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ONELAUNCH

STIIndex  Stocks

STI CHART	GET THE EDGE SINGAPORE		STI INDEX STOCKS  FULL TECHINCIAL ANAYLSIS
CDP SGX	STI Index TOP PERFORMERS STI  CLOSING 2011 STI 2010 STI  2009 STI 2008 STI 2007 source:yahoo finance
STI INDEX STOCKS			REITS
CORPORATE  ACTIONS DIVIDENDS UPDATE	COMPANY  ANNOUNCEMENTS  AND NEWS UPDATE	A TO Z STOCKS	STOCK CHARTS

The performance of our STI stocks from the lowest point to 10 Nov 2008.

Wall Street
Why it's (finally) time to buy
Singapore maket falls behind America's; one serious view is that US equities, after being overpriced for 10 years, are now at sensible - but not bargain - prices.
Oct 4, 2008

By Shawn Tully,
editor at large, Fortune Magazine
New York - You didn't hear this uttered very often, but over the past decade and a half, through bull and bear market alike, the value proposition for stocks could be stated succinctly: There's nothing to buy.

The fact is that equities were over-valued for years, making them vulnerable to the kind of brutal, sudden sell-off we've just witnessed. But now that the S&P has declined 40% in 12 months, the question is whether equities are at long last a bargain.

The answer is a qualified yes: Stocks aren't exactly cheap, but for the first time in years you can expect decent returns, provided you're patient.

"If you buy now and wake up in 10 years, you'll probably get a return around the historic average," said Yale economist Robert Shiller.

In the near term, however, Shiller - who correctly predicted the implosion of the stock-market and real-estate bubbles - is more cautious.

"There is a substantial risk that with all this economic turmoil, stocks will fall far lower," he warned.

But make no mistake, stocks are now at levels where buying makes sense.

The best measure of stock valuation is Shiller's own index of price-earnings multiples. Shiller uses a 10-year average of inflation-adjusted earnings to calculate an adjusted P/E. The advantage to the Shiller method is that it smoothes out the peaks and valleys in profits.

Example: In the 2003 to 2006 period, earnings soared to historic heights, jumping from a normal 9% of gross domestic product to an extraordinary 12%.

The profit bubble made P/Es look artificially low, handing the stock jockeys a logical-sounding reason to claim that equities were a buy, when in fact they were overpriced.

Both the "P" and the "E" were in a bubble - the "P" even more than the "E." When the "E" collapsed in the face of the current downturn, the outrageous valuations were rudely exposed.

To see how out of whack P/Es had gotten, let's take a look back. From 1890 to the early 90s, the average Shiller P/E stood at 14.6.

It dropped as low at 6 in the early 80s, and never went over 24. Then, in the late 90s, P/Es regularly stood at over 30, and at their peak in 2000 hit 44.

In the bear market that followed, P/Es dropped - but only into the low-20s. Then they took off again, averaging 25 to 28 from 2003 to the beginning of this year.

Now they're at 15.7, not far from their pre-bubble average. That decline is tonic for investors.

Research by economist and hedge fund manager Cliff Asness shows that buying in at a high Shiller P/E usually leads to poor returns, while grabbing stocks at a low Shiller P/E is a reliable route to riches.

From today's levels, what can we expect? Stocks' future return is closely related to the inverse of the P/E, also known as the earnings yield.

So at a P/E of less than 16, investors should obtain real, or inflation-adjusted, gains of around 6.5%, which is about what Asness found in his research.

Add 2.5 points for inflation, and the nominal return comes to a respectable 9%. That's about a point below stocks' long-run return, but it's far better than anything investors could expect for a decade and a half.

The rub is that getting even that 9% return won't be easy. Assuming no escalation of P/Es, stock returns come from a combination of earnings growth and dividend income.

Earnings per share grow only at about 2% a year after inflation. (Total earnings grow faster than that, but new issues of stock dilute that growth.)

So add in our 2.5% inflation rate to 2% real growth, and you still need a dividend yield of 4.5% to get to that 9% goal.

The yield on the S&P 500 is now around 3.3%, versus around 2% earlier this decade. That's better, but not enough.

So simply buying "the market" at today's decent valuations isn't enough. You also need to choose stocks that pay higher-than-average dividends to reach the 9% threshold.

