market updates 8 oct 2012
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◆ Indices keep climbing
◆ Automobiles sector led the market
“If you are a risk
taker, it’s time to put
your every cent into
the stock market.”
By Joseph Lau
MARKET RECAP
After the holiday, Hong
Kong’s equity market kept climbing due to the steady up-ward trend of the US stock market. The Mainland mar-kets will open on the coming Monday. It is expected that stimulating policies will be re-leased in the coming weeks. Market atmosphere will keep improving.
What now?
Two weeks ago, index con-stituents’ performance im-proved but the situation is now changing. Individual stocks are going to lead the market. Industries like gold mining, communication and automobiles showed a strong move. As market focus is switching to small cap stocks, investors should immediately adopt relevant plans to ride on the wave and maximize their profit.
Our market timing model for both HSI and HSCEI shows an
‘Uptrend’ signal. The trend of individual stocks and the mar-ket is now consistent. The chance of advent of a brand new bull market is reaching to 80%. A smart investors should try his very best to find out the leading sectors and build position on the strongest stocks. If you are a risk taker, it is time to put your every cents into the market since the winning probability and expected return are continu-ously increasing.
HSCEI outperforms Hang Seng Index
Hang Seng Index keeps breaking new highs
4
What is expected return?
Expected return is a measure of the relative balance of win or loss weighted by their chances of occurring. For example, if a fair die is thrown and numbers 1 and 2 win $1, but 3 to 6 lose $0.5, then the expected gain per throw is E(R) = 1/3 × 1 - 2/3 × 0.5 = 0
Borizon
Market Update Issue 7 October 2012
This article is intended for any students with interest in stock market. With 9 years of trading experience, our writer is an investor. He is currently managing 500k of equity.
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Issue 7 October 2012
INDUSTRY COMPARISONS
Currently, the automobile, paper-making and communication sec-tors are leading. The strongest company in the automobile sec-tor is Brilliance China (01114), the manufacturer of BMW in China. Its sales increased unex-pectedly in September 2012. This great news immediately stimu-lated the stock price and led to the uptrend of the sector. Geely Automobiles (00175) surged 20% within a month. Great Wall Motor (02333), the major SUV manufac-turer, even made a historical high.
The paper manufacturer bene-fited from the rise of product price. Lee&Man Paper(02314) and Nine Dragon Paper(02689) rose about 20% within one week. Investors should observe the change of fundamentals. The com-munication industry kept sky-rocketing. COMBA (02342), China Wireless (02369) and TCL Comm. (02618) continued their strong move and surged 15% more these two weeks. Investors should wait for the consolidation and consider to take action in the next break-out.
Brilliance China (01114) led the industry
Great Wall Motor (02333) broke new high
Automobiles— Winners of this week
Strongest 5 industries
1) Automobiles
2) Papermaking
3) Communication
4) Mainland securities
5) Gold mining
Weakest 5 industries 1) Luxury 2) Cosmetic 3) i-phone related 4) Gamble
5) Utilities
Market Update
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