Posted by 稻田·* 粒粒芳香 > 2017-01-10 23:56 | Report Abuse

win liao lo like that...awal awal already 出大招

Posted by paperplane2016 > 2017-01-11 00:22 | Report Abuse

Sure win stock

Posted by IamGoogle > 2017-01-11 00:41 | Report Abuse

Days still young, so fast declare winning already?

Posted by John Lu > 2017-01-11 01:21 | Report Abuse

7.60% now...behind of me (8%)...my competitor

Posted by stockmanmy > 2017-01-11 01:58 | Report Abuse

The magic formula should be called the Conservative Party.
Their success depends on maintaining stability, status quo, straight line extrapolations......Their success depend on the pre internet, pre social media world order., where things and businesses hardly ever changes. If X is what you get last year, X will be what you get this year.

Dynamic investing is the New World Order . We should be called the Progressive Party. We look for changes, look for disruptors, look for new trends. In this 21 century business environment and value discoveries, we need a new way to look at the share market. I call it entrepreneurship. You may call it some thing else.

No wonder the two parties cannot get along.

Posted by stockmanmy > 2017-01-11 02:20 | Report Abuse

And I too think the 5 stocks are well chosen by the Conservative Party for their conservative features.

Posted by stockraider > 2017-01-11 08:10 | Report Abuse

KC,

Your stock very good pick strong balance sheet, good cashflow and got sustained earning potential.

FYI raider also follow buy on 3 out of your 5 picks .
This type of investment, should able withstand the test of time or longer term hold.

Raider think u will do well in this 2017 competition, as your stock pick got a good winning chance.

Most importantly, you make monies in your interest of investment.

Posted by popo92 > 2017-01-11 09:06 | Report Abuse

these stocks are pick very well especially in terms of the magic formula ev/ebit and roic . however, it might expose itself with weaker usd in the year end... but there's chance to boost up by tppa which i think highly chance succeed. I hold few stocks of out 5 myself and i am mentally hesitate for upcoming changes. I hope these macro factors won't affect them but highly unlikely.. KC, would you share some of your thoughts?

Posted by stockmanmy > 2017-01-11 10:12 | Report Abuse

"Never invest in something you don’t understand well, and have a low conviction on, and is outside your circle of competence. If one changes his or her investment approach in response to recent underperformance, one might be doomed to mediocrity."

translated....KC should remain KC, there will be times the magic formula will serve you well., but not always.

Posted by stockraider > 2017-01-11 10:16 | Report Abuse

There is no holy grail....all investment system can fail loh....!!
Magic....is one of the best...value investment formula loh...!!

Posted by IrisLee > 2017-01-11 10:18 | Report Abuse

I am a newbie and learning tremendously from all the sifus. Thank you all for your input. All the best for your investments!

Posted by valuelurker > 2017-01-11 10:26 | Report Abuse

Old man, you mask it behind the 'Magic Formula' but come on who are you trying to blindside, old clueless uncles and aunties again? As I said earlier, you are taking a bet on one and only one direction...its pure export theme first (and we all know its going to be played/is currently being played - how else to unlock the intrinsic value), then only Magic Formula

Of course, on the balance of probabilities (Lord Denning god bless his soul), it would be the correct play since US are raising rates etc etc but history has shown, things can change...

In the mean time, try not to count your eggs before they hatch, old man, you dont see me trumpeting my returns do you, and half of the ideas havent even materialised

Posted by imoogi99 > 2017-01-11 10:28 | Report Abuse

As the word "Magic", it sometimes can wow you and sometime it can fail you too. Like what icon says, this competition is unique as you cant profit taking and results is compare during the end of the year. As of now it shows profitable and you can say your "magic formula" is working but end of the year the result shows negative returns, are you going to say the "magic formula" is not working well?

Posted by stockraider > 2017-01-11 10:54 | Report Abuse

As raider say...any investment system can fail u too mah...!!
Just that Magic is one of the best system...thus better chance of success loh....!!

Posted by 3iii > 2017-01-11 11:19 |

Post removed.Why?

Posted by 稻田·* 粒粒芳香 > 2017-01-11 11:24 | Report Abuse

3iii,

早安，这几天观察了你好久。

小弟本身对你的背景非常感兴趣。请问小弟有幸可以晓得您现在或之前的专业领域吗？

如不便透露也没门。

感恩

Posted by 兄弟 bin HengTai > 2017-01-11 11:30 | Report Abuse

3iii very panlai!

