STI Trending in 2020 is dramatic. It was moving to a small peak at the end of Jan 2020 and suddenly it had a double dip in Feb 2020. Let’s take a look at the STI chart for a clearer picture.
Sell off your current stock portfolio During This Downward STI Trending?
I sold off 60% of my entire stock portfolio one week ago. This sell off includes my Ascendas India Trust stock at $1.8 per share.
What happened in 2019 was a year of flat market which tested against the support level of 3100 three times. But this support level was broke due to the market fear of CoronaVirus (Covid-19) spread in Wuhan.
In fact, Covid-19 is currently the hottest global topic which often occupied the headlines of major news media. The short term impact to Singapore economy may be expected to be significant.
In my opinion, the economical impact can be more obvious after Q1 result announcement by the listed companies in Singapore. But I did not wait until then to liquidate some of my stocks with good profits. STI trending may experience another dip by then.
4 Reasons For My Partial Sell Off
- I had my said target profit margin of Ascendas India Trust at 80% met and all the other 5 six stocks were profitable sold off as well.
- I want to accumulate my war chest to better prepared for the next downturn opportunity. Profits earned during this time can be further maximised when i re-enter the market. I intend to buy back my same old stocks again. They are already a proven gem to me. If you had attended our value investing boot camp before, you will know how to build your own shopping list. Get ready to shop.
- The impact of Covid-19 is global and significant. The lock-down of china cities, the halt of large scale factory production and travel bans by other countries are no jokes. If this is true, the global economy including US, Japan and Singapore will not be spared either. Covid-19 has already affected over people from 50 over countries and countries such as Korea and Iran are having spike community outbreaks and deaths.
- STI Trending is changing from a flat market in 2019 to an obvious dip in this month, Feb 2020. I do not think it will bounce back in the short term. There is no immediate cure of Covid-19 yet.
I wrote this article at this time is because I believe STI support level at 3000 is crucial. It may be broken easily in the weeks to come.
Temasek holdings, Singapore government and companies such as Singapore Airlines were taking their lead to have pay cut. On the other hand, the World Health Organization has increased its Covid-19 risk assessment to “very high at a global level”. If these moves are not too obvious to you as a value investor or stock investor, what will that be? To me, hold only the essential defensive stocks and try to keep the coast clear during this turbulence period. Good luck in your investing.
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