Selamat Hari Merdeka!

September Prediction of Pump Oil Price (Ron 95)

**It is easier to predict the direction of fuel price than to estimate amount of swing of fuel price due to the government REFUSING to disclose the compute mechanism.**


This is the third time I'm posting my prediction. Please bare that I will repeat some lines for new readers :) Also I always care to post my predictions before any official news or other analysts have given their views (typically too late after the queue starts at the stations).

Why is this sort of important? Say every month you know ahead of official price announcement and let's assume there is a price swing on average of 10 sen per month and you can fill in 35 litres. 0.10 x 35 x 12 = RM 42 savings a year. Obviously you don't feel it's a lot but every year you will always call and beg for credit card waiver of RM50 on govt service charge? Ironic isn't it? :)

Sep 2015
Global oil price has a huge volatility over the month of August from China's rout to other events in oil producing countries. In August, oil declined the sharpest (~20%) decline in one month before recovering sharply in recent days. Oil futures have gained the most in about 6 years since post financial crisis. If this trend continues, October is going to be a cruel month for us if the MYR stays where it is now.

As expected we continue to see MYR weakening against USD with BNM trying to smooth the decline by selling some foreign reserves. From a low of 3.80 -> 4.19 (peaked at around 4.25), that's a 10% decline in just one month - the sharpest increase in a decade. Should the US Fed hike the interest rate in Sept by 0.25%, it will have some impact on our currency (small but not likely a big rout).

On the home front, we have a peaceful but necessary "BERSIH 4.0" over 34 hours. Super Moron isn't going to resign because he will go to prison if he does, anyway he has a My Second Home Programme in Kazakhstan. Neither of these will impact oil pump price. However it is also our Merdeka Day (31st Aug) - a sentimental and patriotic event for all Malaysians.

"Tough call" but I predict fuel prices to be kept at current pump rice (RM2.05 for RON95). I also maintain a small possibility that a small 5 sen cut is possible. Refrain from pumping petrol until 1st September, either way you don't lose anything. I cannot fathom that the price will go up, it is too "keji" for a Merdeka Day announcement, he is sentimentally dumb if he increases it.

Below are my previous predictions (thru emails, whatsapps, blog posts and word-of-mouth so I might have missed people out therefore decided to put it in blog is the best). **It is easier to predict the direction of fuel price than to estimate amount of swing of fuel price due to the government REFUSING to disclose the compute mechanism.** My predictions are based on WTI crude oil price, performance of Ringgit (added after Mar) & politics conditions (which was added after May). My total savings to date: RM 36.75 (not very far off RM 42 and we are already halfway thru 2015)

Aug 2015
Oil is now heading to a new normal of $50 per barrel (down ~15%). No changes to my expectation of a continuation of a weaker MYR. I predict fuel prices to fall back 15/10 sen (RM2.00/RM2.05 for RON95). Worst case they will maintain it or give only a small 5 sen cut.
Ron 95 RM 2.15 (Jul) -> RM2.05 (Aug) (prediction set, saved RM 3.50)

Jul 2015
WTI crude oil future still very near $60, however the performance of the Myr has been abysmal. It continues to weaken from 3.65 to almost 3.80. I expect prices to maintain (RM2.05 for RON95). No harm to pump though, if there is a remote chance of increase it would be 5 sen. It is extremely unlikely to go down.
Ron 95 RM 2.05 (Jun) -> RM2.15 (Jul) (prediction set, saved RM 3.50)

Jun 2015
Oil per barrel still hovering near $60 and likely to be within this range. Myr has weaken again, now 3.67 and expected to weaken even more. Honeymoon is over. Like the u-turn on prepaid card GST fiasco, petrol will go up 20 sen.
Ron 95 RM 1.95 (May) -> RM2.05 (Jun) (prediction set, saved RM 3.50)

May 2015
Aboi's fuel price est for May. More likely than not likely to go up 10 sen on 1st May. Due to oil futures hovering slightly above $60 (up 10%) while Myr only strengthen by 3% against the US dollar.
Ron 95 RM1.95 (Apr) -> RM1.95 (May) (prediction off, should have factored in the two 'buy' elections)

