Caveat Emptor

  Conch Cement - Boring companies Galore  After applying my newfound method of automated stock screening into SGX, my interest zoomed towards Hong Kong market and US market. Although I have no expertise in market timing, the fruits of my research coincided with the recent market correction and I am trying to see if there are good performing businesses at a more attractive price. Looking through the podcasts of ValueInvestAsia, I got wind of aastocks which is a powerful HK stock screener tailored for the Value / Fundamental Analyst. I shall not disclose my list of stocks that were picked up in my screens as I am still trying to discern what makes sense and what is not. But one thing is for certain. The sheer variety of companies as well as number of listed entities are much more populous and varied compared to the limited variety and number in the local scene. Aswath Damodaran is right in the sense that if I know nothing about the companies, I can more objectively value it...

Joel Greenblatt may not be a well-known name to most retail investors, but his investing record and well rooted investment strategy deserves a look. After recommendation through a friend, I have skimmed through several books and the talks he gave. Coming from a fund management business like Peter Lynch, his description of the fund management business is startingly similar. Although he is not a smooth talker, his formidable intelligence and his active efforts to make his process understandable and simple is impressive. Benjamin Graham version of “Magic Formula Investing” had a resounding investment record across the periods of the great Depression, where most companies are worth more dead than alive, active liquidation can bring about impressive returns, and wide diversification to counteract value traps . Joel Greenblatt’s Magic Formula is more focused on screening, longing the most profitable companies, and wide diversification / shorting the expensive stocks. To put it simply,...

Betting on Alphabet   Thesis : Fast grower with highly volatile earnings with plenty of room to grow. Most of the thesis will be centered around digital advertising growth and its ability to mantain its moat in the search engine ecosystem business and ability to secure advertising revenue. The ecosystem growth story will be subject to perpetual flux, but the dominance of android OS and its versatile apps (Gmail, Youtube, Google Maps, Google Drive) leads to a formidable moat that is not easily disrupted and replaced IMHO. The side bets (periphery purchases and research projects, such as self-driving cars and other automated services.) are not the core focus but Google will have first right of refusal should the side bets succeed.   Alphabet, one of the top companies in my USD watch-list recently had a mini correction due to quarterly earnings miss as well as a recent flux in bad news triggering a sharp short off. The PE dropped towards the threshold I have for Gr...