Bursa FB30ETF Beating market ?

First at all , i want to introduced what is FB30ETF


If you don’t know what is an ETF, this is a 3 letter acronym for "Exchange Traded Funds". Basically, these are passively managed funds with minimal expenses, i.e. the manager who manages the fund is not permitted to engage in active trading. Instead, the ETF goal is to simply track the performance of a Benchmark Index, with minimal “tracking error”. This is done by simply buying the Index component shares and holding them until such time when the Component Shares are altered. The Manager then swaps the shares in line with the change in the Index component. That’s pretty much simply investoment decision. WHo partimer want to swap to investment with limited costs involved.

Compare with Tradisional unit trust in Malaysia, Which is paying 5% cost of entry ( latest Epf entry only 3%). There is advantages of using this fund with costs only 0.7 % or even low of rm 12 per entry. Wah amazing , Many market participant fail to win the battle due to commision. Imagine your fund put into market and u lost 5% immediately on holding such fund. These is very much similarily within those fund and return. Compare to those Aggresive fund, This fund only invest in top 30 component stock on Bursa Malaysia. Which is moderate return and risk compare to those agrresive fund. Of course return may be lower but risk will be higher. Remember the costs is lower, you no need to monitor the performance on the stock price daily.

There may be many other choice of derivate market. This may be one of the best choice in current uncertainty market for equity investor.

HEDGE on Comodities using Bursa tools?

Some one comment my posting, said i am persuade people to hedge while i got no such intention to do so!

All go back to Equity again, beside Commodities counter, such IOI, Kinsteel and Oil n gas counter. Wat stock should i hold to mitigate the reverse condition. As i mention early that , Cost Push inflation this time is totally due to high oil and other commodities price. There is no demand push or other factor behind. So Wat?

If the assumption is real. There is possibility interests rates as weapon for hedge the inflation. There is difficulty using strong currency hedge inflation in Malaysia, Overall we are net exporter, Strong currency is not good to our economic, so Wat is next, of course if interests rate hit... Non performing loan , margin all such will reverse from our Banking system or financial control. But

If said oil suddenly drop 20%, the erase of inflation risk and fear on financial stock will removed. Looking at Bursa stocks, I find Bumi Commerce is rather cheap now. Why Bumi-Commerce ?

P/NTA 2.4x
2007 PER: 9x
2008 PER: 9.7x (absorption of Thai bank)
ROE 2007: 20%
ROE 2008: 16%

The Thai bank stake acquisition while a bit pricey at p/nav of 2.9x is still much better than Maybank's recent purchases, and makes more sense. Bank Thai is the 9th largest bank in terms of assets with 147 branches. Post recapitalisation, the purchase price would be 2.3x adjusted NAV. It had some losses in CDOs hence they were open to Bumi-Commerce's entry. The CDO's exposure had been written down already. At least Bumi-Commerce is showing the right culturally correct way to make a regional acquisition, take note Temasek.

There are calling from CLSA , 98% gain from current price Rm 7.40. See there is insurance given. I am thinking buying such stock is something hedging risk of down turn of commodities. Of course there is a risk. At current price, I think risk is minimum.

Of course you can said buying Citigroup , AiA or bank of American all about 30% to 40% value at the peak! There is similarity to buy finance stock as hedging on buying IOI, KNM and so on.. Such stock never been correct since oil keep breaking record.. again USD 200 or 300 coming I don no!! Really Donn.

KLSE 1123 < CHEAP ?>

Political uncertainty and inflation worry make Bursa Malaysia Retreat from year high 1500 to current around 1123, Many punter are away from market since 308 , post election.........

Does current stocks price value cheap or reverse? of course compare to 1500 point.. the entry point now is much lower . the question will be deep down said below 1000 point... wow... another 15% from current price!~~~

In my opinion Inflation is something unavoidable and will continuous impact on our market. High fuel price and commodities always is enemy of equity market. There are many people blame on speculator to make oil surge and the bubble may burst once they left the market ? Does it true?
Well, there are other opinion that is naturally demand increase (china , India....) and constraint on supply (Natural source) . There is a lot of supporter believe in for long term, natural resource like oil... and other commodities will end... since continuous explosion. Does the price support current level near Usd150 per ballet . or Usd 200, 250...... as their predict. Honour's I donno the answer and no body can answer too.
Political uncertainty. I believe this is short term for equity, over the long run..... political risks should be managed by good administration system. Many people will not agreed with this statement. Malaysia administrative system is under develop by British system which well develop and easy administrative. Our problem here is execution and human Bias to make system unworkable. If changing the government will affect our basic/fundamental administrative system. I fully confidence with the risk of political may not hurt our good system build up...
Any unreasonable deep in political link, government link stock is good opportunity to hold in. Of course must be careful to those incompetent company I.e those company only able to gain company contract with unreasonable price! I would not mention which counter are they. Easily you can find info for them in market.

Third and not least, for short term holding on commodities and oil n gas counter is based option to hedged the inflation risk and is current trend. But... if oil drop said 10% ore 20% , certainly there is rebound on equity. By that time who is gainer?? Where inflation risk is erase and... political stable. So think wisely and act correctly before investment.