Posted by 3iii > 2017-01-11 11:35 | Report Abuse

Magni I had looked at this company in the past. The CEO's remuneration is disproportionately high. I shy away from this stock due to this.

Posted by 稻田·* 粒粒芳香 > 2017-01-11 12:10 | Report Abuse

3iii,

早安，这几天观察了你好久。

小弟本身对你的背景非常感兴趣。请问小弟有幸可以晓得您现在或之前的专业领域吗？

如不便透露也没门。

感恩

Posted by Flintstones > 2017-01-11 14:15 | Report Abuse

Vrrom vrroom. Drama incoming. Whats the story with 3ii?

Posted by 3iii > 2017-01-11 15:25 | Report Abuse

Rather than just looking at EPS, it is better to look at ROE or ROIC.

There are differences between ROE and ROIC.

1. ROE looks at returns on equity. The ROE maybe high due to high leverage. So, be careful to look at the financial leverage of the companies with high ROE.

2. ROIC incorporates debts into the denominator.


As investors, we are interested in the high incremental earnings earned on the incremental capital employed or retained by our invested companies. ROE and ROIC are better measures for this than EPS.

[I am just repeating what KC has taught and shared with us many times in this forum.]

Posted by kcchongnz > 2017-01-11 15:54 | Report Abuse

Posted by valuelurker > Jan 11, 2017 10:26 AM | Report Abuse
Old man, you mask it behind the 'Magic Formula' but come on who are you trying to blindside, old clueless uncles and aunties again?

ME: I AM JUST CURIOUS ABOUT YOUR BRINGING UP. DID YOU PARENTS TEACH YOU ABOUT MANNERS? AREN'T YOUR PARENTS "OLD"?

BLINDSIDE "OLD" CLUELESS UNCLES AND AUNTIES AGAIN? WHEN WAS THE FIRST TIME? HOW IS IT "BLINDSIDING" UNCLES AND AUNTIES? FOR WHAT PURPOSE?

As I said earlier, you are taking a bet on one and only one direction...its pure export theme first (and we all know its going to be played/is currently being played - how else to unlock the intrinsic value), then only Magic Formula

ME: EXPORT THEME? YEAH LAH, MOSTLY EXPORT STOCKS. DIDN'T REALIZE IT. BUT WHAT IS WRONG IF THEY ARE ALL EXPORT STOCKS? MUST BE LOCAL STOCKS? SHOW ME SOME HIGH MAGIC FORMULA LOCAL STOCKS PLEASE!

OH, CAN UNLOCK EXPORT STOCKS AH? GOOD WHAT. SO WHAT IS WRONG IF IT IS SO?


Of course, on the balance of probabilities (Lord Denning god bless his soul), it would be the correct play since US are raising rates etc etc but history has shown, things can change...

ME; CORRECT PLAY AH? SO WHAT IS WRONG? THINGS CAN CHANGE? WHAT CHANGE? CHANGE SO WHAT?


In the mean time, try not to count your eggs before they hatch, old man, you dont see me trumpeting my returns do you, and half of the ideas havent even materialised

ME; PLEASE READ THE ARTICLE AGAIN AND AGAIN. WHAT IS THE PURPOSE OF THIS ARTICLE? IS IT ABOUT SHARING ABOUT MAGIC FORMULA INVESTING, OR TRUMPING ABOUT RETURNS OF THIS NEW PORTFOLIO?

WHERE IS THE PART OF THE ARTICLE WHICH SHOWS, OR TALK ABOUT, THE RETURN OF THIS 2017 I3INVESTOR STOCK PICK?

YOU GOT SOMETHING TO TRUMPETING ABOUT? REALLY AH?

Posted by stockraider > 2017-01-11 16:01 | Report Abuse

Eps can relate to sure price mah.....!!
ROE not related mah....if company having 35% ROE so what ?
If the share price is overvalue loh.....!!

But if company having PE 4X u will think very cheap...loh..!!

The other thinG...investor..misconception...high ROE means the company..can reinvest capital FOR HIGH return, but usually high ROE do not need reinvestment....bcos business already mature, no need more capital for reinvestment mah...!!

EPS and PE a better measurement than ROE loh...!!
But nothing to stop us, using both or various measurement loh....!!

LIKE W. BUFFET SAYS KEEP IT SIMPLE LOH...!!

Posted by stockmanmy > 2017-01-11 16:21 | Report Abuse

if one is happy with a portfolio full of these characteristics.....by all means.
the magic formula will magically transform you into those stocks. of similar characteristics.
a smaller, more conservative universe of simpler companies, more probably matured companies / industries., traded at very decent prices.

