Posted by Flintstones > 2018-12-02 08:27 | Report Abuse

Hahaha. Funny article. Cheers to your effort. An elderly businessman with more than few RM 100m net worth wont take the advice of a young speculator with RM 100k portfolio. This article did one thing though. It got my attention!

Posted by CharlesT > 2018-12-02 08:34 | Report Abuse

Qqq3 lost his job while sneaky jon boy is looking for a new job...

People come people go but the games is still on

Posted by CharlesT > 2018-12-02 08:37 | Report Abuse

If elderly bizman could listen to an plp idiot what makes u to think he wouldnt do that to jon boy?

Jon boy is yr plp skill as good as yr england?

Is so, yr seat is 90% secured

Posted by Beary > 2018-12-02 09:18 | Report Abuse

Hahahaha jonniboy your plp skills left much to be desired compared to qqq3.

I think the oldman will feel more annoyed rather than impressed by your open letter.

Posted by PotentialGhost > 2018-12-02 09:44 | Report Abuse

definitely this Jon is an idiot . Now I can confirm.

Posted by okdoke > 2018-12-02 09:54 | Report Abuse

you are lucky if you don't get this sentence " you should look at your investment record why you are poor and remain poor(always lost in bursa)" or he has soft spot when Jon write good england my two cents view

Posted by huatahhuat > 2018-12-02 10:02 | Report Abuse

In the end want to network with rich man, more easy to earn money this way?

Posted by Ayoyo > 2018-12-02 10:03 | Report Abuse

For a young head like Jon, I must say I'm very impressed with his thinking and incredible maturity on the markets. If you are prepared to polish your rough edges, for an example, tone down on brashness (for the markets have its way to pound you down to compliance), you will get very far in life... I've been trading the markets since I was 18,now 47 and I've never seen anyone with such passion at such age.. All the best

Posted by supersaiyan3 > 2018-12-02 10:10 | Report Abuse

If you really know investing, you don't need to collect fees or collect fans to push up the price.

Just keep the way you are now.

Posted by Jon Choivo > 2018-12-02 11:42 | Report Abuse

Haha I'm guessing plp means kissing ass. In which case I'm too lazy to do that.

The reason I invest is to be able to just say what I consider to be true and let the chips fall where they may.

If I liked kissing ass so much, I'd just do it at work.

As a fund manager, the only thing I can control is my investment philosophy, investment process and client base.

The way he is now, I will not accept kyy as a client. But I'm open to meeting him, and see if I can get it him to reach an understanding similar to mine.

But considering kcchongnz failed, I don't think my chances are good. Haha.

I'll just consider the time spent teaching him, if he takes me up on the offer, charity work for future scholarship students, and what will likely be a very interesting conversation.



====
CharlesT If elderly bizman could listen to an plp idiot what makes u to think he wouldnt do that to jon boy?

Jon boy is yr plp skill as good as yr england?

Is so, yr seat is 90% secured
02/12/2018 08:37

Posted by Alex™ > 2018-12-02 13:08 | Report Abuse

so 5k fee still valid? =D

Posted by soojinhou > 2018-12-02 13:17 | Report Abuse

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.

Posted by qqq3 > 2018-12-02 13:37 | Report Abuse

soojinhou Wtf am I reading? Jon want to teach unkle koon?.....
============


let him try....cannot stop the young ones......but get scolding more likely......lol....

Posted by qqq3 > 2018-12-02 13:50 | Report Abuse

when Jaks is $ 1....swap shares for warrants can work....at this price cannot work already.....

anyway....nobody will buy the warrants at 25 sen now...Jaks will not receive the $ 70 million.....and does not appear to be under written.....

will be lucky to get half subscription.....

Posted by Jon Choivo > 2018-12-02 13:51 | Report Abuse

I did not lose 60% this year. Minimum.

He is sharper and smarter in spots. But by his own admission, he does not know how to read financial statements.

In that metric at least, i'm far ahead.

I have to concede, i come across arrogant at times, and probably am.

