Common Sense Trading - A Blue Jeans Approach to Philippine Stock Market Trading

So the last post I wrote implied that tracking the index was a good idea. I was wondering what companies are currently part of the Philippine Stock Exchange Index (PSEi), formerly known as PHISIX. I looked it up on google.  Here's what wiki says: The following are the companies listed on the PSEi (effective 17 March 2014) : AYALA CORPORATION (AC) ABOITIZ EQUITY VENTURES, INC. (AEV) ALLIANCE GLOBAL GROUP, INC. (AGI) AYALA LAND, INC. (ALI) ABOITIZ POWER CORP. (AP) BDO UNIBANK, INC. (BDO) BLOOMBERRY RESORTS CORPORTION (BLOOM) BANK OF THE PHILIPPINE ISLANDS (BPI) DMCI HOLDINGS, INC. (DMC) ENERGY DEVELOPMENT CORPORATION (EDC) FIRST GEN CORPORATION (FGEN) GLOBE TELECOM, INC. (GLO) GT CAPITAL HOLDINGS INC. (GTCAP) INTERNATIONAL CONTAINER TERMINAL SERVICES, INC. (ICT) JOLLIBEE FOODS CORPORATION (JFC) JG SUMMIT HOLDINGS, INC. (JGS) LT GROUP INC. (LTG) METROPOLITAN BANK & TRUST COMPANY (MBT) MEGAWORLD CORPORATION (MEG) MANILA ELECTRIC COMPANY (MER) METRO PACIFIC ...

I have been out of the country and was wondering how the Philippine stock market is doing.  The first time I talked to a broker was around seven years ago.  I had just finished college and wanted to try buying stocks.  It was supposedly a booming market.  Daily trades were at a remarkable Php4-ish (or was it 5) mark.  I didn't know anything about it back then.   So I just had a look at my online account today and found the following information for the most recent trading day: Total Trade  31,744 Total Value  13,124,067,307.50 Total Volume 1,372,853,880 Php13billion! ($98M) That's a huge jump in seven years!  That'll make for a great sales pitch for brokers.  But really, what is the implication of the trade value jumping three times in value in seven years.  Does that mean that if I throw money into the market, I could potentially triple my money?  How I wish it was that simple.  The PSEi (index) was at around 3,...

I've noticed a lot of good press on the Philippine economy for over a year now.  I typed in "Philippine Economy" on google.  This first hit (after wikipedia), was a neat little article by Walden Bello, a writer for the Philippine Daily Inquirer (my favorite of the 3 big dailies).  The article was entitled Hot Emerging Markets? The curious case of the Philippines and Mexico . It's a good read. Check it out here . Bello highlighted the praises given to the president's of both countries, in bringing about positive change.  He also gave a sobering reminder of poverty and inequality issues. So the question is, if the economy is growing, who's pockets are getting deeper.  I think the average Filipino has a good idea of what the answer to that question is.  The real question I want to ask is if the stock market can help the average Filipino get a piece of that growing pie instead of the crumbs that trickle down.

News of Manny Pacquiao's assets being frozen spread like wildfire the day after he beat Rios.  His victory, coming after a calamity, is seen to raise spirits of many Filipinos.  Yet, he faces another difficult fight back home.  The Philippine taxing authority wants Php2.2 billion from him in alleged back taxes.  That amount is larger than his net worth.  In U.S dollars that around fifty million. Taxing authorities in the Philippines have been way more aggressive lately and that probably helped the country to achieve its investment grade rating from all three major ratings agencies: Standard and Poor, Moody's, and Fitch.   (see:  http://www.philstar.com/business/2013/10/03/1240995/moodys-gives-phl-3rd-major-investment-grade-rating )

Here's a good article explaining why the Philippine economy has "good fundamentals" for economic growth. http://www.philstar.com/business/2013/11/28/1261583/phl-remains-star-performer-nomura

Okay, Okay, Okay. . . so I keep saying that Typhoon Haiyan (locally, Yolanda) shouldn't affect the stock market much. Let's consider some long term ripple effects.  Tacloban, which was hit hardest, is being called "ground zero" for  Philippine politicians and the emerging early campaign for the presidency.  This is something we might want to think about as we recall how politics has played a part in buoying the PSEi over the last couple of years. For one reason or another, President Aquino's administration has been good for the stock market.  Knowing who the future contenders makes for more than just good conversation.  It can help us prepare for how investments will be moved around.  If a stock market will be pushed down by external forces, there may be buying opportunities.  We'll want to have cash for that.  If it pushes the market sky high, we'd want to have a good inventory of stocks to sell. Vice president Binay was treated as almost a...

According to the Philippine Star (www.philstar.com), bargaining hunting halted the slump in the PSEi. http://www.philstar.com/business/2013/11/27/1261212/bargain-hunting-buoys-index-above-6000 My sense is that local investors will not be fazed by the news of the Typhoon.  With due respect to the victims, the fundamentals (for listed businesses) remain largely unchanged by the Typhoon.