Author: The Asia Report

Lessons Learnt From Hyflux, Singtel & Starhub

I writing a topical email every week to my mailing list. Here’s our last email to subscribers which I thought I share. You can sign up on our mailing list to get the latest updates when it goes out every week. Investing for “yield” is one of the main draws of the Singapore stock exchange. However, investors chasing yield have been burn badly in recent years – something I have talked about. The following email will cover both dividend paying stocks, bonds, preference shares and perpetuals. This email is one of the longest emails I’ve sent out but bear...

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Extracts from Hyflux Reply to SIAS Letter

I have been following the Hyflux implosion and restructuring (which is still ongoing). It is one of the most painful experiences for Singaporean investors in recent memory given its widespread uptake by retail investors. For the record, I have no position in any of Hyflux stock or its related securities. You have investors who are understandably upset and angry at what has happened. Many of these grievances were taken up by SIAS who sent and publicly released a letter airing a lot of these concerns of which Hyflux has recently replied today. There are several questions and answers which...

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How to avoid losing money in stocks and investments

I writing a topical email every week to my mailing list. Here’s our last email to subscribers which I thought I share. You can sign up on our mailing list to get the latest updates when it goes out every week. Investors often focus on investing returns which is easy enough to understand. At the same time, experience has taught me that the biggest impediment to long term returns are catastrophic losses and improper position sizing. Examples in the last few years are common enough – from Hyflux perpetuals to Oil & Gas bonds. These problems become fatal when...

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Why the Singapore market is such a challenging place to invest

I read recently that MAS was launching a $75m grant for the equity market. The aim is to encourage listing and to also boost equity research coverage. I must admit I am pretty pessimistic about its future success. The woes of the Singapore market are well known – poor liquidity, a lack of quality companies and even poor cooperate governance. SGX has taken steps to improve corporate governance in recent months. This should be commended but the problems in my mind about the Singapore market are much more deeply rooted. Our domestic market is really really small Singapore has...

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Astrea Investor Day 2019 Write-Up & Thoughts

I attended the Astrea Investor Day 2019 held at the DBS Asia Central Auditorium on Saturday morning. Earlier this year, I wrote two articles on Astrea IV: Astrea IV PE-backed bonds – 3 things you need to know before you invest 5 structural safeguards in the Astrea IV PE-backed bonds Many people have a cynical view of the Astrea issues which is understandable given their complexity. Personally, I really like them given the depth of their structural safeguards as well as their efforts to reach out to the public to educate them about the underlying product itself. One of...

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Value investing isn’t about buying “cheap” stocks

I understand the appeal of using approaches that rely on buying “cheap stocks” as someone who likes a more quantitative approach to investing, At the same time, I have always felt that many people have the misconception that value investing is about buying cheap P/E, cheap P/B or high dividend stocks. This is completely wrong! As someone who likes a more quantitative approach to investing, I understand the appeal of looking at “hard numbers”. However, value investing is really about buying companies at a discount to intrinsic value, and valuation is only one part of the equation when assessing whether...

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The market crash is coming… how do you prepare yourself for it?

The market crash is coming… how do you prepare yourself for it? | The Asia Reportchevron-circle-rightchevron-circle-rightchevron-circle-right Top Dividend Ideas In Small & Mid-Cap Stocks With Virtually Zero Analyst Coverage Exclusive Coverage of Paid Conference & Research Pieces From Around The World Subscriber Only Premium Articles Delivered With Author’s Own Research Notes I writing a topical email every week to my mailing list. Here’s our last email to subscribers which I thought I share. You can sign up on our mailing list to get the latest updates when it goes out every week. Every market downturn brings the usual litany...

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What is IFRS 16 and why is it so important? [Case study – Singapore Airlines]

This is a slightly technical post but highly relevant if you for certain types of businesses where leasing is prevalent. Come 2019, new accounting standards (specifically IFRS 16) will come into effect which will drive up the leverage ratios of businesses which have significant leases liabilities. The new leases standard – IFRS 16 – will require companies to bring most leases on-balance sheet from 2019. Explaining it in layman terms Let us think about this in terms of you buying a car. The normal route to buying a car would be for you to take a car loan. You...

