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Talking about "Evening with AK and friends" (15 July 2016).

Saturday, July 16, 2016

The first "Evening with AK and friends" was, hopefully, fun and educational, for everyone. I picked up some pointers from my guest panelists, Victor Chng and Rusmin Ang from The Fifth Person too. For sure, AK doesn't know everything and has lots of room for improvement as an investor.

Of course, being financially secure is not just about being a good investor in equities. So, I briefly talked about insurance, bonds and real estate too. Most of the evening was devoted to answering questions regarding some stocks and REITs.

I understand that some readers are more seasoned investors and some are newer investors and here are links to books which were mentioned for the newer investors at the event:

1. Recommended books for FA and TA. (Book no. 1 for FA is recommended and the one that Rusmin said to read first.)

2. 5 rules for successful stock investing. (This is the book recommended by Rusmin to read later.)

There was a good discussion on Telcos as well and Victor pointed to various articles he wrote on SingTel, Starhub and M1. I found the link to the list of articles: here. Good stuff!

Whatever we want to invest in, question our motivations. Be clear about what we want. Then, we know what to do and whether that investment is for us.

Make sure that it is a bona fide investment that is sound. Get in with a margin of safety or, at least, don't overpay. There are ways to do this and I mentioned using PE ratio and NAV as two possible metrics in the example of DBS and why I thought it was undervalued.

As investors for income, always look out for financial engineering. Find out what is the real income generated by an investment and what they can actually pay in dividends based on their operations. That is being realistic. 

Assuming anything higher introduces an element of speculation and it could go either way. It is OK to speculate a little, I always say, but if we want to reduce downside surprises to the minimum, then, it is best not to.

We could also invest in something as a possible asset play and I used the examples of OUE and WingTai. It would be good if such investments pay us while we wait (don't know for how long).

It is good to be cautious but don't be overly cautious that we end up leaving most of our money in our war chests waiting for a war (and getting increasingly frustrated as the war seems to be overdue). 

There is still lots of liquidity out there and with BREXIT, it does not seem like liquidity is going to reduce. Instead, we won't be wrong to expect looser monetary policy as central bankers around the world are scared stiff of another credit crisis. 

So, another bout of liquidity driven rally in the stock market is definitely possible. Money will go to where it is treated best and good income generating stocks in Singapore will likely benefit.

I try not to be overly pessimistic. I try not to be overly optimistic. I try to be pragmatic.

Finally, for those who missed out on this session and requested that I organise another one, good news! 

There will be a second session and it will definitely be the last one for 2016. (Really, AK is very lazy this year.) Details will be released when available. So, look out for it.

Related post:
1. Track the companies we are "Vezted" in.

2. "Evening with AK and friends" in 2016.


Unknown said...

I wonder if AK has any thoughts of holding a workshop on investing?

SMK said...

are you in a business venture with the fifth person now?

sy sy said...

hope got chance to join ur next session... ;)

AK71 said...

Hi Unknown,

AK is too lazy to do something like this. ;)

AK71 said...


AK is too lazy to do something like this. ;)

AK71 said...

Hi sy sy,

AK is lazy but another (and final) session will happen this year. :)

SMK said...

lazy is good :)

AK71 said...

Inflation expectations and German bond yields have slid since the British referendum on June 23, fuelling speculation that the ECB may have to extend its money-printing program and will eventually run out of bonds to buy.

The ECB is unlikely to take further action before seeing updated inflation forecasts at its Sept. 8 meeting, taking comfort from a stabilization in financial markets after an initial 'Brexit' shock.

But economists expect it to announce as early as the autumn that its 80-billion-euro asset purchase program will continue beyond its current end-date in March 2017.

A change to the technical terms of the bond purchases is also expected, to allay concerns about a scarcity of bonds to buy in some countries such as Germany.

The most palatable solution is likely to be scrapping a rule barring the ECB from buying more than 33 percent of any bond, so long as it does not have a Collective Action Clause.

Source: CNA

Nicole said...

Let me know if you will organise one in end Sept where I will be in Singapore! :) Will support you!

AK71 said...

Hi Nicole,

We are looking at middle of September now. Look out for the blog post. :)

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