But investing is in essence an arrogant act; an investor who buys is effectively saying that he or she knows more than the seller and the same or more than other prospective buyers.

I can only counter this necessary arrogance with an offsetting dose of humility, by always asking if i have an apparent advantage over other market participants in any potential investment and to so thoroughly and persistently.

You also need to keep your ego in check. Your comments related to me these days tend to rely more on personal attacks, or to attempt to put down my arguments via reference to my age etc.

Be specific and elucidate.

Your personal attacks speaks volumes about your intellectual honesty. For your sake, i hope its kept to only interactions here and your comments and does not leak into your investing or speculating.

===
Posted by soojinhou > Dec 2, 2018 01:17 PM | Report Abuse

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.

Posted by qqq3 > 2018-12-02 13:51 | Report Abuse

back to the drawing board for Jaks......

Posted by CharlesT > 2018-12-02 14:10 | Report Abuse

I admit i can hardly finish reading ah jon n kc's long essays...

Posted by soojinhou > 2018-12-02 14:16 | Report Abuse

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.

Posted by probability > 2018-12-02 14:16 | Report Abuse

KC is OK, the same tangible concepts...ah Jon likes to touch intangible concepts which has no significant value to practical investment decisions...

take for example he talks about Kelly criterion...

the biggest uncertainty is the probability factor in the equation...you can use the most advanced maths for the rest with sensible logics...but if your probability factor is incorrect...everything is useless..


you see despite all his value investing propagation...
he will finally end up as PLP like qqq...realizing thats where it works more effectively.

Posted by CharlesT > 2018-12-02 14:20 | Report Abuse

Jon is brave...he dare to dream big n aim high even he has yet to show any impressive results in stock mkt so far...

Posted by soojinhou > 2018-12-02 14:23 | Report Abuse

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

Posted by probability > 2018-12-02 14:24 | Report Abuse

but...i do believe cute Jon will eventually be more humble after all the baby fats on his face disappears...

Posted by Ricky Yeo > 2018-12-02 16:34 | Report Abuse

the biggest uncertainty is the probability factor in the equation...you can use the most advanced maths for the rest with sensible logics...but if your probability factor is incorrect...everything is useless..

***

I think you got the entire logic of using probability incorrect. Probability is useful precisely because the nature of uncertainty. When a person who knows how to apply probability say he is 83% confident, he isn't fooled by the precision of the figure, all that means is he has 27% chance of being wrong, therefore, he is interested to find out if that 27% happens, what's the plan B and what's the margin of safety.

Posted by Ayoyo > 2018-12-02 16:50 | Report Abuse

I think it does not matter whether one has 87% confidence of a positive outcome for even with a 99% probability, that 1% may just turn true circa Murphys law...

For a simple person like myself, my laws of probability are made simple too.. Based on the what the eyes could see, there is a good probability (regardless of %, which is arbitrary anyway) of prices rising if I am right... Therefore, if x happens, do y else z - simple excel formula

Posted by probability > 2018-12-02 16:51 | Report Abuse

Ricky...i am not saying using the 'probability factor' as incorrect...i am saying determining this value itself would be very challenging...

and that requires a separate book itself to describe and put into use

the Kelly's criterion conveniently uses this variable in its equation without any narration how its tangibly determined...

Posted by Jon Choivo > 2018-12-02 19:44 | Report Abuse

Yeah, im sure davidtslim made buckets this year, despite being wrong every single time.

That's what you get by frying up the stock beforehand to lock in the profit.

Buy before self generated rumor, sell just before news.

Wrong or right, write new article. Most won't remember the last article.

I concede the point on putting down others. I have been more arrogant than i would have liked, this probably flowed unconsciously from the derision i feel for people's whose thinking are incredibly hypocritical, inconsistent and weak, but act as if they are the walking jesus.

I don't deride trading. Most of my conversation of with my 500% trading friend, consist of trying to understand how he did it down in a repeatable manner, of at least first principles.

