Having A Look at DBS in Tableau

 Hope everybody's doing well!

I thought it would be fun to construct a heat map of DBS- this was a short piece of work in Tableau.

Firstly, the fundamental premise here is that we are using 3 years worth of DBS stock data- for simplicity's sake, I used the adjusted close price (to account for dividends) from Yahoo Finance on a monthly basis- 1st Jan, 1st Feb, 1st Mar and so on. The y-axis here is the month that the position in DBS was entered and the x-axis is the month where the position was exited. . Furthermore, I used CAGR as a benchmark to gauge the performance of the stock between the time of buying and the time of selling. Feel free to comment how I can improve my little analysis here!

As we can see here, entering a position of a longer duration generally outperforms shorter duration positions (more green than red). But interestingly, shorter duration positions also produce higher profits (green of higher intensity)- which does make sense too. Another observation is that entering in 2018 period will generally yield negative CAGR (red data).

Happy to hear from you!

Thoughts on the red market

Monday was a bloody day for STI, having dropped 6.03% (haven't seen this since global financial crisis!) As I am writing this, US markets are down a good 5-6% cos of the double whammy caused by virus fears and oil uncertainty.

But for me, I think this is a good chance to look at stocks that are normally expensive and now relatively cheaper to buy.

I have quite a number of picks but for now I am looking at DBS.

Currently priced at 21.15 (monday’s closing price) and based on a annual dividend of 1.32, dividend yield is a cool 6.24%.

A few factors I am noting for myself:

First: the Federal Reserve announced a pretty extreme rate cut which will affect banks in terms of factors such as Net Interest Margin (NIM). I think this is a pretty good read here, but effectively, a low fund rate at Federal Reserve will reduce NIM and banks can potentially suffer a lower profit as yields on mortgages might be lower. The DBS report states potentially 6-8% lower profit, which can mean that we should not take the current dividend for granted.

Second: the current oil crisis is also another area of concern. I am pretty worried DBS's exposure to the oil and energy sector and crude oil falling to $20-30 levels should not be taken lightly.

Third: of course the coronavirus is the top of the list. This directly affects the economy, consumption will go down and holidays cut. This uncertainty of the damage to the economy should keep DBS's share price even lower in the interim.

I am looking at levels below 20 for now to enter as my bullets are limited, but we will see again!

Lastly, I saw this article and thought it was pretty interesting that the advice now is not to enter due to uncertainty. But perhaps uncertainty is opportunity too. What do you think?

 Take care and trade well! Hoping all your trades are good. ($$$ below for everybody)

P.S tuesday market quite green now

Coronavirus and Thoughts

I haven't been posting in a while because of my new job, but I think it is always good to take a step back and formulate my thoughts about recent news.

The best incident to fall back on while considering this issue would be the 2002-2003 SARS outbreak because both incidents are largely similar: SARS started around November 2002 and ended around May 2004. A quick look at the STI:

We can see that from the period from November 2002 to May 2003 there was a clear downtrend in the STI before rebounding decently into 2004.

Currently, the STI seems to be in the infant stage of a downtrend which suggests some potential buying opportunities. I came across this article which aptly compares the two outbreaks.

Further points to take note:

1) China's economy is much bigger now than it was during the SARS outbreak period so the impact is gonna be pretty painful as trade between China and Singapore is quite extensive.

2) Banks will be affected as they have exposure to China; OCBC has the highest exposure here.

3) Airlines are affected too as flights are being cancelled here and there. Example: Hong Kong Airlines being on the verge of bankrupt. Note to self- SIA.

4) REITs with China exposure are already feeling the pain - Mapletree NAC, CapitaChina, Sasseur.

5) Generally, retail should continue to deteriorate as everybody will most likely be minimizing their outside movements. (CapitaMall, Suntec, Mapletree Com, Starhill)

But otherwise, I think it would be a good time to look at the market to consider entry points. Cheers!

STI and HSI Red Amidst the Trade War

A short read today showed that the STI plunged 2% due to escalating tensions in the US-China trade war. This could be contributed to the tariffs which Trump promised on Friday, which includes a 10% tariffs on US$300 billion worth of goods. On the contrary, the Federal rate cut did not give the expected stimulus to the stock market, which might not be unexpected as based on current market conditions, a rate hike should have been more logical.

As I am very interested in the STI constituents, I decided to see which stocks were bearing the brunt today.

The first stock is SIA which is hovering near its 52-week low of 9.01. At this point of writing, its current price is 9.02.

The second stock (which I have mentioned before) is SATS which is hovering near its 52-week low of 4.55. At this point of writing, its current price is 4.74.

Other notable stocks include DBS which had a 3.2% drop today.

Another point of interest will be the HK market, where today, 5th of August, is notably the biggest strike in Hong Kong's history. I think it is a double whammy for HK as they have to deal with the twin reasons of the trade war and the ongoing protests.

I am currently looking at Bank of China, which has broken its previous 52-week low of 3.19 to 3.05, which makes it even more appealing to go in. (Let us bear in mind that BOC is actually based in China and is just a H-share) I will be looking at other HK banks but I will be probably avoiding those banks based in HK such as the BOC (HK) holdings and Hang Seng Bank etc.

Just a superficial thought.