Much have been said that the recent rally in non-plantation stocks was driven by liquidity. So how does one position in a situation like this? This sound advice came from Salvador Dali of Malaysia-Finance blog...
"There is some truth in that a general election driven rally has started as well judging from the jumps in IDR plays, MRCB and even Maybank (which has been dormant for more than a year). So how do you play the markets in Malaysia? Trade with the trend, I guess. As I have said before, the only things worth holding are palm oil and O&G stocks in 2008.
Anything else you should cut once there is any wobble. Thats because other than the two sectors, anything else being pushed higher looks to be driven by pure liquidity, thus pushing them to over valued territory. Take note. Ride the trend but be prepared to cut if things start to look iffy."
Other news:
A truly smart move by IOICorp
IOI Corp Bhd said it raised US$600mil from a convertible bond, taking advantage of a global commodity boom and giving it a war chest for acquisitions. (The Star)
Additional comment: The IOI convertible bonds were originally launched at a size of US$500mil, but it attracted more than US$3 bil of demand. With a conversion price of RM11 ( the stock now selling at RM8.35/share, Wednesday's close), and a low yield of 1.25-2.25% range, investors are clearly in it for the upside in its stock price. IOICorp should also be praised for the timely release of this convertible bond, when sentiments for oil palm plantation stocks are bullish.
FTSE Straits Times Index Series replaces Straits Times Index
The FTSE Straits Times Index Series tracking Singapore's equity market will replace the former Straits Times Index today in the biggest revamp of the city's stock benchmarks in almost a decade. The 47-member Straits Times Index, which was started in August 1998, rose 0.2 percent to 3,344.53 yesterday. The FTSE Straits Times Index, which includes 30 of the city's largest companies, will begin with the same value, according to a Dec. 10 statement by Singapore Exchange Ltd. and FTSE Group and Singapore Press Holdings Ltd., who jointly compile the island's benchmark. (Bloomberg)
Informed Investment sectorial stock pick: stay with steel, election play and palm oil.
Anything else you should cut once there is any wobble. Thats because other than the two sectors, anything else being pushed higher looks to be driven by pure liquidity, thus pushing them to over valued territory. Take note. Ride the trend but be prepared to cut if things start to look iffy."
Other news:
A truly smart move by IOICorp
IOI Corp Bhd said it raised US$600mil from a convertible bond, taking advantage of a global commodity boom and giving it a war chest for acquisitions. (The Star)
Additional comment: The IOI convertible bonds were originally launched at a size of US$500mil, but it attracted more than US$3 bil of demand. With a conversion price of RM11 ( the stock now selling at RM8.35/share, Wednesday's close), and a low yield of 1.25-2.25% range, investors are clearly in it for the upside in its stock price. IOICorp should also be praised for the timely release of this convertible bond, when sentiments for oil palm plantation stocks are bullish.
FTSE Straits Times Index Series replaces Straits Times Index
The FTSE Straits Times Index Series tracking Singapore's equity market will replace the former Straits Times Index today in the biggest revamp of the city's stock benchmarks in almost a decade. The 47-member Straits Times Index, which was started in August 1998, rose 0.2 percent to 3,344.53 yesterday. The FTSE Straits Times Index, which includes 30 of the city's largest companies, will begin with the same value, according to a Dec. 10 statement by Singapore Exchange Ltd. and FTSE Group and Singapore Press Holdings Ltd., who jointly compile the island's benchmark. (Bloomberg)
Informed Investment sectorial stock pick: stay with steel, election play and palm oil.
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