But it seems to be not much more than the principles i've written in other articles (which is damn bloody hard as it is). The rest seem to be mostly turkey before Christmas kind of thinking (which to be fair he has very little off, and what has, he ensures they are profitable and don't hurt as much if they go wrong).

In addition, some of my investors consist of traders, who have me manage the investing portion of their capital.

You may also not have read my other pieces, but i've spoken very highly about Ray Dalio, Nassim Nicholas Taleb, and Ed Thorpe. All of whom are traders and have also taught me a lot.

Whether you are a trader or not does not matter. The question for me is whether your thinking is clear and consistent, whether one is intellectually honest.

By and large this does not exist in the retail traders, not surprisingly, since everyone's first action here start at trading, and few move on to or combine investing.

Ill give this you you. You're the latter.



===
soojinhou And yet he criticizes those who do q to q forecasting, even though those who do q to q probably outperforms him.
02/12/2018 14:23


soojinhou 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.
02/12/2018 14:16

Posted by Sslee > 2018-12-02 20:32 | Report Abuse

Dear Jon Choivo,
There are many routes leading to Rome or in Deng’s word; “it doesn’t matter if a cat is black or white as long as it catches mice” You only believe in “Moat Factors” in selecting your stocks to invest. You are a total disbeliever of TA chartist and q-q FA analyst. This is fine but to look down, ridicule and mock a hard working TA chartist looking at hourly, daily chart and FA analyst working hard in collecting all the relevant data from publication source to predict Q-Q earning is uncalled for and unacceptable behavior.

As of EverendaiI if you are truly good at MOAT factor or competitive advantage then put yourself in an old school civil engineer shoes and tell me what Mr. Koon see in Eversendai.
https://klse.i3investor.com/blogs/koonyewyinblog/152033.jsp
I agreed with Koon on Eversendai competitive advantage but I do not have this emotional baggage and agreed with KCChong on the risk side of Balance Sheet, Cash Flow and Receivable. Mr. Koon often said you should not let your emotion clouded your judgment but unfortunately Mr. Koon is the one too emotion when defending his personal friend and have too much faith in the goodness of human nature. He even went berserk in defending Tan Sri AK Nathan:
https://www.freemalaysiatoday.com/category/opinion/2018/06/28/ak-nathan-best-choice-for-master-builders-president/
https://www.freemalaysiatoday.com/category/opinion/2018/07/02/mbams-reply-to-koon-yew-yin-on-master-builders-president/

Thank you

Posted by soojinhou > 2018-12-02 20:51 | Report Abuse

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.

Posted by John_Lee > 2018-12-02 23:03 | Report Abuse

Jon Choivo, some pointers for you.

1. KYY may not be a master at reading financial statements but I am certain that he has a team of capable people doing that for him. You must be a little naive to think that he is a one man show. Dabbling in KLSE in not mere investing for KYY, it is a business.

2. You are looking for a big break from KYY. I think you are doing yourself a disservice by writing this letter as you have discredited yourself in public.

3. You are trying to do business with KYY however you word it; directly now or indirectly in the future. You see that he is a little beaten now with a few of his stock selections and you smell that here is an opportunity for you to sell your ware. Lets not fool any one that you are not trying to get him to allow you to manage some of his money. You surely look green when it comes to doing business. Your lack of maturity shows. The element of arrogance has likely gotten into you. Do reflect upon this.

4. You place too much emphasis on investment and financial literatures. Universally, investment and finance is the same everywhere. In practice, that is hardly the case. Also, making real money with a small portfolio vs a big portfolio is worlds apart. It is more than a simple extrapololation of numbers and strategy.

Posted by Jon Choivo > 2018-12-02 23:14 | Report Abuse

Just from the first point.

If he is the kind to not read his own financial statements. There is very little probability of him actually being a good investor.

Uh no. If i wanted a "big break" with kyy, i would have perfected my ass kissing skill a little more, and wrote about Jaks. God knows i can bullshit and write well.

Third point, yes. If he meets my criteria's. Otherwise, he can take that money and go build 3 more dormitories, or lose about RM70m 2 or 3 more times.

