Performance of KLCI’s 30 counters in 2018

I dissect the performance of each of the counters that comprises the Kuala Lumpur Composite Index.

Note that this illustration is purely based on share price movement and does not take into account the distribution of dividends or any other corporate exercise that may have affected share prices.

CIMB GROUP HOLDINGS BERHAD
  • Price at the start of the year: RM6.54
  • Price at 21.12.2018: RM5.65
  • Variance: (~14%)
HAP SENG CONSOLIDATED BERHAD
  • Price at the start of the year: RM9.64
  • Price at 21.12.2018: RM9.88
  • Variance: ~2%
PPB GROUP BERHAD
  • Price at the start of the year: RM17.28
  • Price at 21.12.2018: RM16.98
  • Variance: (~1%)
PUBLIC BANK BERHAD
  • Price at the start of the year: RM20.80
  • Price at 21.12.2018: RM24.68
  • Variance: ~19%
MALAYAN BANKING BERHAD
  • Price at the start of the year: RM9.66
  • Price at 21.12.2018: RM9.29
  • Variance: (~4%)
PETRONAS CHEMICALS GROUP BHD
  • Price at the start of the year: RM7.72
  • Price at 21.12.2018: RM9.20
  • Variance: ~19%
PETRONAS GAS BHD
  • Price at the start of the year: RM17.70
  • Price at 21.12.2018: RM19.04
  • Variance: ~8%
MALAYSIAN AIRPORTS HOLDINGS BHD
  • Price at the start of the year: RM8.70
  • Price at 21.12.2018: RM8.20
  • Variance: (~6%)
HONG LEONG FINANCIAL GROUP BERHAD
  • Price at the start of the year: RM17.46
  • Price at 21.12.2018: 18.85
  • Variance: ~8%
KLCC REAL ESTATE INVESTMENT TRUST
  • Price at the start of the year: RM8.12
  • Price at 21.12.2018: RM7.65
  • Variance: (~6%)
NESTLE (MALAYSIA) BERHAD
  • Price at the start of the year: RM102.60
  • Price at 21.12.2018: RM147.60
  • Variance: ~44%
GENTING BERHAD
  • Price at the start of the year: RM9.30
  • Price at 21.12.2018: RM6.27
  • Variance: (~33%)
DIALOG GROUP BERHAD
  • Price at the start of the year: RM2.51
  • Price at 21.12.2018: RM3.00
  • Variance: ~20%
DIGI.COM BERHAD
  • Price at the start of the year: RM4.90
  • Price at 21.12.2018: RM4.35
  • Variance: (~11%)
KUALA LUMPUR KEPONG BERHAD
  • Price at the start of the year: RM24.96
  • Price at 21.12.2018: RM24.20
  • Variance: (~3%)
HARTALEGA HOLDINGS BERHAD
  • Price at the start of the year: RM5.33
  • Price at 21.12.2018: RM6.26
  • Variance: ~17%
HONG LEONG BANK BERHAD
  • Price at the start of the year: RM17.10
  • Price at 21.12.2018: RM20.10
  • Variance: ~18%
PRESS METAL BHD
  • Price at the start of the year: RM5.39
  • Price at 21.12.2018: RM4.80
  • Variance: (~11%)
RHB CAPITAL BERHAD
  • Price at the start of the year: RM4.98
  • Price at 21.12.2018: RM5.30
  • Variance: ~6%
GENTING MALAYSIA BERHAD
  • Price at the start of the year: RM5.59
  • Price at 21.12.2018: RM3.04
  • Variance: (~46%)
AXIATA GROUP BERHAD
  • Price at the start of the year: RM5.46
  • Price at 21.12.2018: RM3.86
  • Variance: (~29%)
PETRONAS DAGANGAN BHD
  • Price at the start of the year: RM24.38
  • Price at 21.12.2018: RM26.00
  • Variance: ~7%
MISC BHD
  • Price at the start of the year: RM7.21
  • Price at 21.12.2018: RM6.15
  • Variance: (~14%)
IHH HEALTHCARE BERHAD
  • Price at the start of the year: RM5.87
  • Price at 21.12.2018: RM5.35
  • Variance: (~9%)
IOI CORP BHD
  • Price at the start of the year: RM4.53
  • Price at 21.12.2018: RM4.30
  • Variance: (~5%)
MAXIS BERHAD
  • Price at the start of the year: RM6.00
  • Price at 21.12.2018: RM5.41
  • Variance: (~10%)
TELEKOM MALAYSIA BERHAD
  • Price at the start of the year: RM6.20
  • Price at 21.12.2018: RM2.68
  • Variance: (~57%)
SIME DARBY BERHAD
  • Price at the start of the year: RM2.21
  • Price at 21.12.2018: RM2.35
  • Variance: ~6%
TENAGA NASIONAL BERHAD
  • Price at the start of the year: RM15.22
  • Price at 21.12.2018: RM13.48
  • Variance: (~11%)
SIME DARBY PLANTATION BERHAD
  • Price at the start of the year: RM5.57
  • Price at 21.12.2018: RM4.79
  • Variance: (~15%)

TO SUM IT ALL UP

Out of the 30 counters, 18 counters are in decline, while the other 12 are up.

