Month: November 2020

OCBC – [ Sector Rotation, Cyclical Sectors Benefiting]

Kelwin & Roy OCBC , , , , , , , , ,
11th November, 2020, 5:49 PM

OCBC – [ Sector Rotation, Cyclical Sectors Benefiting]OCBC 11th nov 2020

Chart Source: Poemsview 11th Nov 2020

OCBC along with the other two banks saw a surge in price over the last few days and even before the election results were out. As these three banks make up quite a heavy component of the STI, it was no surprise that we saw the STI trending up the last few days too.

We wanted to be prudent and wait for results to be out before entering the market as we never know what may happen and anticipating results could result in being a hero or zero! As OCBC showed signs of interest and life on monday we alerted our EXCLUSIVE CLIENTS on this trade analysis and we’re glad OCBC gave us a favourable run. From our alert of $9, it has ran up to $9.58 which is more than 6% in three days!

From a technical perspective , OCBC has ran up for about 5 days and today’s volume has started to decrease. Some possible scenarios, we might see it push higher to our next target of around $9.84 which is also the gap resistance in the next couple of days. Optimism on vaccine news has funds flowing to the more cyclical sectors on hopes of recovery. It could also take a break as it ran up quite a bit so having a break is a positive thing. We’ll prefer for a retracement before looking at it again.

Want to cut through the noise and get such trade alerts straight to your handphone?

Then be our EXCLUSIVE CLIENT and find out how much value is waiting for you!

See you onboard soon!

Yours

Humbly

Kelwin&Roy

HPH Trust – [ A New Up Wave Coming? Let’s See The Charts]

Kelwin & Roy HPH Trust , , , , , ,
10th November, 2020, 7:07 AM

HPH Trust – [ A New Up Wave Coming? Let’s See The Charts]HPH 10th Nov 2020

Chart Source: Poemsview 10th nov 2020

HPH Trust USD saw an increase in volume with a nice upside movement too. Let’s take a look at it from a technical perspective. It has broken above its horizontal resistance of $0.148 and with volume coming in we might see it push towards the next resistance at $0.16 and maybe even $0.167.

With biden winning the US election , a less aggressive foreign policy could see some relief in the shipping sector.

Keep a close eye for HPH Trust. We’re looking at the USD one so take note of the foreign currency.

Yours

Humbly

Kelwin&Roy

Tesla – [ Watching For That Break!]

Kelwin & Roy Tesla , , ,
9th November, 2020, 11:31 PM

Tesla – [ Watching For That Break!]

Tesla 9th Nov 2020

Chart Source :Trading View 9th Nov 2020

Tesla (TSLA) could benefit from biden’s clean energy policy which we mentioned in our previous post. Tesla is one of the prominent electric vehicle players led by one of the most outspoken CEO of all times Elon Musk.

Let’s take a look at the chart of tesla. We can see that the horizontal resistance is around the $458 range and a break above that and staying above that might see it push to $500 first. Tesla might be a little harder to trade and we’ll prefer to be holding this for longer term rather than trading it. The moves for Tesla is a little more volatile and if you believe in the technology that tesla has then you might want to be in it for the long haul.

Keeping a close eye on the break with the support at the 50ema.

Yours

Humbly

Kelwin&Roy

 

AEM – [ Here’s What We Did Today, Bullish Candle, Can It Sustain?]

Kelwin & Roy AEM , , , , , , ,
9th November, 2020, 10:44 PM

AEM – [ Here’s What We Did Today, Bullish Candle, Can It Sustain?]AEM 9th Nov 2020

Chart Source: Poemsview 9th Nov 2020

AEM saw a strong push up today up over 5%! Head over to our facebook page to find out what we did today!

https://www.facebook.com/singaporehumblestock/posts/3261163827344303

With a good volume coming in, we might see AEM heading towards the next resistance of $3.90

Don’t forget to checkout our facebook and see how you can be the first to receive such trade alerts!

Yours

Humbly

Kelwin&Roy

Biden Triumphs Over Trump! What Sectors/Stocks We’re Looking At Post Election?

Kelwin & Roy Joe Biden , , ,
9th November, 2020, 7:01 AM

Biden Triumphs Over Trump! What Sectors/Stocks We’ll Looking Post Election?

