?) ; Companies normally store 5 years supply
f. Japanese Demand: 3m lbs pa; Starting 21/54 reactors? Currently, only 9
g. No. of Nuclear plants: +8 pa for next 20 yrs, 440 to 595; Current 452
h. 56 new reactors being built; 481 planned;
i. China: 46 existing plants; Building 11; To build 177 more?
j. India: 22 existing nuclear plants; Building 5; To build 64 more?
k. 75% long-term contracts expiring between 2017-25
l. 200 European nuclear reactors will be shut down over the next 25 years
m. France: Reduce nuclear to 50% from 75% by 2025 and closure of 20
n. Apr 14, 2019: US requires 25% local production; Higher electricity cost
o. Kazakhtan reducing supply by 10% (40% of global production)
p. Competition: Natural Gas, Solar, Wind, Wave etc
q. US: Nuclear - 20% of electricity; 99/447 Plants; 25% drop by 2025; Two Year Moratorium on Closure
r. Supply: 50k tons; Demand: 68k tons; 2k tons enriched for weapons
s. 1b pounds to be purchased for long-term contracts over next 5-10 years
t. Average reactor needs around 650,000 pounds to run for a year
u. US: 100/420 reactors; Importing 95% uranium; Demand 50m lbs pa
v. Uranium from Sea Water; Viable at US$180/kg (US$80/lbs); Timing?
w. Glut at 15m pounds (23 reactors for 1 year)
x. Cameco mothballed McArthur River & Key Lake; 10% world's supply
y. Kazatomprom, world's second largest, cut production by 20% for 3 yrs
z. Russia banning export of Uranium?

11. Cobalt - Lower; $15.76 ($34,750/t) from $16.10 (US$35500/t) from $15.42 ($34,000/t); Low $10; High US$43
a. Electric Vehicles (8 kg), Smartphones (8 grams), Jet Engines; Gigafactories
b. Congo: Supplies >50% world's supply; Child Labor?
c. Demand: 8% to 10% pa
d. Shortage: 2022 and beyond
e. Cobalt Reduced EV is 5-10 years away? Musk: Reducing Cobalt in Tesla;
f. 2018: 1m EVs (10k tonnes); 2027: 27m ( 27m tonnes)
g. Glencore - stockpiling till June 2019 (radioactivity); 25% Global Supply
g. Target: 2018 - US$62,000/t; 2022 - US$44.000/t


Equities - Mixed (Data as of Saturday every week)

1. US Equities - Higher. 2940 from 2905 last week from 2907 two weeks ago
a. Support: 2320; Resistance: 2940; 3000; Fwd PE 16
b. No Trade
viewtopic.php?f=11&t=7643&start=200

2. HK Equities - Lower. 29605 from 29963 from 29910
a. Support: 24500, 23500; Resistance: 31200; 31600;
b. No Trade
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120

3. Shanghai Equities - Lower. 3086 from 3271 from 3189
a. Support: 2450; Resistance 3300; 3600
b. No Trade; No Convincing Stories
viewtopic.php?f=10&t=7190&start=210

4. Spore Equities - Higher; 3357 from 3348 from 3332
a. Resistance 3850
b. Added to Genting Singapore
viewtopic.php?f=10&t=6828&start=b110

5. Japan Equities - Higher. 22259 from 22201 from 21871
a. Forward PE 13
b. Support 19000; Resistance 25000
c. BOJ owns > half government bonds and 75% of ETFs
d. No Trade; No Convincing Stories
viewtopic.php?f=10&t=7138&start=200

6. Malaysian Equities; Higher; 1638 from 1622 from 1630
a. Added to Genting Malaysia
viewtopic.php?f=10&t=6292&start=30


Currencies- Mixed (Data from XE.com on April 27 @ 11.30am)

1. USD to JPY - JPY Stronger; 111.59 from 111.92 last week from 112.03 two weeks ago
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Why is it a Safe Haven ?
e. QE Infinity?
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Weaker; 3.0344 from 3.0506 from 3.0421
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Weaker; 0.7039 from 0.7153 from 0.7169
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
c. To diversify my AUD into what currency?
viewtopic.php?f=32&t=5256&start=130

4. AUD to SGD - AUD Weaker. 0.9588 from 0.9691 from 0.9700
a. The range is 0.98 (2016) to 1.36 (2012)
b. I would choose the AUD over the SGD

5. AUD to MYR - AUD Weaker. 2.9093 from 2.9566 from 2.9509
a. The range is 2.20 (2008) to 3.41 (2017)

6. EUR to USD - EUR Weaker. 1.1161 from 1.1245 from 1.1318
viewtopic.php?f=32&t=5523&start=100

7. USD to HKD - HKD Weaker. 7.8443 from 7.8436 from 7.8426
a. 52 week range is 7.7452 - 7.8530
b. USD Peg band: 7.75 to 7.85
c. Will they remove the peg to the USD during the next crisis?
d. Will China ask HK to depeg from the USD?
viewtopic.php?f=32&t=3529&start=40

8. USD to MYR:- MYR Stronger. 4.1332 from 4.1336 from 4.1157
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9. USD to SGD:-

9. USD to SGD:- SGD Weaker; 1.3621 from 1.3548 from 1.3530
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country
viewtopic.php?f=32&t=136&start=100

10. USD to CNY:- CNY Weaker; 6.7288 from 6.7042 from 6.7037
a. When is the right time to buy some CNY? How?
viewtopic.php?f=32&t=7720&start=90

11. GBP to USD:- GBP Weaker; 1.2916 from 1.2997 from 1.3073
a. Brexit; Politics;
viewtopic.php?f=32&t=333&start=80

12. GBP to MYR:- GBP Weaker; 5.3384 from 5.3717 from 5.3801

13. Dollar Index - USD Stronger; 98.01 from 97.38 from 97.26
viewtopic.php?f=32&t=7616&start=60


Others

Sentiment - Complacent?

