Welcome to my last posting for year 2018.

2018 has been less active

I have been relatively inactive this year. Made some gains, some losses. Overall, my portfolio has shrunk significantly in view of certain bad calls (in O&G) and prevailing market uncertainties. I have been acting defensive lately, with significant exposure to yield-driven equities, cash market and gold.

You can’t predict the future

I have just finished reading Howard Marks’ Mastering the Market Cycle: Getting the Odds on Your Side. Howard said: “we may never know where we’re going, but we’d better have a good idea where we are.” Essentially, don’t predict where the market will head in the future. Remember the CLSA’s annual Feng Shui Index – just compare the actual vs predicted for 2018

clsa.png

Where are we now? Probably late cycle. Numerous domestic and global headwinds. As far as Malaysia’s FBMKLCI is concerned, valuation appears to be ‘elevated’, trading at P/E more than 19x (relatively higher than historical average of 16x).

KLCI PE.png

My Plans for 2019

As we may be looking at a potential global bear market in 2019:

  • Continue to re-balance portfolio towards defensive yield-driven equities and cash markets
  • Invest for the long term (stocks with significant margin of discount)
  • Opportunistic short term trading
  • Continue to learn up on macro and data science

Happy New Year 2019!

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