 

It’s been a long and exciting week as we await the election results and finally the results are out!

Joe Biden emerged as the 46th elected President of The United States, ending four tumultuous years under Trump. Is it clear skies now? Not quite yet as we also have to see who makes up the senate and house. Will Biden’s push for more corporate taxes, more regulation, bigger stimulus be pushed through easily?

So what are we expecting?

Quote from Singaporehumblestock 30th Oct

Market has ran up quite a bit since we blogged at the end of Oct . S&P500 was trading around 3230 and we mentioned that it might have been a good time for investors to take some position, scaling into the markets then. Ever since then, S&P500 has risen around 8% so we won’t be surprised that market might have some near term profit taking given the run up.

  1. Democratic President would be deemed more anti-growth and pro-regulation as compared to the Republican President which introduced uncertainty into the market with new policies and agendas.
  2. Biden has proposed higher corporate taxes while Trump says he will maintain low taxes
  3. Market has run up quite a bit so some pullback is not unexpected.

That is one potential scenario that could play out and with any pullback, there might be a chance to scale into the markets again. IF market continues to rally, then enjoy the rally!

So some sectors/stocks we’re looking at!

GOLD! Read up on our previous article which we wrote just 2 weeks back! Gold prices has seen risen and might further given some short term uncertainty and with a fiscal stimulus, inflation could be on the cards and gold is considered a hedge against inflation and currency debasement. Interesting Fact:

Barack Obama was the last Democrat president, and if we will draw a conclusion based on his years in office, one could observe an immediate increase in gold prices right after he assumed presidency.

When Obama took office in January 2009, the gold price was just over $890, and by the end of his first term, the precious metal has risen about 88.6% to $1,685.

Foreign Policy – CHINA! 

In his campaign, Biden says he will counter abusive Chinese economic practices. Biden helped to craft and promote the original Trans-Pacific Partnership trade deal. He now wants to renegotiate certain aspects of that. This suggests that tensions with China will not vanish overnight, even if Biden wins. It will be tricky for Biden to consider immediately lifting existing tariffs without imposing any other measures.

We might see a less harsh stance and erratic approach towards China, a more balanced and level headed policies. Asian equities in general could see some near-term relief, though we do not expect US and China to be best friends overnight but an improvement could be a positive sign.

China big techs are still on our list. Tencent, Alibaba, Meituan, Xiaomi, JD.com are just some that we are looking at.

SMIC ( 981.hk) is a another company that we’re looking at . Under trump’s administration it was under US restriction but could a biden administration ease some of the regulations? IF this happens, SMIC could see some recovery and also China has planning huge investment to develop its domestic semiconductor industry and counter Trump’s administration restriction. SMIC could potentially benefit from this.

Moving on : CLEAN ENERGY, EV & SOLAR POWER! 

Electric cars, clean renewable energy are some of Biden’s new policies and agenda.

The electric vehicle industry has been soaring in 2020.  If elected President, Biden has said that he plans to build more than 500,000 charging stations by 2030, restore the full electric vehicle tax credit, and institute strict regulations that would encourage the use of electric vehicles.

Counters like TESLA, NIO, XPENG could be potential winners!

HAIL (SPDR S&P Kensho Smart Mobility ETF),

PBW  (Invesco WilderHill Clean Energy ETF) ,  

QCLN (First Trust Nasdaq Clean Edge Green Energy) 

SMOG (VanEck Vectors Low Carbon Energy ETF) 

TAN ( Invesco Solar ETF)

2845.hk (Global X China Electric Vehicle ETF)

 are just some of the ETFs that could benefit and have been rising steadily over the last few months.

Technology

Even though Biden has stronger impulse than Trump to break up the Big Tec, with antitrust policies, reform of corporate taxes if senate is not controlled by the democrats then these policies might be harder to pass which could bring relief to them. Short term we might see some uncertainty but it could once again present opportunities for entry. Names like Facebook, Amazon, Alibaba, Alphabet (google), AT&T are on our list.

Stocks with China Exposure 

Stocks like Nike, Estee Lauder could see some relief are these are retail stocks with the highest exposure to China Market. Apple could also be a beneficiary.

Conclusion

Chart Source: macrotrends.net

It’s a lot to digest. In the long term we believe market tends to go up but positioning yourself in the right sector is equally as important. Oil&Gas sector as an example is probably one which we’ll avoid.

