GFC Is it over?

[azza33]

Well folks - it has been 2 years since the first shocks of the GFC emerged. Can you believe its been that long? It has been a long tough road for many i suspect - but there are always winners. How has everyone coped during this messy time? Have you managed to keep your head above water? Or drowned like so many of the professionals did during the crisis? Has the past 3 months helped or are your losses just improving?

Moreover, has the crisis ended or are we merely in the eye of the hurricane?


Personally - its actually been a mixed period for me - i had many losses in 2007 when i dumped everything i owned - i was lucky as i had the fortune to exit as i could see what was unfolding - and got a premium for most stocks. I've been profitable during 2008 and 2009 but that could all evaporate if we are just in the eye of the storm.

So i'm curious to read about people stories and going forward what are your thoughts? Where do you think the big returns can be made?

Asian currencies seem to be extremely cheap? Korean won and Malaysian ringgit for example seem a monty to appreciate in value. I've been looking for an korean ETF denoted in KRW - no luck finding it on Australian, US, Singapore or HK exchanges - bugger.

Corporate bonds - heavily geared companies have had their bond prices decimated - Just this week i am up 80% on a bond that i bought at an 18% yield - i suspect the astute investor will make large returns in this sector - again its not without its risks.

Are there any shares/stocks that are standouts due to low PE multiple and low level gearing on the balance sheet?


hope to read some stories and get some insight from you guys - many minds are better than one

**********

Just an aside - I read in the paper this week Malaysian government had refused to give air asia x expansion rights to Seoul and Sydney due to air asia (sister company) failing to pay 65 million ringgit to the Malaysian airport company for services and taxes owing. As an avid supporter of air asia i tracked down their financials for the year ending 31/12/2008 - they lost approx. 900 million Malaysian ringgit!!! It's a massive loss for a budget airline and the number seems to have gone under the radar. Operationally they are fine but their treasury division managed to loose nearly one billion ringgit on derivatives and hedging activities - i assume related to fluctuations in oil price and the massive depreciation of the Malaysian currency.

[Stogie]

My money is on the banks for the upcoming week. I'm hoping that good results here will see the market hold up for the next few weeks.

Short term: In addition to the banks, I'll cuddle up to BATM Advanced Communication, Standard Chartered, Tullet Prebon, Premier Foods and StatPro Group.

If these play out I'll move some of the returns to Ladbrokes and Unilever on Wednesday.

Long term I like Bovis, Templeton Emerging Markets and a host of others...

It's gambling innit?

[azza33]

(Stogie @ Aug. 02 2009,12:02) It's gambling innit?  

Maybe but then again....

Gambling is set up so that the house always is going to be statistically ahead...

At least the financial markets give us a sporting chance

[seamus]

Bought into a radio station group 10 years back at £0.27 per share, now worth £0.03 a share & I had £25,000 worth Radio is dead now, never to return to the heights of yesteryear, so money well & truly spunked.
I was never in it for the money, so there's one good thing I guess, but would I get so heavily into the music scene , given My time again.................................NO

[azza33]

Ouch that hurts Seamus ...

[seamus]

Thing is Azza, even at £0.03 a share no fucker would want to buy them, so in reality their worth nowt

[PigDogg]

(azza33 @ Aug. 01 2009,20:01) I've been looking for an korean ETF denoted in KRW - US exchange

Azza, take a look at EWY

EWY

[PigDogg]

My losses were minimal but I don't like any loss. My primary edge is manipulating my portfolio to maximize tax advantages.

I'm verry cautious and think the market is headed back down.

So I look for special situations such as the thinly traded KDUS which sells at a discount to net cash on hand.

Or try to play the discount spread between ESD and EFL which will be merging at NAV in a couple months.

Long term, I think there is a new normal, people will be using even less toilet paper and toothpaste.

One thing people will always need is clean water so my biggest holding is VE, a French water purification company with worldwide operations.

But all my long positions are hedged with inverse ETFs.

