What's up with the equity market?
The sell off is not fundamental. Economy is doing better, earnings are great but everything falls apart. The market correction may has nothing to do with fundamental.
*Analysing S&P500 chart:*
• From 26Jan18 peak to 9Feb18 is a drop of 11.84%.
• Based on the history of S&P500 since 1928, there are 217 times where S&P500 drops more than 5%.
- Mean decline is 12.00%
- Medium decline 8.20%
- Current decline 11.84%, that is in line with history.
Investors may want to consider start buying small amount.
*We want to buy stocks with the following characteristics:*
• Companies that have reported healthy revenue and earnings growth.
• Preferably strong balance sheet: Plenty of cash and low net debt are necessary for companies to survive, especially when companies face difficulties in terms of refinancing and a slowdown in sales.
• Sustainably high margins and ROIC: These are good indicators of the business moat.
• Medium to large market cap. Small-cap stocks tend to drop more than bigger caps during a bear market.
• Prefers dividend payments that would not be interrupted.
*Actionable trades:*
*• Alphabet*'s 2017 revenues were up 23 percent year-over-year, hitting $110.9 billion.
=> Buy 50% at current price.
• *Facebook* is still growing at 40% annually, the fastest growing of the largest internet players.
=> Buy 50% at current price.
• *Walt Disney* reported revenues of $15.35 billion, up 4% from the same period last year, but short of the $15.5 billion analysts had been expecting. Net income was $4.4 billion, up 78% from the same quarter last year.
=> Buy at 98.00 or lower.
• China banks are potential re-rating potential over the coming year.
- encouraging progress in deveraging so far.
- receding industrial sector NPL (non performing loans) risks.
- stablizing NIM (net interest margin) prospects.
- untapped opportunities in consumer banking over the longer term.
=> Buy *Bank of China* at HKD3.90, dividend yield 4.90%.
=> Buy *ICBC* at HKD5.00, dividend yield 4.20%.
• *Ascendas REIT*
- AREIT's diversified portfolio and exposure to the comparatively resilient business & science parks segment underpins the steady growth in DPU.
- Dividend yield is at 6.50%.
• *Frasers Logistics and Industrial Trust*
- The industry outlook in Australia outlook remains firm, with Sydney's Outer West seeing strong demand and Melbourne's take up rates improving on pre-lease activity.
- Dividend yield is at 6.52%.
*Analysing S&P500 chart:*
• From 26Jan18 peak to 9Feb18 is a drop of 11.84%.
• Based on the history of S&P500 since 1928, there are 217 times where S&P500 drops more than 5%.
- Mean decline is 12.00%
- Medium decline 8.20%
- Current decline 11.84%, that is in line with history.
Investors may want to consider start buying small amount.
*We want to buy stocks with the following characteristics:*
• Companies that have reported healthy revenue and earnings growth.
• Preferably strong balance sheet: Plenty of cash and low net debt are necessary for companies to survive, especially when companies face difficulties in terms of refinancing and a slowdown in sales.
• Sustainably high margins and ROIC: These are good indicators of the business moat.
• Medium to large market cap. Small-cap stocks tend to drop more than bigger caps during a bear market.
• Prefers dividend payments that would not be interrupted.
*Actionable trades:*
*• Alphabet*'s 2017 revenues were up 23 percent year-over-year, hitting $110.9 billion.
=> Buy 50% at current price.
• *Facebook* is still growing at 40% annually, the fastest growing of the largest internet players.
=> Buy 50% at current price.
• *Walt Disney* reported revenues of $15.35 billion, up 4% from the same period last year, but short of the $15.5 billion analysts had been expecting. Net income was $4.4 billion, up 78% from the same quarter last year.
=> Buy at 98.00 or lower.
• China banks are potential re-rating potential over the coming year.
- encouraging progress in deveraging so far.
- receding industrial sector NPL (non performing loans) risks.
- stablizing NIM (net interest margin) prospects.
- untapped opportunities in consumer banking over the longer term.
=> Buy *Bank of China* at HKD3.90, dividend yield 4.90%.
=> Buy *ICBC* at HKD5.00, dividend yield 4.20%.
• *Ascendas REIT*
- AREIT's diversified portfolio and exposure to the comparatively resilient business & science parks segment underpins the steady growth in DPU.
- Dividend yield is at 6.50%.
• *Frasers Logistics and Industrial Trust*
- The industry outlook in Australia outlook remains firm, with Sydney's Outer West seeing strong demand and Melbourne's take up rates improving on pre-lease activity.
- Dividend yield is at 6.52%.
Really so informative blog and this types of blog or article very useful Its so impressive and nice lines in this blog.keep posting such blogs.!!!!!Really appreciable.
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