Substack (My thoughts, whenever I write): taychikeng.sub... 🅰SeekingAlpha (14Day Trial): www.sahg6dtr.c... Leave a comment down below, and let's have a discussion.
Damodaran mentioned elsewhere that, no matter how good a Chinese company is, your biggest risk is always the Chinese government. So buying Chinese equities depends on your view about whether their government is a benefactor or an adversary to the business in question.
Everyone should invest in a way that fits his/her temperament the most, so just b/c Adam Khoo is not touching Chinese equities, it means jack shit to me.
The Chinese take a view on the economy that is very much the same as an industrialist - theres not much concern for speculations like real estate and market valuations and instead their focus is on industrial production and climbing the technology ladder. The Chinese government sets very clear objectives for itself and outlines its long term policy in multi-year plans. Investors should be mindful of and ideally align themselves with this industrial mindset when investing in China.
I am Malaysian, Tencent is my third largest stocks ( just smaller than Costco and Brk-b) in my family portfolio…I might be wrong, but let calculate the Odds- how much I can lose and win in next 5 years…( say drop to HKD 200 and shoot to hkd 1,000…the odds is risking lost 1 for gaining 8…people may laughling me how can tencent shoot to hkd 1,000, but that means at that time ,market cap still less than usd 2 trillion….the most important for lay man like me is using simple Kelly criterion….as long as never Game Over in this game when you hit by worse case scenario. Is okay…
Tencent stock has gone from about HK$270 earlier this year to HK$382 today (Jun 17, 2024). Of course Adam Khoo is quietly hoping everyone will forget about this episode.
Recent q4 earnings Martin Lau mentioned Tencent domestic games ARPU (average revenue per user) is actually at very low end compared to industry peers. So regulation on spending is not their concern, since it wont hurt the company at all. And there is more room for domestic game revenue expansion (since they are at the low end ARPU)👌🏻
"for chinese companies, you're not a shareholder, you're a capital provider". Well, if a company is not paying a dividend and it's not buying back shares, that's what an investor is. I reject the notion that chinese companies behave any different from anywhere else, lots of "investors" are ready to buy in US companies with negative cash flow issuing shares and diluting them like crazy, then turn around reject China on ideological bases.
maybe im a noob but isn't tencent like a huge global company with revenues that are not exclusive to china? does this not mean that they can still do ok globally? Im not invested in tencent but just a thought.
The fact they own half of fortnite that is going to be worth maybe a trillion dollars in 10 years its worth buying just for that alone. Microsoft is inferior to tencent today. But tencent is trading much lower. This is an investment that will make you rich within 10 years if you hold it long term. The mobile gaming will be their big revenue driver long term. They are going to make so much money on all their games going forward that everything else they have is just a bonus.
I cannot help but wonder about Howard Mark's outlook on China. If you look at China's demographics, they are staring down the barrel of a gun, no small thanks to the one-child policy.
Marks mentions growth for the US will be limited in the future, whereas China still has plenty of room to grow. I guess he is referring to GDP growth. Birth rate is low all over Eastern Asia, especially China now that women want careers. Individual companies could of course still grow fast which is more relevant for both stocks and bonds
saw an article where Tencent says they may cede some of there fintech to Chinese banks, kind of sucks because this makes a larger portion of potential future growth.
Chi Keng, the opportunity cost impacts you more than Adam Khoo. Adam is a millionaire. Your gains at 65 is less by not following the liquidity flow. Lossing time horizon.
Damodaran said he would buy Tencent, but he did not say he actually bought Tencent. Unless you have another source, i do not believe he holds the shares. Chinese shares are not investable for me currently. Until maybe XJP steps down.
I dunno if anyone is willing to b at the mercy of Beijing flip Flop policies on online game companies. Moderator can reason extensively but follow the money. The money is flowing right now out of China market. By exiting, Adam had cut his pain - ten cent was to him a sunk cost. AI stocks anyone?