Apr 2015
50/50 chance for price to remain or go slightly lower (5 sen/10 sen). It is highly not likely to go up.
WTI futures hovering at $50-55 instead of $60.
Offset by weaker ringgit RM3.70 instead of RM3.60.
Saudi declared war on Yemen but expected not to cause any break in oil production levels as of now.
Hence the bet best is to wait until April 1 to fill up
Unlike 28th no need to beratur...
Ron 95 RM1.95 (Mar) -> RM 1.95 (Apr) (prediction set)

Mar 2015
Time for my monthly update again. I expect fuel price to go up by 5 sen/10 sen in March.
This is because WTI oil futures is around $55-60 as compared to a month ago when it was $48.
Not likely to maintain prices unless gohmen wanna give you ang pow.
Don’t wait till 28th, later need to 'beratur'..
Ron 95 RM1.70 (Feb) -> RM1.95 (Mar) (prediction set, saved RM 5.25)

Feb 2015
I lost the original message. Continue to expect a decrease in pump oil price as per barrel dropped to $45. This is when America shale oil pumped record amount of oil and the Sheikh's continue to fight for market share at the expense of market price. If not mistaken I predicted a 10 sen drop.
Ron 95 RM1.91(Jan) -> RM 1.70 (Mar) (prediction set, saved RM 7.35)

Jan 2015
I lost the original message. Expected a decrease in pump oil price due to oil dropping below $55 per barrel. If I remembered correctly I estimated a 20 sen drop.
Ron 95 RM2.26 (Dec) -> RM1.91 (Jan) (prediction set, saved RM 12.25)

Dec 2014
Oil sinks after OPEC decides to hold onto production targets. Maybe some countries will go rogue (decide not to hold but decrease barrel production).
Oil 68.71-4.926.68%
Ron 95 @ rm 2.30 is based on $85 per barrel. So we should see it priced lower than RM 2.30 by December. Maybe rm 2.15 or rm 2.20? #tanyanajib.
Ron 95 RM2.30 (Dec) -> RM2.26 (Jan) (prediction set, saved RM 1.40)

**It is easier to predict the direction of fuel price than to estimate amount of swing of fuel price due to the government REFUSING to disclose the compute mechanism.**

Padini Holdings Bhd - First Look

Padini Holdings Berhad is an investment holding company. The Company's subsidiaries are dealers of ladies' shoes and accessories, dealers of garments and ancillary products, dealers of children's garments, maternity wear and accessories, provision of management services and dealers of garments, ladies' shoes and ancillary products. The Company principally operates in Malaysia. The Company's subsidiaries include Vincci Ladies' Specialties Centre Sdn. Bhd., Padini Corporation Sdn. Bhd., Seed Corporation Sdn. Bhd., Yee Fong Hung (Malaysia) Sendirian Berhad, Mikihouse Children's Wear Sdn. Bhd., Padini Dot Com Sdn. Bhd., Padini International Limited, Vincci Holdings Sdn. Bhd. and The New World Garment Manufacturers Sdn. Bhd.

Stock Rating: OUTPERFORM

Price: RM1.32

Target price: RM1.50  

based on 2016 PE of 12.5

Long Term Outperform (5-year period)

Short Term Bearish (3-month period)

Risk Level: Medium-High

**Outperform: Expect to do better than market return; has upside/cheap vs target price. Usually a buy call.
**Market perform: Expect to be on neutral, can be + - 3% to 5% either way; Usually a hold call.
**Underperform:  Expect to do worse than market return; has downside/expensive vs target price. If fundamentals change a sell call.

Due to time constraints I will only perform high level analysis (takes me 45 mins). However I will use (based on my experience) well known and thoroughly research from others, call it leverage. I will quote these sources when it arises.
Core Fundamentals

Profitability: Growing EPS and DPS but met expected headwind (GST) in 2014.
Since 2012 facing intense competition by H&M and Uniqlo. Compounded by implementation of GST in 2014 and higher capital cost from opening 6 Padini Concept Store & 6 Brands Outlet (to open in 2016).
Leverage: Coverage of debt is healthy. DE ratio of not more than 0.5.
*PADINI (vs Bonia, AsiaBrands, Voir, TGL, Kamdar) is the least leveraged company. *Retained Cash Flow to Debt – 386.2%.
Returns on Equity(ROE): Not less than 10% averaged over time.
*PADINI (vs Bonia, AsiaBrands, Voir, TGL, Kamdar) is the champion in generating profits with the highest efficiency.

