財智語陸：A股後市跑贏港股 - 陳永陸

港股昨日先升後回軟，雖然創超過一年新高，但恒指只能於22600點水平收市。今日期指結算，相信恒指會繼續窄幅徘徊。當然，大家會覺得A股昨日雖然出現回吐，但聖誕假期累積如此大的升幅，為何不能為港股帶來刺激作用。

首先，美國仍需要就財政懸崖問題討論，在此憂慮下，港股自然難以大幅上升。另外，A股上升某程度是追落後，因為相對H股或歐美股市之表現，A股今年的表現的確令人失望，所以當資金於11月大舉流入的時候，A股被大幅推高亦屬正常，但不代表資金會同時大舉推高H股或港股。

資金持續流入香港金融市場，但越來越多數據顯示，這些資金不是全面流入港股市場，反而有一定部份流入A股相關產品，如ETF等產品，所以港股並沒有因為資金流入而出現預期的升勢，亦屬正常。

資金湧港　部份捧A股ETF
如果A股繼續向上，一定會為港股帶來刺激作用，但未來A股升幅，很可能會大於H指或恒指。

昨日A股回吐，除因為技術整固外，很大程度與中國工信部部長苗圩預期，明年中國規模以上工業增加值增長目標只有10%左右有關，因這一目標與今年的增速相近。

今年中國規模以上的工業增加值雖然按年增加10%，甚至工業對經濟增長貢獻率超過40%，可是實現利潤只是與去年持平，所以，如果明年工業增加值增速繼續只有10%，但同時仍然是中國經濟的最大貢獻部份，那麼中國經濟明年增長的增速，未必如市場預計般大。

事實上，雖然中央多次表示，透過內需去刺激經濟，但少了出口部份的一台馬車，中國始終面對潛在增長動力不夠穩陣的風險。不過，這問題太長遠，暫時不用過慮。

陳永陸
獨立股評人

The Most Innocent company in America - Poor poor Herbalife!

by Daniel Loh

In Singapore, we have Olam. In America, we have Herbalife (HLF). The thing is herbalife suffered the same fate twice! Another $20 drop in one week! It happened to them in April and last week. Blame the shorting hedge fund managers!

This year 2 well known hedge fund managers both questioned herbalife business model. Greenhorn and Ackman. It is amazing that Ackman calls the company "pyramid". Sigh, i thought MLM has been around for ages, and it is not like herbalife is a new MLM company. They also did not change much of their business plan. Ackman actually bought huge amount of put options a few days before! This is all planned in advance.

http://www.marketwatch.com/story/herbalife-slides-as-ackman-presents-short-thesis-2012-12-20

Updated:

Some of our friends asked about whether can invest in this company. My suggestion is to wait for the short to subside and wait for its next earnings to prove itself. Short term it is never good to go against the hedge funds who are shorting the stocks.

My opinion is next time you see a hedge fund manager like Ackman or Greenhorn talking badly about a company, just short with them! In America, they have hedge fund conferences whereby these sharks will make their presentations. And these 2 guys are famous to make a lot of pages of info why they short the companies! Just short with them wont be wrong.

Market outlook for 2013, choppy H1 likely for equity

The Star Online > Business
Tuesday December 18, 2012
Market outlook for 2013, choppy H1 likely for equity

MARKET OUTLOOK 2013

By RHB Research

WE continue to anticipate a choppy few months for the equity market in the first half of 2013, given the uncertain election outcome on the home front as well as uncertainties from the imminent challenge of the US fiscal cliff and the eurozone's long-running debt problems.

The market outlook will, however, likely improve in the second half, given improving global economic conditions as investors shift focus to fundamentals after the general election.

As it stands, risks of Greece exiting the 17-nation eurozone and a full-blown disintegration of the region are dissipating while positive indicators are emerging from the United States and China.

Meanwhile, the Malaysian economy turned up to be stronger than envisaged this year and prospects are for a slightly stronger gross domestic product growth of 5.4% in 2013, underpinned by the implementation of the various economic programmes and sustained robust domestic demand.