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UOB has dropped almost 20%.. are valuations finally attractive at $25.00 and 3% dividend yield?

UOB has dropped almost 20%.. are valuations finally attractive at $25.00 and 3% dividend yield? | The Asia Reportchevron-circle-rightchevron-circle-rightchevron-circle-right Top Dividend Ideas In Small & Mid-Cap Stocks With Virtually Zero Analyst Coverage Exclusive Coverage of Paid Conference & Research Pieces From Around The World Subscriber Only Premium Articles Delivered With Author’s Own Research Notes I thought about doing up all three Singapore bank valuations in a single article but changed my mind. Although each bank is headquartered in Singapore, they have differing exposures in the region so I am going to run through each one separately and try to...

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The Most Important Thing About Investing – My own Reflection After Close to a Decade

I writing a topical email every week to my mailing list but I thought I share the last email with everyone as it really resonated with me. Rule No. 1: Never lose money. Rule No. 2: Never forget rule No. 1. – Warren Buffett 2019 has rolled right in and many people are busy setting the yearly goals. Many of these goals will inevitably involve making money. While its important to focus on these things, I thought I start this year’s email by talking about something less popular but far more important – not losing money in the first...

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Some reflections & stocks are volatile… but they always have been.

I was reading a post from a local Singaporean investing message board. For the sake of privacy, I am just going to summarize its contents. The gist of it was that the author’s portfolio was down > 40%, and he was feeling extremely dejected and depressed worrying that all his money would be lost. Know what your investing in I have a lot of sympathy for the investor in question as no one likes to see their portfolio plunge in value dramatically, especially if that is money you need in the immediate future. You read about it time and...

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Bond funds / ETFS are NOT Bonds!

With the rise of robo-advisors in Singapore, there’s been an increased allocation into US listed bond ETFs that most investors would probably not have known about or invested in otherwise. This article, I cover the key difference between bonds and bond ETFS and explain why they are quite different things. Bonds in a nutshell Bonds are essentially debt obligations. You can think of them as IOUs. You are essentially lending money out to a company in exchange for interest for a fixed duration of time. Bonds are normally regarded as safer because they rank higher than equity holders. That’s...

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Market prices do not always reflect intrinsic value

I wrote this back in 2015.. but its still relevant so I thought I share it: The underlying assumption behind ALL fundamental analysis is that the markets will eventually recognize the underlying value of the security. If you are long a stock, you believe that there’s a divergence between price and value – and that the markets are incorrectly pricing it below what it’s actually worth. If you are short a stock, you believe that the market is placing a far greater value than whatever the business is actually worth. In truth, learning how to value a business is...

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Follow up on Singtel 5.9% yield – Are dividends at risk?

The last post on Singtel generated quite a lot of responses on Facebook which I didn’t find surprising given the widespread ownership of the stock. One of the interesting comments which I thought I re-share here along with my thoughts for the benefit of everyone: Impact of airtel is minimal, provided their management dont enter price war and burn cash which will lead to big losses. If $0 profit and loss, then no impact to singtel’s profit cos contribution is insignificant. So just a re-cap, Singtel’s group share of associates pre-tax profits took a hit from its India operations...

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[Its Christmas] – Want to get the top investment books for free for the rest of the year?

The National Library has a great resource you can borrow digital books from them. https://nlb.overdrive.com/ It’s very easy to sign up. You can either read the books on your computer or download the app on your tablet. I use an iPad Pro and got it sorted out pretty fast. Selection of books is great I was really surprised at the selection of books that were pretty extensive. You can get investment classics like The Intelligent Investor by Benjamin Graham or Warren Buffett’s biography (books by both authors, Roger Lowenstein & Alice Schroder are available). They even had more niche books...

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