Double Dip Recession?

Some of the investor asked me about the double dip recession few weeks ago. He said it make him worry whether should he take profit now. He told me he is holding WFC, BAC and LVS.

This is what i told him a few weeks back:
1. i am not the economist to predict double dip recession. and i do not know when is dip recession.
2. i do not like speculation, it make me very emotional and can't make my judgement properly.
3. i am looking at long term. What i understand now is DJI at around 10400 pt and there is a still huge room for appreciation vs DJI peak's at more than 14000 pt.
4. you are buying a good company like WFC which you should not worry. you should be happy to hold those good company. WFC and BAC are in my portfolio as well.

He replied, "but there is no fundamental, there will no any other stimulas package."
"If you are really not comfortable, go into analysis, sell with the trend to take profit.", i told him.

But today yahoo's new headline: Obama warns of a 'double dip' recession.
http://news.yahoo.com/s/ap/20091118/ap_on_re_as/as_obama_economy

Some other new: Dubai debt fears hit world market hard.
http://finance.yahoo.com/news/Dubai-debt-fears-hit-world-apf-3624614071.html?x=0&sec=topStories&pos=2&asset=&ccode=

Dollar hits 14-year yen low amid Dubai debt fears
http://finance.yahoo.com/news/Dollar-hits-14year-yen-low-apf-3450592897.html?x=0&sec=topStories&pos=3&asset=&ccode=

ehm.... well.... are my buy hold strategy not working for double dip recession? Frankly speaking, i do not know. But i will continue hold those stocks which are already in my portfolio. And i really happy to hold those company. Because, i know that those company are improving thier biz operation. They will get out from the trouble. The CEO is doing their job to improve thier biz.... One thing, i trust those company. American has proven in thier history for 200 years that they have the talent to improve thier country and make it better and better country.

one last thought, i would like to restate what warran buffet's qoute "Be fearful when others are greedy. Be greedy when others are fearful."

i will continue hold. how about you?

Retirement Planning Seminar (Part 2)

A lot of time people talk about the inflation. But how much those inflation impact our life? Will it impact our retirement plan? I got some good snap shoot taken during my seminar. I think it is good to share with you.

Do you remember this? Check out the coffee price below. I am not that old to experience RM1 for 4 cups of coffee. But i still remember RM1 bought me 2 cups of coffee ;)

By the way, 4 cups, 2 cups 1 cup or 3/4 cup is not the killing part. The Killing part is Starbuck Coffee. RM10++... My favaourite Green Tea Latte RM15++..... Haha.....

Let review some official inflation data from government web. Do you believe in below inflation figure? Do you think 5.4 for year 2008 is low or high? Don't laugh, you got your inofficial answer ;)

What is the implication of inflation rate toward your Fixed Deposit? you are earning a negative income (real rate -1.7%) for FD in year 2008. Sorry for those who has a lot of FD in year 2008.

How about your retirement fund? EPF. ehm... not too bad... slightly better than FD.... but you are earning an -0.9% in year 2008 as well. Will this -0.9% impact your retirement planning? "probably not for year 2008 data. average return still good with 5%"  ;)

How about below article? EPF has hard time to maintain ~5% return every year. So, what is your action? Do you still want to wait for government to gurantee your retirement fund? Some said your EPF is not sufficient, you need to die before age 77 (life expectancy in Malaysia) like what my previous instructor said ;) another instructor said, die also expensive.... haha.....

http://biz.thestar.com.my/news/story.asp?file=/2009/7/15/business/4318886&sec=business

 What should i do? Where are the source for your retirement fund? Stock? Property? Bond? FD/Saving? Same type of question i have been thinking...............

Below are some of the instruments that you could use to plan for your retirement. Higher risk give your potential higher return. Find your own sweet spot. Talk to your financial planner or unit trust consultant to plan for your future. Let start together... Happy Retiring and Happy Jobless..... ;)

Retirement Planning Seminar (Part 1)

I attended the retirement planning seminar. The instructor was a humourous guy from Public Mutual Brunch Manager, Vincent. He mentioned the top 5 fears for retirement survey result:

1. illness
2. capability to earn income
3. make lost in investment
4. inflation
5. continue prolong for economy downturn.

He joked about those fear also happen every month "Duit habis, bulan tak habis".... haha...
OK, let get into our real biz here today to share some good content during the seminar.

What is retirement planning? It is a plan to save and invest to maintina ones' pre-retirement lifesypte during the retirement years. Do you believe in one must have cash reserves of about RM1mil to be able to maintain one's current lifestyle 20 years after retirement? Check out the article below ;)

source: http://biz.thestar.com.my/news/story.asp?file=/2009/1/28/business/3128286&sec=business

What is your ideal retirement age? Some said 55? 45? 35? The best retirement age is yesterday and today i do not need to work, so nice :) But are you ready for your retirement? can your retire?