Most oil and gas related counters are on the rise. However, the global geopolitical uncertainties together with the downtrend of crude oil prices may test the resilience of those counters in due course. On the other hand, chemical producers like Petronas Chemicals would benefit from lower crude oil prices.

With the exception of CIMB and Maybank, the finance and banking sector is held up pretty firmly, with Public Bank and Hong Leong Bank leading the way.

The telecommunication sector is in an overall slump. Telekom takes the cake for the biggest drop, in terms of percentage, of any counters listed in the KLCI by losing 57% of its value in 2018. Telekom has been affected by the new government’s policies; the call for cheap access to broadband services, among others. As for Digi, Maxis and Axiata, they are being affected by stiff competition amongst each other.

The Genting-related counters have experienced a sharp decline due to the dispute with Disney regarding the Fox theme park, the impairment of the promissory note issued by the Mashpee Wampanoag Tribe and also the rise in gaming tax, by the Malaysian government.

You may not be doing so well if you have made bets on the plantation sector. Shares of Kuala Lumpur Kepong Berhad, IOI and Sime Darby Plantation Berhad experienced a slight drop since the beginning of the year. This come as no surprise due to the decline in palm oil prices.

The consumer sector, represented only by Nestle, has experienced a stellar performance. The rise of its share price, over 40%, was due to the mid year strengthening of the Ringgit, which meant lower import costs of raw materials for its products. However, the value of Ringgit is on a decline. It would be interesting to observe how this would play out for Nestle.

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A reflection of 2018

To err is human…” – Alexander Pope 

To be frank, my investments, this year, is something left a lot to be desired. The majority of my investments, in equity, are in the red. However, bonds and peer-to-peer lending are in a much better position.

As i usher in the new year, I reflect on the decisions that I’ve made this year regardless of whether they are inadequate or satisfactory.

Photo by Keegan Houser from Pexels
WE CANNOT PREDICT THE FUTURE

Though, very obvious, it’s fallacious of men to assert that we are capable of predicting the future. 

My share portfolio is a victim of such fallacy. It was constructed on the premise that all the goodness that occurred in 2017 would transitioned seamlessly into 2018. And because because of that, I forgo re-balancing, or preparing my share portfolio for the worst.

Though the ramifications for my misapprehensions were kept to a minimal, I note that all of the gains made in 2017, were no longer preserved, to my disappointment.

LACK OF DIVERSIFICATION

Because we cannot predict that a government, once rooted in the very fabric of our lives, can be democratically removed, or the rising tension between two superpowers, our portfolio must be malleable and risk-averse, in order for it to be “all-weather”. The thought of not putting all of your eggs in one basket means your portfolio can withstand a downward market trend and therefore, be more resilient.

If you are stock picking, your portfolio must encompass a variety of well-established and profitable companies from an array of different sectors and industries. 

Also, to achieve a balanced and diversified portfolio, consideration must be had of other types of investments or asset classes such as unit trusts, bonds, REIT, ETF, ETBS, commodities, and even peer-to-peer lending. 

If you’re equity-heavy, like me, then its time to re-balance.

POLITICOS ARE BAD HOMBRES

Look, I try to keep politics out of my writings but sometimes the fallout from a changing political landscape is so atrocious that I’m forced to talk about it albeit in passing. 

Because of the way things are run in Malaysia, a lot of  companies and businesses are, to a certain degree, reliant on the government. More so especially when the government, through its investment arm, takes up a substantial shareholding in a company.

Having only been ruled by the one and only coalition party for more than 60 years, Malaysians are simply unable to comprehend that governments do come and go. Ideally, businesses must be free from political subversion and should never cosy up to a government for favours. 

Tony, the reluctant idiot.

However, seeing how things have unfolded since the May 2018 general election, it would be prudent to invest in businesses that would not be profoundly affected by a change in the political landscape of the country. This is especially true if your investment horizon is long (more than 10 years) as elections are generally held once every 4-5 years. 

DIVIDENDS

If it hadn’t been for dividends, my share portfolio would have been absolutely hammered. Dividends are very precious when the markets acts like a headless chicken. They act like a cushion that minimises any impact from a downward market trend. I’m grateful that I, at least, got this going for me.

Generally, you should consider companies that are, in the past, consistently paying out dividends, at an attractive yield. If you’re unsure about dividends, note that I’ve made a case for dividends in my past writing: Dividend stocks or not? That is the question. 

LOOK OUT FOR NEW THINGS

Investing can be monumentally frustrating especially where you are clueless about what to investment. I was in that situation, before taking initiatives to understand the concept of investments. The trade-off of investing without professional help is that I consumed many hours of reading and research.

If ever you find conventional investments inapplicable to you for whatever reason,  there are other types of investments which are worthy of consideration such as peer-to-peer lending or robo advisors. Both, although alien concepts a few years ago, are now licensed to operate in Malaysia. Just remember to start small until you get the hang of it.

NEVER LOSE MONEY

I think Warren Buffet has said this over a million times. Having most of my shareholdings in the red, I have a profound appreciation of those words.

Once you lose money, it’s harder gain them back.

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