It Ain't Over Till The Fat Lady Sings
I have been recommending to go short on Europe, Asia and Emerging Markets since March 2018. Also, decided the time is ripe to go short on S&P500 on Sept. EUM has been up over 30% since March. EUM is inverse 2x Emerging Markets ETF. EPV up 25%. This is the inverse 2x MSCI Europe. SH is up 20%. This is inverse 2x S&P500.
I was recently tempted to suggest a LONG for selective markets. Tencent, 700 HK rebounded around 30%. But i resisted the temptation to do so because the rebound upwards was too sharp and fast and I was sure it will retrace back from 340 back to 300. The low was 250 incidentally.
Brazil ETF started to rebound strongly, so did Russia. I bought into HSBC Brazil Fund, and Baring Russia. But I decided to put it at half weight as the general brought indices across the four major markets are still indicating a SELL.
Now I also saw cannabis stocks like Cronos shoot up 30% suddenly as they become subjects to takeover. Medicinal marijuana is a big thing now as it has anti cancer, anti inflammatory properties.
Value investing paid off handsomely as in Hong Kong, stocks like Hopewell Holdings, 54 HK shot up by 37% due to a privatisation offer. Small caps like Chen Hsong suddenly rose 40% due to sale of land.
China Sunsine of Singapore dropped to a low of 90ct from 1.50, but rebounded promptly to 1.35. I would not be chasing this but instead look for a retracement back to 1.20 and below.
Property wise has been fantastic. My family members are running a thriving business in the UK. Airbnb in Manchester is generating an incredible return of over 25% return on equity. Even during winter months, we are hitting 60% occupancy. Birmingham is chugging along at 17%, with the London portfolio at around 5% only. But capital gains in the London portfolio meant our ROE is infinite as they refinanced out all the equities.
Over in Singapore, we are happy to see a property's value shoot up by between 25 and 50% as one property is put up for en bloc.
Overall, the stock markets are still in a downtrend. I expect a 5 to 10% rebound late Dec for a Christmas rally before falling to a new low. This bear market ain't over yet.
Theresa May is likely to have a Brexit deal rejected by parliament this Tuesday. She's likely to resign and in January 2019, no deal has been trashed out. There is likely to be a stay of execution to extend deadline, after which a second referendum occur. This is a reasonable outcome as most people in UK have been too simplistic in their assumption that they don't need the EU and a divorce is easy. For heaven's sake the UK is about to lose Northern Ireland and Scotland with Brexit! 2019 will be a volatile one for the UK. We will strike in Britain once there are demonstrations against Brexit. The people have to realise that the referendum is invalid in the first place because they have been lied to.
Opportunities will occur in troubled countries like Britain. But I do like Belfast's prospects the most. Price is cheap. Return on Assets over 10%. A real bargain as whatever happens to Brexit, Northern Ireland will always be in the customs union.
H2O Asset Management predicted a sharp correction of US stocks between 2Q and 4Q 2019. That means any rebound in January is likely to be short lived. It could only be six to nine months at best.
We could see a US recession in late 2019 or 2020 onwards. Very dicey times.
The Fed is unlikely to hike so many times. I felt at best they will hike two more times. The Fed rates will move to 2.75% and the two years US Treasurys likely to be over 3.2%. The 10 year UST could easily drop below 3.2%, causing an inversion. The only thing that can force the Fed to hike more than twice is inflation shooting above 3.5% for prolonged periods.
I was recently tempted to suggest a LONG for selective markets. Tencent, 700 HK rebounded around 30%. But i resisted the temptation to do so because the rebound upwards was too sharp and fast and I was sure it will retrace back from 340 back to 300. The low was 250 incidentally.
Brazil ETF started to rebound strongly, so did Russia. I bought into HSBC Brazil Fund, and Baring Russia. But I decided to put it at half weight as the general brought indices across the four major markets are still indicating a SELL.
Now I also saw cannabis stocks like Cronos shoot up 30% suddenly as they become subjects to takeover. Medicinal marijuana is a big thing now as it has anti cancer, anti inflammatory properties.
Value investing paid off handsomely as in Hong Kong, stocks like Hopewell Holdings, 54 HK shot up by 37% due to a privatisation offer. Small caps like Chen Hsong suddenly rose 40% due to sale of land.
China Sunsine of Singapore dropped to a low of 90ct from 1.50, but rebounded promptly to 1.35. I would not be chasing this but instead look for a retracement back to 1.20 and below.
Property wise has been fantastic. My family members are running a thriving business in the UK. Airbnb in Manchester is generating an incredible return of over 25% return on equity. Even during winter months, we are hitting 60% occupancy. Birmingham is chugging along at 17%, with the London portfolio at around 5% only. But capital gains in the London portfolio meant our ROE is infinite as they refinanced out all the equities.
Over in Singapore, we are happy to see a property's value shoot up by between 25 and 50% as one property is put up for en bloc.
Overall, the stock markets are still in a downtrend. I expect a 5 to 10% rebound late Dec for a Christmas rally before falling to a new low. This bear market ain't over yet.
Theresa May is likely to have a Brexit deal rejected by parliament this Tuesday. She's likely to resign and in January 2019, no deal has been trashed out. There is likely to be a stay of execution to extend deadline, after which a second referendum occur. This is a reasonable outcome as most people in UK have been too simplistic in their assumption that they don't need the EU and a divorce is easy. For heaven's sake the UK is about to lose Northern Ireland and Scotland with Brexit! 2019 will be a volatile one for the UK. We will strike in Britain once there are demonstrations against Brexit. The people have to realise that the referendum is invalid in the first place because they have been lied to.
Opportunities will occur in troubled countries like Britain. But I do like Belfast's prospects the most. Price is cheap. Return on Assets over 10%. A real bargain as whatever happens to Brexit, Northern Ireland will always be in the customs union.
H2O Asset Management predicted a sharp correction of US stocks between 2Q and 4Q 2019. That means any rebound in January is likely to be short lived. It could only be six to nine months at best.
We could see a US recession in late 2019 or 2020 onwards. Very dicey times.
The Fed is unlikely to hike so many times. I felt at best they will hike two more times. The Fed rates will move to 2.75% and the two years US Treasurys likely to be over 3.2%. The 10 year UST could easily drop below 3.2%, causing an inversion. The only thing that can force the Fed to hike more than twice is inflation shooting above 3.5% for prolonged periods.
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