Fourth, this is where we differ. The principles to living a good life is universal. They way one applies it differs individual to individual.

This is why even StoneCo, a Brazilian payment services company that just listed, at a valuation of 20 times revenue (just turned over a profit this quarter). Can count berkshire hathaway and 3g capital their cornerstone investors at their IPO. And having studied the company, i can roughly see why it would make sense.

The problem here is you don't understand the concepts deeply to begin with.

From what i read, you only understand the surface level.

Having said that, thanks for the critique. I appreciate it.

====
Posted by John_Lee > Dec 2, 2018 11:03 PM | Report Abuse

Jon Choivo, some pointers for you.

1. KYY may not be a master at reading financial statements but I am certain that he has a team of capable people doing that for him. You must be a little naive to think that he is a one man show. Dabbling in KLSE in not mere investing for KYY, it is a business.

2. You are looking for a big break from KYY. I think you are doing yourself a disservice by writing this letter as you have discredited yourself in public.

3. You are trying to do business with KYY however you word it; directly now or indirectly in the future. You see that he is a little beaten now with a few of his stock selections and you smell that here is an opportunity for you to sell your ware. Lets not fool any one that you are not trying to get him to allow you to manage some of his money. You surely look green when it comes to doing business. Your lack of maturity shows. The element of arrogance has likely gotten into you. Do reflect upon this.

4. You place too much emphasis on investment and financial literatures. Universally, investment and finance is the same everywhere. In practice, that is hardly the case. Also, making real money with a small portfolio vs a big portfolio is worlds apart. It is more than a simple extrapololation of numbers and strategy.

Posted by Jon Choivo > 2018-12-03 00:21 | Report Abuse

Alright. Thanks for taking the time. For a moment, let us try to not see who is right or wrong. There is no value in that. Let’s try and see if we can understand ourselves better through the others critique. I know I’m definitely too arrogant.
The third method you speak off. Is essentially trading/speculation.

Now just for my definition, you may think differently.

Investment: The purchase of a security at a price at a significant discount to the value of all its future cash flows discounted to present value.

Speculation/Trading: The purchase of a financial instrument, with the expectation that the price will go to a certain place.

Now i have my own perspective on trading on macro pictures. Can it make money? Of course. Can people become extremely rich through that with alpha instead of luck.
Definitely, Ray Dalio, and Soros did it.

But i don't think my perspective on trading is where our bones lie. I think our points of contention have largely been my accusations of you, icon or david being malicious. I have no problems when people want to make money in the market via trading or investing. But i do find it either slightly distasteful, unethical, or downright despicable when one tries to do so by manipulating the crowd.

The first question i'll ask is this. Why does david write? No doubt, it probably started as just sharing, coupled with the hope of pushing the price up a little. And then, he feels of the rush of being right, and the praise he gets. He betters his writing.

The next time he writes, people follow him in and bid up the equity prices. 5 hours of work, and he can potentially make 5% easily. Now, depending on his ethics, one here may turn into bonescythe or icon(or the current david).

He stays mostly correct. And walks his current path. Where he will look for macro changes that may result in strong and unexpected changes in quarter results.
And then he writes his article, that pops up the stock prices 5-10%. Or even 20% over 2-3 weeks. Now, given the few times he may have gotten burnt on selling after when profit is not as much as he would like. He sells some, basically the start of somewhat (but not downright) unethical front running.

He also starts writing like this, "Forward 3-month PE of Hengyuan could be very attractive (below PEX3.5) even based on current price of RM11.00."

As if it’s an investment, and not a trade. Now to be very fair, you may say that many reports write the same way. Some in an even more stupid manner such as, "MYEG should be valued at 40 P/E, which is cheap as its below historical P/E of 50." by the trading houses.

But i consider the majority finance industry to be a sewerage. Partly from the individuals. Mostly from the fucked up incentives that make people do horrible things. The iron rule of nature is: you get what you reward for. And the incentives in the finance industry awards despicable behavior. If you use their morals as a relative comparison, well, i'm not going to say much more.