Fortunately, that's not too difficult to do now. Lots of stocks with predictable, reliable earnings streams now offer yields between 4% and 6%, including Consolidated Edison (ED, Fortune 500), Kraft Foods (KFT, Fortune 500), Duke Energy (DUK, Fortune 500), and Merck (MRK, Fortune 500).

You'll also want to avoid most tech issues. Companies such as Oracle, Google (GOOG, Fortune 500), Symantec, and Research in Motion (RIMM) pay no dividends at all, and sell at pricey multiples between 16 and 23.

Finally, remember this: Shiller points out that stocks were cheap in the early 1930s, and investors who bought then eventually made good money. But it took them many years to get there.

So if you buy now, stick with strong dividend-paying stocks, and fasten your

 seatbelts. It will be a bumpy ride.

Is it too late now to pick up stocks? 5 Nov 09

 By Lorna Tan, Senior Correspondent/ Straits Time

 Plenty of investors are walking around dwelling on that most painful of questions: What if?

What if they had jumped back into the stock market in late March or April, soon after the market bottomed out?

Since then, the white knuckle panic of the global financial crisis has given way to optimism.

In Singapore, the Straits Times Index (STI) closed at a 13-month high of 2,712.15 on Oct 15. This was up a breathtaking 86 per cent from its March low of 1,456.95.

In fact, online unit trust distributor Fundsupermart.com is so bullish on the Singapore market that it recently announced it will donate $50,000 to a local charity if the STI does not hit its forecast level of 3,600 by the end of 2011.

Other market indexes also have enjoyed big rallies. The Dow Jones Industrial Average, a bellwether of top US stocks, crossed the psychologically important 10,000 level on Oct 14 for the first time in a year, boosted by robust US corporate results.

It is no wonder that investors are wondering if the bears have departed the scene for good. Also, what are the latest hot stock picks?

The Sunday Times polled some experts on their outlook on equities.

Q: Is the current rally sustainable?

Mr Timothy Wong, head of DBS and DBS Vickers Group Research:

'The current rally is not sustainable from a short-term two-month view. We think that upside will be capped at 2,800 over the next two months. However, the global economic recovery process is still panning out and we see more upside for the STI on a six- to 12-month basis. Our current 12-month forecast for the STI is 3,160.'

Ms Carmen Lee, head of research, OCBC Investment Research:

'We believe the momentum is still healthy, although the pace of appreciation may not be as sharp as what we witnessed in terms of the recent recovery.

'Confidence has also returned to the market. In the US, the Conference Board Consumer Confidence Index, which hit a low of 25.3 in February, has rebounded and is now at 53.1. With the renewed confidence from both businesses and consumers, together with the current liquidity and low interest rates in the market, this should continue to support interest in equities.'

 Mr William Cai, director of GYC Financial Advisory:

'As the recovery is still at an early stage, investors still need to be cautious as we still have to see if sales growth and earnings data are sustainable early next year. The final drive that will swing us back to be more bullish will be further improvements on the job numbers, retail numbers and better corporate earnings. This could bring the STI to between 2,800 and 2,900 by year-end.

'However, from a technical perspective, in the short term, many equity markets look ripe for a correction of 5 to 10 per cent.'

Mr Wong Sui Jau, Fundsupermart general manager:

'Earnings have been battered to extremely low levels in 2009, and we expect earnings to be significantly higher next year and in 2011. Thus, we expect a sustainable rally, but only over the longer term as the recovery becomes more pronounced. We also do not rule out short-term corrections in the stock market, given the fickle nature of investor sentiment.'

Q: For investors still on the sidelines, what should they do?

Whilst some experts agree that the best part of the rally is over, it is not too late to get in now.

Instead of investing one lump sum, stock investors are advised to buy into the market in stages. Mr Cai's advice is for stock investors to stick to companies that are fundamentally sound. This means firms that have increasing sales revenue, high gross margins, free cash flows and healthy levels of borrowing.

'Start with 5 per cent of capital into each stock and increase only when it proves to be profitable. Limit the exposure to a stock or related stocks to 15 to 20 per cent,' said Mr Cai.