We project net earnings per share growth for the benchmark FTSE Bursa Malaysia KL Composite Index (FBM KLCI) to improve from 5.4% in 2012 to 7.2% in 2013, which will continue to create new shareholder value for investors.

This, coupled with prolonged low interest rates and ample liquidity in the system, is supportive of higher asset prices.

Assuming that Barisan Nasional will remain in control of the Government and global situations stabilise in three to six months and the global economic recovery is intact, our end-2013 FBM KLCI target remains unchanged at 1,815 points, close to 15 times 2014 earnings.

In our view, equity still stands up against low-yielding alternative asset classes, given the prolonged low interest rate environment, set by the United States, and as long as the global economic recovery is not derailed.

While our core strategy remains defensive, particularly for the first half of 2013, we believe investors would still need to accumulate fundamentally-robust stocks on weakness to outperform the market.

Sector-wise, our key overweights are banking and telecommunications, although we also have an overweight stance on the utilities and healthcare sectors.

In our view, banks are the safest bets on account of low earnings risk, cheaper valuations and with decent dividend yields while telcos remain defensive and are preferred relative to consumer stocks on valuations and liquidity grounds.

Source/Extract/Excerpts/来源/转贴/摘录: The Star Online
Publish date: 18/12/12

Consistency - A Short Cut to Reach Destination

No doubt, a lot of people who can earn a lot of money at the beginning. And they started to think that they are "genius" in making money without hard work. But they will soon face some difficulty when the economy turns worse. And most of the people will just stop investing after they faced the losses. If you still can make money from investment for at least 10 - 20 years, then I have to congratulate you on two things:

1. You are still surviving in long run. You may end up achieving a better return in long run, as your experience grows.
2. You are still in the investment for so many years. It is not an easy task to a person who just want to make money but not about "passion" for doing so in long run. 

It's just a like a body training. You will see immediate effect after you have done all the instruction by your personal trainer. But it would become a waste if you just stop training from there and your body will not be kept in good shape if you do not train yourself consistently.

It applies same to the investment. The more homework you do, the "smarter" you are in doing your investment. The more experience you are in the investment, the better result you could get in long run. But you will start experiencing losses if you do not improve yourself in investment skills, or you just become lazy to stop learning a new investment skill that could cost you a million dollar in long run.

As this is a never ending game, consistency plays a very important role here. If you really wish to achieve financial freedom or any of your lifetime goals, just do it. And never give up.

I still remembered that some of my friends told me that it is not easy to earn money from blogging and they urged me to stop blogging and focus on more other thing. But my passion on sharing my thoughts or information on investment has brought me here.

Try not to focus too much on just the destination you want to arrive, but the nice scene along the way you go to your destination. You will find out a lot of beautiful things along the way.

Fear Of Investing

It had been a crazy few months. Having met quite a number of people in their fifties, most were on the topic of planning for retirement. A typical sentiment shared by most of them immediate at the onset of the conversation is "I am old already, going to retire, I cannot take any risk with investments". This is a disturbing trend and it is difficult to change mindsets. This reminds me of the time I met a "Poor Dad" and a "Rich Dad".

First, the "Poor Dad". He was a humble civil servant who being highly educated, worked his whole life for the government. He slowly rise through the ranks. By the time of retirement, he had reach a respectable level and even had a pension pay out. He was frugal and amassed a fair sum for a comfortable retirement. This was 15 years ago.

Fast forward to the present, he is in his late sixties and complaining that he is afraid to live too long as he has nearly a good twenty years based on average life expectancy and may not have much to leave for his children. What happened? Well, he simply shared the same fear of investing and placed all his savings into fixed deposits that had eroded tremendously due to inflation. Even his pension is barely able to sustain a reasonable standard of living that he is used to as it was based on 1990s salary levels.

Next, the "Rich Dad". He was a bus driver. He drove primary school children to and from school as well as factory workers. Although not having finished proper education, he was keen on learning simple investments. So, after paying up his HDB at about age 30 plus, he insisted to place a small percentage of his savings into shares. He did not understand which company to choose, neither were there complicated analyst reports to follow. He used what he knew, simply follow government supported companies that have a monopoly in Singapore market at that point in time.