Got any questions? Feel Free to drop us a message and we’ll get back to you as soonest. Remember, investment carries risk and so always consult your adviser before making any move!

Have a good week and stay safe!

Yours

Humbly

Kelwin&Roy

 

Xiaomi (1810.HK) – [ Big Up Move Came In, Can It Sustain? ]

Kelwin & Roy Xiaomi , , ,
5th November, 2020, 7:15 AM

Xiaomi (1810.HK) – [ Big Up Move Came In, Can It Sustain? ]
Xiaomi 5th Nov 2020

Chart Source: Poemsview 5th Nov 2020

Xiaomi should be no stranger to most with most household having at least a xiaomi product. It could be their handphone, their robot vacuum or even their power bank which i own two of it! Xiaomi has recently been added to the HSI in July and since then did some retracement.

Back in Sept when it was trading at HKD$21 we also shared it with our clients sending the charts, plotting the  potential support and resistance and letting them understand how we view the markets.

So fast forward to yesterday when Xiaomi saw a burst of energy when it finally broke out of its downtrend line of $22.90 and made a dash to our first resistance of $23.95. It even went on to $24.45 a good 6% run since the break  and eventually settling just below our resistance line.  If Xiaomi can now stay above $23.95 we might see it move up to $24.90 area! Fingers crossed! From the chart, good volume came in which is the  highest for the last 1.5 months so this move up should be able sustain and hopefully meet our next resistance of $24.90.

Want to cut through the noise and get such trade alerts straight to your handphone?

Then be our EXCLUSIVE CLIENT and find out how much value is waiting for you!

See you onboard soon!

Yours

Humbly

Kelwin&Roy

How To Invest Into The China Market? ChinaA50 or CSI300?

Kelwin & Roy China A50 , , ,
4th November, 2020, 7:00 AM

How To Invest Into The China Market? ChinaA50 or CSI300?

If biden wins the election there could a more measured approach towards foreign policy, which china and the rest of the asia market could potential benefit from. Lesser crazy tweets and tariffs!

If trump wins, foreign policy and tariffs would probably still be enforced but China being the second largest economy could still see so much more growth. So let’s take a look at how one can invest into the china market and diversify their portfolio.

INTRODUCTION

China is now the world’s second largest economy and in October 2020, it’s stock market has shown resilience despite covid-19 and exceeded US$10 trillion in total capitalisation just behind US. Therefore having exposure and having China as part of your investment portfolio makes good sense.

However, China market is still not easily available to foreign investors. Imagine if it opens up and allow more foreign investors to invest in it!! So today we shall look at some of the indices  to gain access to the China Stock Market.

China A50 & CSI 300

China has 2 main Stock exchanges namely the Shanghai Stock Exchange and the Shenzhen Stock Exchange. Shares are mainly classified as A-shares (RMB-denominated common shares) which refer to ordinary shares, subscribed and traded in RMB or B-shares (which refer to RMB-denominated special shares subscribed and traded in foreign currencies and are more widely available to foreign investors). Both A and B shares are issued by companies incorporated and listed in mainland China. Most companies listed in China are the A-shares.

China’s Largest Stock Exchange, the Shanghai Stock exchange has around 1564 companies listed in its Main A share market with many of the company listed there being the larger, state-own companies.

The Shenzhen Stock Exchange while being the smaller of the 2 exchanges has around 2,322 companies listed with the smaller, more entrepreneurial companies and many tech companies listed there.

The 2 most common indices for foreign investors to get access are the

FTSE China A50 index by FTSE Russell and CSI 300 index by China Securities Index Co.

FTSE China A50 index started in 2003 and it comprises the largest 50 A Share companies by market capitalisation of the securities listed on both the Shanghai and Shenzhen stock exchanges.

The CSI 300 index started in 2005 and it comprises of the 300 largest stocks listed on Shanghai and Shenzhen stock exchanges by market capitalisation, representing about 70% of the total market capitalization of the two exchanges. It is considered the blue-chip index for mainland China stock exchanges.

Comparing China A50 & CSI 300

To gain a better understanding of which of the two indices  is more suitable, we shall compare the industry breakdown as well as how much the overall weightage of the top 10 holdings in each index.

