Haha connie555 love your sarcasm.

Interesting. For most popular no 1 and no 2 picks, equal no of participants bet for and against oil.

Let me share the biggest lemon in my life in a HKEX company called CW Group listed in HKEX. At the time of purchase, it was trading at PE 3.7, and about to make an acquisition for a German machine maker with a profit guarantee that will push the PE to 2+. I'm not stupid, and I clearly know the weaknesses of the company. But then, there's sufficient mitigating factors also. The main weakness of the company is poor receivables collection, and it keeps growing every year. However, the company's revenue and net profit is growing at 5 year cagr of 31-32%. At that rate of growth, it is not difficult to justify weak FCF due to rapid expansion of working capital. Even though collection is poor, impairment on receivables is very low for the past 5 years. Company justified the poor collection from their business as part of a turnkey project supplier where everyone gets paid only when the whole project is commissioned, which made sense. AVIC, one of the largest aerospace conglomerate is an investor, and they paid more than double what I paid for it. They also have a board seat, which made the investment more reassuring.

To cut the story short, I got dumbstrucked when the company announced they have defaulted on their bond payment, when the money from the bond is clearly sitting in an escrow account as indicated in their annual report. Final confirmation of fraud occurred when the majority and CEO sold his stake for 20 cents, for a company with a book value of more than HKD 3. I've lost 70% on an overweight position in this counter. It's the most painful loss in my investment career.

I get asked if I have learned anything from this, and if I have gone back in time, would I buy this company again. People are surprised when I said I learned nothing from it, and I will buy this kind of company again. As an investor with high risk appetite and a fairly aggressive strategy, my return for the past 6 year is satisfactory, even after taking into account this year's loss, which CW Group contributed to. I'm cognizant of the fact that no strategy is perfect, as some winners will undoubtedly slip through, and some losers will be caught instead. That's a fact of life. Nobody wins all the time. The same strategy that ensnared me with this big lemon, also served me magnificent returns from stocks like AEM, which peaked at 11x my investment in 1.5 years time. What is important is that the strategy yields satisfactory result given one's risk appetite over a reasonably long period. If that is met, I don't see why I should change my strategy due to an occasional lemon, as painful as it was.

KC Chong's advice is sound. Those with less appetite for risk and adventure should stay away from lemony stocks. Also, a loss like mine can easily wipe my portfolio out if I have leveraged with margin and get too cocky with weightage like how KYY got with Jaks. As it is, even with an aggressive strategy, I'm mindful of risks and so the loss from CW Groups is recoverable. But I do expect to be hit with more lemons in the future because I'm too stubborn to learn hahaha.

@probability, not joining for 2019. But since you asked, here's a present for you: https://www.nextinsight.net/story-archive-mainmenu-60/940-2018/12621-sunpower-buying-opportunity-on-share-price-fall

I kena seemingly low market valuation lemon *sigh*

Merry Christmas Calvin. May the Lord grant you wisdom to navigate the treacherous market next year.

All he does, is writing article after article boasting his past successes. Zero content, read until sian.

Wah y u look down on unkle koon? He lost 64m in 1 year he can easily make back in the next year. Just need to leverage kaokao that's all.

Unkle Koon, I believe you can make back 64m in a jiffy, no problem. Just remember to use margin to the max and bet big big so within a short time you can reclaim your stock god status. And yes, please buy so much you exceed 5%, and don't forget to declare your sell and buy movements if not SC will come knocking on your door.

And... low cost comes from poor environmental standards, Lynas can just let the waste pile up for 7 years with full agreement from the previous government. If they need to spend money to clean up the waste you think they can still be so profitable meh? We are cheap, that's why.

Of course there are instances of pollution in Malaysia. But then, Malaysia reaps the benefit of the sale of products through taxes. In contrast, Lynas pays no tax. All products are exported. And most of Lynas shareholders are foreigners. The real benefit of Lynas is just the 600 jobs Lynas generated. Seriously, that's as dumb a deal as it gets, compliments of the corrupt BN gomen. Do you think diluting and spreading their radioactive waste throughout Malaysia, which is what Lynas is proposing, is an acceptable exchange for 30 millions Malaysias for 600 jobs in Gebeng?