*In depth Fundamental Analysis I highly recommend LC Chong's post :
PADINI – Fundamental Analysis (21 Aug 2015)
Also worth mentioning is Kenanga Research : 
RESULT NOTES - PADINI HOLDINGS BERHAD - 19 AUGUST 2015

Opportunity Seeking

Effects of the GST (1/4/15) - weaken consumer sentiments*. (adjustment period of GST is usually one year based on other countries) presents an excellent opportunity to accumulate. The current share price has breached below FY 2016 PE12.5 target price of RM 1.50. 

In valuation terms, it look quite attractive. Also the dividend yield of 7.5% at current price is a steal (which what attracted me in the first place) and would help offset further small dips in the price over the short term. Recent rout in KLSE has not impacted PADINI yet - has the price really bottomed out? Budget 2016 will be tabled in October may hold unexpected surprise. Will monitor PADINI for now and buy slowly later using cost averaging method.

*weak consumer sentiment - no signs of improvement yet

Disclaimer: The reports, analysis and recommendations in this blog are solely my personal views. I do not link to any investment body or company. As such, I will not be responsible of any of your investment decision. Consult your investment adviser or come to your own conclusions before making any investment decision.

Weekly Market Highlights August (3)

Source: Amp Capital (here for full market update) & iCapital biz (subscription required)

The global share market correction continued over the last week as worries intensified regarding emerging countries, their currency rout and the impact on global growth along with the ongoing fall in commodity prices. 

For the past week, US shares fell 5.8%, Eurozone shares lost 6.7%, Japanese shares fell 5.3%, Australian shares fell 2.7%, and Chinese shares lost 11.5%. Reflecting investor nervousness, oil and metal prices remained under pressure and bonds benefited from safe-haven demand. Emerging market currencies fell further and weak Chinese economic data put renewed pressure on the emerging market currencies.

From their highs earlier this year, US shares have now lost 7.5%, Japanese shares are down 7%, Australian shares are down 13%, Eurozone shares are down 14%, Asian shares have lost 20% and Chinese shares are down 32%.

United States
US economic data was consistent with okay, but hardly booming growth. Housing starts and existing home sales all rose. Markit PMI and biz survey indicate overall growth not that strong. CPI in July weaker than expected.

The US Federal Reserve backing away from a September hike. Downside risks to inflation have increased with further falls in commodity price, still-weak wages growth and China's and EMs increasing risks. Probability less than 40% of a Sept hike if EM related turmoil intensifies.

US economic data releases over the week ahead are expected to be positive. Expect further gains in home price, bounce back in new homes sales and pending home sales. Strong reading for Aug consumer confidence, upwards revision to June quarter gross domestic product growth to around 3% annualised with inflation remaining low at 1.3% year-on-year.

Eurozone
Eurozone biz conditions PMI impressed in Aug, better than expected (strong 54.1 reading): 4-year high and points to improved growth in Q3'2015.

Greece’s third bailout program now in place, the PM has called for new elections likely for 20 September to purge non-supporters of the bailout. So expect some more noise regarding Greece, but it’s unlikely to be a major threat.

Asia

Chinese economic data was contradictory, putting doubts whether the figures released by the government can be fully trusted. While property prices rose again in July and the MNI business sentiment survey rose strongly in August, the closely watched Caixin manufacturing purchasing managers’ index fell to its lowest since March 2009. The latter likely reflects the difficult conditions in small and medium businesses and the need for further monetary easing. 

Japanese June quarter gross domestic product contracted but growth is likely to return in the current quarter. A further improvement in the August manufacturing conditions purchasing managers’ index to 51.9 also points up.

In short manufacturing activity in America, Europe and even Japan is strong while China is struggling. No harm to reiterate again, avoid China at all cost. The Chinese Dream is quickly becoming a Chinese nightmare. 