We used the iShares FTSE A50 ETF ( ticker code 2823) which is the largest china a50 ETF listed in HK with $16.43 billion for the sector breakdown as we couldn’t get much info on the A50 on the website.

From the 2 indices sector breakdown between China A50 Index and CSI 300 index:

  • Financial sector form almost half of the China A50 index with 42% of the index while it form only around one-third of the CSI300 index at around 32%. That means any movement in financial sector stocks in the A50 index will have a much bigger impact on its performance compare to the CSI 300 index
  • The Top 3 sectors of Financial , Consumer Staples and Consumer Discretionary constituted almost 74% of the China A50 index while the Top 3 sectors ( Financial, Consumer Staples and Industrials) on the CSI 300 index comprise of about 58.7% slightly more than half of the index but much less concentration compare to the A50 index. This means the impact of each of the Top 3 sectors on the CSI 300 index is less compare to the Top 3 sector impact on the China A50 index

Weightage of up and coming sector in the new economy such as Information Technology and Healthcare have almost 20% weightage in the CSI300 index (19.03%), while they only made up about 12% weightage in the China A50 Index (11.77%)

Next, we look at the Top 10 holdings in the 2 indices to see how they may impact the respective indices:

 

We can see that in the China A50 index the Top 10 holdings comprise of 54.05% of the index which is more than half of the index, while Top 10 holdings of the CSI 300 index only comprise of 25.53% of the index. This is less than of the weightage in the Top 10 holdings as compared to holdings in the China A50 index. This means any significant movement in the Top 10 holdings in CSI 300 index will have less impact on the Index as compared to the China A50 index, making it more diversified as compared to the China A50 index.

Concluding Thoughts: 

After making the comparison ,we can see that the CSI 300 index  has 6 times more stocks covered. It’s a little bit like dow 30 and S&P 500, which most investors tend to look at S&P500 as it gives a broader scope of the economy.

The financial sector also has a major concentration in the China A50 index compared to the CSI 300 index, with the Top 3 sectors stocks already covering almost 3 quarters of the China A50 index. Also , with new and emerging economy sectors like Information technology and Healthcare, the CSI300 better represent these changes

Lastly, the Top 10 holdings concentration in the China A50 index is more than half of the index as compared to the Top 10 holdings in the CSI 300 index which is about a quarter of the index. This means that China A50 index is more easily affected by the movement of a few leading stocks, which can exacerbate the volatility of the index as compared to the CSI 300 index.

As such, We are of the view that the CSI 300 index is a better choice index to invest in the China Stock market givign a more balanced view compared to the China A50 index.

In the next few blog post, we will look at some of the Etfs that we can invest for the CSI 300 index and other Etfs like KWEB(KraneShares CSI China Internet ETF), KURE (KraneShares MSCI All China Health Care Index ETF). And how you can use poems to invest directly into China Shares.

Stay tune!

Yours

Humbly

Kelwin&Roy

Ant Group Listing on 5th Nov! Pre-IPO On 4th Nov On Poems, Some Things To Know!

Kelwin & Roy Ant Group , , , , ,
3rd November, 2020, 6:45 AM

Ant Group Listing on 5th Nov! Pre-IPO On 4th Nov On Poems, Some Things To Know!

Ant Group started out as Alipay, a digital payment platform that millions and millions of Chinese use to buy stuff online through Alibaba and other online stores. To date, it has more than 1.3 billion global users and is still growing!

If you been to China, and step into shops and restaurant you’ll notice that most ppl in China uses alipay to pay for their purchases. Back in early 2018 when i was Shanghai, i noticed most shops have the Alipay signage whenever i make my payment which was kind of new to me as back then Singapore digital payment wasn’t that mature yet. China in terms of digital payment is way ahead of the curve and the rest of the world is catching up. And guess what, Singapore accepts Alipay too!

Ant Group’s Businesses 

1.Yu’e Bao (Ant’s investment platform allows users to invest their money directly in money markets, and is already the world’s largest money market fund.),

2.Sesame Credit(Ants’ credit score system, gives users a way to get financing, lending, buy a house or car immediately based on their payment record, with over 10 million users getting credit even if other banks have given them a poor credit score.),

3. Ant Fortune, (Ant’s investment supermarket, gives financial institutions a place to reach all Ant users and to educate and serve them with their investment products.)