He bought paper shares into SPH, Singtel, SIA, basically according to him jokingly, Companies that have Singapore in their names. Needless to say, inclusive of the dividends, the funds have increased about five times. And the next thing he did before his retirement was to sell off a portion of it and used it to purchase a private property in the most unheard off place at that point in time, Buangkok. Today, the property has more than doubled in value and he is living happily off the rental income and dividend income from all his investments. At the same age of sixties, he does not fear the next twenty years as much as "Poor Dad".

Is it sheer luck? We can only see from hind sight. But a prevalent point I got from this is that retirement is a good 30 years. That in my opinion is not short term. So even when it comes to retirement, do not place all the bets into a fixed deposit. Asset allocation is still crucial if not more important now more than ever.

Cheers to all! An advance Merry Christmas and a Happy New Year!

Posted by Lau

Do You Want to Trade Stocks For a Living?

http://www.swing-trade-stocks.com/trading-business.html

I do not trade for a living. I get emails from traders wanting to start a trading business. They want me to tell them how to trade for a living. My standard answer is this: "I don't trade for a living." Their reply?
"Why don't you do this full time? Don't you want to quit your job?"
And then it hits me...
This person is sick and tired of his "job" and wants to do something that he loves to do - trading stocks! I currently own a small business (not related to the stock market) and believe me - one is plenty! I don't have the desire that this person has because I don't work for someone else. I work for myself.
I can understand the desire to want to trade stocks for a living. I used to have a "job" and to be quite honest - it sucked!

A Job Versus A Business

Having a "job" is the worst method of generating income and the most inefficient way to make money.
Why you ask?
Because your salary is based on time. You can see the problem right away. There is only so much time in a day! In order to make more money you have to invest more time. This makes you miserable, tired, and cranky!
Some other problems associated with having a job..

• You can never get paid what your really worth.
• You have to work long hours to make someone else wealthy.
• You can't make more money unless you beg for a raise.
• You have no freedom.
• You have no leverage.

And the number one problem? You have to work in order to make money.
Yep. I can see why so many people want to trade stocks for a living!
Now let's look at owning a business. Time is no longer a factor. How much time you spend running your business is up to you. You get paid for the value that you provide to your customers. This is usually in the form of a product or service. If you trade stocks for living, then you are providing liquidity to the markets. This is very valuable. Without traders, the stock market wouldn't work!
Now let's look at the benefits of having a business:

• You get paid what for what you are worth.
• You get paid to make yourself wealthy.
• You decide how much money you want to make.
• You have freedom.
• You have leverage.

And the number one benefit? You do not have to work in order to make money. You can put on a trade, type in your stop loss order, and go fishing. Assuming the trade goes in your direction, you will make money without working.
As I type this on my computer, I am making money with my current business, even though I'm not doing any work there.
Another thing to consider...
When you own a business, you can get paid over and over again for a one time effort. Let me explain: Let's say you decide to trade stocks for a living. You buy a stock on Monday. This will be a typical three or four day swing trade. When the stock moves in your favor, you will continue to make money over the course of several days, for just that one time effort you put into it on Monday!
This is the same way with any business.
So, when you go into work tomorrow to that dreadful day job, tell your boss that you would like to get paid over and over again for the effort you put in last Monday. He will laugh and think you are crazy! But, HE will get paid over and over again for YOUR efforts!
Doesn't seem fair does it?

Trading Stocks For A Living

Well, I hope I haven't upset you by the above comments. But hopefully it will inspire you to make a change.
Like I said at the beginning. I do not trade stocks for a living but I am observant. I own a business so I can see what other professional full time traders do to make a living.
There a several things that I know you MUST do before you begin a trading business:

• You must eliminate all of your personal debt.
• You must be well capitalized.
• You must have a logical trading system.
• You must follow strict money management rules.

