Baidu share price in blaze of glory

On 24 January 2019, it was reported that Microsoft’s search engine, Bing, was temporary inaccessible. There were market speculations that Bing might have been blocked by China’s Great Firewall, presumably due to the strict Chinese authorities censorship over online content. The latest development came after Google’s exit in 2010 and blockage of other US social media such as Facebook and Twitter. The ban of foreign search engines gave Baidu the golden opportunity to further entrench its market leadership in the China’ search engine space. But will Baidu share price continue to bask in the blaze of glory?

According to data from Analysys, Baidu’ search business represents 71% of China’s internet search market share as of December 2015. With Google exit from China, Baidu had apparently ruled the Chinese search engine market with no worthy competitor in sight. As a result, Baidu share price stormed from USD40 in 2010 to US263 in 2018. That was a mighty six-fold increase of Baidu share price within 8 years.

Baidu share price

However, like many technology stocks, Baidu share price suffered a devastating rout since middle of 2018. Obviously, the unfolding trade war between US and China had rattled Baidu share price. Indeed, for the past six months, Baidu investors cannot sleep well as Baidu share price collapsed from USD263 to USD163. Should investors run for their lives?

Beyond looking at the short-term volatility of Baidu share price, there is a dark side to Baidu’s growth strategy as it embarks on an aggressive Artificial Intelligence (AI) journey. In this article, I will share my insights on my hesitance in investing in this stock.

Baidu set to conquer China search engine market

Most people may think that the reason why Baidu is able to displace Google’s market position in China is due to the government’s intervention. Actually, such …

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CapitaLand share price faces destiny with Temasek Holdings

Since my last article, “CapitaLand share price ready to rocket”, this counter took on a life of its own. For the longest time, CapitaLand was a forgotten stock in SGX but trading volume hit the roof on 15 January 2019 following announcement of the $11 billion acquisition of Ascendas Singbridge from Temasek Holdings. Is this the dawn of a new era for CapitaLand share price?

Post transaction, CapitaLand will become the largest diversified real estate group in Asia, with combined assets under management (AUM) exceeding $116 billion. Given the mind-boggling deal size, one would wonder the impact to CapitaLand share price in the short-term and the implications to the REITs under both entities.

CapitaLand share price

Many analysts and financial bloggers have pointed out that the major impetus for this mega deal is all about scaling to achieve bigger things for CapitaLand. Of course, scaling is important for a real estate company. In recent years, CapitaLand share price had become stagnant and was consistently traded at prices below Net Asset Value (NAV). So it makes sense for a mega merger and acquisition deal to “stimulate” CapitaLand share price and drives returns for shareholders. As Temasek Holdings is the parent company of both entities, it is obvious that the state-linked firm orchestrated this merger.

In this article, I will share my view on why I am not so gung-ho with this acquisition and the key factors that may affect CapitaLand share price in the coming months.

Sluggish CapitaLand share price

In my point of view, the above is not the real motivation for the stunning acquisition. It is likely that Temasek Holdings is setting the stage for the newly minted CEO, Lee Chee Koon, who took over the helm only in September 2018. As CapitaLand is one of the top three marquee …

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Temasek Holdings laughing all the way to the bank despite Tencent share price meltdown

The bloodbath of Tencent share price must have rattled numerous investors. Since early 2018, Tencent share price free fell after the Chinese authorities’ criticism on the addictive effect of mobile games on children. Following that, Tencent started to implement self-imposed limitations on games for minors. In August 2018, it didn’t help that the group announced its first quarter profit drop in 13 years. The slew of bad news created the perfect storm for Tencent share price.

So did the meltdown of Tencent share price injure Temasek Holdings? From a high of HK471 to a low of HK260, Tencent share price suffered a massive correction in 2018, making it one of the worst performing stocks globally.