RM500,000 only last for 16.7 years if you spend RM2500 per month. Do you have RM500,000 in your bank?

Table below showed how much of Retirement Fund Needed at Age 55. Is your Employee Provident Fund

(EPF) or Government Pension Scheme sufficient to cover below figure?  A person at age 35 with RM2500 monthly expense requires more than RM1million lumpsum in the bank assuming that person live until 77.

I will share about on the inflation and instrument available in the market in my next Part 2 article.

Maxis IPO result

Dear investor,

Maxis IPO result is already out. You could call up your broker to check the result. or below is the url
http://www.mih.com.my/enquiry.php

Rich Dad, Poor Dad

i received a "My story" presentation today from Jerry. It was impressive and triggered me to start reading "Rich Dad, Poor Dad" which was left unattended on my book shelf for long long time. Below are the 6 lessons:

Lesson #1 The Rich Don't Work for Money
Lesson #2 Why Teach Financial Literacy?
Lesson #3 Mind Your Own Business
Lesson #4 The History of Taxes and The Power of Corporations
Lesson #5 The Rich Invent Money
Lesson #6 Work to Learn - Don't Work for Money

Dear investors, how do you do with the 6 lessons?

Maxis relist on Main Market Nov 19 2009?

I read some interesting article on Maxis market view. I would like to share as a follow on dicussion on my previous Maxis IPO article. Again both views are in 180' reverse direction ;)

Why it is a buy

1. A must have large cap stock for fund managers
2. Industry learder since year 2000 and offers investors biggest exporsure to Malaysia's telecoms sector
3. It has a performance driven board and management (Ananda)
4. Good track record as old Maxis delivered 300% total return
5. Generate more cash vs spending due to hived off from overseas unit. Good dividens.

Why it is not a buy

1. RM5.2 is higher valuation than local and regional competitors. Limitted potential upside.
2. Not the only choice for dividend yeilds.
3. No regional exporsure, lack of growth
4. When the old Maxis debutted on Bursa in year 2002, mobile penetration was about 40% vs today more than 100% penetration.
5. Margin under stress due to competition.

how about you? is Maxis a buy or not for you?

Automated Forex Trading?

Hi Friends,

I have excellent news to share especially for people with not much time available or know-how in Forex Trading. Forex Exchange is the largest financial market in the world with a volume of over USD3.5 Trillion a day and runs continuously for 24 hours a day, 5 days a week. It presents the best investment opportunity for anyone involved in the trade, for which many are not familiar with.

ESA Trader have just launch a "proven robot, rather a software" that automatically trades forex on your behalf. It's effectiveness was demonstrated when last year in Jan 2008 we started to test run the software and as at 31st July 2009, the account grew from an initial investment of $10K to $170K (aggressive mode) while it grew from $10K to $240K (extremely aggressive). We have just released and launch a "moderate risk software" that is being used by the general public since Aug 1.

Check out the website www.esatrader.com and see the statements of the clients. These are genuine statements of some of my friends' and it is up to date (real time). So if you are looking for a return of investments of 5% to 30% monthly, this will be just right for you (as can be seen from the account statements on the website). The initial minimum investment is USD2,000.

Alternatively, you could also earn as much as RM100K a month by introducing this investments to your friends. Please look at the above attachment (ESA Commission) for the potential earnings from this. The most important thing is, it is achievable.

Call me if you want to know more. Thanks.

A lot of my friends and investors received this email and some of them had joined the automated forex trading program with ESAtrader. ESAtrader even published statement of client on the website. Base on what they published on the web, ROI looked very attractive. 2 methods to earn $$:
1. deposit certain amount of $$ and use thier automated forex trading software.
2. start you MLM biz with ESA, you will get some commission for building up your network.

Check out thier web,
http://www.esatrader.com/
http://www.fxdd.com/en/index.html
http://www.nzfinancial.com/

"i am tempted", said one of the investor.
"it looked too good to be good", said one of the investor.
"i donno. i am not familiar with forex thing. i only know it is about the currency exchange trading. But i am into fundamental, i am happy with my buy and hold strategy and my portfolio right now. No intention to switch", i told them.
"i do not know what is ESA as well. but i heard a lot of high level manager from MNC joining the program. why not you go find out and share more with us?", i told them.

so, below are what they found in the forum.
http://cforum5.cari.com.my/viewthread.php?tid=1754825&extra=&page=1
http://blog.simplyjean.com/2007/11/14/sunshine-empire-probe-illegal-investment-company/comment-page-6/
http://cforum5.cari.com.my/viewthread.php?tid=1754825&extra=&page=1
http://www.forexpeacearmy.com/public/review/www.fxdd.com

Bear in mind that some information in the internet or forum might not true. No bias here. Please use your judgement for your risk analysis.

