Over the last six
months, Hang Seng Index edged up 12.5 percent more than Straits Times Index and
the analysis in my blog that H-shares were the best bet has been vindicated.
From The Business Times Weekend,
the p/e of STI at 2857.65 now is 12.24x and the p/e of HSI at 22909.54 is
12.17x. They are almost equal now. Still,
H-shares are the better bet. Why?
I can think of the
following reasons:
1. GDP of China at more
than 6.5% is still much higher than that of Singapore which is of anything
lower than 2%.
2. the average p/e of
H-shares is lower than that of HSI.
3. The Shenzhen and HK
Stock Connect will propel H-shares to close up the current A- and H-shares gap
of 24.96%.
4. The anticipation of
Fed Chair Yellen to jack up the US interest rates alone will strengthen the US
and HK currencies and thus the influx of foreign funds to HK. Singapore
currency, on the contrary, should be weakening due to poor NODX figures.
However, what with the
interest rates moving in the opposite direction of the performance of stock
markets, and with HSI moving higher, we have to reduce our investment in the stock
market unless you can find another phenomenal growth stock like Tencent 腾讯
(Ticker: 700) about 10 years ago.
Superphang
