Official Shiny Things thread—Part IV

[streetfighter]

Looks like such fake news has lot of supporters! Ok i will be going 100% into China ETF. I see great opportunity for large profits here.
There was a time when US banks also trading at low prices & people start spreading rumours & i made a bundle!

It has nothing to do with "propaganda." Shiny Things is explaining why Chinese bank stocks are trading at low multiples to (purported) earnings. The market consensus view is that these banks have comparatively low value since investors are concerned about their credit exposures, and they have reason to be concerned. It's not because nobody can read Chinese financial reports and other evidence; it's because they can. After all, these bank stocks are listed and traded in stock markets that happen to be located in China. Investors in China who speak, read, and write Chinese are the ones valuing these banks at low multiples, too. Mostly investors in China, actually. Investors outside China have relatively little influence over these bank stocks' valuations.

If you disagree with the consensus of investors around the world including in China about these valuations, as Shiny Things already pointed out you're certainly free to take long positions in Chinese bank stocks (unless you think the current valuations are too high). He even told you the ways to do it if you're interested in such speculation.

 

[FrostWurm]

well, the reality is... buying a whole world index is pretty stupid.

in fact, i don't agree with buying a developed world index

So are you cash gang or deep in TSLA calls?

 

[moolala]

So are you cash gang or deep in TSLA calls?

u theta gang??

can teach me how to play options?

 

[chrisloh65]

After lying that China banks got gargantuan amount of bad debts and cannot find evidence to substantiate it when I challenged you previously, now you changed to insinuating nobody knows how much bad debt?

Ok, you can keep spinning your China bad and US good here (because the smart ones here know you and BBCWatcher have strong personal vested interest in US and over-weight on US stocks)!

While I get what you’re saying, and I’m certainly not opposed to having some China exposure (it’s VWRA’s third biggest allocation!), I don’t agree with the argument you’re making (that China looks cheap because the USA is full of haters).

China looks cheap because the market is heavy on banks, and Chinese banks trade CHEAP. Most other sectors of the Chinese market—tech, consumer staples, consumer discretionary trade pretty much in line with where those sectors trade in the rest of the world.

But the CSI300 is >30% financials and 11% tech + communications; while the SPX is basically the other way around (38% tech + communications, and 10% financials). And those financials trade far cheaper than the equivalents in the USA—Chinese banks trade at a P/E ratio of around six-and-a-half, while the US financial sector trades at a PE ratio around 14.

The reason those Chinese banks trade so freakin’ cheap is basically because Chinese government policies are squeezing the banks’ margins; and because nobody seems to know exactly how bad the loan books are and how much the banks will be able to offload to the AMCs.

In short—saying “China is cheap” amounts to saying “Chinese banks are cheap”, which amounts to saying “the market is mispricing Chinese banks’ loan books; the default rates and recovery rates will be better than expected, and also the government will take its foot off the banks’ neck and let them actually earn some money”.

 

[0x0011]

I think you might be a bit late tbh? The time to put on the COVID recovery plays was
we had two >90%-effective vaccines ready to hit the market.

Damn right! What would u recommend anyways?

 

[OnePunchMan]

u theta gang??

can teach me how to play options?

you do know what theta means right

 

[brfish]

Uh, good question. This is normally the point where I’d say “ping me and we’ll do this as a consulting arrangement”, but we can spitball it in public if you’d like.

The SARs are basically a call option, as I understand it from your post. Are they coupled to the stock somehow - you get both RSUs and SARs? Or do you just get SARs?

You are absolutely right. It is basically a call option. Only difference is that I can't sell it as an option. I can only choose whether to excise or not.

They are not coupled with stock. I get both RSUs and SARs and they are separated. I mentioned RSU just to demonstrate why I am puzzled by the SAR part.

 

[cassowary18]

I'm looking to put some of my portfolio (maybe 1-5%) into sustainable ETFs. Any recommendations? I'm looking at SUSW.L possibly.