Headwinds
a. Derivatives (US$700t);
b. Debts (US$237t, 318% GDP);
c. Corporate Debt (US$50t); US Corp Debts (US$9t)
d. Institutional Investors (US$0.5t)
e. ETFs AUM (US$3.4t)
f. Bitcoin (US$200b)
g. US Pension Short-Fall: US$385b
h. NPLs at European Banks: EUR$1t
i. China's Bond Market: US$12t (third largest)
j. Private Client Cash Levels as a % of Total Assets: Record Low (10.4%)
k. Institutional Investors: lowest levels of cash for past 8 years; 1/3 high in 2016


Tailwinds
a. Low Interest Rates
b. Cash Sidelines (US$50t)
c. QE US$18t: US (US$4.5t), ECB (US$3.7t), Japan (US$4.4t) & China (US$5.1t)
d. Negative Yield Bonds (US$6t from US$10t)
e. US Foreign Funds Repatriation (US$2.5t)
f. Cash US Corporations (US$1t)
g. Cash Japanese Corporations (US$2t)
h. Buybacks
i. US Household Net Worth (US$90t)
j. EM Consumption
k. Private Equities: US$600b Cash

Risk Management:-
a. Global Diversification
b. Asset Class Diversification
c. Diversity of Industry & Company Exposure
d. Currency Hedging
e. Tactical Asset Allocation
f . Inverse ETFs and Put Warrants

HK Properties
a. Vacancy tax
b. 9000 vacant apartments
c. CLSA, UBS and Citi - Prices may drop 10% to 15% by end 2019
d. Rising Interest rates
e. Slowing Economy / Trade War
f. Depreciating Yuan
g. Weak Stock Markets
h. Justin Chiu (CK Asset): 10-20% drop; Outskirt Nanos (30% drop)

Spore Properties
a. 60,000 Units of Supply (7 years Supply of 6500 Homes per year )
b. Unsold residential units doubled to over 34,000 in 2018

Malaysian Properties
a. JPPH: Overhang - 30,115 units (2018) vs 20,304 (2017)
b. Overhang would be greater if Serviced Residence and SOHOs are included

China Properties
a. 20% of Urban Housing is vacant (65m homes)
b. In 2018, nationwide ASPs have climbed by 15% to a record high
c. Since 2015, Tier One cities have risen by 55%
d. Since 2015, Tier Two cities have risen by 35%
e. Government targeting annual increase of 7% to 10%

Yield on 10 Year US Treasuries - Lower; 2.50% from 2.56% last week from 2.57% two weeks ago
a. Resistance 3.3%

Yield on 2 Year Treasuries - Lower; 2.28% from 2.38% from 2.39%

Interest Rates:-
a. Expecting US Interest Rates to slowly rise over next 2 years
b. About US$9t or about 23% of the world’s bonds have negative yields
c. US Rate Hike: None in 2019?
d. Argentina's Intertest Rate: 60%
e. Turkey's Interest Rate: 24%
f. Ukraine's Interest rate: 18%
viewtopic.php?f=16&t=7319&p=221670#p221670


JNK (SPDR Barclays High Yield Bond ETF) - Flat; 36.17 from 36.14 from 36.22

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Higher; 86.75 from 86.68 from 86.96

Baltic Dry Index - Higher; 869 from 790 from 726; Low 290; High 2330 (2013)


The above is to from 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 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.

Second Opinion - Please see the "Second Opinion" thread in the "Services for InvestIdeas Members" section, located just below the Miscellaneous Section.
viewtopic.php?f=26&t=3168

Active Topics - Do you know that there's an "Active Topics" button? It's located on the top left hand corner of the Index
You do not have the required permissions to view the files attached to this post.
It's all about "how much you made when you were right" & "how little you lost when you were wrong"
User avatar
winston
Billionaire Boss
 
Posts: 118539
Joined: Wed May 07, 2008 9:28 am

Re: Winston's Investment Ideas 04 (Oct 15 - Jun 19)

Postby winston » Sun Apr 28, 2019 3:00 pm

TOL @ April 28, 2019

Sell In May.jpg


Sell In May & Go Away?

The Markets have not really gone anywhere over the past 2-3 weeks.

Are we now facing a "resistance" or are we "plateauing" before it rises again, possibly when Trump and Xi meets in June?

Intuitively, I think that we are now facing a "resistance" as it's widely expected that the US and China would be signing something in June.

However, the damage has already being done. Businesses are no longer expanding and world trade is declining.

Bond yields have also decreased due to the huge amount of money that's moving to the sidelines.

Very soon, the Central Banksters will have to start printing money again.

In view of the above, I'm no longer chasing things and if I do buy, there's a need for a very convincing story.

BTW, if they do not handle Iran and Venezeula well, that could be the catalyst to bring the current "house of cards" down.

At the same time, I need to remind myself that the current "goldilocks" scenario may go on much longer than I can be solvent, so it may not pay to be too pessimistic either.

It's a probably a stock-picker's market now and staying disciplined is probably the right approach in this type of market.


Weekly Risk Management Progress Report:-
1. To Monitor Exposure To Equities: Safe (10% from 9% last week, of Liquid Assets);
Goal: Zero Equities before the next recession (2020-2021?); Maximum 45%;
2. To Diversify From Asian Equities: Worse (67% from 65% last week)
Goal: To reduce percentage of Asian Equities to around 50%
3. To Buy Inverse ETFs and Puts - Waiting for "M" on charts.
Goal: To have a sizable short position going into the next recession
4. To Increase "USD/HKD/Gold" - No Progress ( at 28%)
Goal: To be in the safe havens before next recession; (HKD may be repegged)
5. To Reduce Number Of Counters to 10: No Progress(11 from 11 last week).
Goal: To focus on only about 10 counters that have convincing stories


Market Risk Indicators
1. Euphoria: 7 (Low: 1; High: 10) - FAANNG, ETFs; Margin Debts; SWFs; Central Banks; Fund Flows;
2. Credit Problems: 8 (Very Good: 1; Very Bad: 10) - Housing, Subprime Auto; Student Loans; Credit Cards; Junk Bonds; EM USD Loans;
3. Recession: 8 (Strong Economy: 1; Depression: 10) - GDP; Taxes; PMI; Housing; Auto; Retail; NAFTA; Trade War; 2019?;
4. Liquidity: 8 (Very Liquid: 1; Tight 10) - QE (Feds, ECB, BOJ, PBOC); Interest Rates; Rotation (Bonds); Asset Shrinkage 2018?; EM; Italy;
5. Inverted Yield: 7 (Low Inversion: 1; High Inversion: 10) - Rising Interest Rates; Slope; Inversion; US 10 Years < US 2 Years; Expecting 2019 to 2020
6. Valuation; 7 (Safe 1: PE15; Danger 10: PE30) - PE S&P 24, Nadsaq 26; Revenue; USD; Tax Reform; Deregulation
7. Geopolitical Issues: 8 (Peaceful: 1; War: 10) - Iran; South China Sea; Europe; Russia; Saudi Arabia
Total: 52 out of 70 (74%); (Safe: 50%; Danger: 80%)


