G20 Today!

Quite meaningful to me, since I just came back from Osaka 2 weeks ago. This article really sums up how I feel about G20, probably another round of photos and talk but no action. Interestingly, the article is inclined towards holding gold and real estate, which may prove to be safe havens during a potential recession.

The debt in the market is so far quite worrying too which further supports the proposition of holding safe haven assets.

Personally, I am still waiting for a downturn which might happen sooner than we think. Singapore might not be spared too, where GDP growth will worsen this year. This can contribute to the downturn.

On a superficial glance, REITs now look very overpriced and I am steering clear of my previous picks of Suntec REIT and Mapletree NAC.

Still waiting while holding bonds!

Reading Financial News

Recently, I got hooked into reading financial news and I would love to hear about where y'all might read news (if it interests you).

I have been reading a few websites.

1) CNBC Finance

2) Marketwatch

3) Bloomberg

4) Reuters

5) Barrons

I am also thinking if I should get a paid subscription too, because for example Bloomberg limits 10 articles per month.

What's your take?

Economy, Trade-War

Some quick thoughts on the general economy!

Rate cuts seem to be pretty likely, supported by factors such as the trade war and pressure from Trump which could lead to a boosting of the economy. However, a slowdown in the global economy seems likely as I think stocks now are generally overvalued.

Had a look at the STI stock list too and it seems that most stocks now are hovering pretty high above their 52-week lows with exceptions which are highlighted below.

Generally, I will be looking to the market to drop further for Singapore as I think some stocks are really too expensive (double digit % difference from their lows) and I think there are more buying opportunities in Hong Kong which I mentioned in my previous post.

Trade safe everybody.

HK investing Thoughts

I have always thought about investing in Hong Kong shares as a form of diversification out of Singapore. Furthermore, this could increase my pool of opportunities to buy undervalued stocks since the population of choices is increased (perhaps by a lot of times) since HK market capitalization greatly exceeds that of SG.

Source: Pexels Free Stock Photos

Let me start with a disclaimer that I am not paid in any way for my post, these are purely my thoughts.

During my travels, I have been using the DBS Multicurrency Account (DBS MCA) and I realize that by creating a Hong Kong Dollar (HKD) wallet, I am able to convert SGD into HKD and buy stocks directly.

A quick check at DBS website tells me that the rate I am offered is 1 HKD for 0.1762 SGD, or 1 SGD = 5.675 HKD.

Source: DBS Exchange Rate Website

I then log on to my DBS ibanking (this is an example).

Source: My own DBS ibanking portal

Do note the deviation from the market rate and whether it is a comfortable deviation. For example:

Source: Yahoo Finance (SGDHKD)

Presuming I am investing SGD 10,000 which will equate into HKD 56,750.

So why am I talking about all of these? There is a HK stock which currently interests me, Bank of China. It is currently trading at 3.26 HKD but its NAV is 6.205 which suggests undervaluation. 52-week low is also at 3.19 which further supports this premise. Dividend payout is according to 6.2% and all statistics are from InvestingNote.

This is just a preliminary look for me and I think some of the risks here is firstly: the controversial extradition bill which caused a rally of 1 million people in the streets here. The loss of investor confidence in HK markets might be bearish for stocks and is something worth looking at. Secondly, if HKD depreciates against SGD, there will be a reduced profit. Since HKD is pegged to USD and there have been rumors of rate cuts, we might expect further depreciation of USD and similarly HKD.

These are my current thoughts now but always happy to hear new ideas about how you will invest in the HK market.

Thoughts about Prices

Back from Japan! Here is a snapshot of Yokoamicho Park in Tokyo.

In Japan, consumption is subjected to a 8% tax unless you are a tourist and you shop at duty free shops such as Uniqlo with a minimum of 5,000 yen. Therefore, when I dine, some restaurants show the before tax prices and some restaurants show the after tax prices.

After tax price:

Before tax price:

Would you prefer to see a all-in-one price or a price without taxes? Please share!

Tariffs Thoughts

Currently I am in Osaka now but I still have some thoughts about the incessant chain of tariffs by Trump.

But first, a quick snapshot of Osaka Castle!

Now back to my thoughts...

Recently, Trump also labelled Singapore as a currency manipulator which was pretty interesting. It also mentions about high saving rates and low consumption rates in our country. I did some quick research about Singapore policy here and essentially, Singapore uses exchange rate policy to manage the economy instead of interest rates (which is left to the free market) which may explain the huge number of foreign exchange purchases with respect to GDP.

Personally I don't think Singapore will be adversely affected in the short term as we have a trade deficit with the US (momentarily sparing us their wrath) but I think Singapore will continue to be affected by US tariffs on the rest of the world. China is also one of Singapore main trading partners and if poor sentiment ensues, we should continue to see downward pressures on STI.

Going to my previous calls, SIA is at 9.11 and Suntec Reit edged slightly higher at 1.82. Both are still on my watchlist and I am quite tempted to initiate positions.

What do you think?