Now back to david.

This difference in understanding between the veteran and the newbie, is how one makes money in a zero sum game. When market is good, its fine, stupidity can be covered up by buoyant prices. But when the bear market comes, and prices go down, being a trader, he would have cut loss quick. But the naive, thinks its an investment and starts averaging down.

And then we have the results of today. He is still a good person. But his actions resulted in a horrible outcome.

The road to hell is paved by good intentions.

I am not saying he is a horrible person. I am saying his actions, along with whoever else's, have horrible outcomes. I am very certain, on a net basis, if one were to remove our the natural effect from rising earnings over time from market prices, more money would have be lost than gained.

Some to brokers. Most to the shrewd. And definitely, some to david.

I have a feeling, that the net effect to retail participants from the articles of people such as icon, david etc, is probably as a whole, a negative financially (it’s just mathematics). Only kcchongnz, ricky's and 3iii's had a positive effect.
In terms of intellectual thinking, it’s probably a positive. Some driven by money, try to understand the world better economically and financially. Some get burnt properly, and decided they needed to know how to think.

But it is the last fools who buy just before the bear from david's articles, and this group also statistically is the largest amount in term of individuals and money.

If he or anyone here believes in their ability so much. Keep your fantastic ideas to yourself and start a fund. Try to at least be ethical by putting the bulk of your own money in the fund. If you are truly ethical, guarantee the principle and the profit rate as if it’s a loan.

Or, have bleeding honesty in your writing. Like the goreng goreng articles. No one is getting confused reading that.

Posted by soojinhou > 2018-12-03 06:54 | Report Abuse

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.

Posted by Jon Choivo > 2018-12-03 09:47 | Report Abuse

Tell me how does 90% of analyst report being buy or hold, with less than 10% being sell, not result in them being in essence worthless? You're telling me that 90% of the companies you see being buy or hold?

If its free, you are not the customer, you are the product! But the analyst, act as if you are the customer.

All these mutual funds, hedge funds etc. They get 5% sales charge, 2% per annum and 20% of any profit.

With incentives that ensure you make money regardless if others make money, how can someone who joins the place not act in a despicable manner? And if anyone is good, they use that track record to raise stupid amounts of money, that will inevitably underperform due to physics basically.

And mutuial fund companies, only keep the funds with a good track record, but those with bad ones, just disappear into the backgroud. Basically misleading people in regards to their real ability.

Don't even let me get started on investment banks.

I don't think you actually understand the industry, or have seen enough of it.

No offence, this is one of the reasons why i dont keep track of steel prices etc. If you spend time doing that, where are you going to find the time to study things like this on top of work?

Even with very spirited reading, i'm still way behind.


======
soojinhou 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.

Posted by John_Lee > 2018-12-03 12:59 | Report Abuse

Jon Choivo,

You just dont get it that a business is a team game; the leader of the pack will not and does not need to know everything or be skilled in every aspect. Keyword TEAM. I attribute this to you being a small scale guy who hasnt seen the world out there.

Note: If you take KYY's words literally that he doesnt know how to read financial statements, then it really shows your limited ability to comprehend and interpret.

Back to reading financial statements. I have read some of your many postings in i3. Honestly, I find your accounting technical skills rather limited (in fact flawed many times) and your interpretations of financial statements generally average. You claim that you have an audit background. I dare say that you are not a product of the Big 4. (Yes, it shows.) Maybe a 2nd tier firm or maybe a medium sized. And you certainly did not spend a long time in audit - probably left after you obtain your MIA membership. Senior or Assistant Manager level at best. You do not show the skills, knowledge and maturity of at least a Big 4 manager. I stand to be corrected.

And I can tell that you are not trained at an investment bank. Again, I stand to be corrected but I am pretty confident.

What you write in i3 (with quotes and names throwing of so and so here and there) may impress the average layman. Some of us here who live in the financial industry however will not buy into your boasting and 'lagak pandai'.