"My comments:

Though slightly and not elaborate, I have mentioned not once but many times about China's overheated playground. If you took note, it's more or less a warning to sell and get the hell out when you still can. Investors' confidence in China will be shaken again. "

China shares wipe out 2015 gains as stocks tumble 8.5% once again. 

Share markets are likely to see a further correction in the next few months. We are still in a seasonally weak period of the year for shares, uncertainties regarding China and the emerging world are likely to intensify in the short term, posing risks for global growth and the US share market has only really just joined in the correction. Barring any major event, I think for now this is just a correction. Hold your horses.

Closer to home, same old story. I've been talking it over the last two weeks:
Aug 22: Alarming Figures of Malaysia's Debt Problem
Aug 16: Stuck in the Middle of Nowhere

Aug 8: Weekly Market Highlights August (1) - Special Malaysia Highlights
Aug 5: The Risk of Holding Ringgit is Skyrocketing, WTB Donations
July 26: Sunday Lite: Flip Flop In Malaysia's Property Market

Aug 8 post has a section on What You Can Do with your MYR. I'm inclined to say that our financial woes will continue until we get more clarity on our 2016 Budget coming October. That's still two grueling months ahead and likely not that any good news will come out. I also heard some rumors about GST but I cannot share - later kena charge for false information :)

Lanun Bugis - Pirates of the Carry-BN

Alarming Figures of Malaysia's Debt Problem

Following up on my previous post: Stuck in the Middle of Nowhere

Malaysia's economy has devolved into a classic credit and asset bubble-driven growth story. Ever wondered why house prices remained strong even during the Financial Crisis and the KLCI rebounded rather quickly following the aftermath.

The emerging markets bubble began in 2009 after China pursued an aggressive credit-driven infrastructure-based growth strategy to bolster their economy during the global financial crisis. Construction activity flourished. Drove a global raw materials boom benefited commodities exporting countries such as Australia and emerging markets. EMs began to attract the attention of global investors who were seeking to diversify away from Western nations that were at the epicenter of the financial crisis.

Rock-bottom interest rates in the U.S., Europe, and Japan, combined with the Federal Reserve’s multi-trillion dollar quantitative easing programs encouraged a $4 trillion torrent of speculative “hot money” to flow into emerging market investments over the past four years. 

A global carry trade arose in which investors borrowed at low interest rates from the U.S. and Japan, invested the funds in high-yielding emerging market assets, and pocketed the interest rate differential or “spread.” Soaring demand for EM assets led to a bond bubble and ultra-low borrowing costs, which resulted in government-driven infrastructure booms, alarmingly fast credit growth, and property bubbles in numerous developing nations.

Foreign holdings of ringgit-denominated bonds hit an all time high

While it is true that Malaysia’s $303 billion economy has been growing at an average 6 percent rate in recent years. But it is also due in large part to a growing government and household credit bubble.

Skyrocketed debt after an aggressive stimulus package was launched to bolster the country’s economy during the Global Financial Crisis

Malaysia’s government has been running a budget deficit since 1999

No surprise to see an inflating household debt bubble when Malaysia’s bank lending rate is at record lows

Ultra-low interest rates have caused Malaysia’s private sector loans to increase dramatically since 2008 (it looks exponential and no longer linear)

Malaysia’s household credit bubble is helping to fuel a consumer spending boom. Malaysian car registrations are up by 50 percent since 2008. With interest rates @ rock bottom (< 4%) how expensive can it be to borrow?

Malaysian corporate leverage, which includes corporate bonds and bank loans, is also rising at an alarming rate, reaching 95.8 percent of GDP in 2013 from 79.9 percent in 2007. (based from Forbes analysis). Like most other countries that are part of the emerging markets bubble, Malaysia has a property bubble in addition to its credit bubble. See the parabolic rise of overall Malaysian property prices.

Source: Global Property Guide, the real bubble began in 2009.

Accounting for nearly half of all household debt, soaring mortgage loan growth is a primary reason why Malaysia’s household debt is increasing at such a rapid rate. With the recent turbulence; lower Ringgit, lower Stock Market, lower Palm Oil, lower Oil, more gloom looks more probable, there is simply no catalyst to turn the negative perception around. I would say we are still considered lucky as one remaining factor: unemployed % remains low. People are still surviving it seems (note I did not say 'flourishing').