 

[chrisloh65]

I suppose you referring to newjersey?
Not sure whether he is vhnwi but unlikely that is why he also has nothing better to share with you than to tell you to act like dumbos (even if you are smart) and invest according to the dumb approach ST prescribed for her cult members

Just because one person ownself is super idiot and dumb so he/she assume everybody must be idiot and dumb and hence cannot do better than him/her, what do you call such person?

I am also scratching my head reading these from a self proclaimed vvhnwi.
May be as vvhnwi he has better investment choice? Care to share?

buying whole world index is stupid and you don't agree with developed world index ... ok... so that rules out VWRD/VWRA and IWDA as ETF options. Not sure what's left...

well, the reality is... buying a whole world index is pretty stupid.

in fact, i don't agree with buying a developed world index, i mean... seriously, how many of us are busting in funds?

that said, i can understand from ST's angle and i think financial investing should be taken as a backburner type of attitude sort of instrument.

if something prescribed is too wacky, i would voice out in public good.

so far, the only constant is... the little angry bird with a '65 tag.

this is how most people are wrecked...
stick w what ST prescribe.
if only stock pickings is so easy, everyone would be rich to hell and back already.
the reality is most people are idiots, except they don't know it or are in denial.

this is why i am a long-term fan of what ST prescribes.
have you looked into the eyes of idiots who did stock-pickings without understanding what they are buying?

CPA, CFA, CFO, lawyers, doctors, all these dumbos.

THEY ALL DON'T KNOW WHAT THEY ARE DOING, BUT THEIR PRIDE / EGO PREVENTS THEM FROM THE TRUTH.

all true stories as this is from my anecdotal account.

whoever reading, i hope you benefit from my sharing.

don't be a dumbo and try stock-picking.

you are most probably employed and tied down to some good job and having some routine that you mistaken for stability.

it's not necessary to make it into the baller league in life, it's not where happiness lies.

stick to ST's book, it provides slowly but surely.

 

[Shiny Things]

You are absolutely right. It is basically a call option. Only difference is that I can't sell it as an option. I can only choose whether to excise or not.

They are not coupled with stock. I get both RSUs and SARs and they are separated. I mentioned RSU just to demonstrate why I am puzzled by the SAR part.

Oh, right, I get you.

OK. I’d need to have a look at the SAR contract to have a more detailed opinion (which is the sort of thing I actually do charge for), but if the SARs are basically call options, then the right strategy is almost always to wait as long as possible to exercise them. If you need cash, sell the RSUs, leave the SARs intact.

You have a fair point that you don’t want too much exposure to your employer’s stock, but it’s tricky with options or SARs - you often can’t hedge them, so it can be easier to just leave them “in the bottom drawer” and not think about them.

Damn right! What would u recommend anyways?

I would recommend not doing the trade, because you’ve probably missed the boat. People who are faster and better connected than you have already done it.

 

[Shiny Things]

Looks like such fake news has lot of supporters! Ok i will be going 100% into China ETF. I see great opportunity for large profits here.
There was a time when US banks also trading at low prices & people start spreading rumours & i made a bundle!

Hi Streetfighter. I don’t remember seeing you around here before, so welcome! The thing I’d gently warn you about is: don’t try to start fights. I noticed you were getting a bit punchy in your other posts, and there’s no quicker route to getting yellow-carded or banned than starting fights or abusing people.

Now that’s out of the way: I don’t think going long Chinese banks is a great idea, but if you absolutely must, I gave you the trade idea upthread. CHIX US if you’re a US investor or you don’t care about the dividend withholding; an equal-weight portfolio of the banks’ H-shares if you don’t like writing massive checks to the US IRS (and really, who does?).

I'm looking to put some of my portfolio (maybe 1-5%) into sustainable ETFs. Any recommendations? I'm looking at SUSW.L possibly.

The problem with “sustainable” ETFs is that everyone has a different definition of “sustainable”. Do you just want “no oil majors”, “no oil majors and no weapons manufacturers”, or do you want “only Tesla and weed stocks” (they’re green, right?)..., or something else entirely? If you care about having an ESG tilt in your portfolio, you might well have to do it yourself.

 

[brfish]

Oh, right, I get you.