Commodities: Risk Off (Data from Commodities Live on April 26 @ 9.00 pm)

1. WTI Oil - Flat. US$63.99 from US$64.00 last week from US$63.80 two weeks ago;
Support: US$43; US$34; Resistance: US$75, US$105
a. Trade Wars will reduce demand for Oil? -500k bpd?
b. Global Stockpiles: 2.5b barrels;
c. US SPR: 679m barrels (33 days); To sell 190m barrels over 8 years.
d. US imports 8m bpd (Total demand of India and Japan combined);
e. China (4th largest producer; largest importer) - Reserve life: Dropped from 10 to 6 years
f. China: Ban on Petrochemical Cars in 5-10 years? Quotas?
g. IEA: Lowest amount of new discoveries; Supply shortage in 2020?
h. Saudi: Aramco's IPO 2021? -1.3m bpd (35% cut in supply)
i. China: SPR 51/90 days; 2019 imports to decrease?
j. Libya: -850k bpd; Brazil +200k bpd; Canada -325 bpd; Nigeria -300k bpd; Iraq -150k bpd; Kurdistan -350k bpd; US +1m bpd; russia -500k;
k. Venezeula: -1.2m bpd; Worst Case -2m bpd supply (50% cut by 2020)?
l. Iran: -2.3m bpd ?
m. US Summer Driving season
n. OPEC: Heavier Crude; More Processing;
o. US: Lighter Crude and Lower Sulphur; Glut in Gasoline
p. EV: -350k bpd?
viewtopic.php?f=33&t=7550&start=210

2. Gold - Higher. US$1286 from US$1278 from US$1294
Support: $1240; $1150; $1050; Resistance: $1400
a. Global 33k tons; US 8k t; China 5k t; IMF 3k t; Germany 3k t
b. Electronics, Coins, Central Banks Reserve, Jewellery etc.
c. 250 oz of paper contract for every oz of physical gold holding on Comex
d. Output fell by 100 metric tons (3%), from 3,150 in 2015 to 3,050 in 2016
e. Demand from Muslim countries as Gold is now a halal investment
f. Rising USD & Interest Rates, would not be good for gold
g. Gold only occupies 0.03% of US investments. In 1981, it was 8%
h: India Demand: Since 2010, down each year. 2017 (700t); 2020 (900t)
i. China Demand: Since 2013, decreased 33% from 940t to 630t last year
j. Global Demand: 2Q 2018: China +5%; India -8%;
k. Central Banks: +22% yoy; 33k tons; Russian, Turkey, Khazakhstan & India
l. U.S. government holds 260m ounces at book value of only US$42m
m. China: Reserves 185m oz; 400m oz ground; Output decreased 6% yoy
n. Strong Selling by Gold ETFs
viewtopic.php?f=33&t=7589&p=202084#p202084

3. Silver - Higher. US$15.02 from US$14.97 from US$14.93
a. Support: US$16.10; US$15.20; Resistance: US$18.50; High: US$49
b. LED chips, Cell Phones, Nuclear Reactors, Photography, Solar Panels, RFID Chips, Semiconductors, Water Purification, Data Storage, Antibacterial products, Silver Coins, Jewelery
c. Demand: 1.2b ounces in 2015;
d. Supply: 0.9b ounces in 2015.
e. 4th year of deficit
f. 35% (7700 metric tons) for Electronics
g. 25% (5500 metric tons) for Bullions & Coins
h. India imports more Silver than the US
i. JPM has 67m ounces
j. High Gold/Siver Ratio: 50 t0 70; Currently 76, 50% higher than average
k, Production declining
l. Demand: 40% Investments / Speculation; 60% Industrial
m. About 1b ounces stored in China; 1 Year Production
n. How will US tariffs on Solar Panels affect silver prices?
viewtopic.php?f=33&t=7589&p=202084#p202084

4. Platinum - Lower; US$895 from US$907 from US$895; Vested
a. 28% for jewelry
b. 42% for diesel catalytic converters
c. Remainder for other industrial applications
d. Huge discount to Gold
e. Sixth year of deficit
f. 10 times more gold than platinum
g. Costlier to mine than gold as located deeper
h. Diesel cars losing market share
i. 70% of supply is from South Africa

6. Palladium - Higher; US$1426 from US$1410 from US$1345;
a. Support: US$940; US$500; Resistance: $1600 (Citi)
b. Catalytic Converters (Petrol Cars), Electronics, Dentistry, Medicine, Hydrogen Purification, Chemicals, Groundwater Treatment, Jewelry and Fuel Cells
c. Auto industry consumes 80% of supply
d. Demand by Auto industry doubled in past 10 years
e. Growth Demand: 10% in 2019
f. Russia and South Africa produced 3/4 of the world's mined palladium supply.
g. 8th Annual supply deficit;
h. Vehicle: PALL; SPPP (Physical Platinum & Palladium)
i. US Auto Sales weak
j. China - Pollution Programs
k. Supply Deficit: 1m Ounces in 2019
l. Global Stockpiles: 10 to 18m ounces (2 Year Demand)
m. Julius Baer 2020 Target: $1000

7. Zinc - Lower; US$2780 from US$2794 from US$2924
a. Global Demand: +14% pa for past 4 years
b. Supply: 13.7 tons; Supply Deficit 1.2m tons;
b. Breakpoint: High US$4400 (2007); Low $1600 (Jan 2016)
d. Used to prevent rusting, zinc oxide (paints), brass (copper), coins, fertilizer
e. Zinc inventories at the LME have dropped to their lowest level since 2009
f. Vehicle: DB Base Metal (Zinc, Aluminum & Copper); MMG
viewtopic.php?f=33&t=367&start=208.

