We bought ALSREIT, Axiata-C4 and CIMB-C7

We have transferred some SGD back to Malaysia from our SREITS dividend and bought into newly listed ALSREIT.  We start to covering it because we want to cover all MREITs as a pioneer player in Malaysia to understand all its behaviour and performance.

We also bought some Axiata-C4 due to weak market sentiment create a great chance for us to profit from valuecap.

We also like CIMB-C7 as we think when market stabilise in mid term.  We should have a fair value of CIMB at least at RM 6 and above.  Perhaps our certainty is valuecap buying I’m next few months to come.

Boycott Palm Oil to stop related forest burning?

The problem become more serious since it started over 20 years ago.  Climate changed also become part of the problem to worsen any palm oil plantation cleaning process. 

The problem not just talking about Healthcare cost for human and vets.  Perhaps other plantation, productivity, tourism, property market for foreign investors and more. 

Scientifically it adding more carbon dioxide emissions and increase global warming issue.  The cycle continuous and the palm oil plantation cleaning up aging trees become more severe haze issue in the region.

Since for more than 20 years cannot resolve the issue. Perhaps boycott palm oil purchase will be the right step to stop this costly option with others products. 

It is a chain effect.  Stop buying it or we going to drain together with it.

We bought Axiata-C4

As market continue to head south.  We found value in Axiata-C4.  We bought at RM 0.05 very mildly purely on speculative play.  It does not change our view on defensive strategy.

Local front the RM 20 bil value cap fund may benefit Axiata in short term.

Defensive strategy via cash flow oriented investment

We are suggesting a shift to cash flow oriented investment strategy.  All investment from now on will bias to companies, businesses and assets that generate cash flow consistently across time.

Alaqar REIT is a good defensive REIT in Healthcare segment.  Paramount Corp is highly recommended for its education segment due to historical week in RM.  Cypark is continously a potential of green front liners in Malaysia.

When Caterpillar to cut up to 5K jobs

It is a decision by a giant infrastructure related players.  When economy is slow. QEs were used to boost activity and have interest near to zero level.  Governments can also boost economy via infrastructure spending. 

When Caterpillar cutting jobs.  You got to believe that they have enough analyst to understand 2016 is going to be at least a forseen slow down.  Less sales pipe with less governmental infrastructure spending ahead. 

We are calling a switch into more defensive strategy in the coming months. 

We think better to do nothing at the moment

World markets up and down with Fed decision surprised people.  It did surprised me after months of comments.  We don’t believe just because of China stock market crashed lead to new decision by FED.

Too many uncertainties ahead by now. Few big cases like VW being investigate for cheating in emissions.  Najib started being probe by US authority. 

We don’t know what to do either and prices in the market not in bargain. So we will wait at the moment.

FED did nothing, I rather they do something. FED rates policy unchanged for now

We hope FED can increase policy slightly to accommodate both turning low interest trend and still making economy competitive to grow.  No what, USD needs to drop back and equities need to strongly pump back?   We understand your worry especially recent China slow down.  But this left too much space for speculation in coming months.

For now, we favour a year end rally in equities to recover most losses in the pass few months.  More fiscal policies will be used to encourage growth.

New RM 20 billions fund for valuecap and Khazanah injection will boost KLCI in short term 

We think the sentiment is largely lifted up deal to Najib announcement of additional RM 20 bill to buy undervalued stocks by the government.  Additional RM 6 billions over announced by Khazanah are evidence that lots of liquidity in Malaysia.  We think KLCI will stable above 1600 in short with buy on dip suggestion.  KLCI related with middle cap linked to government funds will be the best bet.  

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