OK. I’d need to have a look at the SAR contract to have a more detailed opinion (which is the sort of thing I actually do charge for), but if the SARs are basically call options, then the right strategy is almost always to wait as long as possible to exercise them. If you need cash, sell the RSUs, leave the SARs intact.

You have a fair point that you don’t want too much exposure to your employer’s stock, but it’s tricky with options or SARs - you often can’t hedge them, so it can be easier to just leave them “in the bottom drawer” and not think about them.

Got it. Since SARs have expiration date just like call options, that means exercise them on the last day if it's above water, and waive if under water. That's a simple strategy. Thanks a lot.

 

[cassowary18]

The problem with “sustainable” ETFs is that everyone has a different definition of “sustainable”. Do you just want “no oil majors”, “no oil majors and no weapons manufacturers”, or do you want “only Tesla and weed stocks” (they’re green, right?)..., or something else entirely? If you care about having an ESG tilt in your portfolio, you might well have to do it yourself.

Thanks for your input. This is more of a "feel good" play that I'm doing with a tiny proportion of my portfolio. Maybe I'll just pick one ETF which has a prospectus that matches what I'm looking for and is relatively liquid.

 

[popol]

Transfer from StanChart to IBKR

Hi Shiny Things et all
I am currently using StanChart Trading Account (IWDA, ES3 and MHB). I have close to SGD 100K in investments and I plan to shift to IBKR.

What is the most cost effective way to transfer my shares over?

Thanks!

 

[software_developer]

Is it still worth to invest in STI

Seem like not performing very well for the past 4 years

 

[crystalnox]

Hi Shiny Things et all
I am currently using StanChart Trading Account (IWDA, ES3 and MHB). I have close to SGD 100K in investments and I plan to shift to IBKR.

What is the most cost effective way to transfer my shares over?

Thanks!

You can directly transfer your SGX stocks to IBKR. That IWDA is the bigger issue, it seems not possible to transfer so you might have to sell and buy back.

 

[streetfighter]

I will go with H-shares, earn management fees myself

Hi Streetfighter. I don’t remember seeing you around here before, so welcome! The thing I’d gently warn you about is: don’t try to start fights. I noticed you were getting a bit punchy in your other posts, and there’s no quicker route to getting yellow-carded or banned than starting fights or abusing people.

Now that’s out of the way: I don’t think going long Chinese banks is a great idea, but if you absolutely must, I gave you the trade idea upthread. CHIX US if you’re a US investor or you don’t care about the dividend withholding; an equal-weight portfolio of the banks’ H-shares if you don’t like writing massive checks to the US IRS (and really, who does?).



The problem with “sustainable” ETFs is that everyone has a different definition of “sustainable”. Do you just want “no oil majors”, “no oil majors and no weapons manufacturers”, or do you want “only Tesla and weed stocks” (they’re green, right?)..., or something else entirely? If you care about having an ESG tilt in your portfolio, you might well have to do it yourself.

 

[streetfighter]

Switching to IB is now IB SG & not as safe as bank?

Hi Shiny Things et all
I am currently using StanChart Trading Account (IWDA, ES3 and MHB). I have close to SGD 100K in investments and I plan to shift to IBKR.

What is the most cost effective way to transfer my shares over?

Thanks!

 

[d5dude]

Is it still worth to invest in STI

Seem like not performing very well for the past 4 years

Last 4 years... its gone nowhere in the last 20+ years, thats 2 "lost decades".

Of course nobody knows if the STI will do better in the future, but do bear in mind that Vanguard (the inventor of index funds) does not recommend overweighting domestic equities by more than 2X of its global weight. STI is <1% of MSCI world, so the recommendation is to allocate no more than 2% into it.

 

[Okenba]

but do bear in mind that Vanguard (the inventor of index funds) does not recommend overweighting domestic equities by more than 2X of its global weight. STI is <1% of MSCI world, so the recommendation is to allocate no more than 2% into it.

Really? Fascinating.
As mentioned, SG global weight is about 0.33%
So 2X that would be 0.7% of portfolio.
Knock yourselves out.