Stock picks

Here are some stock selections for investors who have set aside some cash for stock investments and have a five- to 10-year investment horizon. Before you buy any stocks, do note that you should do your own thorough research on the company first.

Mr Timothy Wong:

Investment: $10,000 to $20,000

'It is better to spread the risk and go for an exchange traded fund with exposure to emerging or Asia markets rather than an individual stock.'

 Investment: $50,000 to $100,000

'Blue chips are preferred as they offer a much steadier return over the long term even as they undergo bull and bear markets. And in land-scarce Singapore, the property sector should offer long-term returns, so go for blue chips such as City Developments.'

Mr Gabriel Yap, senior dealing director at DMG & Partners Securities:

'Investors should set aside at least $50,000 if they want to invest in the stock market. Wait for a good pullback of 6 to 12 per cent to build up your investment portfolio.'

Here are his stock picks:

1) OCBC Bank: Banks normally outperform in the second stage of recovery.

2) DBS Bank: DBS currently has the cheapest valuation among Singapore banks.

3) Bukit Sembawang: The property developer owns a great landbank in the Seletar area which is undergoing rapid changes. Its cash flow is expected to improve.

4) CapitaMall Trust: It has a great portfolio of assets with respect to locations, yields and borrowing levels.

5) Ascendas Reit: Its high-tech properties are under-rented, so there is potential for higher rents. Its built-to-suit strategy and acquisitions are expected to propel growth further.

6) Frasers Centrepoint Trust: The acquisitions of Northpoint 2 and Yew Tee Point next year will propel growth. It also has conservative management and a robust balance sheet.

7) Noble Group: The recent investment by Chinese sovereign wealth fund China Investment Corp will open doors further for this commodities trading firm. It is expected to benefit further from increasing profit margins.

8) Midas Holdings: Midas engages in the manufacture of aluminium alloy extrusion products primarily for the rail transportation and infrastructure sectors in China.

It is therefore a great beneficiary of China's rail industry's booming growth.

Mr Kenneth Ng, head of CIMB-GK Research:

'Investors should ask themselves which Singapore company can truly turn into a pan -Asian leader in five to 10 years' time. Stocks I would own for a five- to 10-year investment horizon must be potential leaders in their field.'

Here are his stock picks.

1) Sembcorp Industries: The utilities division will give it a stable earnings growth profile, which will also benefit from the clustering of the petrochemical industry in Singapore. Its offshore & marine division will benefit in the next few years from orders.

2) Parkway Holdings: It is on the way to becoming a significant Asian health-care player. It already has an entrenched leadership position in Singapore which will improve further when its hospital at Novena opens in 2011. It will also benefit as Singapore builds its position as a health-care hub for the region.

3) Parkway Life Reit: We like Parkway Life Reit because we see health-care assets as one of the most stable asset classes and this Reit stands out as one of the few health-care Reits that can amalgamate such assets.

4) Ascott Reit: Its assets are diversified over Asia and serviced residences stand as a good asset class to benefit from increased business dealings in Asia. With Asia likely to grow in importance as the main growth driver for the world, travel for business projects will grow in tandem.

5) DBS: It is the cheapest among the three Singapore banks, but stands out as the Singapore bank which has established the overseas platform with the most potential. Its short-term risk is poor risk management.

6) Wilmar International: The management of the palm oil producer is proven. Its integrated exposure across the palm oil value chain allows it to manage prices and profit from market intelligence. And its leadership position for cooking oils in China is immensely valuable.

7) Genting Singapore: It is likely to remain as one of Singapore's top five market capitalisation stocks in future. Short-term risks are: high market expectations and the potential disappointment of first-year profitability if a gestation period is necessary.

8) Noble Group: It is enjoying increased volumes and value-added processing capabilities from projects coming online, as well as its expansion into the oil and gas segment. Emergence of a Chinese shareholder also solves capital requirement to fund future growth.

