Sunday, April 27, 2008

More Rumblings On Tan Teng Boo's ICapital's Disposal Of Shares

Blogged previously, What Do You Think of ICap's Recent Disposal Of Shares Held?

The main issue in the posting was that in the quarterly earnings report ended Feb 29th 2008, ICapital had disposed some 50 million worth of shares.

Some find it truly amazing because it was just in Jan 2008, ICapital's Mr.Tan Teng Boo had been quoted on the daily news paper that he had been bullish on the Malaysian equities.

See Jan 5th 2008 article
Corridors of catalysts and Jan 19th 2008 article Analysts and fund managers weigh in on scope of Dow’s impact and as mentioned by Mr.Tan.


  • The KLCI is resilient as it is not over-valued with sectors such as palm oil, which is doing well. The KLCI would continue to perform despite a slowdown in the US.

And my point was rather simple. I have nothing against his selling or whatever.

My point is why he is telling everyone he is BULLISH on the market when deep underneath it all, he is a huge seller?

Now, I had received some interesting feedbacks that I thought deserves to be highlighted. One reader, madcap had said that I had simply been insinuating someone to be deceitful with flimsy assumptions is wrong.

Here are his comments:

  • Moolah, you have always pride yourself in looking beyond the obvious. In the quarter ending Feb 2008, when do you think ICap sold? Don't you think it is naive to assume that ICap was a consistent net seller in a month from the fact that it was a net seller in a quarter? The first article says he is a net buyer at that time. Was that an outright lie? Fact is, you assumed from the fact that ICap sold in that quarter, that he must be a net seller in January. Could he have sold in February? Honestly, I don't know that.

    Was TTB advising on long term trend or was he giving advice on short term market timing? Look at his reasoning and tell me if he is implying that markets will go up in the next month. If TTB is bullish long term, does this mean that he should not trade in the short term? Is he implying that people who listen to his advice should not trade?

    The insinuation here is that the man is deceitful, not that he gave bad advice - that he was selling when he gave bullish comments - and I think that it is unsubstantiated.

    Finally, you quoted March 8. Take a look at KLCI from March 8. If I took his advice, I would probably be making money. So, do you think he continued to sell in March?

    His long term call has yet to be proven right. You can challenge him on that. But to insinuate someone to be deceitful with flimsy assumptions is wrong.

Madcap, many thanks for your feedback. I am not here to degrade Mr.Tan's ICapital capabilities and performance and neither do I want to challenge his long term calls. And let me repeat again, I have absolutely nothing against his selling of shares. What amazes me is what has happened while he was selling the shares!

So, in this reported quarter ending Feb 29th, he could have sold in December, January or February.

Looks like the issue is now focused on when exactly he sold.

If he had sold in December or January, then how would one interpret his two massive comments on January stating that the KLCI is not over-valued and that the KLCI would continue to perform? Now, that wouldn't have been nice and it would NOT make sense, would it? Well sell when he thinks the market is not over-valued?

Yes, he could have changed his mind and decided to sell in February.

Possible. However, to suddenly sell 50 million worth of shares alone in one month, in February would have been incredible.

I am wondering, did something happen in February to spook him?

Can it be the US economy or the US market? Well it can't be because in early March, March 8th, the day of our elections, Mr.Tan had another lengthy interview in the Star Biz, stating that he was still bullish in the US Market, Dare to be contrarian .

And in our local market, the one and notable market event was Gamuda's market led selldown.

And mind you, he did make a commentary on this issue in February 2008!

Feb 23rd 2008, published on BizWeek, Market expected to recover with bargain-hunting.

  • While most people are gripped by fear over US taking a one-way street to Recessionville, i Capital.biz managing director Tan Teng Boo maintains an extremely bullish view on the US economy while he holds on to the view that the world economy has decoupled from the US economy.

    Tan says that without the strong US export growth in 2007, especially in the China market, the US economy would have been in a recession 6 to 9 months ago. The export-oriented Asian economies have all seen their currencies appreciate.

    Tan welcomes the present panic-selling as it allows many equity markets to undergo meaningful corrections. He sees the current fall as a panic attack, based partly on an eagerly waited, long anticipated correction. He expects market volatility to eventually subside.

Still bullish and he publicly said he welcomed the panic selling in February 2008.

Now I am confused, if Mr.Tan welcomes this panic selling in February, did he also sell some 50 million shares during this period too?

Well, madcap, like you, I honestly do not know if ICapital shares were sold during this February time frame but if it did happen during this period, I find it incredible, really.

