Monthly Archives: July 2014

What can you expect for your investments the second half of the year?

T-Advisor investment opportunities

Tomorrow is the beginning of August, a typical month for holidays. However, investments do not take any rest and markets become more fragile in this month, as there is a decrease in the market volume of operations. While VIX index shows a historical low point in the market volatility, there are some reason to be warned: the crisis in Ucraine and the commercial fight between Europe and Russia, the crisis in Palestine, the end of the QE in US and the chance of an interest rate rise in the middle term or the continuous rumors about a possible turndown in the markets with current peaks.

Experts from different entities agree that the economic recovery is a real fact and the trend will keep on, but investors have to be watchful about the possible developments. Wells Fargo advises an investment strategy taking into account that low volatility does not mean absence of risk. It recommends a diversified portfolio underweighting fixed income and overweighting equities. Fixed income yields are now not interesting, but a tighter monetary policy in the US will push them up.

BlackRock maintains its view as in the beginning of the year. In US, it expects more volatility linked to the Federal Reserve policy evolution. In Europe, the trend is also linked to the ECB, but with other gear: the fight against deflation. Cyclicals, energy and large cap values are some bets. In Asia, the fund manager is bullish with Japan and cautious with China, as it considers that the growth is not sustainable.

The Swiss Julius Baer predicts for the next half a continuation of many of the trends. The general relaxing monetary policy in almost all central banks, a controlled inflation and a moderate economic growth are the basis of the scenario. The bank focuses in two points: European peripheral debt is not interesting anymore, because the risk premiums are low and reached the convergence point; and the company balance sheets in the non-financial sector, as they expanded significantly in the last years and that is a strong argument to invest again in equities instead of corporate debt.

Generally speaking, there are risks as mentioned above, but the outlook is positive mainly for equities in the second half of the year.

Market opportunities by T-Advisor: Kotak Mahindra

T-Advisor, through its tool Market Opportunities, has detected the company Kotak Mahindra, listed in Bombay Stock Exchange, as an opportunity for investment.

These are the main figures about performances and volatility in the last years:

Kotak Mahindra main data in T-Advisor

The technical analysis reveals also more data:

Kotak Mahindra technical analysis in T-Advisor

The chart shows the evolution i the last year:

Kotak Mahindra chart in T-Advisor

Finally, the risk analysis is as follows:

Kotak Mahindra risk analysis in T-Advisor

Founded in 1986, Kotak Mahindra is a leading Indian group with subsidiaries in all kind of financial services. The entity accounts 600 branches and 15 million customers. The net interest income increased a 17.9% in the fiscal year 2013-2014 (ending the 31st March) compared with the same former period, till 56,7 billion rupees (US$ 944.4 million). The net income jumped a 58.3% in the fiscal year 2013-2014, till 24,6 billion rupees (US$ 410,3 million). The market capitalisation also improves a 25%. In the last five years, the group doubled the net income and increased a 130% the market capitalisation.

Create a portfolio: organizing my investments

Imagine this situation: you are an investor, you have different assets which have different performances and evolutions in the markets. Think about you have dozens of assets: ETF, stocks, mutual funds, bonds, maybe alternatives… And you cannot find a way to organise and control all of them. Well, the answer is: you have to create a portfolio.

First of all, you have to think about a strategy. The main steps are:

  • Define your goals. Answer yourself: when will I need the money? Consider a strategy for a short-term or a long-term taking into account the volatility and the Value at Risk.
  • Consider your risk aversion. An investment is always risky. If you choose very volatile assets, you may get high returns… or losses.
  • Consider the asset correlation. Uncorrelated assets help reduce losses.
  • Think also about how often you will control your investments: every week, every month, every three months. It should be related with your goals. Consider changing your asset allocation and rebalancing your portfolio.

My portfolio in T-Advisor

T-Advisor provides you a tool to create your own portfolio. The steps to do that are very easy: after defining your investor profile (depending your risk aversion, from very conservative to aggressive), just follow the steps in this video tutorial.

Then you will find a great deal of information to analyze your investments, as performance, risk and diversification. You can also review the investment movements that you have done, buying and selling assets.

My portfolio charts and data in T-Advisor

But what are the main advantages of creating an investment portfolio?

  • You can allocate different kinds of assets to protect you against volatility. A portfolio helps you structure your investments in order to diversify and reap benefits.
  • It helps you plan your finances. Think about that you are saving money for different milestones in your life: a house, the studies of your children, your retirement. You set a portfolio with a certain investor profile to get certain returns in order to achieve your performance goals.
  • You can rely on a passive investment style. Once you create a portfolio, you do not need to change your assets as a day-trader, but just rebalance them every certain period of time, if necessary.

T-Advisor is ready to cover your investor needs. Our tools report you about the main figures and data from stocks, ETF and funds from many markets around the world, so that you can choose the best for your interests and design the suitable portfolio for you.

