Saturday, February 15, 2014

Regional vs KLCI - Update and Property Proxy

The tables and numbers are self-explanatory. I only use some of the stocks in SGX and BursaKLSE for analysis. The presence of Malaysia own local funds show the current level on Friday closing is only about 3% correction from the peak.

Some of these I have my own personal interest but I won't tell you exactly which ones. For simple layman academic education I call these stocks into 2 categories.

1) Heavy weights  (Bank Chip)
2) Property Construction (Green Chip)

One can opt to contra your trades or choose to hold for the long haul.   

We have heard Malaysia Singapore Property bull run. If you seriously look into the simple analysis above does it makes sense to "speculate" in property?

If you have the BALLS to buy and hold the decently Green Chip, your return for Malaysia stocks will be average of 321% (376% + 266%). Assuming you don't buy at the LOWEST and sell at the HIGHEST, we can safely assume absolute 250% return over 6 years (75% of 321%).

If you are buying in the initial or midway of a falling market to the low than your returns will be less!

Can you make 250% in KL property over 6 years? I have not been able to do these despite having bought a condo in Orchard Road Singapore at the lowest point of 2008-2009 GFC! You can look at Singapore Property stocks for a comparison.

The only consolation is that one can take bank loans to buy property if you qualify for the loan. Isn't it the same as share margin financing? Ok. Not same but conceptually same! Maybe this can give you a better results for property returns. Don't forget you have Real Property Gain Tax but no such thing for stocks! 

The best next proxy to buying properties is to by decently property good stocks in the exchange during the severe market correction.

Hmmm ... why is not Warren Buffet or George Soros heavily invested in equities and not properties?

So folks ..... do your home work. Track your charts to time your entry!

Have a great week ahead!   


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