Temasek Holdings hold a small stake of less than 1% in the Chinese internet firm as at 31 March 2018. While Tencent share price crashed in the past one year, Temasek Holdings  can still laugh all the way to the bank despite the meltdown in Tencent share price. Why is this so? Tencent share price Tencent share price hit the skids

It appears to me that Temasek Holdings invested USD98 million in Tencent since 2015 because the investment shown up in the FY2015 financial report. Assuming that Temasek Holdings entered when Tencent share price was trading at the range HK130 to HK160, the state-linked firm will still be sitting on a paper profit of 100%.

Then again, US98 million is a pretty small sum of money for Temasek Holdings. So the plunge in Tencent share price is unlikely to cause significant dent to its asset portfolio’s value.

Given the spate of corporate governance issues of S-chips listed in Singapore Exchange, Temasek Holdings rarely invest in Chinese firms listed in local stock market. However, in Alibaba Group and Tencent Holdings, Temasek Holdings own stakes in two leading Chinese technology …

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Does inheritance property attract ABSD?

Many people view inheritance property as a windfall. In my point of view, this may not necessary be true. When crafting a will, you have to put in thoughts and make the effort to consider important areas like applicable taxes ABSD (Additional Buyer Stamp Duty) and SSD (Seller Stamp Duty). Otherwise, you may end up causing more harm than good to your beneficiaries.

Recently, a member wrote in to enquire about the applicable taxes on inheritance property. I thought they were very good questions because he had raised concerns on areas that I have never considered before. So, I put forward his questions to Inland Revenue Authority of Singapore (IRAS) for an official reply. This is one of the merits of being SG Wealth Builder member – the opportunity to solicit official responses from government agencies concerning important financial issues.

Inheritance property

The reply from IRAS revealed some dark sides that may lead to potential traps for beneficiaries of an inheritance property. And there are even serious implications if you are not careful about it. Thus, I am sharing this article to raise financial awareness.

Basically everyone can craft his own will without the aid of legal advisors. There are even free digital platforms that allow people to craft their wills. Although this is the case, it is not advisable to do so because most of us are not familiar with the laws in Singapore. In life, there is no such thing as free lunch. Therefore, you should always seek legal advice from qualified lawyers to ensure that your will is made in accordance to the law.

Before proceeding, I need to clarify that I am not a lawyer by training and this article is not meant to be a form of legal advice. I am writing this article to the best …

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Alibaba share price in wonderland with Temasek Holdings

With the onslaught of the unfolding trade war between United States and China, the past six months had been a dark chapter for Alibaba share price. From USD208 in June 2018 to a low of USD132 in December 2018, Alibaba share price had experienced a terrifying loss of form. When will Alibaba share price rise from the ashes or has the bubble really burst for this iconic e-commerce giant?

To put things into perspective, Alibaba share price had increased substantially since the company got listed in 2014. Within a short span of time, Alibaba surged from IPO price of USD68 to a record USD208 in June 2018. But this is not to say that investors had a jolly good ride as the increase of Alibaba share price was nether linear nor exponential. As a matter of fact, Alibaba share price had gone through a period of soft landing, falling to a low of USD59 in 2015. However, the stunning entry of big boys from Singapore changed the dynamic of Alibaba share price forever.

Read my other articles on Alibaba share price: Dark Side of Alibaba Group.

Alibaba share price

Fairytale run of Alibaba share price

Singapore’s Temasek Holdings was an early investor of Alibaba and is currently the 5th largest shareholder. In 2016, both Temasek Holdings and GIC bought USD1 billion worth of Alibaba shares from Japan’ Softbank. The shares were purchased at USD74. The shares acquisition ignited a massive bull run for Alibaba share price, which surged to a record USD208 in June 2018. On looking back, it was a shrewd investment by Temasek Holdings and GIC.