There is nothing wrong with you writing your opinion in 13. It is after all a public site. But you should learn to handle your ego and arrogance. It is quite a pain to read your downright rude postings.

Posted by probability > 2018-12-03 14:31 | Report Abuse

your quote below:

"Investment: The purchase of a security at a price at a significant discount to the value of all its future cash flows discounted to present value."

...........

Until all the future cash flows takes place the so called 'investor' by your definition is just a trader (calculated gambler) who is waiting for the valuation to match his perceived intrinsic value as per his predicted Future Cash Flows (FCF) based on his present knowledge of the business.


There are no certainty his estimated FCF will take place as per his prediction.


Investors are just traders who are predicting future cash flows (relative to different investment options) by sitting on their purchase for a slightly longer period relatively and ignoring - being less sensitive to recent information changes.

As much as trader who makes mistakes on their valuation, investors have the same odds of doing so equally.

...................................

Now, when one (person x) comes an enlighten the market with new information on the relative valuation of these investments as per x's perception, market appreciates this by reflecting the probable value of these investment based on this newly acquired knowledge (perception).

Perhaps in the near future another person y will enlighten differently and market will start valuing these investment back as it was earlier.

And then again in a distant future, person z may come and enlighten differently...

Until the future takes place and all these future cash flows happens no (traders or 'ínvestors') is certain who was right...x, y, z or the axxhole that never listened to any of these new information providers.

Now where is ethics involved here and where is the difference between investment and trading?

Its all just about being more intelligent than the other.

when someone come and help you to become more intelligent, a little appreciation and humbleness wont do any harm.

Posted by probability > 2018-12-03 14:38 | Report Abuse

and what these x,y and z gains for the information they shared...is none of your bloody business...why bother? nothing is free man....

you are always free to scrutinize the information they shared..and chose to act or not to act according to your new perception..

Posted by Jon Choivo > 2018-12-03 15:04 | Report Abuse

This is not business, this is investment. Unless you run a hedge fund that is doomed to underperform the index, you don't need that many staff. If you're good, 4 people can probably handle about USD200billion,

There is two things you need to note. Acccounting and Investing have very different requirements.

What is true and fair in terms of accounting, is often inaccurate in describing the economics in the business. Its trade offs, that have no easy solutions.

I dont remember writing much about accounting standards beyond MFRS9 for financial institutions. Whose audits i have zero experience with.

My previous audit firm (i resigned 3 months ago) has a bigger audit department than Deloitte. And i was scored pretty damn good in performance reviews before leaving. I also got an offer from PWC for AM last week (which i turned down). Audit firms dont pay much. ;)

Thank god i wasnt trained at an IB. I would be an utter IYI, intellectual yet idiot then. Working under fucked up incentives that are net negatives to society.

Lets have some fun, show me a five year projection that you made, and compare it to the actual. Lets see how much of your time and brainpower did you waste.

Or how these fools do valaution using industry average. Really? IHH is 50PE, when it can barely make 4% ROE much less ROA using peak results.

Or how past price trends and volatility mean anything in terms of risk.

Thank god for IB's and their training of their analyst in financial models. Along with economic departments in universities. They contribute to the inaccuracies in the market that allow people like me to profit off.

On the ego and arrogance. I concede i am definitely a little of both.

But do note confuse my contempt for hypocritcal, sewerage rats as ego/arrogance. I am both capable as judging someone as both brilliant and disgusting.

I dont know you well enough, but you seem to be an one of the latter.

Now, if you have crticism on my thought process and analysis. Be specific and elucidate.

====

And I can tell that you are not trained at an investment bank. Again, I stand to be corrected but I am pretty confident.

What you write in i3 (with quotes and names throwing of so and so here and there) may impress the average layman. Some of us here who live in the financial industry however will not buy into your boasting and 'lagak pandai'.

