Gold price to hit USD2000 in 2020?

2020 is shaping up to be one of the most intriguing leap years in recent memory. We have major political upheaval in Malaysia with Dr Mahathir resigning as Malaysia Prime Minister abruptly. The US Presidential election will have a major influence on the financial market. Coronavirus emerged out of nowhere to wreck havocs in China. In view of these uncertainties, gold price had a good run. But whether this run is sustainable is a big question because the epicentre of the virus is China, the biggest importer of gold in the world.

At the point of writing, there were about 2,700 deaths linked to the virus. The countries significantly affected by the virus outbreak are China, Japan, South Korea and Italy. Against this backdrop, global economic growth for 2020 is widely expected to slow down, fuelling the charge of gold price.

gold price

Traditionally viewed as a safe haven, gold price typically surge in times of crises as investors buy gold to preserve wealth. The coronavirus takes place at a time when US stock market hit a record high. Dow Jones hit a record peak of almost 30,000 points on 12 February 2020. However, on 25 and 26 February 2020, Dow Jones plunged about 1,900 points.

Gold price emerged from nightmare run

It seems that investors are taking some monies off the stock market in view of the unfolding virus outbreak. The US stock market had enjoyed an unprecedented decade of bull run and this correction is timely. After all, what goes up will surely come down. But what surprises investors is that it takes a black swan event like coronavirus to shatter the multi-years bull run. Whether the virus outbreak is a short-term disruption or a global recession in the making is too early to tell. But gold price is increasing …

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OCBC share price to increase three-fold in decade?

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Looking back, OCBC share price had risen more than two-fold since 2009. But a series of unfortunate events had combined to knock the wind out of OCBC share price. Will the coronavirus prolong the suffering of investors? In my frank opinion, whilst there are significant challenges in the short-term, the long-term outlook for OCBC is still good.

As a bank stock, I have always maintained that OCBC share price is volatile even in peace times. So it is important for investors to set an entry and exit price. Previously, I have shared that I entered this counter at $11.00. Obviously with the onset of the virus, OCBC share price had turned bearish. But I am not losing sleep because I am convinced that I am investing in a great piece of business at a reasonable market price.

OCBC share price

On 21 February 2020, the management released a set of excellent results for full year 2019. Net profit rose to a record of $4.87 billion. Net interest income increased 7% to a new high of $6.33 billion while net interest margin (NIM) rose to 1.77%. Return on equity (“ROE”) of 11.4% for FY19 was marginally below 11.5% in FY18. The slight drop in ROE was due to the enlarged share capital base.

To celebrate the stellar result, the management is proposing a final tax-exempt dividend of 28 cents per share, representing a 22% increase from the final dividend of 23 cents a year ago. Indeed, 2019 had been a challenging year which saw the bank hit by the impact of Singapore property cooling measures, Hong Kong riots and US Federal Reserves cutting interest rates three times. Somehow, OCBC share price had remained resilient in 2019 but was a shadow of its former self in 2018.

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Sheng Siong share price hit record high with virus

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Virus? What virus? Sheng Siong share price shrugged off all talks of coronavirus impacts on its stock by staging one of the most powerful rally in years. It certain seems that the sky is the limit for Sheng Siong share price.  The initial onset of the coronavirus saw Singaporeans scrambling and hoarding food items at supermarkets. The mad scramble sent Sheng Siong share price soaring like crazy. As of 20 February 2020, Sheng Siong share price smashed a record high of $1.32.

Given the bullish form of Sheng Siong share price, investors must be smiling to themselves. Since IPO in 2011, Sheng Siong share price had stormed from $0.33 to the current $1.30 level. Investors should be laughing all the way to the bank because of the huge capital appreciation and the consistent dividend pay outs.

Sheng Siong share price on super bull run!

Rampant Sheng Siong share price on magical run

Sheng Siong share price

To be frank, the supreme form of Sheng Siong share price confounded me. Previously, I had some reservations about investing in this counter because it was listed only in 2011 – the post Great Financial Crisis era. Due to this, there is a lack of track record on how Sheng Siong share price will perform during crisis times. But Sheng Siong share price had managed to establish itself as a recession-proof counter after overcoming the challenge of global trader war of 2019 and the virus outbreak in 2020.

Question now is: will Sheng Siong share price continue its positive momentum in 2020? With the massive run up in Sheng Siong share price, has this counter transformed into a growth stock (instead of dividend stock)? Dividend yield has slowed to a low of 2.65% against the backdrop of rising Sheng Siong share price.

Note …

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DBS Group share price in dark chapter with virus

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Is this the beginning of the end for DBS Group share price? On 13 February 2020, DBS Group finally unveiled it’s much anticipated fourth quarter results. Being the largest bank in Singapore, investors look to the bank’s FY2019 performance to gauge the outlook for DBS Group share price in FY2020. Many investors are also concerned whether the coronavirus outbreak will cast a dark shadow on DBS Group share price.