Market opportunities by T-Advisor: Danske Bank

T-Advisor, through its tool Market Opportunities, has detected the company Danske Bank, listed in Copenhagen Stock Exchange, as an opportunity for investment.

These are the main figures about performances and volatility in the last years:

Danske Bank main figures in T-Advisor

The technical analysis reveals also more data:

Danske Bank technical analysis in T-Advisor

The chart shows the evolution i the last year:

Danske Bank chart in T-Advisor

Finally, the risk analysis is as follows:

Danske Bank risk analysis in T-Advisor

Danske Bank is the largest financial entity in Denmark. The company offers a full range of banking services, with emphasis in retail banking. It is organised in three business units: personal banking, business banking, and corporates and institutions. The bank was hit by the financial crisis and took part in the rescue plan (Bank Package I and II) disposed by the Danish Government. The company has had four CEOs in the last three years, as a result of its difficulties. In 2011, the entity conducted a big issue of new shares, which was sucessfully received in the markets. The group has subsidiaries and second brands in Norway, Sweden, Finland, Latvia, Lithuania, Ireland and Northern Ireland.

The total income registered a decrease of 12.4% in 2013 compared with the former year, till DKK 40,004 million. The net income, however, increased a 50% in the same period, till DKK 7,115 million. The bank has improved its profitability since 2009, as the net income multiplied three times while the total income diminished a 32.5%.

Tourist branch: the fight against low cost and Internet

Summer is here to stay some weeks and many people in the world take their holidays. Some figures published at the end of 2013 promised a rosy year in the sector: 4-5% growth forecast driven mainly by emergings, although Europe and North America were expected to show also a solid growth.

Trends in tourism have deeply changed: people shorten their holidays and the destinations are more diverse (not only the beach), but the strongest change is related to the companies. The irruption of Internet has meant the biggest revolution, as people are independent from traditional tour operators and the supply has expanded: low cost hotels and flights, internet travel agencies and holidays organized by oneself instead the traditional all-inclusive.

What is the impact in the stock exchanges for this branch? Well, we focus today in four big European companies: the biggest hotel chains and tour operators.

Intercontinental Hotels main data in T-Advisor

The British group Intercontinental Hotels obtained US$ 1,903 million in revenues in 2013, a 3,7% more. The profit increased also a 5%, US$ till 420 million.

Accor main figures in T-Advisor

French Accor hotel group revenues decreased a 2% in 2013, till €5,536 million, while the net profit reached €126 million, after the losses in 2012.

TUI main figures in T-Advisor

The German-British tour operator TUI improved the revenues a 4% in 2013, till GBP 15,051 million. However, the net profit halved till GBP 63 million.

Kuoni main data in T-Advisor

The Swiss tour operator Kuoni decreased its revenues a 3%, till CHF 5.669 million, while the company obtain again a profit of CHF 69.2 million, compared with the losses in 2012.

The comparison in the main data made by T-Advisor has the following results:

Performance

YTD

Volatility

YTD

Score

Liquidity

VaR

1 week

Intercontinental

12.53 %

20.48%

8.76

8

-4.41%

Accor

7.43%

18.53%

5.80

9

-4.93%

TUI

-5.51%

26.96 %

4.64

8

-6.13%

Kuoni

-20.30%

22.34%

2.92

7

-5.45%

Fundamental figures show the trend: the traditional companies are not very profitable if we compare the result with the revenues. Figures from T-Advisor point out that tour operators are not under the investors’ view: performance and score are quite bad. However, hotel chains have still some interest, with a good performance in the first half of the year, taking into account that the tourist branch was very affected by the current crisis.

Market opportunities by T-Advisor: Softing

T-Advisor, through its tool Market Opportunities, has detected the company Softing, listed in Xetra, as an opportunity for investment.

These are the main figures about performances and volatility in the last years:

Softing main data in T-Advisor

The technical analysis reveals also more data:

Softing technical analysis in T-Advisor

The chart shows the evolution i the last year:

Softing chart in T-Advisor

Finally, the risk analysis is as follows:

Softing risk analysis in T-Advisor

Softing AG is a German engineering group specialized in software and hardware for industrial automation and automotive electronics. The group is composed by four companies and six subsidiaries with 300 employees. Group revenues reached € 52.55 million in 2013, a 6.4% more compared with 2012. Incomes increased from 2010 a 66%. Net income was € 4.29 million in 2013, a 22.5% better compared with the former year and four times more than in 2010. The share almost doubled in these last four years.

The group recently bought the company Psiber Data GmbH, specialized in electronic components which are complementary to the industrial automation branch. Softing has also raised its capital issuing 450,000 new shares.