Australia got other rare earth plant? Have you been following the news ah? Lynas is the only rare earth plant outside of China, understand? China's rare earth plants are located deep inland in the north, near baotou/mongolia area, the whole area is horribly polluted. And don't think Lynas didn't think about doing it in Australia. They did, and that was when Lynas was called Ashton. Let me tell you the environmental conditions to do it in Australia is much stricter. Here's proof:

http://www.nkkhoo.com/2012/03/26/lets-de-politicise-the-lynas-issue-by-stop-lynas-coalition-and-its-reply-by-dr-looi-in-the-sunday-daily/

Well, the exercise price is significantly higher than the share price of the mother. So it won't be easy to get below 10c, but not impossible. Maybe a few Trump tweets will do it. Let's see. Since I'm punting, not investing, I'm looking for a bargain, no bargain no punt.

I'm happy to punt some warrants if I can get below 10c

Jonathan Choi Yi Kit, this one your house or you still stay with parents?

Can i ask why all the semiconductor co need third party people to burn in their goods?

Because it is a low margin, high capex, cost intensive process. There are companies who do it, I believe Intel does in-house. But for others, it's more profitable to focus on the upstream process. In fact, many players don't even want to do upstream process, they just want the juiciest part of the industry, and that gave rise to fabless semicon players.

Timely reminder.

He's just here to cari makan lah. He put down others so he can lift himself up. If not how to appear knowledgeable? OK lorr, it's his right to do that, it's an open forum.

Great to know that your contempt for everyone else other than yourself extends to professional analysts too. Let me remind you again that there are multitude of products like mutual funds, unit trusts, low cost etfs and fixed deposits for the uninitiated, uninterested and the risk-averse. We are not babysitters and no one guarantees a positive outcome from forecasts. In fact, analyst reports, either from i3 amateurs or investment bank professionals are pretty transparent in their thesis and valuation. While I have my reservations for professional analysts and fund managers, I'm not about to call them sewerage. You have some serious mental issues boy, and your language reflects your immaturity.

Thanks for sharing. But I' sure you pissed off those who paid the 5k hahaha

I'm debating whether I really want to reply to you, because what I had already said is obviously not getting through to you. But I've decided to give it another try.

First of all, there you go again assuming davidtslim runs a pump-and-dump operation and then deriding him. From my limited interaction with him, he ain't that type. He's like me, icon8888 and even KYY, we all sink and swim with the stocks we write, and we all face the full brunt of market sell-off if we get our forecasting wrong.

The problem with you, is that you think there's only conventional bottom-up value investing and trading. No, there is a third. And that's what I called top-down value investing. Top-down value investing entails close monitoring of macro events, and profiting from accurate forecasting. Such method requires close monitoring of macro events, and since macro picture changes very quickly, what was a buy a few days ago easily become a sell within a short time.

Look at China rebar price. It fell from 4500 rmb a week ago to 3800 now. In a week, what was profitable becomes loss making. How about crude oil price? What was a strong buy for Hibiscus a month ago, becomes a hold now. Or coal price, which collapsed from USD40/ton to USD30/ton practically overnight from a single change in China policy to stop all import until next year due to a domestic glut? Geo Energy went from a PE 4 company to a loss making company.

Does that mean people who practice such method, or what you term as quarter-to-quarter forecasting, carry ulterior motive to deceive the public? Or is it just because the fact that trying to predict something that hasn't happened yet, and especially if those events do not have historical references, like Jaks building a power plant, will always be volatile because future events are simply hard to predict? Does that mean that we are intellectually dishonest?

Come on man, gimme a break. I'm an engineer, not a financial guru. I really don't need to know all the teeny-weeny theories on investing because I make money by taking low risk bets on future events. I'll be honest with you, most of my investments are loss making, but those that I profit from, I profit big, and occasionally I profit huge. And that's my job, to make sure that the overall position I take is profitable even though some (or even most) of it will not be.

I'll tell you now that KYY and icon8888 practices exactly the same thing I do. We try to peer into the future and try to position ourselves before what we think will happen happens. We don't profit from pump-and-dump, and we face the full wrath of the market when we get it wrong.