However, Temasek Holdings began to pare down its stakes in Alibaba in 2017. As of 30 September 2018, Temasek Holdings held 28,988,503 Alibaba shares. Incidentally, the paring down of Temasek’s stake coincided with …

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UOB share price flying again

UOB Chairman Emeritus Wee Cho Yaw is certainly larger than life. At the age of 16, I had a brief encounter with him when I received a school award from the banking legend (Mr Wee is an old boy of Chung Cheng High School (Main)). Back then, he was already very well-known, and I was totally overwhelmed by his aura. Indeed, Wee Cho Yaw is synonymous with UOB, the third largest Singapore bank. For the longest time, UOB share price has been running neck-and-neck with DBS share price.

Like DBS and OCBC, UOB share price had a mixed form in 2018. But on the business fronts, it has been a fantastic year for all three banks as earnings surged as a result of interest rate hikes. In this regard, will UOB share price rock or roil the market?

Rally of UOB share price halted

Since October 2016, UOB share price went on a berserk run, surging from $18.40 to reach the incredible height of $30 in May 2018. The dazzling run of UOB share price was certainly intriguing as it occurred at a time when the banking sector was struggling with toxic loans issued to the ailing oil and gas sector. The powerful surge of UOB share price seemed so surreal for investors until the bombshell from the government.

UOB share price

In July 2018, investors feared the worst for UOB share price as the government announced new property cooling measures. Unlike DBS and OCBC, UOB share price is considered a major proxy for property play. This is because in his younger days, Wee Cho Yaw had meticulously built a massive property-cum-banking empire, through UOB, UOL, UIC and Haw Par Corporation.

Unexpectedly, it turned out that Wee Cho Yaw had the last laugh as UOB share price did not collapse as what many …

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OCBC share price at threshold of an era

Being the oldest bank in Singapore, OCBC was born out of the Great Depression through the consolidation of three banks in 1932 – the Chinese Commercial Bank Limited, the Ho Hong Bank Limited and the Oversea-Chinese Bank Limited. Through the decades, OCBC had weathered numerous storms and went on to become one of the largest banks in Southeast Asia. In May 2018, OCBC share price even hit a sensational high of $14. The powerful surge of OCBC share price created much wealth for wealth builders.

Will OCBC share price recapture its magical form again? A lot will depend on the management long-term strategies. Indeed, OCBC has a rich heritage as its founding father is Lee Kong Chian, the son-in-law of Mr Tan Kah Kee. Former Singapore President, Dr Tony Tan, also used to be OCBC Chairman and CEO in the early nineties. The uncle of Tony Tan was the late Tan Chin Tuan, the man responsible for the numerous investments of OCBC such as Fraser & Neave, Raffles Hotel, Robinson, Straits Trading, Wearnes and Great Eastern Life.

OCBC share price

Under Lee Kong Chian’s leadership, OCBC embarked on overseas expansion since 1950s, opening branches in China and Malaysia. The early days’ overseas adventure helped OCBC to become one of the largest listed banks in Southeast Asia by market capitalisation. The strong business foundation and overseas businesses also enabled OCBC to ride out the 1997’s Asian Financial Crisis and 2008’s Great Financial Crisis. As a result, OCBC share price had been rising steadily through the decades.

Thus, investors of OCBC should be confident of the long-term prospects of OCBC share price and not lose sleep over the short-term volatility of OCBC share price. After all, this is an institution that has withstood the test of time.

OCBC share price in soft landing mode

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DBS share price poised for explosive come-back?

For many Singaporean investors, the New Year resolution must be to avoid losses in the stock market at all costs. Indeed, 2018 had been a terrifying year as numerous blue chips got thumped. DBS share price is no exception. Being one of the leading lights of Straits Times Index (STI), DBS endured a challenging year which saw new property cooling measures and global trade tensions roiling DBS share price.

On a brighter note, 2018 had been a milestone year for DBS as the bank celebrated its 50th anniversary. To put the icing on the cake, DBS had a better-than-expected financial results in 2018 as it emerged victorious from a devastating war against toxic loans farmed to the ailing oil and gas industry. On the basis of the 9MFY2018 results, full year net profit is very likely to exceed that of FY2017. Thus there is a strong possibility of DBS share price staging a magnificent come-back in the coming weeks.

