Our formal schooling teaches us that when things get tough, we should get tough. We learn that the harder we work, the more we accomplish. I've learned that this logic has to go out the window when we surf the waves and when we trade stocks.
"When the market fights you, don't fight back."
Surfers know that its all about timing. You catch the wave, you ride the wave. No surfer will paddle his way to a great speed then hop on the board. The same logic works for market movement. Its an ocean out there. When the waves come, we party. When the waves die down we have not much more to do than to pull out our guitars, sing some songs, live our lives and wait it out.
I'm getting tired of waiting though, I want to catch that next wave. :)
Saturday, March 1, 2008
common sense trends
Some trends are there for reasons that are so plain to see, that they can be worth betting on. From the top of my head here are five things that I think are almost certain (at least for the next five to ten years) and don't take rocket science to figure out.
1) The energy industry will grow whether we like it or not.
2) There will constantly be demand for fastfood in the Philippines.
3) Health and wellness concerns will grow.
4) Real estate prices as well as demand will take a breather from their increase.
5) Filipinos will keep going abroad for work or will provide services to people abroad.
With that I think its wise to invest in renewable energy, count on fastfoods for stability, bet on healthy goods and services, hold that real estate purchase and believe in the peso.
Energy
There are now almost 90 million Filipinos and there's no sign of any slowing down there. More people = more energy needs. It doesn't hurt my theory that we're a tech savy nation. GG client, a popular server for dota has about 20,000 Filipinos logged on at any given time. Dota is a variation of the popular game, warcraft. Tech savy=energy needy.
Fastfood
Tony Tan put it quite well. When the economy is good, the lower classes come to fastfoods. When the economy is bad, the upper classes return to their burgers and fries. Either way, they win.
Health and Wellness
There was a time we would laugh if someone told us that people would one day buy so much bottled tea, that coca cola would be concerned. Now C2 seems to be more popular than carbonated drinks on shelves of groceries, sari sari stores and cafeterias in the Metro. Neither would be believe it if people told us five years ago that KFC and Mcdonald's would be serving up salads.
Real Estate
There's been so much growth in this industry that it won't take a great mind to see that it has to cool off eventually. What comes up, must go down. It seems like every other block in Makati has a new building coming up. Condos have also spread far and wide in and out of the Metro. Demand is high and money is cheap. Its a sellers market. Prices are up, but they'll eventually have to retreat.
Work abroad
OFWs and BPO workers. They are our greatest competitive advantage to the world. The world knows it and we know it. Whether we are proud of that fact or not we can't deny that they bring in the dollars and push our peso up. They really are heroes.
1) The energy industry will grow whether we like it or not.
2) There will constantly be demand for fastfood in the Philippines.
3) Health and wellness concerns will grow.
4) Real estate prices as well as demand will take a breather from their increase.
5) Filipinos will keep going abroad for work or will provide services to people abroad.
With that I think its wise to invest in renewable energy, count on fastfoods for stability, bet on healthy goods and services, hold that real estate purchase and believe in the peso.
Energy
There are now almost 90 million Filipinos and there's no sign of any slowing down there. More people = more energy needs. It doesn't hurt my theory that we're a tech savy nation. GG client, a popular server for dota has about 20,000 Filipinos logged on at any given time. Dota is a variation of the popular game, warcraft. Tech savy=energy needy.
Fastfood
Tony Tan put it quite well. When the economy is good, the lower classes come to fastfoods. When the economy is bad, the upper classes return to their burgers and fries. Either way, they win.
Health and Wellness
There was a time we would laugh if someone told us that people would one day buy so much bottled tea, that coca cola would be concerned. Now C2 seems to be more popular than carbonated drinks on shelves of groceries, sari sari stores and cafeterias in the Metro. Neither would be believe it if people told us five years ago that KFC and Mcdonald's would be serving up salads.
Real Estate
There's been so much growth in this industry that it won't take a great mind to see that it has to cool off eventually. What comes up, must go down. It seems like every other block in Makati has a new building coming up. Condos have also spread far and wide in and out of the Metro. Demand is high and money is cheap. Its a sellers market. Prices are up, but they'll eventually have to retreat.
Work abroad
OFWs and BPO workers. They are our greatest competitive advantage to the world. The world knows it and we know it. Whether we are proud of that fact or not we can't deny that they bring in the dollars and push our peso up. They really are heroes.
3 day breather from the snowballing descent
The market's index went up in tiny increments for three days in a row, but trading remained thin.
This seems consistent with the behavior of people cautiously building portfolios. Analysts are calling it consolidation. If I'm to agree with them, then we're to follow the assumption that our market is really still going down.
Though I'm skeptical if we'll see the index crawl down to 2700, I will be sure to pump more money in when we see that level. When I do, I will stick to the best beginner guideline of all: bet on quality. I'll keep my choices within the tried and tested like BPI. The growth may be slower, but so will the exposure to risk. Under the circumstances, I think that's the better play for a newbie like me.
This seems consistent with the behavior of people cautiously building portfolios. Analysts are calling it consolidation. If I'm to agree with them, then we're to follow the assumption that our market is really still going down.