8. Copper - Lower; US$2.88 from US$2.92 from US$2.94
a. Higher inventories at LME
b. China - 50% of global consumption
c. China - Lower Power Grid demand
viewtopic.php?f=33&t=5598&p=215285#p215285

9. Uranium - Flat; US$25.40 from US$25.90 from US$25.85
a. Breakeven: US$40 per lb; Long-Term Contract - 2x Spot
b. Range: $20 (2005) to $136 (2008); 580% rise in two years
c. Global Supply: 158m lbs pa; 15% from decommisioned weapons
d. Global Demand: 190m lbs pa to 300m lbs pa (2030)
e. Stockpile: 1b lbs (till 2022?) ; Companies normally store 5 years supply
f. Japanese Demand: 3m lbs pa; Starting 21/54 reactors? Currently, only 9
g. No. of Nuclear plants: +8 pa for next 20 yrs, 440 to 595; Current 452
h. 56 new reactors being built; 481 planned;
i. China: 46 existing plants; Building 11; To build 177 more?
j. India: 22 existing nuclear plants; Building 5; To build 64 more?
k. 75% long-term contracts expiring between 2017-25
l. 200 European nuclear reactors will be shut down over the next 25 years
m. France: Reduce nuclear to 50% from 75% by 2025 and closure of 20
n. Apr 14, 2019: US requires 25% local production; Higher electricity cost
o. Kazakhtan reducing supply by 10% (40% of global production)
p. Competition: Natural Gas, Solar, Wind, Wave etc
q. US: Nuclear - 20% of electricity; 99/447 Plants; 25% drop by 2025; Two Year Moratorium on Closure
r. Supply: 50k tons; Demand: 68k tons; 2k tons enriched for weapons
s. 1b pounds to be purchased for long-term contracts over next 5-10 years
t. Average reactor needs around 650,000 pounds to run for a year
u. US: 100/420 reactors; Importing 95% uranium; Demand 50m lbs pa
v. Uranium from Sea Water; Viable at US$180/kg (US$80/lbs); Timing?
w. Glut at 15m pounds (23 reactors for 1 year)
x. Cameco mothballed McArthur River & Key Lake; 10% world's supply
y. Kazatomprom, world's second largest, cut production by 20% for 3 yrs
z. Russia banning export of Uranium?

11. Cobalt - Lower; $15.76 ($34,750/t) from $16.10 (US$35500/t) from $15.42 ($34,000/t); Low $10; High US$43
a. Electric Vehicles (8 kg), Smartphones (8 grams), Jet Engines; Gigafactories
b. Congo: Supplies >50% world's supply; Child Labor?
c. Demand: 8% to 10% pa
d. Shortage: 2022 and beyond
e. Cobalt Reduced EV is 5-10 years away? Musk: Reducing Cobalt in Tesla;
f. 2018: 1m EVs (10k tonnes); 2027: 27m ( 27m tonnes)
g. Glencore - stockpiling till June 2019 (radioactivity); 25% Global Supply
g. Target: 2018 - US$62,000/t; 2022 - US$44.000/t


Equities - Mixed (Data as of Saturday every week)

1. US Equities - Higher. 2940 from 2905 last week from 2907 two weeks ago
a. Support: 2320; Resistance: 2940; 3000; Fwd PE 16
b. No Trade
viewtopic.php?f=11&t=7643&start=200

2. HK Equities - Lower. 29605 from 29963 from 29910
a. Support: 24500, 23500; Resistance: 31200; 31600;
b. No Trade
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120

3. Shanghai Equities - Lower. 3086 from 3271 from 3189
a. Support: 2450; Resistance 3300; 3600
b. No Trade; No Convincing Stories
viewtopic.php?f=10&t=7190&start=210

4. Spore Equities - Higher; 3357 from 3348 from 3332
a. Resistance 3850
b. Added to Genting Singapore
viewtopic.php?f=10&t=6828&start=b110

5. Japan Equities - Higher. 22259 from 22201 from 21871
a. Forward PE 13
b. Support 19000; Resistance 25000
c. BOJ owns > half government bonds and 75% of ETFs
d. No Trade; No Convincing Stories
viewtopic.php?f=10&t=7138&start=200

6. Malaysian Equities; Higher; 1638 from 1622 from 1630
a. Added to Genting Malaysia
viewtopic.php?f=10&t=6292&start=30


Currencies- Mixed (Data from XE.com on April 27 @ 11.30am)

1. USD to JPY - JPY Stronger; 111.59 from 111.92 last week from 112.03 two weeks ago
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Why is it a Safe Haven ?
e. QE Infinity?
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Weaker; 3.0344 from 3.0506 from 3.0421
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Weaker; 0.7039 from 0.7153 from 0.7169
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
c. To diversify my AUD into what currency?
viewtopic.php?f=32&t=5256&start=130

4. AUD to SGD - AUD Weaker. 0.9588 from 0.9691 from 0.9700
a. The range is 0.98 (2016) to 1.36 (2012)
b. I would choose the AUD over the SGD

5. AUD to MYR - AUD Weaker. 2.9093 from 2.9566 from 2.9509
a. The range is 2.20 (2008) to 3.41 (2017)

6. EUR to USD - EUR Weaker. 1.1161 from 1.1245 from 1.1318
viewtopic.php?f=32&t=5523&start=100

7. USD to HKD - HKD Weaker. 7.8443 from 7.8436 from 7.8426
a. 52 week range is 7.7452 - 7.8530
b. USD Peg band: 7.75 to 7.85
c. Will they remove the peg to the USD during the next crisis?
d. Will China ask HK to depeg from the USD?
viewtopic.php?f=32&t=3529&start=40

8. USD to MYR:- MYR Stronger. 4.1332 from 4.1336 from 4.1157
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9. USD to SGD:-

9. USD to SGD:- SGD Weaker; 1.3621 from 1.3548 from 1.3530
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country
viewtopic.php?f=32&t=136&start=100

10. USD to CNY:- CNY Weaker; 6.7288 from 6.7042 from 6.7037
a. When is the right time to buy some CNY? How?
viewtopic.php?f=32&t=7720&start=90

11. GBP to USD:- GBP Weaker; 1.2916 from 1.2997 from 1.3073
a. Brexit; Politics;
viewtopic.php?f=32&t=333&start=80

12. GBP to MYR:- GBP Weaker; 5.3384 from 5.3717 from 5.3801

13. Dollar Index - USD Stronger; 98.01 from 97.38 from 97.26
viewtopic.php?f=32&t=7616&start=60


Others

Sentiment - Complacent?