This year, I took a massive 70% loss on CW Group, which regrettably, I actually thought it looked so good I spent time to write about it. Turns out the company is a fraud, and I'm sure I've caused losses for people who actually believed in what I wrote. But it would be deeply insulting, to have people tell me that I intentionally defraud other's for my own benefit. And I'm pretty sure your remark about davidstlim is deeply insulting to him too. People like you are why I'm a lot more reluctant nowadays to share my thoughts and write about potential gems, because of the fear of getting it wrong and then get accused of duplicity. I'm better off counting my money in my own bedroom than to share my work.

As for the effectiveness of top-down value investment approach, I've returned 55% last year, and returned 45% cagr over the past 5 years. I excel by knowing what's going on in the world, rather by how many financial theories I know. That's the 3rd method that you missed out, and probably will never understand because you simply don't dig engineers.

This has taken enough of my time. Whether you want to continue to be an asshole or not is up to you. I'm writing this in defense of those who practices what I do, and who continue to receive insults from people like you who will never understand the incredible financial reward of predicting something that eventually come true, and the higher risks that such venture entails.

Uncle Koon Yew Yin, I would like to donate to the charity concert your wife is directing, since I can't attend. If you leave a bank account information here I will bank in some money. And kudos for the effort.

And yet he criticizes those who do q to q forecasting, even though those who do q to q probably outperforms him.

Problem with Jon is he likes to put others down to lift himself up. That invites a lot of ill-will. To him, only his path is the right path. That condescending attitude is pretty disgusting and no I won't be wasting brain cells on intellectual debates with him.

Wtf am I reading? Jon want to teach unkle koon? Good lord, is this a joke? Even though I'm not fan of unkle's reckless risk taking, he's a lot sharper and smarter than you boy. You should be taking lessons from unkle, not the other way around. Talk about misplaced sense of pride haha. You need to start growing hair down there first before u ask ppl to be your follower little boy.

Now u say margin loan cut both way. Didn't u encourage everyone to use leverage to maximise profit? And the egotistical person is you. You should buy a mirror and look at yourself before calling others that

I admire your conviction. I’m happy to punt some warrants if I can get them for a few cents. But frankly, there’s too many unknowns. The reasoning uncle koon used, that Chinese banks has done their due diligence, and therefore the project will be profitable, is a weak conjecture. Chinese banks are known to fund unprofitable overseas projects to trap creditor countries in debt. Short of having access to the actual agreement between Jaks and the Chinese contractors, it’s at best a calculated punt, in my opinion. Anyway, all the best and may Jaks be profitable for you.

Haha what a ninja! Oklah, 10+% is a recoverable loss, u did reasonably well too, congrats. Hope 2019 is a kinder year.

54 Stock Pick 2018 - soojinhou -40,262.50 -40.26%

Probability, since you asked, as of today, real life portfolio -13.4%.

On the flip size, gasoline crack is nearly zero. A barrel of oil refines into 20% gasoline and 4% jet fuel. So overall it's a net negative.

Is this analyst sleeping on the job? Steel price got crushed over the past week.

30x is a bit of a stretch. Sure they got moat, but they can’t deliver whenever they want to, they have to follow customer’s build schedule, the speed of their growth is limited by this factor. Pe 20 quite generous oledi lorr

Sslee, stocknanny = qqq3

Hambantota Port is also financed with Chinese money. Look what happened to it? It's suicidal to believe that the project will be profitable just because Chinese banks fund it. Chinese banks are state owned and are extensions of the communist party of China. They may have other consideration other than profit.

Now since I've taken care of lionind, got a bit of time to be intellectual. Now everybody knows the highest upside is found for companies at inflection point where you take a bet on something that hasn't happen yet but if the anticipated result fits your forecast model, you'll make a fortune. That's not a secret, that's common knowledge. There are simply people who bother to work hard to find these opportunities. But since it hasn't happen yet, it is still cheap, and market hasn't realize yet. A bull run like that is like having AEM at 1100% gain in 2 years. What's your best performer? Want to compare?

And it's not even that I want to brag about it, many are also losers. It's just my strategy of qualitative forecasting facilitated me in finding this gem, before market found out about it. I bet to you, many of the top contributors in i3, in spite of this shitty year, are making way above buffett levels. Why the hell need to follow buffett if we are beating him by a large margin? For ikan bilis like us, agility is our weapon. Find a few big runners a year, overweight appropriately, and close the year above Buffett's.