This is true for most any business. You have to have your ducks in a row before you even begin.
But there is one major problem that I can see if you decide to trade stocks for a living. This is no small problem either:
Draw Downs.
You WILL have draw downs. Every professional trader goes through periods where they lose money. Anyone that tells you otherwise is a liar! How will you deal with this?
How do professional traders deal with this? The answer is right in front of you but I bet you never noticed it.
They teach others to trade, sell books, and create a myriad of other products and services related to the stock market. They create multiple streams of income to compensate for the harsh realities of draw downs.
Think about it. Look around the internet. Every one of them has a product or service to sell. There is nothing wrong with this if what you are selling is valuable and helpful to other stock traders. That's what a business does. It sells value. If it succeeds, then it becomes a total win-win situation for both the business owner and the customer.
Heck, you don't even need a product or have to sell a service to make money on the internet! I know of a couple people who make a living selling other people's products. Not only do they make a living but they make a very nice living.

Check out some of these success stories from the company that I use to build this website. Yes. They make a living from their website. You'll be shocked but inspired.

Anyway, back to my point. If you want to trade stocks for a living you would be wise to come up with other ways to make money to compensate for draw downs. A LOT of professional traders do it. Very smart.

In Conclusion...

Like I said in the beginning. I do not trade stocks for a living.
The thought of staring at a computer screen watching candles form on a chart does not excite me! But, I wanted to write this page to give you some perspective on it from a business owners point of view - without the hype.
Do not start a trading business just because you want to quit your 9 to 5 job.
Do it because...
YOU LOVE TO TRADE STOCKS!
I certainly do.

10-point plan of tough love for Olam

Published December 06, 2012

COMMENTARY

10-point plan of tough love for Olam

It needs to restore credibility and take definitive actions for a healthy future

By michael dee

In short, Muddy Waters is not the issue here, it is Olam's strategic and financial decisions that have brought this situation to a head - PHOTO: OLAM INTERNATIONAL LTD

Muddy Waters is not the issue here, it is Olam's strategic and financial decisions that have brought this situation to a head.

OLAM'S announcement of a major financing package this week has been characterised as ranging from a "government bailout" to a "vote of confidence". Either way, it is time for Olam to get serious about creating long term sustainability. Having missed the point earlier this year from the Feb 21 CLSA report, the emergence of a significant short position, a 30 per cent decline in Olam's share price since and the resignation of Olam's 20-year CFO in June, Olam's management and board remain in denial. The short-seller research firm Muddy Waters produced an extensive 133 page report which Olam dismissed as out of hand and responded to with a lawsuit which dilutes management bandwidth, wastes shareholders' money and does not address the root causes of Olam's problems. In short, Muddy Waters is not the issue here, it is Olam's strategic and financial decisions that have brought this situation to a head.

The latest Temasek-backed transaction raises significant issues, as it is extremely expensive debt and equity capital, capital that Olam spent a week telling the market it didn't need. The package of US$750 million of five-year debt and so-called "free" warrants are hardly free as they have tremendous value. Black-Scholes models have valued these warrants to be worth an estimated US$127 million. Since Olam's proposed US$750 million of debt is priced at 95 per cent of par, the proceeds, before fees, are actually US$712.5 million including the warrants. By backing out an estimated warrant value of US$127 million, the true bond value is actually only US$585 million, equal to 78 per cent of the original bond value. Thus, the true yield on the bond is not the 8 per cent that Olam would like investors to believe, but rather a whopping 13 per cent. Given the generous nature of these terms and Temasek's commitment to fully take up the rights issue, one has to wonder why Olam is paying US$15 million in underwriting fees to the banks who are taking no risk. If you back out those fees, the cost of this debt is an even more eye-popping 13.7 per cent.

In other words, Olam is offering existing investors a bond yielding an estimated 13 per cent and at-the-money warrants which can only be exercised in years 4 and 5. No wonder Temasek wants to underwrite the entire deal - this is the sale of the century, just in time for Christmas. But before shareholders get too excited about shiny packages under the tree, they should consider that this is just a left-pocket, right-pocket deal. The shareholders are paying for this lavish set of terms. The real losers are the bondholders, not to forget the investors who only a few months ago bought the US$275 million perpetual preferred shares issued at 100 per cent that are now quoted at 82 per cent. Their already over-leveraged securities just got more risky and they get no benefit from this package. And of course any investors unable to take up their rights will see them go to Temasek, who has no shortage of capital.

