I bought half my position (2.5%) in the Philippines Stock Exchange (PSE). I love stock exchanges - they are simple, inflation-proof businesses. Most are expensive, but PSE is reasonably priced: ex-cash PE around 12 with a 5% yield (before 25% witholding tax for Singapore residents). Its a dirt-poor, growing country and their stock market is cheap and unloved, with some catalysts (paid link). Long term the key metric to tracks is the number of listed companies. In the short/medium term, it depends on the cycle.
Why buy now?
- We are nearer the end of the bear market (started end 2021) than the beginning.
- Hedgeye's trend signalled the Philippines stock index is in bullish trend. And the country has expected increasing yoy gdp growth in the next 2 quarters. This trend might last for months, quarters, or change tomorrow. But since I was intending to buy a some anyway, buy a little now.
Why buy only half?
- I'm expecting a US recession and bear market in 1H24, if this happens, other countries' indexes and stocks will probably follow it. Final leg down.
Long term, the key metric to track is the number of companies listed. The market will go up and down when it wants, but long term, you need to have companies listed for people to invest/trade.
PSE is a *very* illiquid stock, even buying a few thousands dollars worth can set the price. Long term holding, not a trade.
No comments:
Post a Comment