S-CHIPS A year of stock picking in 2011

S-Chips saw renewed investors’ interest that helped the sector outperform
the STI index by 2% over the past three months. Results from our latest
stock-take suggest there are 150+ S-Chips, which are predominantly
small-cap counters with average S$350m market size. At trailing 12x P/E and
1.3x P/B, valuations of S-Chips are near their historical five year
average. We believe that S-Chips will continue to provide investors with
attractive return opportunities in 2011, in which their share price
performance may also be event-driven i.e. macro tightening in 1H11,
finalisation of 12th 5-year plan in Mar 11 and dual-listings. We like
companies with visible growth profiles, supported by favourable industry
outlooks and compelling risk-reward tradeoffs. Despite macro tightening
concerns in China, we expect 2011 economic outlook to remain supportive of
our investment thesis, in particular in the agricultural and environmental
segments. We are buyers of upstream food-related players – China Animal
Healthcare (CAL), China Minzhong (MINZ), and Yamada Green (YGR); and
environment counters – Leader Environmental Technologies (LET), Sound
Global (SGL) and United Envirotech (UNEV). In addition, we like strong
projected growth from Fuxing China (FUXC) and Midas Holdings (MIDAS). Key
headwinds include RMB appreciation, surge in raw material and labour costs.

S-Chips are back. S-Chips saw renewed investors’ interest that helped the
sector to catch on the liquidity driven wagon and deliver 3-month return of
5%. The 150+ S-Chips make up close to a fifth of total counters listed in
Singapore and have a total market capitalisation of S$52b. Key sectors are
off-shore and marine (~26%), food related players (~20%) and property
(~15%).

OSK-DMG’s S-Chips approach. We believe that S-Chips will continue to
provide investors with attractive return opportunities, especially those
arising from possible mispricing and potential re-rating due to lack of
familiarity in these companies. Our approach is biased towards those with
visible growth profiles, supported by favourable industry outlooks and
compelling risk-reward tradeoffs. Past lessons also suggest much emphasis
has to be placed on management track record, sustainability of growth and
quality of earnings.

- China: Economic Outlook for 2011
- 12th 5-year plan (2011-2015)
- Dual-listings
- We like upstream food players – CAL, MINZ and YGR…
- Environment counters – LET, SGL and UNEV…
- …FUXC and MIDAS as strong growth kick in
- Valuation tables including S-Chips under DMG’s coverage and Top 50
S-Chips by Market Cap

 

BASIC FEAR VS CONFIDENCE

The recent headwinds followed by turmoil and the plunge of the financial, forex and equity markets has in total and in tandem led to the interplay of fear versus confidence.

The balance of fear and confidence is the key to successful investing. Many investors enter the market when stocks prices are high (lacking confidence to enter when prices were GOING low). Once the stocks market crash, they tend to sell out their shares  CUTTING LOSS out of fear and pessimism. Hence, contrarian investors buying on fear and attendent inherent risks, may however be compounded by inaccurate  "insiders' information or rumours", more bad news and fear  creating information resulting in herd instincts  and a flight to safety. Fundamental investors selling on good news may be a way to lead the market.

When the momentum of fear enters the market, fundamental analysis and sound analysis of earnings outlook  and the best logic will not be the decision markers. Stockmarkets becomes a house of gamble. There must be a good balance of objectivity of the mathematics versus the subjectivity of our emotions.

Many factors affect share price movements  in the short term movements and long term trends. Significant investor unloading/ unwinding to raise cash could drive prices down - always lookout for it.  We need to recognise them and lead them in order to set proper target price and direction- buying into uptrend and selling before market turns.

Broad economic factors, industry outlook, currency fluctuations,  company specifics and activities, execution, capabilities, capacities and timing all affect the company's future performance.

Long term investor may focus on earnings potential and value of the shares by choosing a comfortable entry point and not subject to the volatilty. In the downturn, it is wise to pick the blue chips with strong revenue and profit gowth- which will be the first to enjoy substantial rebound when the market turn.

The Risk Of Uncertainty

The lessons learned last Thursday were immensely valuable, but none more so than the message  from  Jim Haskel from Bridgewater Associates. Bridgewater is one of the preeminent hedge funds in the world and Jim is responsible for assessing risk in the overall portfolio. He was clearly one of the sharpest guys  in the room but his message was deceptively simple - above all else stay alive.  Haskel recounted how Bridgewater was able to weather the post Lehman financial storm by essentially not trading for a while.

"It's much better to miss an opportunity than to assume unnecessary risk."