There is nothing wrong with you writing your opinion in 13. It is after all a public site. But you should learn to handle your ego and arrogance. It is quite a pain to read your downright rude postings.
03/12/2018 12:59

Posted by Jon Choivo > 2018-12-03 15:09 | Report Abuse

Yeap having read your other comments.

Definitely an IYI. Lots of intelligence. Low common sense.

At the rate you're going on, i would strongly suggest you take you money out and buy fd along with the chinese index.

Posted by probability > 2018-12-03 15:24 | Report Abuse

Jon, after my message above, and if you still could not grasp , i would need to conclude you are hopeless liao...having serious mental issues as said by others.

Pointless to have any interaction further.


Posted by soojinhou > Dec 3, 2018 06:54 AM | Report Abuse

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.

Posted by Jon Choivo > 2018-12-03 15:39 | Report Abuse

You remind of people who go around studying and argueing about the exact day seneca was born, instead of just obtaining the maximum value by reading his philosophy.

The difference is this.

The figures given by these quarter predictor analyst in malaysia, are often unusually optimistic and far above the actual economic power of the company. And to often to do so with precision which end up to completely wrong.

And these quarter predictors, usually have their own motives hidden. Or at least not obvious.

I have no problem if someone bets their own money on the pop etc.

But i find it despicable when people try to manipulate the crowd to be stupider than it already is. One can argue, what's the use of fools except to be taken advantage off?

Well, nothing wrong with that. But i reserve the right to find you disgusting, and state so.

Now do note, i am not saying that is david etc.

But he sure comes close, knowingly or unknowingly.

I don't get why you or sjh, seems to think i have to consider people like david etc etc as angels of the market or somthing.

I find them a bit more ethical that people like "Spartan" or whatever name they appear by.

In any event. I'm done. There are few things less productive than arguing or dicussing things with someone online, that result in zero new insight formyself.

====
Posted by probability > Dec 3, 2018 03:24 PM | Report Abuse

Jon, after my message above, and if you still could not grasp , i would need to conclude you are hopeless liao...having serious mental issues as said by others.

Pointless to have any interaction further.

Posted by probability > 2018-12-03 15:44 | Report Abuse

Even for investors to make money, he needs fool who cant value the future cash flows as good as he does...

What makes you certain that market (or crowd you said) is full of fools and that people like David can generate unrealistic optimism?

Market is ever changing and dynamic...it can be very efficient too.

So, stop these unsupported bias you have for certain methodology of investment and criticism on others...

as you simple do not have the facts to prove your judgement is more correct than the others.

Posted by probability > 2018-12-03 15:52 | Report Abuse

what prevents me from saying investors have their own hidden motives to find a market which are stupid...they seek stupidity so that they can buy cheap?

Why cant i say the same to investors...despicable manipulate with ill intentions to take advantage of others?

stock market is about a calculated bet on future value...

whoever comes and helps with whatever financial and investment tools or business knowledge...are totally to be welcomed.

if they provide wrong information.. its the duty of the readers to highlight these for the benefit of all the readers including self.

Posted by Jon Choivo > 2018-12-03 16:07 | Report Abuse

Wahseh, your reading comprehension really nothing to say.

I have nothing against people who trade, i do so a little myself.

Yes, if an investor sees a wonderful company, but spread rumours that its going bankrupt etc to buy cheaper.

That is despicable as well.

People who try and provide just knowledge, well they are of course to be welcomed.

But if someone writes an article espousing the wonder of a certain company. They are to be viewed with scepticism. Track the incentives!

Yes, i called out, yours and stockraider foolishness. Davidtslims, and that fella who went around predicting lionind earnings.

However, that is apprently not acceptable, by the fellow interested parties. You forget how you and raider sabo 3iii everyday ah?

You forget how SJH thought i was being very unfair to the guy who wrote the lionind article.

I quote

“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.”

Waseh, challenge his arguements equal belittled.

For writing an article for which he will benefit very well financially from the goreng, even if it was completely wrong.

I should commend him.

Look if it was his own private research, then yes. I'll commend him and be in awe of the work done. He did it for his own curiosity, and he held it close to his chest, because he is so certain its a fantastic bit of research. So good, he don't want people to buy.