As the saying goes, past performance is not an indicator for the future. This is especially so, given that the latest financial result covers the performance of DBS Group until 31 December 2019 (the first reported case of coronavirus in Singapore was 23 January 2020). So investors will not be able to assess the impact of the coronavirus on DBS Group share price based on the latest financial result.

DBS Group share price

Good financial result for FY2019

In spite of the above, DBS Group recorded yet another stellar financial performance – full year net profit rose 14% to a record $6.39 billion. To celebrate the achievement, DBS Group proposed a final dividend of $0.33 per share. The annualised dividend will be $1.32 per share, representing an increase of 10%. The good news gave investors something to cheer about and lifted up the mood for DBS Group share price, which increased from $25.25 to $25.50.

With a 5-year beta of 1.5, DBS Group share price is one of the most volatile counters in SGX. If investors can stomach the volatility, this blue chip is definitely worth the risk because of its strong business fundamentals. Being a growth stock, DBS Group share price is particularly sensitive to its net interest income. Since 2011, the full year net interest income for DBS Group had consistently grown without fail. This explained why …

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Singtel share price to swim or sink with coronavirus?

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With the onset of the coronavirus, many analysts claim that Singtel share is a defensive play because Singaporeans are likely to stay indoors and use data for communications. To this end, I do not dispute. However, as the saga unfolds, my opinion is that this virus could cause more harm than good for Singtel share price. The latest financial result appears to vindicate my thesis.

The third quarter result is bad. Revenue tanked to $4.3 billion from last year’s $4.6 billion while net profit declined 24% to $627 million. Although the result is disappointing, investors must have heaved a sigh of relief after the horror second quarter in which Singtel recorded its first ever quarterly loss because of the Indian Supreme Court’s hefty fine on its associate (Airtel). Singtel share price had slumped to $3.18 at one point but managed to recover much grounds in recent weeks.

Singtel share price

The reason for the recovery of Singtel share price could be attributed to tariff hike by Airtel effective 1 December 2019. That move signalled the end of bitter mobile telco price war in India. Following that announcement, Singtel share price surged to stunning high of $3.46 on 2 December 2019. But since then, Singtel share price turned bearish and could not shake off the persistent blue. Why is this so?

Perhaps the sentiments for Singtel share price had turned cautious. Despite the provision for the hefty penalty, it is too premature to claim that Airtel had won the price war in India. On the other hand, Singtel is also facing another major legal dispute, albeit in Thailand. The latest update is, “AIS received a favourable award from the Arbitral Tribunal in respect of the demands for additional revenue share from disputes on roaming rates from 2013 to 2015

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Three important money advice from Jesus Christ

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In this article, I will share my insights on three important money advice. The story is written from the perspective of Christianity but I have adapted the story to re-frame it from the angle of wealth building. Note that I am not a Christian and this is definitely not an article meant to spread Christianity. Instead, I believe that readers can benefit very much from this sharing in the course of their financial journey.

In life, we will always receive money advice from well-meaning friends and relatives. Yet, very often, it is only those simple money advice that really withstand the test of time. As a matter of fact, the three money advice contained in this article served me rather well in my financial journey. Thus, I am sharing this article with readers.

money advice

The long journey

Once upon a time, there was a poor young man named David who just got married. The couple lived in a small farm. David wanted a better life for his wife and decided to venture out to find a better job. Before he left, he said to his wife,

“Dear, I will go and find a job that pays well so that both of us can have a better life. I am not sure how long I will be away but all I ask of you is to stay faithful and wait for my return.” The wife promised to do so.

And so, he left. David walked for many days until he met a farmer in need of help. The young man offered his services and was immediately given a job. However, David requested the following,

“Sir, I will work for you as long as possible but when I decided to return home, please do release me. In addition, …

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DBS Group Holdings share price ambushed by coronavirus?

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What a calamity out of nowhere! DBS Group Holdings share price looks set for another bout of volatility with the unfolding coronavirus saga. Investors could be forgiven for punching the wall as this counter had barely emerged from the persistent Hong Kong riots when the coronavirus took the world by storm. Will the upcoming financial result be a cup of hot milo in the winter for investors?

As the bellwether of the economy, the banking sector is very susceptible to economy condition. It is still too early to judge whether this coronavirus will pose a short or long-term challenge for Singapore economy. But one thing for sure is that DBS Group Holdings share price will come under pressure in the coming months because of its significant exposure to the Hong Kong market, which had been roiled by the civil unrests, recession and the coronavirus.

DBS Group Holdings share price

In recent years, Hong Kong had emerged to be an important market for Singapore banks, particularly DBS Group and OCBC. The start of the Hong Kong protests in July 2019 saw DBS Group Holdings share price correcting to $24 by end of August 2019. Since then, DBS Group holdings recovered to rise to $26 in January 2020. Of course, the recovery wasn’t linear but the trend demonstrated the resilience of DBS Group Holdings share price.

