Thursday, November 21, 2013

A little summary of the last couple of years

Here is a list of macro predictions that I made two years ago with a five year horizon. I posted them in Sept 2011 but I have told many already early that year, and also stated in my very first class in UST (a HKD 8 million student investment fund class).

n  China will face sharp slow down in growth for years within five years (could drop from 10% to as low as 3%)
n  Related emerging markets and commodity producers will suffer as well.
n  HK’s housing price will drop substantially, but China much more
n  Chinese people may not suffer that much and the world will not end when China slows down
n  Eurozone will not survive in the current form
n  The U.S. will become stronger in relative terms if it can get the political act together

Please see more detailed description here.

Short term timing is harder. But I have been lucky so far in the last two years. Please see the risk on and off timing marked at the titles of my blog entries with the level of Hang Seng (have switched to SP500 as I stated recently in March).

n  April 10, 2011: Predict deflation scare later in the year;
q  Risk Off; HSI = 24K
n  August 4, 2011: Deflation scare is in full force;
q  Risk Off; HSI =  22K
n  October 12, 2011: Bear rally;
q  Risk On; HIS = 18K
n  November 9, 2011: Italian job;
q  Risk Off; HSI = 20K
n  January 2, 2012: The rally is on;
q  Risk On; HSI = 18.5K
n  March 2, 2012: It is time to lighten up risk;
q  Risk Off; HSI = 21.2K
n  June 15, 2012: Like always, if all the central banks are about to take out the big gun, follow the flow of the crowd
q  Risk On, HIS = 19.0K
n  September 15, 2012: The first milestones in turning the tide around; still underappreciated by markets
q  Risk Keeps On, HSI = 20.8K
n  February 22, 2013: Hold on to your stocks
q  Risk Keeps On, HSI = 22.8K
n  May 29, 2013: This rally has legs
q  Risk Keeps On, S&P500= 1648
      Now S&P500= 1792; I hope you have listened and have not missed boat.