Headwinds
a. Derivatives (US$700t);
b. Debts (US$237t, 318% GDP);
c. Corporate Debt (US$50t); US Corp Debts (US$9t)
d. Institutional Investors (US$0.5t)
e. ETFs AUM (US$3.4t)
f. Bitcoin (US$200b)
g. US Pension Short-Fall: US$385b
h. NPLs at European Banks: EUR$1t
i. China's Bond Market: US$12t (third largest)
j. Private Client Cash Levels as a % of Total Assets: Record Low (10.4%)
k. Institutional Investors: lowest levels of cash for past 8 years; 1/3 high in 2016


Tailwinds
a. Low Interest Rates
b. Cash Sidelines (US$50t)
c. QE US$18t: US (US$4.5t), ECB (US$3.7t), Japan (US$4.4t) & China (US$5.1t)
d. Negative Yield Bonds (US$6t from US$10t)
e. US Foreign Funds Repatriation (US$2.5t)
f. Cash US Corporations (US$1t)
g. Cash Japanese Corporations (US$2t)
h. Buybacks
i. US Household Net Worth (US$90t)
j. EM Consumption
k. Private Equities: US$600b Cash

Risk Management:-
a. Global Diversification
b. Asset Class Diversification
c. Diversity of Industry & Company Exposure
d. Currency Hedging
e. Tactical Asset Allocation
f . Inverse ETFs and Put Warrants

HK Properties
a. Vacancy tax
b. 9000 vacant apartments
c. CLSA, UBS and Citi - Prices may drop 10% to 15% by end 2019
d. Rising Interest rates
e. Slowing Economy / Trade War
f. Depreciating Yuan
g. Weak Stock Markets
h. Justin Chiu (CK Asset): 10-20% drop; Outskirt Nanos (30% drop)

Spore Properties
a. 60,000 Units of Supply (7 years Supply of 6500 Homes per year )
b. Unsold residential units doubled to over 34,000 in 2018

Malaysian Properties
a. JPPH: Overhang - 30,115 units (2018) vs 20,304 (2017)
b. Overhang would be greater if Serviced Residence and SOHOs are included

China Properties
a. 20% of Urban Housing is vacant (65m homes)
b. In 2018, nationwide ASPs have climbed by 15% to a record high
c. Since 2015, Tier One cities have risen by 55%
d. Since 2015, Tier Two cities have risen by 35%
e. Government targeting annual increase of 7% to 10%

Yield on 10 Year US Treasuries - Lower; 2.50% from 2.56% last week from 2.57% two weeks ago
a. Resistance 3.3%

Yield on 2 Year Treasuries - Lower; 2.28% from 2.38% from 2.39%

Interest Rates:-
a. Expecting US Interest Rates to slowly rise over next 2 years
b. About US$9t or about 23% of the world’s bonds have negative yields
c. US Rate Hike: None in 2019?
d. Argentina's Intertest Rate: 60%
e. Turkey's Interest Rate: 24%
f. Ukraine's Interest rate: 18%
viewtopic.php?f=16&t=7319&p=221670#p221670


JNK (SPDR Barclays High Yield Bond ETF) - Flat; 36.17 from 36.14 from 36.22

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Higher; 86.75 from 86.68 from 86.96

Baltic Dry Index - Higher; 869 from 790 from 726; Low 290; High 2330 (2013)


The above is to from 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 feel free to provide me with your kind thoughts and comments


Please Note:-

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Second Opinion - Please see the "Second Opinion" thread in the "Services for InvestIdeas Members" section, located just below the Miscellaneous Section.
viewtopic.php?f=26&t=3168

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User avatar
winston
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Re: Winston's Investment Ideas 04 (Oct 15 - Jun 19)

Postby winston » Sun May 05, 2019 12:50 pm

TOL @ May 05, 2019

Genting-Group.jpg


Time To Add To Genting?

I have been adding to my positions in Genting Singapore, Genting Malaysia and Genting Berhad, over the past few weeks.

I have reached a good position size and it's timely to review whether I want to increase my existing position size or to manage my exposure to them.

The following are my notes on the above 3 counters:-

1. Genting Singapore
a. Dropped from Sin$1.08 to Sin$0.96 on the Sin$4.5b expansion plan
b. Free Cash Flow of around Sin$700m per year
c. Net Cash of Sin$3.2b
d. Catalyst: Japanese License in 3Q 2019?
viewtopic.php?f=29&t=6816&start=80

2. Genting Malaysia
a. New Taxes by PH government
b. Catalyst: Settlement of Outdoor Theme Park lawsuit?
c. Catalyst: Writeback of MYR1.8b (US Casino)?
viewtopic.php?f=76&t=3886&start=60

3. Genting Berhad
a. 50% Discount to RNAV?
b. Cash - MYR9b (MYR 2.40/share)?
c. Catalyst: NYC Casino 4Q 2019?
viewtopic.php?f=76&t=3885&start=30

From the above, the potential of these 3 counters seems to outweight the risks.

However, I'ved to also reflect on the following:-
1. Company Concentration Risk - three companies of the same group
2. Industry Concentration Risk - Asian Gaming
3. Moral Objection: Do you want to invest in a business that may contribute to the suffering of many individuals?

As for (3) above, I've been struggling with it for a while. My justification is that it's a "trade" and that I'm not investing in it for the long term or for it's dividends. It's no different than trading warrants, futures, currencies, options or any other equities. (There are also people who have a moral objection to "trading").

However, my friends have said that it's a flimsy excuse. On reflection, I do agree with them but I'm a trader at heart,

Therefore, I need to remind myself to donate some of my profits from trading such companies ie. gaming, tobacco, marijuana, alcohol, computer games etc.