The combination of a slow down in both Singapore and Hong Kong economy is indeed a perfect storm for DBS Group Holdings share price. But fortune favours the brave. To make money from the stock market, investors must be able to buy low and sell high. Question now is: what is the bottom for DBS Group Holding share price?

Note that this is an opinion article and not meant to be a financial advice. Please do …

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Keppel DC REIT immune to Wuhan virus

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Crisis? What crisis? Keppel DC REIT share price shrugged off all talks of impending economic meltdown in Singapore to smash a high of $2.33. Since my last coverage in October 2019, Keppel DC REIT had a great run, surging from $2.00 to the current $2.33. Will this counter be another fairy-tale among the SGX stocks?

Amid the sea of red, Keppel DC REIT share price stood out from the rest of the pack and continued to be mightily bullish. In fact, Keppel DC REIT share price increased from $2.11 on 3 January 2020 to the current $2.33. It appears that not even a black swan event like the Wuhan virus can bring down Keppel DC REIT share price.

Keppel DC REIT

The shining Keppel DC REIT share price came on the back of an aggressive expansion of its portfolio assets. In 2019, the additions of Keppel DC Singapore 4 and DC1 increased the REIT’s assets under management to about $2.6 billion, an increase from $2.0 billion as at end-2018. Then in December 2019, Keppel DC REIT announced the acquisition of Kelsterbach Data Centre, which will be the REIT’s second data centre in Germany.

To be frank, the bullish form of Keppel DC REIT share price confounded me. I was expecting the share price to correct in the latter part of 2019 because of the preferential offering. Instead, the share price roared ahead since early 2020.

The current Wuhan virus crisis will be a baptism of fire for Keppel DC REIT share price. If it continued its run, this counter will establish itself as a recession-proof REIT ideal for long-term investments. On the flip side, the surging share price inadvertently depress its distribution yield, which tumbled to a low of 2.87%. As strange as it may sound, the …

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Elite Commercial REIT a value buy or value trap?

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Is it really the right place and right time for Elite Commercial REIT? At a time when the whole world is firmly gripped by fear because of the Wuhan coronavirus, Elite Commercial REIT braved the storm to seek a listing on SGX mainboard. Notably, this IPO came after a slew of S-REIT listings in 2019, which included ARA US Hospitality, Eagle Hospitality Trust and Prime US REIT. Those were primarily US assets but Elite Commercial REIT differentiates itself as the first UK-focused S-REIT.

It seems that the management is determined to make the IPO a success. The public offering constitutes only 5,734,300 units while there is international placement of 108,981,000 units. In addition, 77,827,900 units are allocated to cornerstone investors. Understandably, given the current climate, such tactical allotment is needed to ensure that a successful IPO subscription.

Elite Commercial REIT

The distribution yield is a mouth-watering 7.1% but whether this sort of distribution yield is sustainable is one big question mark given that the forecast is based on merely 15 months of financial results. The private trust investors were “unwilling to provide representations and warranties” for the latest three financial years of Elite Commercial Trust and had sought exemption from SGX.

Will Elite Commercial REIT turn out to be falling knife like Eagle Hospitality Trust or soar into the sky like Parkway Life REIT? In this article, I will weigh the investment merits and major risk factors of Elite Commercial REIT.

Note that this is an opinion article and not meant to be a financial advice. Please do your due diligence or engage financial advisors before investing in the stock market. Furthermore, my investment policy is not to invest in IPOs. So, I will not be participating in the IPO of Elite Commercial REIT. Whether the unit price …

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Wuhan virus offers three opportunities to build wealth

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No winter lasts forever and fortune favours the brave. Could the Wuhan virus be the proverbial Black Swan event that investors can exploit? It is still early days of the outbreak of Wuhan virus but wealth builders must prime themselves to strike when the iron is hot.

Amid the global outbreak of the Wuhan virus, there have been media reports of numerous retailers looking to profit from the coronavirus by increasing prices of facial masks. It is not for me to make moral judgements on whether the actions of these retailers are ethical. After all, many of them are businessmen and not charity bodies. But as an investor, I ask myself how I can make money from this Wuhan virus in a responsible, safe and ethical manner.

Wuhan virusHealth crisis like this Wuhan virus can present opportunities but such crisis only occurs once in a blue moon. Prior to the Wuhan virus, the last flu epidemic that sparked off such global panic was the SARS in 2003. In view of this, wealth builders must be able to spot and seize opportunities when they surfaced. Many investors like to lament that there is a dearth of opportunities in our generation but when opportunities present themselves, investors often don’t dare to take the leap of faith.

A quick and dirty way of making money out of this Wuhan virus is obviously to stock up healthcare supplies (masks and gloves) and then sell them for a handsome profit through online platforms. But generally speaking, I don’t advocate readers to do so as it is rather socially irresponsible in my own opinion.

On the other hand, there are healthcare service providers looking to ramp up their screening services for Wuhan virus by offering lucrative monetary rewards for part-timers. For those …

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