4. Xiang Hu Bao (Xiang Hu Bao, an online mutual aid platform introduced by Alipay, has attracted over 150 million participants since it was launched in oct 2018, helping health protection in China become more inclusive by making it more accessible especially for the lower income and those living in rural areas.

5. MYBANK (Since launching in 2015, MYbank has served 29 million small and micro enterprises, and recently announced a plan for the next 5 years to support 10 million more SMEs and 40 million female business owners, through supply chain financing and rural lending.)

6. Ant Financial cloud and so much more that it will be impossible to list it all here! Reading up on it just blows our mind!

Growth In China Digital Payments

Alipay is the largest digital payments services provider as measured by Total payment volume (TPV) in China, according to iResearch.

Innovations of Alipay app is synonymous with digital payments in China. The app has allowed Alipay to deliver unrivalled value and convenience to our customers, which has led to wide acceptance and popularity of e-wallet and massive transaction volumes. According to the prospectus, it has 711 million monthly active users and more than 80 million merchants today.

Ant Group has created a powerful -eco system which goes beyond just a digital payments system.It contains more than 1,000 daily life services and over 2 million mini programs. As you can see from the above, you can do almost everything on alipay!

And talking about Economic moat, it looks like Ant Group has a really wide one which is a positive sign!

Largest IPO In History! 

Yup! It’s the biggest IPO in history, surpassing Saudi Arabian oil giant Aramco which raised USD$29.4 billion.

 

Ant Group is 872 times oversubscribed and will be raising around US$34.5 billion and based on the IPO price of HK$80 , it will be valued at around  US$313billion. This would make Ant more valuable than all the other banks in China and even bigger than Citigroup and Bank of America. Now imagine, if Ant pops 10% on the first day that means the value of the company jumps by another US$31 billion!

With plans to further innovate and expand its reach with the proceeds from the listing offerings, Ant group is one of the most watch IPO in 2020

TRADE Ant Group on Poems one day (4th Nov) before the official listing date with our Hong Kong Pre-ipo market!

What is Hong Kong Pre-ipo

Ant Group will be listed both on Shanghai’s STAR Market and the Hong Kong Market (ticker : 6688)

The Hong Kong Pre-IPO trading market is a channel provided by Phillip Securities for customers to trade Hong Kong shares one day before their official listing in the HKEX. Phillip Securities is the first broking house in Singapore and Hong Kong to offer customers the Pre-IPO trading channel.

Customers can login to POEMS 2.0 and trade under the Hong Kong Pre-IPO tab. Shares bought in the Hong Kong Pre-IPO market can be sold in the Hong Kong market on the next trading day.

 What are the trading hours?

Singapore (Mon – Fri) Full Day Session 04.15pm – 06.30pm
Half Day Trading 02.15pm – 04.30pm

*The performance of stocks in the Pre-IPO trading session should not be considered as an indicator of its price and demand in the official trading session.*

 For more information, please click HERE

Our Concluding Thoughts 

Ant Group has a brand Monopoly and dominates the China’s digital payment. More than half of the digital payment goes to alipay. It has an amazing network and with so many users and merchants supporting Ant Group, this will allow them to continue to grow and tap on their wide network.

Ant Group unlike most IPO like Uber, snowflake is profitable already! So that’s one plus point. We’ll be wanting to get our hands on Ant and so it’s important to see how it will open on 4th nov if you’re interested in the Pre-ipo market. Already news source has reported that Ant Group trades at 50% premium in the gray market which puts it at HK$12. With such a jump the fear of missing out (FOMO) might set in and it’s very natural to want to chase!

So what can one do? Remember in investing, we never go in all at one time! It is important to scale in and not all in!

Depending on the opening price, if you’re really scared to miss out go in about 20% of ur allocated fund for this stock. If the price runs further at least you’re in. If it retraces, (remember facebook crashed after it got listed, but look at where it is now) then at least you still have some bullets to take a position. Be patient and remember you’re in it for the long term. A range of HK$100 seems like a good entry to nibble, but let’s wait and see how it moves ya.

Lastly, Alibaba owns about 30% of Ant Group so one consideration is to have some exposure to Alibaba if you do not have any yet.

Contact Us if you’ll like to know more about Ant Group.

Yours

Humbly

Kelwin&Roy