Recently, I attended a talk organised by iFast: Where and What to Invest in 2009. The lineup of speakers include:
- Aberdeen Asset Management Asia Limited – Asian Equities: Looking Beyond Uncertainty
- DBS Asset Management – Global Bonds: Lessons from 2008; Opportunities in 2009
- Deutsche Asset Management (Asia) – Small/Mid Cap Value Investing in Asia
- Henderson Global Investors (Singapore) Limited – 2009 Property Outlook: Asia vs Global
- UOB Asset Management – Global Equity Market Update – Searching for Diamonds in Rough Times
- iFAST Research Team – Positioning Your Portfolio For 2009
I won’t be elaborating on the things covered by each individual speaker. Rather, I will list out some of the points that they mentioned. No prizes for guessing who said what.
- In terms of global equity, to overweight the food, tobacco, telecomms, utilities and healthcare industries.
- To underweight cyclicals like energy, materials (except gold and fertilizers). consumer discretionary (eg autos), and industrials.
- Identify opportunities in emerging markets like Brazil and India.
- Asian markets are trading at attractive valuations.
- The beta of Asian small caps is higher than large caps. Therefore, when the market recovers, the small caps will also give a higher return.
- Historical price-to-book of Asian small caps is from 1-3. Now, they are at about 1.3. PE is around 7.
- An example of an undervalued stock is Chen Hsong (HK), which has a PE of 2.8 and price-to-book of 0.38.
- As share prices get hit due to the bad economy, there will come a turning point (as prices drop) where valuations become good.
- There is a 7-8% yield on global property stocks.
- Investing in property shares is more liquid than investing in property. They will also recover before the physical real estate recovers.
- S-Reits are providing an average yield of 11%. This is 9% higher than the long term government bond rate of 2%. It is also a big gap as historically, the yields were only like 3-6%.
- In terms of portfolio asset allocation, to overweight equities.
Generally, all the speakers were (cautiously) optimistic about the sectors in which their funds were operating. 🙂