The way I see it at the moment, three factors that could POP us. 
[1] People start to losing jobs (retrenchment, companies moving out or stop hiring), we would begin to lose the economy, just like 1999 companies and people simply can't service any loans.
[2] When China’s economic bubble pops and/or as [3] global and local interest rates continue to rise, which are what caused the country’s credit and asset bubble in the first place.

Berhati-hati la....

Stuck in the Middle of Nowhere

Based on the original post from The Economist : 
http://www.economist.com/news/leaders/21660979-emerging-markets-are-being-squeezed-americas-recovery-and-chinas-slowdown-stuck-middle

My comments in blue.

• Emerging markets (EM) squeezed by America’s recovery & China’s slowdown. Malaysia is considered an emerging market.
• Unexpected devaluation of the yuan this week fueled fears about China’s economy, caused falls in commodities & EM currencies.
• America is the world’s biggest economy. Sets the tone for interest rates & currencies globally. 
• China has been the fastest-growing big economy by a distance.
• America’s recovery is gradually gathering pace, while China’s economy is slowing sharply. 
• Divergence causing trouble in EM which have lived the high life on China’s investment boom and on a flood of cheap credit from America. Malaysia is such a market.
• Healthy growth in the world’s largest economy is good news. However brings us closer to; possibly Sept - US Fed raises interest rates for the first time in almost a decade. 
• That prospect has pushed up the dollar; risen by 15% against trading partners past 2 years.
• Squeezed emerging markets in two ways. [1] capital is drawn towards higher-yielding American assets, rather than home [2] corporate borrowers in the developing world face currency risk on the $1.3 trillion of dollar-denominated bonds they have issued since 2010. 
• Figures this week showed an 8% fall in Chinese exports in July and a 5.4% drop in factory-gate prices. Output prices have fallen for 41 straight months, overcapacity in much of China’s heavy industry. 
• The impact of China’s slowdown is greatest for commodity producers (Brazil, South Africa, not so much for Malaysia). 
• Fears that this week’s devaluation presages a determined effort to drive down the value of the yuan to benefit Chinese exporters—and squeeze other emerging markets all the more.
• The yuan’s fall this week prompted declines in other Asian currencies against the greenback.
• GDP growth in Singapore, a bellwether of the world economy, has slowed to below 2%, the lowest rate for three years. 
• The lodestars of the global economy are moving apart, spelling more trouble ahead.

My thoughts : Am I worried? To a certain extent yes because apart from the super moron many of these external factors are out of our control. Furthermore we have severely incompetent folks running our country on auto pilot. No two crisis are identical. In 1998 it was really a currency crisis. Right now as I see it - we are in a confidence crisis as of now (Weekly Market Highlights August (1) - Special Malaysia Highlights). 

BNM continues to intervene day by day - though it is impossible for me to know how much it is. BNM will only publish the figures every end of he month. Whether they will run out of bullet in the reserve is still too early to tell. 

Technical Analysis - Defending the MYR

Back in 1998 - The Malaysian stock market dropped dramatically from almost 1,300 in February 1997 to a low of 262 in early September 1998, eighteen months later. The interest rate was raised to double-digit at 11% in an attempt to stop foreign funds outflow. It didn’t work and the stock and property market bubbles burst - hence the peg.

The "genius" Wahid (Minister in PMO) also justified that in 1997, the country’s reserve was below US$30 billion and borrowings among companies were high. True, Malaysia’s reserve is higher today but its depleting fast to US$96.7 billion as of July 31 from US$100.5 billion just 15-days earlier. And the central bank has burnt US$25 billion defending the ringgit since July 2014.

True, the borrowings among companies today are not as high as those during the 1997 crisis. But he conveniently forgets to mention about Malaysia’s household debt. The ratio of household debt to gross domestic product (GDP) rose to 87.9% in 2014, with total debt at “RM940.4 billion”. Most importantly, the ratio of household debt to income is 146%. Did he also deliberately miss out the government external debt, which has tripled to RM740 billion?

