Picking winners among STI stocks

The Straits Times Index (STI) was up 10.2% since the start of 2017 on the last trading day of April.

However not all 30 component stocks of the STI were doing well.

Stock 30/12/2016 28/4/2017 Change
YZJ Shipping 0.815 1.15 41.1%
Global Logistics 2.20 2.88 30.9%
City Dev 8.28 10.79 30.3%
CapitaLand 3.02 3.76 24.5%
Genting Singapore 0.905 1.115 23.2%
Hongkong Land (USD) 6.33 7.71 21.8%
UOL 5.99 7.24 20.9%
ST Engr 3.23 3.79 17.3%
Jardine Matheson (USD) 55.25 64.53 16.8%
Jardine C&C 41.23 47.23 14.6%
Ascendas Reit 2.27 2.56 12.8%
Keppel Corp 5.79 6.51 12.4%
DBS 17.34 19.35 11.6%
SIA Engr 3.37 3.74 11.0%
Comfort Delgro 2.47 2.74 10.9%
OCBC 8.92 9.80 9.9%
CapitaComm Trust 1.48 1.625 9.8%
Thai Bev 0.85 0.925 8.8%
UOB 20.4 21.80 6.9%
SembCorp Ind 2.85 3.03 6.3%
SIA 9.67 10.25 6.0%
SATS 4.85 5.09 4.9%
CapitaMall Trust 1.885 1.97 4.5%
SGX 7.16 7.40 3.4%
Sing Tel 3.65 3.74 2.5%
StarHub 2.81 2.79 -0.7%
Wilmar Intl 3.59 3.55 -1.1%
SPH 3.53 3.47 -1.7%
HPH Trust (USD) 0.435 0.405 -6.9%
Golden Agri-Res 0.43 0.360 -16.3%
SPDR STI ETF 2.94 3.2 8.8%
STI 2,880.76 3,175.44 10.2%

Stocks like StarHub, Wilmar Intl, SPH, HPH Trust and Golden Agri-Res were negative. Even dividend stock like Singtel could only manage to increase by 2.5%.

At the top were stocks like Yangzijiang Shipbuilding (+41.1%), Global Logistics (+30.9%). These stocks were in the spotlight because they are merger and acquisition potential by suitors.

This time round the property developer counters like City Development, CapitaLand, Hong Kong Land, and UOL were ramping up and playing catch-up with better property outlook in the current economy.

Picking winners require lucks. It would be speculative to know which stocks would be take-over targets. The property counters got a boost because the Singapore government relaxed some property cooling measures on 10 March. Who would know that this is coming when the Ministry of National Development had been saying it was not time to relax the measures yet?

Even when the STI had gone up 10.2%, it was just the composite figure of all 30 stocks. Individual stock painted a different story. One can still be owning stocks that were not winners. That is the reality of investing in specific stock.

One recommendation is to buy into STI ETF, which is a basket of stocks that make up the STI. The SPDR STI ETF was up 8.8%. You spread the risk of picking losers and not picking the winners. 

Copyright © 2017, limkimtong for Living Investment

The material presented is intended to be general and written in layman’s language as much as it is possible. The author shall not be liable for any direct or consequential loss arising from any use of material written. Please seek professional advice from your financial advisor or financial institutions on material written covering financial matters.

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