Weekly Risk Management Progress Report:-
1. To Monitor Exposure To Equities: Safe (13% from 10% last week, of Liquid Assets);
Goal: Zero Equities before the next recession (2020-2021?); Maximum 45%;
2. To Diversify From Asian Equities: Progress (58% from 67% last week)
Goal: To reduce percentage of Asian Equities to around 50%
3. To Buy Inverse ETFs and Puts - Waiting for "M" on charts.
Goal: To have a sizable short position going into the next recession
4. To Increase "USD/HKD/Gold" - No Progress ( at 28%)
Goal: To be in the safe havens before next recession; (HKD may be repegged)
5. To Reduce Number Of Counters to 10: No Progress(15 from 11 last week).
Goal: To focus on only about 10 counters that have convincing stories


Market Risk Indicators
1. Euphoria: 7 (Low: 1; High: 10) - FAANNG, ETFs; Margin Debts; SWFs; Central Banks; Fund Flows;
2. Credit Problems: 8 (Very Good: 1; Very Bad: 10) - Housing, Subprime Auto; Student Loans; Credit Cards; Junk Bonds; EM USD Loans;
3. Recession: 8 (Strong Economy: 1; Depression: 10) - GDP; Taxes; PMI; Housing; Auto; Retail; NAFTA; Trade War; 2019?;
4. Liquidity: 8 (Very Liquid: 1; Tight 10) - QE (Feds, ECB, BOJ, PBOC); Interest Rates; Rotation (Bonds); Asset Shrinkage 2018?; EM; Italy;
5. Inverted Yield: 7 (Low Inversion: 1; High Inversion: 10) - Rising Interest Rates; Slope; Inversion; US 10 Years < US 2 Years; Expecting 2019 to 2020
6. Valuation; 7 (Safe 1: PE15; Danger 10: PE30) - PE S&P 24, Nadsaq 26; Revenue; USD; Tax Reform; Deregulation
7. Geopolitical Issues: 8 (Peaceful: 1; War: 10) - Iran; South China Sea; Europe; Russia; Saudi Arabia
Total: 52 out of 70 (74%); (Safe: 50%; Danger: 80%)


Commodities: Risk Off (Data from Commodities Live on May 3 @ 6.30 pm)

1. WTI Oil - Lower. US$61.76 from US$63.99 last week from US$64.00 two weeks ago;
Support: US$43; US$34; Resistance: US$75, US$105
a. Trade Wars will reduce demand for Oil? -500k bpd?
b. Global Stockpiles: 2.5b barrels;
c. US SPR: 679m barrels (33 days); To sell 190m barrels over 8 years.
d. US imports 8m bpd (Total demand of India and Japan combined);
e. China (4th largest producer; largest importer) - Reserve life: Dropped from 10 to 6 years
f. China: Ban on Petrochemical Cars in 5-10 years? Quotas?
g. IEA: Lowest amount of new discoveries; Supply shortage in 2020?
h. Saudi: Aramco's IPO 2021? -1.3m bpd (35% cut in supply)
i. China: SPR 51/90 days; 2019 imports to decrease?
j. Libya: -850k bpd; Brazil +200k bpd; Canada -325 bpd; Nigeria -300k bpd; Iraq -150k bpd; Kurdistan -350k bpd; US +1m bpd; russia -500k;
k. Venezeula: -1.2m bpd; Worst Case -2m bpd supply (50% cut by 2020)?
l. Iran: -2.3m bpd ?
m. US Summer Driving season
n. OPEC: Heavier Crude; More Processing;
o. US: Lighter Crude and Lower Sulphur; Glut in Gasoline
p. EV: -350k bpd?
viewtopic.php?f=33&t=7550&start=210

2. Gold - Lower. US$1272 from US$1286 from US$1278
Support: $1240; $1150; $1050; Resistance: $1400
a. Global 33k tons; US 8k t; China 5k t; IMF 3k t; Germany 3k t
b. Electronics, Coins, Central Banks Reserve, Jewellery etc.
c. 250 oz of paper contract for every oz of physical gold holding on Comex
d. Output fell by 100 metric tons (3%), from 3,150 in 2015 to 3,050 in 2016
e. Demand from Muslim countries as Gold is now a halal investment
f. Rising USD & Interest Rates, would not be good for gold
g. Gold only occupies 0.03% of US investments. In 1981, it was 8%
h: India Demand: Since 2010, down each year. 2017 (700t); 2020 (900t)
i. China Demand: Since 2013, decreased 33% from 940t to 630t last year
j. Global Demand: 2Q 2018: China +5%; India -8%;
k. Central Banks: +22% yoy; 33k tons; Russian, Turkey, Khazakhstan & India
l. U.S. government holds 260m ounces at book value of only US$42m
m. China: Reserves 185m oz; 400m oz ground; Output decreased 6% yoy
n. Strong Selling by Gold ETFs
viewtopic.php?f=33&t=7589&p=202084#p202084

3. Silver - Lower. US$14.66 from US$15.02 from US$14.97
a. Support: US$16.10; US$15.20; Resistance: US$18.50; High: US$49
b. LED chips, Cell Phones, Nuclear Reactors, Photography, Solar Panels, RFID Chips, Semiconductors, Water Purification, Data Storage, Antibacterial products, Silver Coins, Jewelery
c. Demand: 1.2b ounces in 2015;
d. Supply: 0.9b ounces in 2015.
e. 4th year of deficit
f. 35% (7700 metric tons) for Electronics
g. 25% (5500 metric tons) for Bullions & Coins
h. India imports more Silver than the US
i. JPM has 67m ounces
j. High Gold/Siver Ratio: 50 t0 70; Currently 76, 50% higher than average
k, Production declining
l. Demand: 40% Investments / Speculation; 60% Industrial
m. About 1b ounces stored in China; 1 Year Production
n. How will US tariffs on Solar Panels affect silver prices?
viewtopic.php?f=33&t=7589&p=202084#p202084

4. Platinum - Lower; US$855 from US$895 from US$907; Vested
a. 28% for jewelry
b. 42% for diesel catalytic converters
c. Remainder for other industrial applications
d. Huge discount to Gold
e. Sixth year of deficit
f. 10 times more gold than platinum
g. Costlier to mine than gold as located deeper
h. Diesel cars losing market share
i. 70% of supply is from South Africa