[azza33]

Thanks Pigdogg but like all ishares ETF - its USD based pricing.
That fund is also listed under the code IKO on the ASX as well.

I was looking for an ETF priced in Korean won not USD (even if it's listed on the korean market i don't mind)

[azza33]

(PigDogg @ Aug. 02 2009,13:18) But all my long positions are hedged with inverse ETFs.

Curious.. ETFs are very limited on the ASX - mainly all the usual ishares ones are there, a couple of commodity ETFs and that's about it.  
These inverse ETFs - could you point us in a direction of a product page or the like.

thanks
Azza  

[PigDogg]

Azza, even though EWY trades on the NYSE and is priced in USD, I'm pretty sure that it holds a basket of stocks that is priced in Korean won. So on a day where the Korean market is flat but the won appreciates by 1% agaisnt the USD, the NAV of the ETF should rise by approx 1%.

Here's alink to some USA inverse ETFs. Note the double inverses do not always perform as you might expect over long periods.

Proshares Inverse ETFs

[Grinder]

Biscuit tin under the bed chaps - always a winner...

Mate of mine who I introduced to the LB world just a month ago has seen his 70k sterling investment (made in 2001) mature this week. Was "promised" 150k... got 10k.

[pacman]

In my opinion the GFC is far from over. That is not to say there won't be opportunities to make money on the stock market, though profits need to be taken. Long hold plays can so easily end in tears.

The big unknown we all face is the effect of exchange rate movements. It is no secret that the US needs to devalue. But how that effects each country is a subject of intense debate. The bottom line is that no-one can predict just how it will play out.

I recently read where all US embassies have been instructed to purchase a years supply of their local currency. Billions of dollars have been allocated for the purpose in readiness for a sharp US dollar decline.

What absolutely staggers me is how the author of the article could be so sure. And just how does the US orchestrate such an event? He banged on about a future announcement of a forced US bank closure, along the same lines of FDR's bank holiday in the 30's. The theory goes that all the insolvent banks, those hopelessly weighed down by a loan book that cannot recover, will simply stay closed.

Again I wondered where the writer gets his info. But he outdid himself with the call that some event is due to take place in the next 2 to 6 months, something designed to bring down the value of the US dollar. He finished by predicting this will happen in September.

I take no responsiblity for his predictions. I found them to be curious. It was the complete certainty of his forecast that motivated me to repeat them.

Unsubstantiated rumours only fuel the public's doubt. But what if it comes to pass? How will it play out? Who wins? And what of commodities? Do they stay priced as they are? Does gold go for a record run?

Could this be the trigger to a new Trade War?

I have no idea. The US dollar is so pivotal to all World Trade that any manipulation could easily backfire. If this is an idea dreamed up by the US Treasury Dept, all I can say is they have not been too clever thus far.

My personal opinion is that ultimately this will lead to a One World currency. The current system is broken & must be replaced to avoid future conflict.

In the meantime, there are great opportunities to make money. Just don't get too greedy because world markets have never experienced such uncertainty & what is clever today may be a disaster tomorrow.

[azza33]

(PigDogg @ Aug. 02 2009,15:34) Here's alink to some USA inverse ETFs. Note the double inverses do not always perform as you might expect over long periods.

Proshares Inverse ETFs

Thanks again

We don't have these products at all in the oz markets  

There are of course other ways to hedge, but having such an array and sector specific mechanism to protect an investments sure as hell comes in handy.

[Tomcat]

(pacman @ Aug. 02 2009,19:02) Just don't get too greedy because world markets have never experienced such uncertainty

Well said Paccers...i agree... its been a rough ride for the last 12 months or so and there is certainly a lot more pain here in the UK to come. Even if you have the worlds best widget... are you going to get paid in 60 days time.. this is the crux of the matter if you offer goods and services.

Some big blue Chip Companies are a bad risk now and i forcast at least two big big bankruptcies on the high st..at least i wont lose me shirt..