I don't think any of the 5 companies listed above will go bankrupt in the next 5 years. And if they continue to do well, surely the shareholders will also do well.

Posted by stockraider > 2017-01-11 16:24 | Report Abuse

1st time mammy...talk sense loh....!!

Posted by stockmanmy > 2017-01-11 16:28 | Report Abuse

if one is happy with a portfolio full of these characteristics.....by all means.
the magic formula will magically transform you into those stocks. of similar characteristics.
a smaller, more conservative universe of simpler companies, more probably matured companies / industries., traded at very decent prices.

I don't think any of the 5 companies listed above will go bankrupt in the next 5 years. And if they continue to do well, surely the shareholders will also do well.

at the end of the day, it is behaviour that counts.

its 99% about behaviour and 1 % about the stock bought.

Posted by stockraider > 2017-01-11 16:35 | Report Abuse

Yes...if u have a system n follow closely with discipline...u behavior under check mah...!!

Thats why govt of Spore so steady compare with msia...bcos they follow the system with discipline loh...!!

Posted by stockmanmy > 2017-01-11 16:46 | Report Abuse

well, like I say, if KLSE boring like NZ, I also will ROIC.

Posted by stockraider > 2017-01-11 16:49 | Report Abuse

In stockmkt u need to play a boring game to win....mah...!!

If want excitement go genting loh...!!

Always separate investment with gambling loh...!!

Posted by stockmanmy > 2017-01-11 17:00 | Report Abuse

raid

The investible world is very rich, very diverse

but if one is a frog like this raider, what will he know about how the eagle soars and what is above the clouds?

Posted by stockraider > 2017-01-11 17:08 | Report Abuse

Raider sifu are Ben Graham, W. Buffet, Peter Lynch, Greeblatt, Walter scholss, Philip Fisher....with all these successful sifu...do u think u need any other unproven things ?

All these sifu are proven sustainable dragons on their own rights loh..!!

Always learn from the successful master...with no ulterior motive, other than impact good investment tech...on investment loh...!!

KC is also a very good sifu loh....people should learn from him loh..!!

Posted by Andry Ong > 2017-01-11 17:40 | Report Abuse

Smart and clever pick

Posted by stockmanmy > 2017-01-11 18:32 | Report Abuse

Extremely difficult for major companies to get into magic formula.....too many people watching.

Posted by matrix6050 > 2017-01-11 19:07 | Report Abuse

love the list ..good one

Posted by 3iii > 2017-01-11 19:20 | Report Abuse

Someone posted that PE of 4 is very cheap.

The last time I looked at Poh Kong, it was trading at PE of 5 (a few years ago).

Was Poh Kong at PE of 5 cheap, and was PBB at PE of 14 expensive?

Have you ever heard of Buffett using PE in his valuation?

Posted by kcchongnz > 2017-01-11 20:27 | Report Abuse

Posted by popo92 > Jan 11, 2017 09:06 AM | Report Abuse
these stocks are pick very well especially in terms of the magic formula ev/ebit and roic . however, it might expose itself with weaker usd in the year end... but there's chance to boost up by tppa which i think highly chance succeed. I hold few stocks of out 5 myself and i am mentally hesitate for upcoming changes. I hope these macro factors won't affect them but highly unlikely.. KC, would you share some of your thoughts?

How would you know "it might expose itself with weaker usd in the year end"?

How many of you expected Brexit last year?

How many of you expect the stock market still doing well after Brexit last year?

How many people gave chance to Donald Trump to win last year?

How many people expect the US market still doing well after Trump won?

Posted by John Lu > 2017-01-11 20:32 | Report Abuse

KC...I am 11.7% now...rank 9th...haha

Posted by stockmanmy > 2017-01-11 20:52 | Report Abuse

I think anyone thinking of magic formula will buy Gadang which made $ 95 million last year on $ 530 million shareholder fund.

But my own analysis suggest its PL will collapse compared to last year ......and the share will be punished this year.

and buying Gadang is buying a contractor with $ 600 million of outstanding works....making it the smallest construction company in the KLSE.



so go figure......

Posted by popo92 > 2017-01-11 21:47 | Report Abuse

Dear KC, thanks for your genuine comments. Unfortunately because of my current job, i often requested to predict the big picture before it happens. I could say Brexit and donald trump victory is expected within my expectations but often, the stock market and currency volatile cannot be predicted. What i am really trying to ask is that what will you react when macro factors are not on your side? Let say we all know the storm is coming eventually but we all do not have any idea when it will comes. What will you do in the storm? Will you stay aside temporary (selling stocks with negative factors and monitor the impact of the storm) or will you wait for the storm past and do nothing but believe everything will eventually past?

