CFA Preview Lecture : Securities Market @ Sunway 17/07/2011

Mr. Th’ng Beng Hooi, CFA giving a Preview Lecture on Securities Market

As part of their marketing, Sunway Tes and AB maximus held yet another preview talk at Sunway last Saturday. Yet, there are some Investment-related insights which I picked up and discuss in some detail here.


Retail Investors(ie: you and me)

One interesting point was when Mr. Th'ng was ranking the order of investors for equities and it went somewhat like this:

• Institutional Investors
  
• Corporate Investors
• ...
• Syndicates (yes, they are in every market even KL)
  
• ...
• Insiders
• Retail Investors ===> That's you and me!

Basically, he was making the point that we retail investors have very little advantage going for us.The other investors above the pecking order not only have the experience and knowledge but all the information needed right at their fingertips. What possible advantage can we have over these other investors?
(Yet interestingly, majority of fund managers don't beat the markets, so what edge do you have over than them?)

In fact, maybe none except long term holding. ie: for retirement as opposed to a mutual fund which has to make good returns annually Of course, this was coming from a self-proclaimed fan of Buffet(read: value investor) but he makes a good point on what little advantage you and I as retail investors have.

So? We have to be patient. Chances are information-wise we lose out to the syndicates, insiders and the big boys at the top as they have teams of researchers and what not behind them.

That's easier said then done, of course- Stocks being easily traded with a click of mouse these days, making it even more of a game running on emotions rather than rational decision making.

If you grow impatient, you may sell although the time frame you set out has not been met. So, that for me was an interesting reminder on what (little) advantage we retail investors have.

Also, at the end, he had a Q&A where he raised and addressed 2 interesting questions(funnily he posed to himself - see pic):

1) Fundamental or Technical Analysis - Which is better?
Mr Th'ng gave a good analogy - It's like Shaolin kung-fu. If you have a different style (crane, tiger, mantis, etc), doesn't really matter as long as you can defend yourself right? So, whatever works for you. As a Buffet fan or a CFA holder, that would usually mean fundamental but personally, the speaker uses both.

2) Will computers take over human jobs (in this field)?
Nowadays, trades are carried out automatically by computers. In fact the 2010 flash crash of the DOW recently (wikipedia here) was caused by such a sell programme that triggered other trades. Some firms out there deal with High Frequency Trades (HFTs) where trades are automated with programmes that pick up data and act on it.

However, this does not necessarily the end of our jobs - you still need a human to key in such data and formulas, no?

That aside, I know will go in my thoughts about the CFA part-time lectures offered by Sunway-Tec + AB Maximus (with Stalla materials):

CFA Part-time Lectures
This has been my 2nd preview lecture and the pricing for their weekend classes is RM4000 and RM 3600 for individual and corporate sponsored respectively. It includes revision and mocks. Sorry, don't have the sheets with me atm and can't find it online for exact details.

The lecturers so far have been impressive and the Stalla materials look impressive in the two preview lectures I have been. Also, Sunway is not too far compared to say Kasturi and the other Management College in KL apparently offering CFA classes too.

Unfortunately for me, it clashes with work on Saturdays so I might just settle for self-study with the Cafepacer (www.cafepacer.org) and maybe the Studymaster (thousands of questions to try out) and see where I get this December.

Oh for the other candidates out there, one question was posed:

Schweser or Stalla Schweser apparently is more concise and hence, suited for the time-strapped candidate. Stalla has been around longer but is more detailed. Sunway-TEC will be using Stalla so they endorse Stalla obviously.

Full Disclosure: This is an unsolicited/unsponsored post.

Buffet's Right Hand Man Speaks - Charlie Munger

This isn't Charlie.. but eye-catching, no?

The vice-chairman of Berkshire Hathaway (NYSE: BRK-B), Charlie Munger or perhaps, better know as Buffet's Right Hand Man speaks and is featured on www.fool.com.

One thing which resonates with me:

"On challenge: Most dentists and doctors know what they're doing. They deal with problems they know they can fix. I don't want that. It's in my nature to move toward the really hard problems that haven't yet been solved."

Really excited by the technological advances made by tablets. Just finished reading - Designing for the Ipad - Building Apps that Sell. Looking at this from an angle of maybe building a killer-app in what little spare time I have..? *shrugs*

It's just really exciting how it's a whole new frontier- how the iPad really much is a tabula rasa and innovative ways its being used to not only consume but also generate content are being created (think music instruments with the ipad) or yet to have been created! Then again, perhaps the writer is right in saying it's very much a 'gold rush'. May spend lots of time and all you get is - dust.

Source of quote: Morgan Housel (a writer for the Fool I also respect) covers Charlie's thoughts on the world in two parts can be found here:-

Check out here for Part 1

and... Part 2

Also, you can check out - Charlie Munger on How to Become Rich. - Very realistic down-to-earth advice.

In life, to get ahead, we have to seek mentors. Why not Charlie Munger as one of them?

Uranium - The Fuel of the Future

Uranium - Fuel of the Future?

Are fears over another Fukushima/Third-Mile/Chernobyl nuclear accident overblown and thus, a buy opportunity for Uranium related stocks?

In recent days, Uranium and its related shares (read: uranium miners) have taken a beating. Who can blame them after the Japan Catastrophe and the following backlash against nuclear energy.

Yet, you still have the former world's richest man, Bill Gates advocate that it will be Nuclear not Green Technology which can save the world from global warming by reducing carbon admission to 0%. Basically, his message is that a tremendous change has to come and most likely it will come from Nuclear Energy not Green Technology which may sound good but does too little good.

Read more here:

http://articles.cnn.com/2010-02-17/tech/bill.gates.nuclear_1_nuclear-reactors-nuclear-power-plant-nuclear-energy?_s=PM:TECH
Also, the Ted Vid: http://www.ted.com/talks/lang/eng/bill_gates.html

Demand-side there is another concern- Germany is phasing out all of its nuclear energy and this would reduce demand for uranium goes the bears.

Yet, India and China are still going overdrive into nuclear energy. It will come a day when China will be churning out one nuclear plant every two weeks. Read bloomberg here - "China and India will lead a 46 percent increase in consumption by the world’s five biggest atomic-power developers by 2020, according to data compiled by Bloomberg. "

On the supply side, the supply of uranium from decommissioned weapons will be reduced after 2013 from Russia.

Give these two separate demand and supply dynamics, are people just over-reacting and reeling from the Japan Nuclear/Tsunami disaster and the policy knee-jerk, perhaps uranium is a Buy Opportunity.

Until another fuel substance than can trump Uranium comes along, I'm inclined to think so, yes, buy.

For deeper Uranium-themed investment ideas, read Howard Ruff's opinion on the Ruff Times here.

The World's Most Powerful Man, President Obama has a few Gems of Wisdom for us All.

http://www.fool.com/investing/general/2011/06/10/the-day-the-president-gave-us-his-financial-advice.aspx?source=facebook

" Save. Earn interest on those savings. Be a disciplined saver. Understand the distinction between investment and expenditure. "

Although this is probably more in the context of the US being in its over-indebted state, there is a personal moral behind this - save more, spend wisely.Words to the wise.

OKS publishes book on top 50 small caps in Malaysia, Singapore and Indonesia.

For more, check out Malaysian Insider's coverage here:

http://www.themalaysianinsider.com/business/article/osk-takes-small-cap-jewels-franchise-regional/

MEGB is also listed there a pick along with HELP international.