Note: Household debt to GDP 16% -> 87.9%, 

Now, do you know why Madam Zeti wasn’t in favour of raising interest rate, even though the ringgit is being slaughtered? Not only would it be an admission that the country is in trouble, but it would immediately send the country into recession. Why? That’s because a raise in interest rate would burst the RM940.4 billion household debt bubble, baby. The confidence crisis could very well become a classic credit bubble crisis.

 

Datuk Paul Selva Raj, CEO of the Federation of Malaysian Consumers Associations (FOMCA), said 47 percent of young Malaysians are currently in “serious debt” (debt payments amount to 30 percent or more of their gross income), something that could catch up with them very quickly. Ni bukan saya cakap kosong kie...Till debt do you part

But for how long can Najib administration resists a rate hike, considering the U.S. Federal Reserve is about to do so next month? The collapse in stock market is only the first step towards a recession. This time, you don’t need George Soros to send ringgit into toilet bowl. External (America and China) and internal factors (Super Moron & his gang of nincompoops) would gladly do the favor. 2017?

Aboi's Portfolio Review For August 2015

Highlights
- Portfolio's increased in value slightly. Fears of Grexit have abated (hence my Aberdeen's fund returns doubled), meanwhile in the home front we continue to get battered on several fronts (currency, growth and the stock market). It is a crisis of confidence (see my previous post).
- Continue to maintain all ratings, similar to June and July'2015. Aboi's Portfolio Review For June 2015.
- No new additions in July, Fed interest rate hike in Sept is still a possibility.
- Postpone my integration of US holdings (I didn't have the time).

Portfolio target composition. Equities 65%, Bonds 25% and Supplementary 10%.

Targets for returns p.a. Equities 12%, Bonds 5% and Supplementary 3.5%.

Notes

- SUPERMAX CORP BERHAD, 0.03 (MYR), CASH DIVIDEND, JUN-22-2015
- GENTING BERHAD, 0.03 (MYR), CASH DIVIDEND, JUN-26-2015
- FREIGHT MNGEMENT HLDG BHD, 0.015 (MYR), CASH DIVIDEND, JUN-26-2015
- AFFIN HWANG SIF, 0.005 (MYR / UNITS), UNIT REINVESTMENT, JUN-09-2015

Comments
- Portfolio target for the 5th year @ RM156k for April 2015: Still slightly OFF. 
- Portfolio target for the 6th year @ RM171k for April 2016.
- The TWRR (time weighted annual return rate = 7.95% 
- TWRR up by 0.07% from July'15 vs portfolio target = 9.40%).

Supermax (Equity Malaysia)
- Maintain HOLD. Uncertainty in local stock market.
- Lowered fair value (RM2.07) - following BursaMKPLC consensus target price. No new developments - stronger USD will help due to exports. See below for previous month June'2015 update.

- Stock crippled due to fire at its Alor Gajah plant but has since recovered.

- Growth in capacity from two new plants in Meru, Klang which will double nitrile gloves production from 6.9b to 12.3b pieces p.a.

- Still has attractive valuations vs peers e.g. PER & Div Yield.

Genting (Equity Malaysia)

- Maintain HOLD. Uncertainty in local stock market.
- Maintain fair value (RM10.69). No new developments. Stock took more beating and is further undervalued, no reason to sell as fundamentals have not changed. See below for June'2015 update.

- However most of its current investments will only come to fruition in 2H15/2016 so there is no short term catalyst to prop up share price.

Freight (Equity Malaysia)

- Maintain HOLD. Uncertainty in local stock market.

- Maintain fair value (RM1.65). No new developments. See below for previous month June'2015 update.

- Stock took a beating due to cessation of a 3PL contract and temporary closure of a warehouse for renovation but expected to slowly recover.

- Growth will be supported by its core Sea Freight division and trade within Asia-Australia region.

ICapital (Closed-End Fund Equity Malaysia)
- Maintain BUY.
- Huge discount from current price to NAV (21.05%)

Affin Hwang Select Income Fund (Equity & Bond - Asia)

- Maintain BUY.
- Asia Pacific's healthy credit market more or less can offset stronger USD in the coming months. See below for previous month June'2015 update.
-Strong USD will make headwinds for Asia markets as such fund pare down exposure in equities (30% -> 20%). 
- Also doubled cash levels to 7% and continue exposure on Asian credit market pending US Fed's direction in the 2H15 (possible hike in Sept / Dec).   