Listening to Haskel  I suddenly remembered the great opening scene of Patton where George C. Scott stands in front of a massive American flag gently swaying behind him and barks at the camera,  "No dumb son-of-a-bitch ever won a war by dying for his own country but by having the other dumb son-of-a-bitch die for his country."  I found this fascinating because even Patton, who was the most reckless military leader in WWII  understood instinctively that self preservation was paramount for victory.

MacArthur, the other great general of the war, was  also famous for never engaging the enemy at their point of strength.  MacArthur's philosophy was always to bypass the toughest Japanese military installations and attack only the weakest. Although the reality of these great military leaders contrasts sharply with our romantic view of "charge-at-all-costs" war hero it offers tremendous lessons to us as traders.

Whether in war or on markets the first rule of the game is to simply survive. For those of us engaged in the day to day  combat with price action   it is sometimes difficult to remember that winning is not always an option and sometimes just staying alive is good enough.  I can't remember how many times in my trading career, I've let my ego get the better of me only to be saved by stop losses (every trade I make automatically carries one)  thus preventing a total blow up of  my account.

In markets, there will always be tomorrow and there will always be chances to make fresh profits, but only if you have capital left to trade.  From the best traders in the world to the greatest military commanders in history we learn that we must always pick our battles carefully and make sure to stay alive to fight another day.

"The absolute price of a stock is unimportant. It is the direction of price movement which counts."

"During major sustained advances in stock prices, which usually occupy from five to seven years of each decade, the investor can complacently hold a list of stocks which are currently unpredictable. He doesn't worry about the top because he knows he is never going to sell at the top. He knows that the chances are overwhelming in favor of the assumption that he will get far better prices by waiting until after the top is passed and a probable reversal in trend can be identified than he will ever get by attempting to anticipate the top, and get out on the nose.

In my own experience the largest profits we have ever taken have come from stocks purchased while they were making a new high in a market which was also momentarily expecting the top. As I have already pointed out the absolute price of a stock is unimportant. It is the direction of the price movement that counts. It is always probable, but never certain, that the direction of the price movement will continue. Soon after it reverses is time enough to sell. You should sell when you wish you had sold sooner, never when you think the top has arrived. That way you will never get the very best price ? by hindsight your individual transactions will never look daring. But some of your profits will be large; and your losses should be quite small. That is all that is necessary for a satisfactory, enriching investment performance."

"Stock Profits Without Forecasting," by Edgar S. Genstein I wanted to leave you with the above paragraphs to ponder. They are two of the most important paragraphs I have encountered in more than 40 years of studying markets. Do not read them just once. Go off to a quiet spot that invites contemplation and read them several times. Then reflect on all of the mistakes you have made in trading and investing. Bells will ring, and curses will be uttered, if you are truly honest with yourself. My advice is to keep this quote handy, read it over, and study it every time you get ready to make an important buy or sell decision; especially if your emotions are reigning.

Ladies and gentlemen, Edgar Genstein's comments are as cogent today as they were when first written in 1956!

HOW DO YOU PLAN EXIT POINT

Selling off requires lots of discipline & determination because this decision determine whether we lose money, make money or make less money. It is not uncommon that we fail to execute or change of the exit plan depends on what we see, what we hear and what we feel.

Below are some  “guidelines” or “rules” when selling your positions:

·         When the profit target is met (for momentum investing) or the stock price exceeds the intrinsic value (for value investing). Selling off 50% of my position to take profit and leave 50% to let the stock price continue its course as long as there is not trend reversal spotted in the chart.

·         When the stock price reverse its trend when the reversal pattern (e.g. head & shoulder, double top or triple top, etc) is formed. When the stock price starts the down trend & the stock price below 20D, 50D and 200D MA. This is a very tough decision to make to cut loss but be mindful that  you can buy the stock back at lower price next time! I look for opportunity to sell when the stock rebounds on a down trend.

·         When the price move sideway for a long time unless this is a dividend stock, we deplore our funds to invest in other stocks for better gain.

·         When there is a fundamental change in the stock and we do not foresee the stock price to rise in the near future.

·         Though we may have worked out my entry and exit points, we still need to take full control over my emotion of Greed and Fear - be discipline to the trading rules every day & every trade.