6. Palladium - Lower; US$1350 from US$1426 from US$1410;
a. Support: US$940; US$500; Resistance: $1600 (Citi)
b. Catalytic Converters (Petrol Cars), Electronics, Dentistry, Medicine, Hydrogen Purification, Chemicals, Groundwater Treatment, Jewelry and Fuel Cells
c. Auto industry consumes 80% of supply
d. Demand by Auto industry doubled in past 10 years
e. Growth Demand: 10% in 2019
f. Russia and South Africa produced 3/4 of the world's mined palladium supply.
g. 8th Annual supply deficit;
h. Vehicle: PALL; SPPP (Physical Platinum & Palladium)
i. US Auto Sales weak
j. China - Pollution Programs
k. Supply Deficit: 1m Ounces in 2019
l. Global Stockpiles: 10 to 18m ounces (2 Year Demand)
m. Julius Baer 2020 Target: $1000

7. Zinc - Lower; US$2756 from US$2780 from US$2794
a. Global Demand: +14% pa for past 4 years
b. Supply: 13.7 tons; Supply Deficit 1.2m tons;
b. Breakpoint: High US$4400 (2007); Low $1600 (Jan 2016)
d. Used to prevent rusting, zinc oxide (paints), brass (copper), coins, fertilizer
e. Zinc inventories at the LME have dropped to their lowest level since 2009
f. Vehicle: DB Base Metal (Zinc, Aluminum & Copper); MMG
viewtopic.php?f=33&t=367&start=208.

8. Copper - Lower; US$2.79 from US$2.88 from US$2.92
a. Higher inventories at LME
b. China - 50% of global consumption
c. China - Lower Power Grid demand
viewtopic.php?f=33&t=5598&p=215285#p215285

9. Uranium - Flat; US$25.25 from US$25.40 from US$25.90
a. Breakeven: US$40 per lb; Long-Term Contract - 2x Spot
b. Range: $20 (2005) to $136 (2008); 580% rise in two years
c. Global Supply: 158m lbs pa; 15% from decommisioned weapons
d. Global Demand: 190m lbs pa to 300m lbs pa (2030)
e. Stockpile: 1b lbs (till 2022?) ; Companies normally store 5 years supply
f. Japanese Demand: 3m lbs pa; Starting 21/54 reactors? Currently, only 9
g. No. of Nuclear plants: +8 pa for next 20 yrs, 440 to 595; Current 452
h. 56 new reactors being built; 481 planned;
i. China: 46 existing plants; Building 11; To build 177 more?
j. India: 22 existing nuclear plants; Building 5; To build 64 more?
k. 75% long-term contracts expiring between 2017-25
l. 200 European nuclear reactors will be shut down over the next 25 years
m. France: Reduce nuclear to 50% from 75% by 2025 and closure of 20
n. Apr 14, 2019: US requires 25% local production; Higher electricity cost
o. Kazakhtan reducing supply by 10% (40% of global production)
p. Competition: Natural Gas, Solar, Wind, Wave etc
q. US: Nuclear - 20% of electricity; 99/447 Plants; 25% drop by 2025; Two Year Moratorium on Closure
r. Supply: 50k tons; Demand: 68k tons; 2k tons enriched for weapons
s. 1b pounds to be purchased for long-term contracts over next 5-10 years
t. Average reactor needs around 650,000 pounds to run for a year
u. US: 100/420 reactors; Importing 95% uranium; Demand 50m lbs pa
v. Uranium from Sea Water; Viable at US$180/kg (US$80/lbs); Timing?
w. Glut at 15m pounds (23 reactors for 1 year)
x. Cameco mothballed McArthur River & Key Lake; 10% world's supply
y. Kazatomprom, world's second largest, cut production by 20% for 3 yrs
z. Russia banning export of Uranium?

11. Cobalt - Flat; $15.76 ($34,750/t) from $15.76 ($34,750/t) from $16.10 (US$35500/t); Low $10; High US$43
a. Electric Vehicles (8 kg), Smartphones (8 grams), Jet Engines; Gigafactories
b. Congo: Supplies >50% world's supply; Child Labor?
c. Demand: 8% to 10% pa
d. Shortage: 2022 and beyond
e. Cobalt Reduced EV is 5-10 years away? Musk: Reducing Cobalt in Tesla;
f. 2018: 1m EVs (10k tonnes); 2027: 27m ( 27m tonnes)
g. Glencore - stockpiling till June 2019 (radioactivity); 25% Global Supply
g. Target: 2018 - US$62,000/t; 2022 - US$44.000/t


Equities - Risk-On (Data as of Saturday every week)

1. US Equities - Higher. 2946 from 2940 last week from 2905 two weeks ago
a. Support: 2320; Resistance: 2940; 3000; Fwd PE 16
b. Bought Weibo (WB)
c. Bought Alphabet (GOOG)
viewtopic.php?f=11&t=7643&start=200

2. HK Equities - Higher. 30082 from 29605 from 29963
a. Support: 24500, 23500; Resistance: 31200; 31600;
b. No Trade; No Convincing Story
htttp:/investideas.net/forum/viewtopic.php?f=10&t=7470&start=120

3. Shanghai Equities - Lower. 3078 from 3086 from 3271
a. Support: 2450; Resistance 3300; 3600
b. No Trade
viewtopic.php?f=10&t=7190&start=210

4. Spore Equities - Higher; 3392 from 3357 from 3348
a. Resistance 3850
b. Bought Venture
viewtopic.php?f=10&t=6828&start=b110

5. Japan Equities - Flat. 22259 from 22259 from 22201
a. Forward PE 13
b. Support 19000; Resistance 25000
c. BOJ owns > half government bonds and 75% of ETFs
d. No Trade; No Convincing Story
viewtopic.php?f=10&t=7138&start=200

6. Malaysian Equities; Lower; 1627 from 1638 from 1622
a. Added to Genting Berhad
viewtopic.php?f=10&t=6292&start=30


Currencies- Mixed (Data from XE.com on May 03 @ 6.15pm)