So you can think of quarter to quarter predictors as people like that. People who actually go deep into research and try to find such opportunities. It's not an evil scheme trying to swindle the investing public. If we are wrong, we suffer financial losses too, coz after all, who wants to write about companies that doesn't have a catalyst? Why quarter to quarter? Because determining the impact of that catalyst is the path to a the sky raining gold! Who wouldn't monitor their stock closely to judge the impact of the catalyst?

Above Buffett levels can be humanly achieved, just need to work at it. Look around you man, many of these people made a fortune from stocks, just chill man. There's more ways to skin a cat than ours. And take a look at Petron, very defensive, one for your portfolio.

He only needs to declare if his holding crosses 5%, where he becomes a significant shareholder. Top 30 no need to declare

Haha... less sailors please lol, ppl like you icon8888 really force me to work harder, come come, competition welcomed. I tell ppl don't be so fixated on kyy. Market is always competitive. If you are not competing against him, you will be competing with other invisible tycoons as well. There's no running away from competition in life, you go to school you compete, you go to work oso you compete. Want superior returns, compete lorr. Just have to be sharper and faster.

Welcome to the market, hope you achieve the investment returns you seek, we are all competitors in the market. I like your conservative strategy, dull but safe. Most suitable for working adults that don't have much time and attention other than work. As for me, I live off this, I need to work to get extraordinary returns, I'm not contented with a conservative approach. I have learned that speed to execute fast makes me more money, even though that means I'm successfully competing against people who employs a conservative strategy, that doesn't make me evil for moving money from your pocket to my pocket because markets are competitive.

You may find PetronM most suitable for your portfolio. Highly defensive retail market that's gaining market share. People associate them with refinery but that's totally incorrect because in FY2016 (I've avoided FY2017 because it is a bumper year), refining profit is less than 20% of gross profit. Sure there will be maintenance in q3, but at most that will hit only 1/5th of business. Net cash, but heavy capex coming up for refinery. What the heck lah, trading at PE 6 only.

Immoral is not illegal. As long as what kyy wrote is not faked or defamatory, he has the right to free speech. Yes yes I know he's a big swindler in bursa. But he's not an accredited analyst, he isn't by law required to be truthful.

Sound advice indeed, but dumb to talk about it in a public forum. When everybody sells first thing in the morning, you will get a shitty price. If the price get pressed down too much, the rebound will be sharp should Lion delivers. Which means if you accept a shitty price, then you probably will miss a significant part of the rally, should Lion delivers. That's why it's dumb to talk about it in public, want to sell just sell quietly.

Thanks for the chart. Didn't know mreits underperformed for so many years

Jon, your article is very offensive because it suggests that people who espouse quarter to quarter strategy carries an ulterior motive to ensnare the investing public for self-benefit. Despite our different strategies, you may be surprised that actually I find most what you wrote agreeable, and most suited for passive investment, where one gets reasonably good return with minimum effort. Guess what general advice I dispense to people? If you do not have the time to monitor the stocks you buy, or the appetite for adventure, then you should not buy what I buy. You should instead follow KC Chong’s method of low risk steady return, similar to yours.

I’m an engineer by training. I make money by understanding things around me and try to use knowledge as a tool to gain superior returns. At the time of writing, I never fool people into believing things that are untrue. However, because macro environment changes quickly, there’s no telling how long a conducive business environment can last.

Sure I’ve written about stocks that went Holland. In fact, I recently got bitten by my first fraud case in my investment career. But then, I also had AEM that returned 1100% in 2 years. I made a tidy sum from O&G theme in 2012, furniture theme in 2014 as well as technology theme in 2016, all of which lasted at least a year before business environment turned sour. Not only for me, many i3 forumers too made good money employing short term thematic strategy.

Point is, in a high risk high reward quarter to quarter strategy, nobody can accurately predict what will come next. But that doesn’t mean promoters wrote what they wrote with the specific intention of ensnaring the gullible public. A homerun like AEM was achieved based on an understanding of their product and just 1 quarter of good result. Just as AEM was a magnificent call, I also lost money in ND Paper when I was slow to respond to China’s cutting waste paper import quota causing waste paper price to rise substantially. I don't blame other's, I blame myself for being slow to react.