Kenanga Growth Fund (Equity Malaysia)

- Maintain HOLD. Uncertainty in local stock market.
- Because fund held so much cash, impact from recent KLCI selloff activity is not too worrisome yet as year-to-date return is still in positive territory.

- Lack of catalyst in the short term, fund holding high level of cash ~20-25%.

FUND PERFORMANCE (BID TO BID CUMULATIVE RETURNS)

Period 1 wk 1 mth 3 mth 6 mth YTD 1 yr 2 yr 3 yr 5 yr 10 yr Bid to Bid Returns (%) - RM -4.3 -2.4 -3.0 2.6 10.87 2.4 32.1 56.7 135.6 365.8 Performance figures are absolute returns based on the price of the fund as at August 11, 2015 (Last updated on August 13, 2015),on NAV-to-NAV basis,with dividends being 'reinvested' on the dividend date.

AmDynamic Bond Fund (Bond Malaysia)
- Maintain BUY.
- No change in my previous commentary. BNM has maintained the base lending rate in the 4th MPC meeting as expected.

- Mainly invested in local corporate bonds ~80%.

- BNM will likely continue its policy pause and maintain cautious stance with a "wait-and-see" approach on US Fed direction (a possible hike in Sept / Dec).

FUND PERFORMANCE (BID TO BID CUMULATIVE RETURNS)

Period 1 wk 1 mth 3 mth 6 mth YTD 1 yr 2 yr 3 yr 5 yr 10 yr Bid to Bid Returns (%) - RM 0.1 0.6 2.2 3.4 4.2 6.7 7.6 12.8 35.1 116.9 Performance figures are absolute returns based on the price of the fund as at August 11, 2015 (Last updated on August 13, 2015),on NAV-to-NAV basis,with dividends being 'reinvested' on the dividend date.

Aberdeen Islamic World Equity Fund (Equity Global)

- Maintain BUY.
- European markets recovered and with fund's medium exposure in Europe, fund has done well. Also it has USD exposure further strengthening its returns since the MYR has weaken considerably in July.
- Fund has no exposure to China's overheated stock market and slowing economy. Fund also has 18% exposure to the already lofty valuations in US equities so impact is minimized if a correction occurs.
- Fund continues to be very diversified globally; Healthcare (21%), Materials (16%), Energy (15%), Industrial (13%), Consumer Staples (13%).

FUND PERFORMANCE (BID TO BID CUMULATIVE RETURNS)

Period 1 wk 1 mth 3 mth 6 mth YTD 1 yr 2 yr 3 yr 5 yr 10 yr Bid to Bid Returns (%) - RM 2.7 3.2 2.5 5.0 9.59 13.3 28.3 - - - Performance figures are absolute returns based on the price of the fund as at August 10, 2015 (Last updated on August 13, 2015),on NAV-to-NAV basis,with dividends being 'reinvested' on the dividend date.

CIMB Principal PRS Asia Pacific Ex Japan Equity Fund (Equity Asia)

- Maintain BUY.
- Shanghai's stock market continue to weight down to date but fund's exposure is minimal so I'm safe. With Grexit off the table, fund has started to recover.
- Fund holding exposure to China's overheated stock market is minimal ~10%.
- Positive on Asian Equities but growth will be more scarce moving forward as regional portfolios are fully invested hence earnings will depend highly on stock selection.

FUND PERFORMANCE (BID TO BID CUMULATIVE RETURNS)

Period 1 wk 1 mth 3 mth 6 mth YTD 1 yr 2 yr 3 yr 5 yr 10 yr Bid to Bid Returns (%) - RM 0.9 1.6 -1.4 2.8 8.99 18.0 36.8 - - - Performance figures are absolute returns based on the price of the fund as at August 11, 2015 (Last updated on August 13, 2015),on NAV-to-NAV basis,with dividends being 'reinvested' on the dividend date.

Disclaimer: The reports, analysis and recommendations in this blog are solely my personal views. I do not link to any investment body or company. As such, I will not be responsible of any of your investment decision. Consult your investment adviser or come to your own conclusions before making any investment decision.