Posted by kcchongnz > 2017-01-11 22:29 | Report Abuse

Posted by popo92 > Jan 11, 2017 09:47 PM | Report Abuse
Dear KC, thanks for your genuine comments. Unfortunately because of my current job, i often requested to predict the big picture before it happens. I could say Brexit and donald trump victory is expected within my expectations but often, the stock market and currency volatile cannot be predicted. What i am really trying to ask is that what will you react when macro factors are not on your side? Let say we all know the storm is coming eventually but we all do not have any idea when it will comes. What will you do in the storm? Will you stay aside temporary (selling stocks with negative factors and monitor the impact of the storm) or will you wait for the storm past and do nothing but believe everything will eventually past?


I would say you were the very few who had predicted correctly the outcome of Brexit and Donald Trump. Well, in any prediction about the future, thee will surely be some who would be right.

Take for example, during the second Board saga when Hwa Tai was trading at RM150, and many others in tens of ringgit, you should know the storm is coming, and it be be furious. I would have long gone hiding.

The same is for the dotcom bubble when a startup with little revenue and losses were selling at Billion USD market.

But not now. Nothing is that euphoric yet. There are still plenty of good companies selling at cheap prices. The storm will come, but it could be beautiful sunlight for days before the storm comes. So I won't hide in the house but enjoy my golf.

Posted by mike90 > 2017-01-11 22:34 | Report Abuse

Wow, all exporters, how if USD weakening?
Do you practise portfolio diversification?

Posted by kcchongnz > 2017-01-11 23:11 | Report Abuse

Posted by mike90 > Jan 11, 2017 10:34 PM | Report Abuse

Wow, all exporters, how if USD weakening?
Do you practise portfolio diversification?



How do you know whether USD will be strengthened or weaken in the future?

Have you heard of financial risk management such as hedging using forward, futures and options and other derivatives?

No diversification?

Focus Lumber: the manufacturing and sale of plywood, veneer and laminated veneer lumber

Fibon:the formulation, manufacturing and sales of polymer matrix fiber composite materials and products for the Electrical, Electronic, Petrochemical and Automotive industries.

FAVCO: Manufacturing of cranes

Latitude: Manufacturing of furnitures

Magni: Manufacturing of garments


Aren't they having different kind of business?

Posted by stockmanmy > 2017-01-12 03:05 | Report Abuse

diversification by industry is one aspect.

but the true objective of diversification is co relationship. Study the co relationship of shares and groups of shares. Certain shares, they move as a herd, groups of shares...such as exports shares.......because they are very sensitive to a common factor.

it is a branch of study all together.

groups of shares such as blue chips and penny stocks, they have different group dynamics.

domestic economy stocks vs exports stocks....they have different dynamics and moves at different times.


on the other hand, a too diversified portfolio will never win the competition.....if you want to win the competition, you have to be ambitious, just like your portfolio. .

Posted by stockmanmy > 2017-01-12 03:14 | Report Abuse

how much to diversify is a function of the objectives of the portfolio.

Share have characteristics, certain shares have certain characteristics. The manager of a retirement fund will have to consider the characteristics of each share and their impact on the portfolio, classified by characteristics as well as by industry group.


not easy to be a public fund manager....but that is certainly outside the scope of this competition.

Posted by stockraider > 2017-01-12 09:38 |

Post removed.Why?

Posted by SALAM > 2017-01-12 10:58 | Report Abuse

Besides all in the KCMF which relied entirely on past figures and data, KC also input his sense of likely future industry/Company trend before recomending a stock, sometime really worth the look. eg his call on FAVCO lately. Thanks KC, appreciate!!

Posted by connie7i3 > 2017-12-28 22:29 | Report Abuse

Dear KCChong
Could you please do a review of your 5 selected stocks on 10Jan this year? The fundamentals are still strong yet the price appreciation is minimal. Therefore, we should not exit from these counters but maintain them in our portfolio. Correct? Thank you very much for teaching us fvi. I appreciate your magnanimous spirit.

Posted by Rahul Sekhar > 2018-05-23 09:58 | Report Abuse

Hi KC, wanted to know if you knew any websites where we can download all the info on the shares in excel format so that we can workout the magic formula.