The holier than thou attitude of yours is disgusting. None of us ever claim to be gods of fortune, we just share what we can piece together with whatever information we get to understand the complex world around us, and hopefully in the process make some money from our effort. Sometimes, when forecasts turns out the way we envisioned, the sky rained gold, sometimes, when forecasts turn awry, we get a river of blood. We take higher risks, and we demand higher returns, and most of us work diligently to see the road ahead before it becomes obvious and the stock re-rate.

Ultimately, I agree with your title. In the market, nobody is your friend. If you have no intention of putting in effort, then don’t buy volatile stocks. There’s always Public Bank for the uninitiated and uninterested. But that doesn’t mean those who dabble in them and write about them are evil who is trying to find the next victim. Your article is absolutely offensive and I’ve no intention of wasting any more time replying to you.

Wanted to reply, changed my mind. Not worth my time. No point writing to someone who can only accept their own investment methods and criticizes everyone else'.

I'd be damned. An investor who hitherto criticizes all short term strategies now singing virtues of short term trading? Haha... What irony. A shit stirrer who criticizes quarter to quarter strategy now singing praise of getting in and out of hengyuan making a quick buck. Hahaha... man the sun will rise from the west tomorrow.

One of the crappiest letter I've seen. How is China going to be angry, when most of the money for the ECRL is already drawn down, paid to Exim bank to the Chinese contractor directly, without even reaching Malaysia? The cancellation will hurt Malaysia a hell lot more than China, because the horse has already bolted and now Malaysia has to figure a way out how to get the money back. Pray tell me, who gets angry after getting paid for no work done?

But then, everything about paying a fair price hinges on growth rate isn't it? If I can accurately forecast growth rate precisely, I would be a trillionaire many times over, won't I? Tencent was considered an unstoppable force until just recently, so was Netflix. Hindsight is always 20/20, of course on hindsight Coca-cola justifies the price Buffett paid, but when he first purchased it, it's at best a calculated bet. Don't get me wrong, Buffett is the best for generating returns for managing humungous amount of capital. But why should ikan bilis like me aspire to be him, when I can use agility to my advantage to get higher returns than his? You problem, in my opinion, is your arrogance to think that you way is the only right way and everyone else is crap, and then start shitting on everyone else's method.

Steel price dropped 5%? Big deal. At current price, it is down 25% from its peak at RM1.6. At the trough of RM0.63, it is down a whopping 60% from its peak.

I do not belittle people for doing in-depth research, I do not belittle people for spending time writing up their work and sharing with public. We need good content in i3. Whether the forecast is correct or not is moot, whether the article leads people to riches or holland doesn't matter. I also don't patronize others claiming my method is superior and others are crap. Most of all, I appreciate good content. So thanks to FutureEye for excellent content. The whole article consists of extensive network of data points taken from numerous sources, it took the author tremendous effort to piece together the whole picture. For that, his effort should be commended, not belittled.

Probability, just ignore him. I don't even bother replying. Here's for you:

http://www.mining.com/web/chinas-shandong-province-cuts-steel-coal-capacity-environment-plan/?utm_source=digest-en-mining-180805&utm_medium=email&utm_campaign=digest

Ricky sorry if I've offended you coz I didn't thought you will be interested in cyclicals. You are after all one of the rational writers in i3. Having said that consider these facts:

1) China produces more steel than the rest of the world combined. The implication from that is that they are the price setters. Given the buoyant steel price in China, Malaysian domestic price can't fall too much before export becomes a viable option, notwithstanding the slowdown in domestic infrastructure and property sectors.

2) Manufacturing process plays a part in profitability in steel making. One of the reason why iron ore based process is more profitable is because the price of graphite electrode has gone up 10x due to China's push into EAF and the shutdown of polluting graphite mines in China. Iron ore based steel making doesn't require graphite electrode.

Do note that Malaysian domestic rebar price has softened in Q2, so, there's a risk Q2 may be weaker than Q1. But then, the annualised PE from Q1 is merely 2.2.