Muddy Waters' boss Carson Block did not magically create these concerns. He merely capitalised on a well-researched bet. This process is explained with wit and insight in

The Big Short by the author Michael Lewis and is a healthy aspect of capitalism. Now the market is left to sort out what is true and what the end game is.

Since this has not been done yet, I hereby submit to Olam's shareholders a 10-point plan of "tough love" to restore credibility and take definitive actions to reposition a great company for a healthy future:

1) End the war of words. Anyone reading Muddy Waters' 133 page report will see a credible work of research. The market has not been impressed with Olam's attempts to discredit Muddy Waters with ad hominem attacks and lawsuits. What's needed now are strong actions, not words.

2) Raise equity, not more debt. Olam made a strategic error in saying equity was not needed until 2015. It needs equity now. Its net gearing of 248 per cent is well in excess of industry norms and the US$750 million new debt makes matters worse and adds USD/SGD foreign exchange risk to boot. Olam should cancel the egregiously expensive debt issue and execute a meaningful equity rights offering giving the KC Group, Temasek and management the opportunity to take up rights that are unsubscribed, if any. This will underpin Olam's equity capital while demonstrating the commitment of its largest shareholders and management. Selling 13 per cent debt with at-the-money warrants is a sign of desperation.

3) Immediately stop the capital expenditure programme. This is essential as the supply of cheap debt is over. Olam's board must stop the acquisitions, conserve cash and prove the value of the acquisitions to date.

4) Focus on generating positive cash flow as soon as possible. Rule No 1 of battlefield triage is to stop the bleeding. Negative cash flow while executing a capex and acquisition programme with ever increasing leverage is untenable.

5) Sell secured receivables. Olam has said that its secured receivables are as good as cash. It should demonstrate that by selling a meaningful amount, raising cash, paying down short term debt, creating liquidity and convincing the market of these receivables' cash-like properties.

6) Draw down a portion of both committed and uncommitted bank lines. Olam is currently closed out of the fixed income capital markets and the availability of its undrawn, fully committed and uncommitted facilities remains in question. In light of Olam's significant upcoming 2013 debt maturities, showing the availability of committed and uncommitted facilities would boost market confidence.

7) Get the debt rated. Olam has raised billions from the Singapore debt markets with no independent rating of creditworthiness. An independent assessment of Olam's credit is required for investors, many of whom are individuals. The argument that others in the industry do not have a rating is untenable and specious. Olam's net gearing of 248 per cent far exceeds Noble's at 107 per cent and Wilmar's at 88 per cent. The MAS and SGX, whose silence have been deafening, should also publicly back this initiative.

8) Do not buy back stock. A stock repurchase programme burns valuable cash, increases leverage and will not impact Olam's share price. In fact, it would likely only further worsen the precipitous declines in its bond and preferreds prices.

9) Declare if management shares are on margin or pledged. While in the past, it could perhaps be argued that this is a personal matter, with so many questions hanging over the company, management needs to treat its shareholders as partners and declare if any shares are encumbered and could be force-liquidated at a given price point and if so, what that is.

Olam should also disclose the timeline of the events leading up to the announcement of the Temasek underwriting as the storyline has been shifting. Olam claimed this was its idea over the weekend and had the bankers take it to Temasek. Yet Olam also said last Friday that the CEO and two board members bought significant shares in the company. Did the idea emerge after those purchases were made and if so, when and how? There is no need to have questions about possible conflicts of interest when a simple timeline can put the issue to rest.

10) Don't rely too much on Temasek in future. Too often the market believes that when Temasek is invested for over 15 per cent, they will underwrite problems that occur and banks, investors, management, and boards can then get sloppy and lazy. As a professional investor, Temasek will do what is in its commercial interest and those who bet on additional bailouts may one day have a rude awakening, as has happened in the past. The US$750 million debt and warrants package is one sweet deal for Temasek and is not being done for charitable reasons.

