10/2020
Global Tech has been the BEST performer in the past decade, yes, one of the rare sectors that even beat REITs. Whether it is over 3 years, 5 years or 10 years, the Tech sector has outperformed and posted the best returns of 29.9%, 27.15% and 21.55% respectively. This has been the best performing sector in the S&P 500 sector! Take a step back and you will realize that a 29.9% annualized return over 3 years means that if you have been the perspicacious investor that we at GCP Global trains, you would have been able to double your wealth in 3 years in Global Tech.
Of course, this means that you had been able to lower your stakes in the underperforming years while increasing your stakes in greater proportions during the comparative outperforming years.
To celebrate the current Tech correction, I am relaunching our Global Tech lectures where do deep dives into the digital economy and select the Tech stocks that will beat the market comfortably in the months and years ahead based on secular grower nature and the unique sector advantages like 5G, AI, IoT, Machine Learning, Augmented Reality, Virtual Reality, E-Commerce and E-Sports.
Investing in the digital economy and next generation stocks went from being a “nice to have” strategy to a “need to have” for any businesses who wants to survive and prosper during the Covid-19 Pandemic. As shrewd investors, we should recognize that we need to be exposed to the most promising and fastest-growing businesses to continue to triple our wealth.
To celebrate tripling my wealth with Tech stocks this month, I wanted to take a step back and share my special list of Tech stocks that perfectly encapsulate the rise of the digital economy and next generation stocks across various big themes of the digital transformation the world is undergoing in our upcoming Global Technology class.
Investing in Global Tech and e-commerce goes beyond offering a thematic portfolio. An idea only has value when combined with proper implementation. My goal has been and will continue to be – an all-in-one service that combines all key aspects of a successful investment strategy from identifying and understanding clearly the underlying technology and the stocks that will benefit from the rapid evolution of the technology.
Why should you care?
Global Tech has an internal rate of return of more than 30% annually since I invested heavily from 2014.Many of the Tech stocks that I presented at public investment seminars in Asia have tripled in the last 3 - 5 years. This has beaten the S&P 500, the FTSE REIT Index and FTSE STI Index hands down over the same period.
Most importantly, thee are real returns, not a back-tested strategy, where we have reaped the bountiful rewards. I expect this superb outperformance to continue in the current decade. As many of my REIT students have come to understand, REITs offer investors steady dividends every quarterly or half-yearly which offers the steady cashflow for investors to invest in high alpha returns stocks like Global Tech.
This has been sacrosanct in our teachings, and we continue to carve it in our tombstone of Multiplying Wealth for our student investors which total more than 8,000 currently across many Asian countries.
We are also timing our lecture so that you can benefit from the mega IPO of the year – Ant Group.
In our 31 years of education and deep dive into stocks and sectors, there are three Types of competitive advantage in attending our classes –
1. Informational advantage through our in-depth deep dives into sectors and stocks
2. Analytical advantage through our profit-proven models, dashboards and scorecards
3. Behavioral advantage through our reliable review of volatility and profit-seeking skills
Why NOW again?
There are a host of reasons, but I will share two very important reasons in this article.
1. Impending listing of Ant Group
Ant Group, renamed from Ant Financial and the parent company of China’s largest payments platform Alipay and leading provider of financial services technology, has announced its concurrent IPO on the Shanghai Stock Exchange’s STAR board and the HKSE with its 674 pages prospectus.
Valuation of Rapid Growers
The IPO is expected to raise US$10 billion and could value the company at a humongous US$225 billion. More so if you compare that valuation to Singapore’s GDP of US$265 billion. When Ant’s IPO was first mooted in 2018, the valuation was barely US$25 billion. At the heart of understanding Ant’s rapid growth is the all-encompassing infrastructure and platform to support the digital transformation of the services industry, first in China and rapidly in the rest of the world. In our classes, we will deep dive into how this ecosystem serve as a powerful competitive moat and how to value rapid growers like Ant which can triple our wealth very quickly.
Fabulous IPOs are lacking on SGX, but they are not to be missed by the sagacious investor. It has been very difficult for Singapore-based investors to find and value mega baggers, but we have had many of such experiences and would like to share and guide you along. Having gone through the 674 pages prospectus, we will deep dive into Ant Group IPO in our upcoming Global Tech class.
Table 4 - The heart of understanding Ant’s rapid growth is the all-encompassing infrastructure and platform to support the digital transformation of the services industry
In Tech, unlike REITs, it can oftentimes be very daunting to navigate and understand high growth companies like Ant. For sure, the stock will be volatile as Ant’s profile is almost totally different from other businesses that are traded on SGX like Banks, Property and Manufacturing. But it is crucial as this are the kind of companies that can create transformational wealth for the sharp and sharp investor, like what we have experienced. Thus, in looking at the atoms that make up and drive Ant’s financials and profitability, we look at some of these issues with a different lens and going deep underneath to discover its cash cow driving atoms and molecules within Ant.
Table 5 - Scintillating springs forth Spectacular: - 1H2020 profits of RMB21.9 billion has already eclipsed the record of RMB18.1 billion achieved in 2019!
The above table shows Ant’s Top and Bottomline growth from 2017. It may come as a shock to many Singapore-based investors who are only exposed to Singapore’s lackadaisical stocks with pathetic revenue and profit growth that –
a. Ant’s Revenue almost doubled from RMB65.4 billion 2017 to RMB120.6 billion in 2019, yes in just 2 years!
b. Ant’s Profit is even more scintillating – it jumped almost 250% from RMB8.2 billion in 2017 to RMB18.1 billion in 2019 in just 2 years!
c. Scintillating springs forth Spectacular - 1H2020 profits of RMB21.9 billion has already eclipsed the record of RMB18.1 billion achieved in 2019!
It is unlikely that companies like Ant with such phenomenal revenue and profit profile and growth will be listed on SGX, but the perspicacious investor that we educate you to be, should not miss out on such mega baggers.
1. Stupendous run in Global Tech will resume after the current correction
Timing is Everything in Global Tech and Investments.
The current correction that started in September 2020 is healthy and long awaited. It has allowed investors to get more into the best of the best Global Tech stocks at lower prices after the sharp run-up from March 2020.
Table 6 - Tech zoomed up 49.86% in 2019 and up another 35.85% as at end-Aug 2020. This is almost a 100% return in just 20 months despite the current Tech correction!
The above table illustrates how Tech stocks behave. After the last correction which saw the S&P Information Technology (XLK) posted a negative 1.66% return, Tech zoomed up 49.86% in 2019 and up another 35.85% as at end-Aug 2020. This is almost a 100% return in just 20 months despite the current Tech correction!
To catch the upcoming winners in Global Tech and China Internet, do take advantage of our Early-Bird discount for our upcoming class on 24 Oct 2020.
From Ant to Cobra to Zebra, join us on our monthly media interview on the upcoming mammoth Ant IPO and Global Tech stocks on
Money FM89.3 Interview hosted by Michelle Martin
Wed 7 Oct 2020
10.05 am
We talk multiplying your wealth “From Ant to Cobra to Zebra – Global Tech & China Internet stocks”