Risk and investments: an inconvenient marriage

Risk and investments

If there is a sure word always linked to investments, it is not performance: it is risk. All investors try to reduce or avoid it. Nobody wants to lose their money, but it is possible, because there is a long list of dangers to deal with. Let’s begin:

  1. Interest rate risk: it affects to fixed-income investments, as bonds. Its value decline if the interest rate increased. Currently, central bank rates are extremely low, but it will take a long time till the curve change the trend.
  2. Currency risk: some investments are made in foreign stocks or bonds, or directly in currencies. Well, the exchange rate plays a big role to decide if you were right with your decision.
  3. Business risk: all business has a common risk, because they can fail and suddenly the investors discover that the company is in bankruptcy. It can also affect to a whole sector. Think about the banking sector around 2007-2008…
  4. Market risk: as a result of the movements in the markets, it can happen a downturn in your investment. Pity, you have chosen the wrong share or the wrong bond.
  5. Inflation risk: sometimes we are too conservative, because we want to avoid a failure, but prices increase and our investments have a lower performance compare with them. We are losing purchasing power. Some people call it “the risk of avoiding risks”.
  6. Liquidity risk: this risk is linked to the counterparty. What if the company or the country has no cash to pay your dividends or your coupon? It is worse when your investments are in funds and the manager has no money for redemptions. This risk also refers to the inability to sell your asset. Think about properties…
  7. Personal risks: your life is a continuous risk and you need money to deal with them. Sometimes there are special situations (from happy ones, as a wedding or the purchase of a car, till unpleasant ones, as illness or accidents) in which you need to redeem your investments, but it can happen that the market situation is not the best one.
  8. Tax risks: with the current high shortfall in the developed countries, tax increases have been sometimes the immediate solution. Suddenly, your tax plans for your investments go to the trash.
  9. Political risks: tax risks are also in this item, but it also includes other government decisions and laws, as restrictions in investment products or in markets.
  10. General risk: we live in an ultra-connected world. This does not only mean Internet, but political events. Do you remember the market impact of the 9/11? Or the Iraq war? Or the Asian crisis at the end of the 90s?

Is it possible to avoid them? No, absolutely. There are two chances to partly control and reduce them. The first one is good information, not only previous to the investment, but also as long as you keep it. Being well reported is a key to survive in this risky world. The second one is diversification. You can fail in a part, but success in the other. Could you mention other investment risks?

Market opportunities by T-Advisor: Commonwealth Bank of Australia

T-Advisor, through its tool Market Opportunities, has detected the company Commonwealth Bank of Australia, listed in the Australian stock exchange, as an opportunity for investment.

These are the main figures about performances and volatility in the last years:

Commonwealth Bank of Australia main data in T-Advisor

The technical analysis reveals also more data:

Commonwealth Bank of Australia technical analysis in T-Advisor

The chart shows the evolution i the last year:

Commonwealth Bank of Australia chart in T-Advisor

Finally, the risk analysis is as follows:

Commonwealth Bank of Australia risk analysis in T-Advisor

The Commonwealth Bank of Australia is one of the “big four” national entities and the second biggest company in market capitalization in the local stock exchange. It offers the whole range of financial services, from banking to investments and insurances. Incomes last full year ended the 30th June 2013 summed up AUD 18.165 million, a 6% more than the former year. Net income increased a 10% in the same period, till AUD 7.714 million. The bank share has doubled in the market in the last 5 years.

Ranking T-Advisor: Our best stocks and funds till June

What stocks and funds were the best in the first half of the year? T-Advisor publishes its ranking taking into account the score. T-Advisor patented score provides an asset rating (bullish, neutral or bearish) based on key performance indicators and technical analysis.

The best shares till June were as follows:

Company Score Perf. YTD Volatility Weekly VaR Market

EUROPE

Cosmo Pharmaceutic

10

87.38%

34.71%

-5.70%

Swiss Exchange
DLSI

10

55.48%

43.71%

-6.57%

Euronext Paris
Paragon AG

10

49.08%

27.94%

-6.28%

Xetra
Nemetscheck AG

10

39.54%

21.68%

-4.65%

Xetra
WMF

10

28.32%

19.99%

-4.43%

Xetra

USA

Natural Health Trends

10

112.18%

63.97%

-10.68%

Nasdaq
Biodelivery Science

10

100.68%

62.10%

-10.04%

Nasdaq
Amkor Technology

10

81.40%

33.42%

-7.04%

Nasdaq
Repligen Corp.

10

72.06%

42.43%

-7.16%

Nasdaq
Biocryst Pharm.