Olam, as a trading business, has failed to grasp the realities of the post-financial crisis era. Today balance sheets, accounts and financing must be beyond reproach. Olam has not achieved this, but has continued to travel a dangerous path in recent years fuelled by readily available credit. It has a fiduciary responsibility to its equity and debt investors to respond with a credible and thoughtful plan of action to preserve and enhance value.

Olam has paid an extremely dear price to Temasek to buy some time. How it proceeds from here will be the existential question.

Michael Dee, an investment banker for over 30 years, was Morgan Stanley's regional CEO in Singapore and a Senior Managing Director of Temasek Holdings from August 2008 to April 2010. He has no position in any Olam securities.

Secrets of Singapore Trading Gurus – Exclusive Video Interviews

by ALVIN

A BIG THANK YOU for buying the book! If you have not, you can purchase it here (Enter “bfp15″ during purchase to get 15% discount!)

You can click on the following links to watch the interviews of the traders:

1. Keane Lee
2. Yeo Keong Hee
3. Binni Ong
4. Nicholas Tan
5. Clarence Chee
6. Tom Yuen
7. Patrick Lee

胡立阳：懂得善用信息才能钓到大鱼

[导读]回顾过去二、三十年来，在世界各地演讲会中，我曾回答了投资朋友们所提出之各式各样的问题。现决定在此专栏中择其精华，与网友们分享当时我的小小研究心得，也希望能继续得到大家的支持与鼓励。

问：我的理财顾问建议我每天都要看些专业媒体报导，这样才能知道该买些什么。但我试过一段时间之后就放弃了，因为跟着利多跑，总是接到最后一棒，很容易变成帮别人抬轿子的轿夫吧？

胡： 问的真好！现在，就让我来跟你分享一个投资小秘密吧。过去，在网络还不发达的那个年代，我们公司曾有一位客户，每天都捧着四、五份财经专业报纸仔细研读， 并且还会认真去做笔记，厚厚一本的日记本，里面记下了密密麻麻的重点新闻。当时的我还只是个华尔街的新兵，对他的研究精神虽然感到佩服，但内心不免感到存 疑，他是太闲了吗？任何新闻只要上报，不已经是人尽皆知，还有钱可以赚吗？特别是，当时行情低迷，连我也认为，看再多的信息也没有用啊！

但事后证明，他的长期投资成绩单，总是令人惊艳。因为他经常能早人一步，买在股价的最低档。

他悄悄地跟我说，绝大多数的人，看股市讯息的目的，都是希望第二天就能买进一支飙股然后立刻赚大钱。但他发现，真正能让人赚大钱的消息，往往不会立即发酵，反而是当时大家都没注意，或是早已被忘却且放弃了一段时间之后的那种。

他 举例说，某家公司宣布由第四季开始扩厂效益终于要实现了，会开始转亏为盈。但由于现在才是第二季，没有太多人会认真看待这则新闻，也许股价在下面几天也是 毫无反应，但他就会等到在第四季来临的前一个月左右，天天开始全神贯注的观察股价是否已出现任何动静，就像是个经验丰富的钓鱼老手似的，懂得在对的时间与 对的地点钓鱼，只要鱼汛一出现，他就会是那第一个钓到大鱼的人。因此，他特别强调，在广泛收集财经讯息的同时，是一定要作笔记的，但千万注意，不能只将今 天看到的某个讯息就放在当天的日记栏中而已，还要将它记录在未来利多实现日的往前一个月，到时就可提前密切观察股价的变化，然后守株待兔。

现 在，我们再以2008年下半年油价开始崩跌为例，许多航空公司当时便纷纷预估半年之后，获利会因油价成本降低而大幅增加。股价当时并无太大反映，而是一直 到了2009年第二季，也就是半年之后，全球的许多航空股才真正的出现了一波极为亮丽的走势。你如果事先做了笔记，就会是第一个坐在轿子上的人了，不是 吗？