1. USD to JPY - JPY Stronger; 111.49 from 111.59 last week from 111.92 two weeks ago
a. 52 week range is 76 to 126
b. Aging Population
c. High Debt Ratio
d. Why is it a Safe Haven ?
e. QE Infinity?
viewtopic.php?f=32&t=4205&start=180

2. SGD to MYR - SGD Stronger; 3.0379 from 3.0344 from 3.0506
viewtopic.php?f=32&t=136&start=110

3. AUD to USD - AUD Weaker; 0.6997 from 0.7039 from 0.7153
a. The range is 0.70 (2016) to 1.10 (2011)
b. Commodity Currency
c. To diversify my AUD into what currency?
viewtopic.php?f=32&t=5256&start=130

4. AUD to SGD - AUD Weaker. 0.9543 from 0.9588 from 0.9691
a. The range is 0.98 (2016) to 1.36 (2012)
b. I would choose the AUD over the SGD

5. AUD to MYR - AUD Weaker. 2.8993 from 2.9093 from 2.9566
a. The range is 2.20 (2008) to 3.41 (2017)

6. EUR to USD - EUR Weaker. 1.1157 from 1.1161 from 1.1245
viewtopic.php?f=32&t=5523&start=100

7. USD to HKD - HKD Weaker. 7.8447 from 7.8443 from 7.8436
a. 52 week range is 7.7452 - 7.8530
b. USD Peg band: 7.75 to 7.85
c. Will they remove the peg to the USD during the next crisis?
d. Will China ask HK to depeg from the USD?
viewtopic.php?f=32&t=3529&start=40

8. USD to MYR:- MYR Weaker. 4.1435 from 4.1332 from 4.1336
a. 52 Week Range is 3.27 to 4.54
b. Lowest: 4.885 (1998)
viewtopic.php?f=32&t=397&start=9. USD to SGD:-

9. USD to SGD:- SGD Weaker; 1.3639 from 1.3621 from 1.3548
a. High 1.70 (2004); Low 1.20 (2011)
b. Am uncomfortable holding the currency of a small country
viewtopic.php?f=32&t=136&start=100

10. USD to CNY:- CNY Weaker; 6.7347 from 6.7288 from 6.7042
a. When is the right time to buy some CNY? How?
viewtopic.php?f=32&t=7720&start=90

11. GBP to USD:- GBP Stronger; 1.3001 from 1.2916 from 1.2997
a. Brexit; Politics;
viewtopic.php?f=32&t=333&start=80

12. GBP to MYR:- GBP Stronger; 5.3870 from 5.3384 from 5.3717

13. Dollar Index - USD Weaker; 97.97 from 98.01 from 97.38
viewtopic.php?f=32&t=7616&start=60


Others

Sentiment - Complacent?

Headwinds
a. Derivatives (US$700t);
b. Debts (US$237t, 318% GDP);
c. Corporate Debt (US$50t); US Corp Debts (US$9t)
d. Institutional Investors (US$0.5t)
e. ETFs AUM (US$3.4t)
f. Bitcoin (US$200b)
g. US Pension Short-Fall: US$385b
h. NPLs at European Banks: EUR$1t
i. China's Bond Market: US$12t (third largest)
j. Private Client Cash Levels as a % of Total Assets: Record Low (10.4%)
k. Institutional Investors: lowest levels of cash for past 8 years; 1/3 high in 2016


Tailwinds
a. Low Interest Rates
b. Cash Sidelines (US$50t)
c. QE US$18t: US (US$4.5t), ECB (US$3.7t), Japan (US$4.4t) & China (US$5.1t)
d. Negative Yield Bonds (US$6t from US$10t)
e. US Foreign Funds Repatriation (US$2.5t)
f. Cash US Corporations (US$1t)
g. Cash Japanese Corporations (US$2t)
h. Buybacks
i. US Household Net Worth (US$90t)
j. EM Consumption
k. Private Equities: US$600b Cash

Risk Management:-
a. Global Diversification
b. Asset Class Diversification
c. Diversity of Industry & Company Exposure
d. Currency Hedging
e. Tactical Asset Allocation
f . Inverse ETFs and Put Warrants

HK Properties
a. Vacancy tax
b. 9000 vacant apartments
c. CLSA, UBS and Citi - Prices may drop 10% to 15% by end 2019
d. Rising Interest rates
e. Slowing Economy / Trade War
f. Depreciating Yuan
g. Weak Stock Markets
h. Justin Chiu (CK Asset): 10-20% drop; Outskirt Nanos (30% drop)

Spore Properties
a. 60,000 Units of Supply (7 years Supply of 6500 Homes per year )
b. Unsold residential units doubled to over 34,000 in 2018

Malaysian Properties
a. JPPH: Overhang - 32,313 units (2018) vs 20,304 (2017)
b. Overhang would be greater if Serviced Residence and SOHOs are included
c. 2018 Residential Housing overhang: +31%

China Properties
a. 20% of Urban Housing is vacant (65m homes)
b. In 2018, nationwide ASPs have climbed by 15% to a record high
c. Since 2015, Tier One cities have risen by 55%
d. Since 2015, Tier Two cities have risen by 35%
e. Government targeting annual increase of 7% to 10%

Yield on 10 Year US Treasuries - Higher; 2.56% from 2.50% last week from 2.56% two weeks ago
a. Resistance 3.3%

Yield on 2 Year Treasuries - Higher; 2.35% from 2.28% from 2.38%

Interest Rates:-
a. Expecting US Interest Rates to slowly rise over next 2 years
b. About US$9t or about 23% of the world’s bonds have negative yields
c. US Rate Hike: None in 2019?
d. Argentina's Intertest Rate: 60%
e. Turkey's Interest Rate: 24%
f. Ukraine's Interest rate: 18%
viewtopic.php?f=16&t=7319&p=221670#p221670


JNK (SPDR Barclays High Yield Bond ETF) - Lower; 36.00 from 36.17 from 36.14

HYG (iShares iBoxx $ High Yid Corp Bond ETF) - Lower; 86.35 from 86.75 from 86.68

Baltic Dry Index - Higher; 1032 from 869 from 790; Low 290; High 2330 (2013)


The above is to from 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 feel free to provide me with your kind thoughts and comments


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viewtopic.php?f=26&t=3168

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