10

69.21%

88.66%

-11.87%

Nasdaq

ASIA

Seiko Epson

10

55.93%

43.44%

-8.33%

Tokyo
Aiful

10

55.22%

56.63%

-11.84%

Tokyo
China Gas Holding

10

39.12%

39.18%

-7.56%

Hong Kong
Singapore Post

10

32.45%

14.10%

-2.27%

Singapore
APT Satellite

10

24.56%

38.08%

-7.22%

Hong Kong

LATAM

Caucho

9.8

-5.45%

74.72%

-9.8%

Lima
Lojas Renner

9.19

13.68%

25.74%

-5.56%

Sao Paulo
Quimpac1

9

-6.81%

65.62%

-14.85%

Lima
Grupo Aeroportuario

8.88

26.24%

21.99%

-4.16%

Mexico
Hortifrut

8.62

59.26%

16.95%

-2.12%

Santiago de Chile

The best funds till June were as follows:

Fund Score Perf. YTD Volatility Weekly VaR Managing company

FIXED-INCOME

BANIF Seleccion I

8.81

9.42%

14.61%

-1.34%

Santander Asset Management
SISF Glbl High Yld GBP Hdg I Acc

8.65

6.29%

2.46%

-0.31%

Schroder Investment Management
M&G HI YLD CORP BOND-£-A-ACC

8.46

3.27%

3.37%

-0.63%

M&G Investment Management
M&G HI YLD CORP BOND-£-X-ACC

8.46

3.27%

3.38%

-0.63%

M&G Investment Management
Pioneer Fund – Emerging Markets Bond  Class I Non – Distributing USD

8.44

7.44%

4.38%

-0.81%

Pioneer
JPMorgan Funds – Global Convertibles Fund (EUR)

8.43

5.58%

5.25%

-1.58%

JP Morgan Asset Management
AXA WF European High Yield Bds M Cap GBP Hedged GBP

8.41

4.72%

1.93%

-0.30%

AXA
Templeton Global Bond Fund A(Mdis) GBP-H1

8.38

2.03%

5.04%

-1.25%

Franklin Templeton AM
Pionner Emerging Markets Bond AC

8.37

8.10%

6.83%

-1.41%

Pioneer
Pioneer Funds – Emerging Markets Bond I

8.35

8.45%

6.22%

-1.42%

Pioneer

EQUITY FUNDS

Franklin Biotechnology Discovery Fund I

9.85

14.47%

22.93%

-6.95%

Franklin Templeton AM
Franklin India Blu – Gr

9.82

21.44%

14.63%

-2.95%

Franklin Templeton AM
DSP BR 100-Reg Grw

9.73

25.91%

16.83%

-2.87%

BlackRock Fund Managers
Ab Gl Jap Sm S2C

9.63

9.09%

16.75%

-4.28%

Aberdeen Investment Services
AXA WF Framlington Health F Cap EUR

9.57

13.66%

11.97%

-2.82%

AXA
LM Cbr Agg Gr — Accum.Shs — Class -A- USD

9.57

12.51%

12.06%

-2.46%

Legg Mason Capital Management
AXA WF Framlington Health F Cap USD

9.56

12.35%

11.73%

-2.78%

AXA
Franklin Technology Fund A

9.53

8.77%

13.40%

-3.15%

Franklin Templeton AM
SISF Taiwanese Equity I

9.44

11.75%

10.55%

-2.27%

Schroder Investment Management
Templeton Emerging Markets Smaller Companies Fund I

9.43

12.52%

9.40%

-2.34%

Franklin Templeton AM

 

Global market trends: markets in June

Global market trends in June were a bit more bullish compared with May, as investors received positively the messages from the main central banks. These institutions are still very important in the market confidence and sentiment, because the economy does not have definitive recovery signals.

Market trends in June in T-Advisor

In the case of Europe, the ECB decided finally to use the artillery against the low inflation and, behind that, the risk of deflation. Chairman Draghi already gave a clear hint in the May meeting, what was not typical from the institution. The decisions, however, were welcomed but disappointed partly the markets, although even the Germans supported them. Investors want a European quantitative easing as in US.

Market trends in Europe in T-Advisor

This quantitative easing is coming to an end at the other side of the Atlantic. Mrs. Yellen cut in every meeting US$ 10 bn and in June she did it again, but there is no reaction in the market about it. The important is the Fed outlook about US growth, because it has to do with inflation and rates. And Yellen still sees some clouds. Investors are sure that a rate increase will not take place for a very long time and this outlook push up US indices to records.

Market trends in US in T-Advisor

Crossing Río Bravo to the South, the earthquake comes from Argentina. The country, which was quite bullish in the last months, received suddenly an unexpected hit from an American court. Argentina has to pay the hedge funds or declare the default. On the contrary, Mexican stock exchange is moving very positively.

Market trends in Latam in T-Advisor

What Asia refers, China economic data are better or not so bad as expected. That helps the markets in the continent. Also India, the most bullish in the T-Advisor ranking, is profiting from the high expectations of the new government. On the contrary, the long electoral process in Indonesia is affecting negatively the local stock exchange.

Market trends in Asia in T-Advisor