Keep going, there are opportunities in the market


PETALING JAYA: The investment landscape has changed a lot since last year when the FBM KLCI hit a low of 1,207.8 points on March 19 and made a spectacular rebound.

Many investors gained from the swing, but then, the local stock market along with many emerging markets were thrown into reverse gear this year after several lockdowns due to the stubborn daily numbers of the Covid-19 cases that show no signs of dropping.

At the same time, markets such as the US Dow Jones Industrial Average, S&P 500 and Nasdaq are continuously booking fresh records.

Over the past few weeks, the local market has started hearing that the worst is over and that its recovery is on track, thanks to the successful vaccination programme.

Nevertheless, the rise in Covid-19 cases globally due to new variants, expectations of monetary policy tightening by the Federal Reserve and the continuous rise in stock prices on Wall Street have raised speculation that a huge correction is due in the market.

StarBiz spoke to Alex Ng, master trainer and speaker at VI College, on how he weathered the market uncertainties and what sort of opportunities he sees.

Ng is one of the master speakers and trainers in VI College, with more than 10 years of investing experience in local and foreign equity markets.

Today, he leads VI College’s team of trainers and coaches in Singapore and Malaysia, while continuing to empower people with value investing knowledge, be it participants, graduates or the public on the talk show he hosts, Behind The Stock, Let’X Invest and VI Talk series.

Ng was also previously managing a US$20mil (RM83mil) fund as an investment analyst with 8I Holdings Ltd, a company listed on the Australian Stock Exchange.

“In every crisis there are opportunities.

“If you look into the market over the last five to 15 years, there have been plenty of sizeable corrections and even some crashes, but the market always performs and moves upwards in the long-term period.

“This is driven purely because of population growth that drives demand and the economy, inflation and technology advancement that improves efficiency and in return drives businesses and economic growth,” he says.

He suggests that it is very important for investors to first understand their risk tolerance before going into the market.

Ng, 30, also suggests that it is always a good idea to have some dry powder or cash ready to take advantage to buy stocks when the market is correcting.

In value investing, he said that when the market makes a major dip it is a buying opportunity.

“But you need to first identify the stocks.

“It doesn’t matter where you invest, either in Malaysia or in the US, but it is very important to find good companies.

“For me, to find a good stock I will follow three main factors – business model, management and valuation,” Ng says.

Aside from that, he believes that investors should not be swayed by market perception and sentiment because no one can time the market and it is beyond anyone’s control.

“I always tell my students that because we can’t predict or control how the market behaves, our investment position needs to always be in a position where it doesn’t matter if the market goes up or down in the short term.

“It is important to have a long-term period view,” Ng says.

Using Warren Buffett and Ken Fisher as his guides, Ng believes that investing is like a marathon and not a sprint and he prefers to hold good stocks while maintaining some cash position for emergencies and taking advantage of the market weakness.

Despite the continuous rise in many technology stocks globally, Ng is not perturbed as he believes that there is no stopping the technology sector from continuing to grow.

He reckons that technology is no longer a sector on its own.

Every sector in the economy has a technology portion.

For instance, in the banking sector, there is financial technology, in the retail sector there is e-commerce and the automotive sector has a growing electric vehicle segment.

“All these growing technology trends are booming and no one is able to stop them.

“And since no one can stop it, we might as well join and grow our wealth,” he adds.

Ng suggests that new investors get proper guidance and coaching when it comes to investing to avoid wasting their hard-earned money on the wrong investment.

“It’s like learning how to swim for the first time.

“You can learn it by yourself but the chances of drowning are higher, or you can get a coach who will teach you the techniques from the beginning and reduce your risk,” he says, adding that value investing has always been his approach compared to technical charts.

Ng will be speaking at a live webinar on “Smart Strategies for Stock Investing” on Sept 18.

He will be sharing some of his strategies focusing on value investing.

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VI College , Alex Ng , FBM KLCI , equity markets

   

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