You think i give the rcecap research because my heart gold meh? No choice mah! And not going to be bad for me mah!

In any event, i'm done with this topic. Its of zero value to me, to continously piss off people here. And is probably a net negative.

An investor just wrote me saying that he was scared of asking me a question on some of the larger picks, because he didnt want to get sabo. As if i have some agenda on not wanting the any errorsor misjudgements to surface, allowing me to sell and save everyones money.

That is definitely not the result im looking for.

Posted by probability > 2018-12-03 16:23 |

Post removed.Why?

Posted by Jon Choivo > 2018-12-03 16:40 | Report Abuse

Dear Probability,

I must say, you have a way of getting me to reply to you haha.

Yes, the macro can change very quickly.

An intrinsic value consist of many factors. The management, the economic moat of the business, its pricing power etc etc

One of them being the cost of goods, as well as the price they can get for the goods they sell, which naturally fluctuate. Espeacially for commodity companies.

But as stated above, the intrinsic value is more than just the change in value in the price of certain goods, that resulted in a temporary increase or decrease in economics.

For example, HY is going to have a record breaking quarter. Does that mean it changes the intrinsic value by a larger amount? No. Unless that record breaking quarter is very resilient and going to persist to eternity.

That is clearly not the case for pretty much 99% of the companies in bursa.

Just because your son fail one exam, does that mean he go from genius to retard? No mah.

At best these temporary fluctuations, account for less than a 10% change all the future cash flows of the business discounted to present value. Or the real economics of the business.

Likewise, they are some events, that at first glance appear to have no effect on earnings. But represent a complete shift in the fundamentals, and can kill a company in 2 years or less. Look at star.

But these quarter predictors, act as if that is the case. Come on, how does it make sense to pay RM1.6 at all for masteel, Rm3.4 for Annjoo or RM20 for HY?

Now, HY was probably very very undervalued at RM2. But at RM7-10. It was probably above fair value d.

now, one can argue, some of these quarter predictors, probably didnt know better.

Well, their stupidity (malicious or innocent) resulted in some very bad outcomes for many people.

I guess its more of hate the sin, love the sinner.

In that respect, im definitely deficient.

Posted by John_Lee > 2018-12-03 16:51 | Report Abuse

Jon Choivo,

You think too highly of yourself.

Good luck to you.

Posted by soojinhou > 2018-12-03 16:53 | Report Abuse

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.

Posted by probability > 2018-12-03 16:56 | Report Abuse

For example, HY is going to have a record breaking quarter. Does that mean it changes the intrinsic value by a larger amount? No. Unless that record breaking quarter is very resilient and going to persist to eternity.

..................

(P): How did you conclude that the record earnings was going to be one time event and will not be the norm going forward at the time of the results?

what is the underlying mechanism that it wont be so....

and why did the market assume so and gave a price of RM 19?

..................

That is clearly not the case for pretty much 99% of the companies in bursa.

(P) : really? there are no companies that continue growing their earnings after such events?

..................

Just because your son fail one exam, does that mean he go from genius to retard? No mah.

(P) : how did you manage to link a son performance with a business performance...they are equally erratic?



I think you argument above arise from a highly debatable opinions....

you should focus on giving such arguments when such an article or unrealistic optimism arise in the future...so that its beneficial at that time...it certainly have no use now.

Posted by i3Value > 2018-12-03 17:00 | Report Abuse

Hahaha. You all actually bother to reply to this Jon. He cannot see that what he do is exactly what he accuse other of doing. People blog is to pump and dump. He blog is to share his knowledge with the world. Hahaha. His vision is see himself only

Posted by i3Value > 2018-12-03 17:03 | Report Abuse

No need argue with this kind people like Jon. You cannot win one. He will write something super long to justify to himself, not to you. He only live in his own world. And he need to always justify to himself that he is correct. That is why he must write long long. Deep inside he has very big insecurity. That why must show the world like he very good