Is Maxis IPO RM5.2 attractive enough?

Thank to anonymous for sharing below url in my previous article. It's very useful and provide some view on the Maxis IPO valuation to the investor.

http://online.wsj.com/article/SB125719127352623511.html
http://www.reuters.com/article/innovationNews/idUSTRE59B0P420091012
http://mysmartmoneytips.com/2009/11/02/should-you-subscribe-to-the-maxis-ipo/
http://www.google.com/hostednews/afp/article/ALeqM5hEev48YbArfdzW87fuguU11b3VBw

Valuation:
Is RM5.2 at the right price? some analysis said it is too high, some said it should be RM4-6, some said you should not pay more than RM7, some said RM6. Which one is correct? Let review some IPO details. Based on the IPO price of RM5.2 per offer share, the total market capitalisation is estimated at RM39 billion. (When Maxis was privatised at RM15.6 per share, the company's market cap stood at RM39 billion as well). According to merchant bankers, if Maxis is valued based on EV/EBITDA, a RM5.2 is too high and translate to >9. Telekom Malaysia ~ 4.99 EV/EBITDA, DIGI.Com ~ 7.25 EV/EBITDA, China Mobile ~ 4.96 EV/EBITDA.

But whatever valuation, i believe Ananda has a record of creation value for his shareholders. right? Let look at Maxis accomplishments over the year and some recent awards.
December 2004 - First operator in Malaysia to launch the BlackBerry
April 2005 - First operator in Malaysi to launch 3G services
September 2006 - First operator in Malaysia to launch HSPA for wireless broadband services
March 2008 - First operator in Malaysia to surpass 10 millions subscriptions
March 2009 - First operator in Malaysia to lanch the Apple iPhone
April 2009 - First operator in Malaysia to launch commercial NFC services
PC.com Awards 2009 - Best Mobile Broadband
Frost & Sullivan Malaysia Telecoms Awards 2009 - Mobile Data Service Provider of the year
Brand Finance Awards 2008 and 2009 - Number 4 brand in Malaysia
Asia Mobile News Awards 2008 - Mobile Operator of the Year Malaysia
Malaysian Effie Awards 2008 - Silver Award Winner.

Market Overview:
Subscribers ('000)  Dec2006     Dec2007     Dec2008     June2009
Maxis                     8,068          9,765          11,234         11,423
Celcom                   6,079          7,202            8,761           9,698
Digi                         5,312          6,409            7,062           7,230

Financial Data:
Revenue (Million)   Dec2006     Dec2007     Dec2008     June2009
Maxis                      6,957.1       7,689.6       8,449.8        4,243.8
Axiata                    16,339.2      9,996.9     11,347.7        6,030.4
Digi                          3,652.5       4,362.6       4,814,5        2,423.2

PAT (Million)         Dec2006     Dec2007     Dec2008      June2009
Maxis                       2,105.4       1,980.2        2,400.4        1,141.0
Axiata                       2,302.3       1,847.6           471.1           621.8
Digi                              805.7       1,062.6        1,140.7           509.9

base on some peer comparison, are you favour in Maxis? is Maxis IPO too expensive for you? Dear investor, you have a choice :)

Maxis IPO

Dear investor, are you ready for Maxis IPO? you could check out the customer eligibility to apply the offer shares at below url. IPO price is at RM5.2
https://dealernet.maxis.com.my/S/maxisipo/eligibility_check.asp

Gold Investment present a good opportunity for 2009??

Recently, a lot of my investor raised question about investing in gold. There is no question that gold's price run up recently. But will it push permanently above $1000 per ounce? Which one should i invest, gold, stock, bond or mutual fund? It is common that investor always compare those performace against each other. Frankly speaking, i am not the gold expert. i do no have the all right answer for that. But in fact, i do some research.

Base on the historical data below, if you were invested in Gold year 1913, with the inflation adjusted, you will get a double for annual average gold price in year 2009. The best timing to invest in gold were:
1. Year 1929 to 1933 - USA Great Depression of the 1930s. People feared their bank would fail or a bank run might happen.
2. Year 1971 to 1980 - Inflation and Stagflation, where the return on bonds, equities and real estate is not adequately compensating for risk and inflation then the demand for gold increases.
3. Year 2001 to 2008 - Increasing gold demand due to USD depreciation.

Source: http://inflationdata.com/inflation/images/charts/Gold/Gold_inflation_chart.htm

You could check out method of gold investing:
http://pbebank.com/en/en_content/personal/investments/gold.html
http://www.thegoldlabel.com/

How about investing gold in year 2009? Could we take the US bank crisis as opportunity for gold investing base on above data? The decision is your.