Though I'm skeptical if we'll see the index crawl down to 2700, I will be sure to pump more money in when we see that level. When I do, I will stick to the best beginner guideline of all: bet on quality. I'll keep my choices within the tried and tested like BPI. The growth may be slower, but so will the exposure to risk. Under the circumstances, I think that's the better play for a newbie like me.
coming change in administration is unlikely
Political news has overtaken everything else in Philippine media over the past weeks. When I pick up a newspaper, its politics. I flip the tv news on, its politics. I log on to igoogle, its still politics.
Boring but relevant
After weeks of watching news on the ZTE NBN fiasco, I'm getting quite bored of it. I'm sure many others are too. But that's not to say that I'm about to stop following the news. I'll stay informed because I consider knowing the political climate to be hand in hand with sound fundamental analysis.
No people power this time
The question on my mind is whether we're going to see something like what happened to former President Joseph Estrada happen to President Gloria Macapagal Arroyo. I'm inclined to say no, for the following reasons.
1. She's playing her cards well. When they rally, she rallies too. While she's at it, she throws lovely golden carrots to the people. Brilliant. (i.e. Gloria @ Cavite last monday)
2. We just had a great year for our economy. Many people are happily enjoying the spoils of 2007 - large profits, large bonuses and many raises. Homes have just been filled with plasma tvs, new cars, ninentdo wiis and what not. People are much too happy to bother taking to the streets.
I know that the public largely believes her to be guilty of Lozada's accusations, but don't think that will be enough to get her out.
Boring but relevant
After weeks of watching news on the ZTE NBN fiasco, I'm getting quite bored of it. I'm sure many others are too. But that's not to say that I'm about to stop following the news. I'll stay informed because I consider knowing the political climate to be hand in hand with sound fundamental analysis.
No people power this time
The question on my mind is whether we're going to see something like what happened to former President Joseph Estrada happen to President Gloria Macapagal Arroyo. I'm inclined to say no, for the following reasons.
1. She's playing her cards well. When they rally, she rallies too. While she's at it, she throws lovely golden carrots to the people. Brilliant. (i.e. Gloria @ Cavite last monday)
2. We just had a great year for our economy. Many people are happily enjoying the spoils of 2007 - large profits, large bonuses and many raises. Homes have just been filled with plasma tvs, new cars, ninentdo wiis and what not. People are much too happy to bother taking to the streets.
I know that the public largely believes her to be guilty of Lozada's accusations, but don't think that will be enough to get her out.
Wednesday, February 27, 2008
A long way from november
Most of my favorite stocks carry a similar pattern of lower highs and lower lows since around november last year. I can think of only a few that defied this pattern, but our experts remain upbeat for 2008.
Not one negative prediction for 2008 has been made yet so many are quick to warn about big drops within they coming weeks. Technical analysts talk of levels like 2700 as a possible scenario. In november last year such a level was thought by many to have been long gone. Now, its that sort of thinking that had to be thrown out the door and many are soberly staring at beaten up protfolios that have fallen far from glorious novemeber.
Call me crazy, but I still think this is a perfect time to build up a good portfolio based on a sound fundamental analysis.
Not one negative prediction for 2008 has been made yet so many are quick to warn about big drops within they coming weeks. Technical analysts talk of levels like 2700 as a possible scenario. In november last year such a level was thought by many to have been long gone. Now, its that sort of thinking that had to be thrown out the door and many are soberly staring at beaten up protfolios that have fallen far from glorious novemeber.
Call me crazy, but I still think this is a perfect time to build up a good portfolio based on a sound fundamental analysis.
third world with expensive taste: pertpetual appetite for imports in both public and private sector
A country like the Philippines will always have an appetite for imports. Now that we're bringing more money in via the OFW and BPO dollar superhighways we're also spending more of it via imports. With infrastructure spending on the rise, we have another reason to smile. But the private sector seems to be reviving its fancy taste.
Public Sector Spending
The Asian Wall Street Journal reported a surge in imports in the Philippines and associated it with rising oil price and infrastructure spending. If there is one thing we should spend on I'd say its infrastructure. I can only be happy to hear that we're spending more on infrastrucure. Yet, I still wonder where that infrastructure is. I don't see many new bridges, flyovers or roads.
Private Sector Spending
Just the other day I saw a rare site. In a single gas station, I saw two porsches, and a lamborghini. These were the new models. I thought to myself that they probably belong either to a cabinet member or a stock trader that rode the way last year.
I also notice that there has been a surge in new and expensive cars. On any given day, I'm no longer surprised to see a Benz here and a BMW there. We're a third world country with expensive taste.
Public Sector Spending
The Asian Wall Street Journal reported a surge in imports in the Philippines and associated it with rising oil price and infrastructure spending. If there is one thing we should spend on I'd say its infrastructure. I can only be happy to hear that we're spending more on infrastrucure. Yet, I still wonder where that infrastructure is. I don't see many new bridges, flyovers or roads.
Private Sector Spending
Just the other day I saw a rare site. In a single gas station, I saw two porsches, and a lamborghini. These were the new models. I thought to myself that they probably belong either to a cabinet member or a stock trader that rode the way last year.
I also notice that there has been a surge in new and expensive cars. On any given day, I'm no longer surprised to see a Benz here and a BMW there. We're a third world country with expensive taste.
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