DBS share price

DBS share price pulled back

Obviously, many investors would complain that DBS share price dropped like flies from a record high of $31 in April 2018 to the current low of $23.75. But if you look back, DBS share price was traded at $26 mark in January 2018. So on a year-to-date basis, the decline in DBS share price is not that bad. At least not on the scale of a horrifying train-wreck.

Nonetheless, many investors would be scratching their head  as the correction in DBS share price came on the back of a fantastic third quarter financial results, which saw net profit sky-rocketing to $1.4 billion, an increase of a staggering 72% year-on-year.

The plausible explanation for DBS share price volatility is due to two major factors – DBS management’s shares buybacks and short-selling by the big boys. Investors …

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Warren Buffett and Berkshire Hathaway chased the wrong dragon?

From hero to zero. Investment guru Warren Buffett recently saw his wealth eroded by billions of dollars after Apple share price plunged in value.

Widely regarded as the Godfather of Investments, Warren Buffett is revered by numerous global investors for his god-like investment acumen. Being a value investor, Warren Buffett showed the way how to make money from stock market through value investing. In short, he is not afraid of going against the herd when it comes to investing.

However, Warren Buffett’s shock purchase of Apple shares, through Berkshire Hathaway, is considered bizarre because it ran against his contrarian principle. Where is the safety margin and mitigations for downside risks that our guru always preach?

Warren Buffett

Over the years, Warren Buffett had made a number of poor investment judgements that proved costly to Berkshire Hathaway investors. Among the worst mistakes should be funding the acquisition of General Re through issuance of Berkshire Hathaway shares. That was a whopping USD 70 billion misjudgement.

In this regard, it should be noted that Warren Buffett do make major mistakes. Thus, investors should not blindly follow what he invests in. Always remember that as a retail investor, you are not in the same league as the big whales.

Then should investors of Berkshire Hathaway run for their lives or is this a good time to enter this counter? In this article, the investment merits of investing in Berkshire Hathaway stock are discussed, taking into consideration its business portfolios and prospects.

Is Warren Buffett over the hill?

It is well-known that Warren Buffett is a conservative investor who seldom invests in tech stocks. His investment tenet is to invest in something that he can understand well. So it was stunning that Buffett announced Berkshire Hathaway would purchase Apple shares in early 2017. By end of 2017, …

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Apple share price to strike back?

Being one of the tech heavy-weights of Nasdaq, Apple share price had taken a severe beating in recent months after a magnificent run that saw Apple becoming the first USD 1 trillion company in United States. Shortly after that impressive feat, Apple share price lost steam unexpectedly as the stock plunged from a high of USD 230 in October 2018 to USD 145 recently.

Would Apple share price strike back in style or continue to spiral out of control? 2018 turned out to be a revelation for Apple share price as it hit the skid shortly after reaching the epic high in October. The roller coaster ride of Apple share price must be giving investors plenty of sleepless nights.

Man proposes, God disposes

It doesn’t help that Apple got off to a poor start when CEO Tim Cook announced it would lower revenue guidance for Q1FY2019 on the first working day of 2019. Following the shock announcement, Apple share price got roiled.

Apple share price

Among the biggest institutional investors is Warren Buffett, whose Berkshire Hathaway owned 252,478,779 of Apple shares. The roil in Apple share price caused billion of dollars of capital loss for Warren Buffett. Ouch!

Although investors are sweating over the volatility of Apple share price, the management appeared to shrug off the upheavals in the stock market as it continued to launch a slew of new products in 2018 that saw the company breaking new grounds. Three new iPhones were introduced, a new version of iPad Pro was launched, a new MacBook Air and Apple Watch Series were sold by Apple. The relentless rollouts of innovative new products paid off handsomely as Apple recorded its best-ever quarter results in September 2018.

But of course, Man proposes, God disposes. While Apple management can strive to steer the company to …

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