Strategy for market 2016

20 December 2015

 

Dear Fellow Investor,

What is our strategy for the KLSE and stock markets in  2016 ?  Many have asked me and my bottom line view is to focus on selected small/ mid-caps. Make sure they have a niche and a highly focused business,  strong financials, low or no debt and a history of growing earnings.

 

Stay away from the mainstream shares: These are the big companies on the broker recommended lists.   They are the favourites of some unit trust companies/ asset managers/ foreign funds and the investment crowd.

 

With the slowing world economy it is difficult for these types of companies to grow. They are layered with large staffs, bureaucracy, competition, and in many cases large debts.

 

Should interest rates rise those companies with large debts will be in trouble.

The downside of small caps can be lack of liquidity. That means you must have the mind set of an investor.  These are usually not trading shares.

 

You must take the time to understand the business, meet with the management and understand their financials. For our clients this is what we do when we invest for them but you can do the same if you have time.

 

We have followed this strategy in 2015  with success and made profits for our clients and hopefully can perform in 2016.

 

Of course if the bull returns to the KLSE we will underperform.  No one except God knows for sure the answer to the KLSE performance in 2016.  My guess based on growth and economic fundamentals show a ranging 2016 market and the need to continue with our 2015 strategy.

 

Thank you for all who joined my Facebook page.  I am still learning about it and am trying to find a way to filter out those who are not investors/ traders.

 

I am getting visits from con men/ Ponzi operators/ Scams/ Call girls etc from all over the world !   Even Nigeria/ South Africa/ Russia/ Thailand  etc.

I do have technical support but any feedback on this topic is greatly appreciated. I know many of you are experts on facebook

 

My Facebook home page is :   

https://www.facebook.com/profile.php?id=100008445604416

if you wish to join our network.

I will be on holiday to Taiping and Cameron Highlands from 22 December to 30 December.  Hopefully there will not be too much rain but in any case should you have any questions do email/ Wats ap me and I will respond. 

 

One of our Phillip planners  told me there is an eagle sanctuary only 30 minutes from Taiping in Samasa . We will surely visit this and post an eagle on Facebook.  ( To be a successful investor you must hunt like the eagle)

Have a Merry Christmas, Bill