And more so, early March 2008, Mr.Tan was quoted to say the following,

  • If there is a contrarian view currently playing out in Malaysia in relation to the prognosis of the US economy, it’ll have to come from and not surprisingly, the frank and candid Tan Teng Boo – a man with a wealth of experience on equities who currently heads Capital Dynamics Asset Management Sdn Bhd.

    And it is for that reason that while many market pundits have written off Asian equities for the time being, he remains unabashedly bullish.

    His take is largely premised on the fact that the US is not faced with a doomsday scenario but a slow-paced softening in economic conditions that is easier to stomach for the rest of the world.

    “Firstly, the subprime problem remains just that – subprime. Secondly, while many large financial institutions have been badly hit, the central banks have successfully averted a credit or liquidity crunch scenario. Thirdly, the US economy is certainly slowing down but a recession is only a possibility, and not certain.” (do read rest of the lengthy article
    here )

Anyway, blogger Seng, from Fusioninvestor, had this to say.

  • I would like to add my 2 sen worth here, since this topic was discussed at length in my chatbox.

    madcap, as john mentions here, "(TTB) has always been bullish". There are many times where he publicly declares that he is bullish. Usually made in a very confident, sometimes, arrogant manner, almost always with no qualification that he has always been bullish.

    Now, we must remember that TTB has a wide following. He is looked at as a leader in the local investing world. His words carry significant influence. Many people will take that with confidence and act on it.

    At the same time as he is making bullish pronoucements in an almost arrogant fashion, he silently sells. $50 million. This selling is only reported a few days ago from the QE Feb 2008 Quarterly Report.

    The amount of selling is not small. Nearly 20%. It is his largest selling yet.

    Of course you can try to confuse the issue by saying he is a trader and we don't know exactly the exact timing, he has the right to silently change his minds, etc.. But that's not the impression he gives to the world when managing ICAP. The impression is that he is a Buy and Hold Value Investor. Most people would assume that.

    So, it is this inconsistency - almost lack of integrity - that when he maintains his bullishness repeatedly, he sells behind the scene. That is what Moo is trying to point out here. Not other things.

    Now, why can't he tell the world that he is "generally" bullish, but will consider/not hesitate to take profits when he feels it's over-priced? Or tone down the arrogance to allow for exceptional cases when some pockets might be overpriced (and thus justify selling)? Wouldn't this be a better and more accurate approach to make? I for one would prefer to see him tell it realistically, rather than maintaining his almost arrogant bullish stance but selling significantly and silently.

    Don't get me wrong - one behaviour doesn't make the man. I still have high respects for Uncle Tan especially his investing skills. But my concern is if this gets repeated, that behaviour might become habitual, and one day, you could see a man with a totally different character than the old TTB we thought we knew before.

    And of course, if you are the owner of ICAP, then, you would be pleased that he practices sound and prudent money management. But this is NOT the issue here. The issue is the discrepancy between Talk and Action. Some people calls it lack of integrity.

In which madcap replied,

  • I must say I am quite disappointed to read your response, Seng. If you tell people that you believe Parkson to be fundamentally sound and you are bullish on Parkson's prospects ("TTB has always been bullish"), but you continue to trade Parkson based on your read of market trends and charts (TTB net seller in last quarter, buying back in this quarter), are you being deceitful?

    You have claimed "fusion" investment strategies. And TTB cannot do the same?

    TTB gives the impression that ICap will be buy and hold? People assume so? Now they see that he also sells. And he is deceitful? Note your words - "gives the impression", "assume". I remember reading somewhere someone being surprised at the amount of buy and sell he found in TTB's portfolios in the past. As you have pointed out, ICap investors will probably be happier to discover that he applies trading techniques to enhance their fund (like Seng discovering the power of trading).

    If TTB says in January that he believes KL markets is still sound. Sells in February. Buys back in March. He is deceitful? I don't know if this is what he actually did. But neither do you know that he sold in January and February. Right? So don't say I am trying to confuse the matter if I say so.

    I think TTB is arrogant. I also think that he has a hard time acknowledging his bad calls. Perhaps that is the quality of an adviser of trends and analysis. (I am not even interested in defending him. I am just pointing out bad analysis and judgement here.)
    You may even say that you think he is a bad advisor. But arrogance is not deceit.

    But I don't see evidence of deceit. And I think it is wrong to pressure BB (in your chatbox) to come to this conclusion when the evidence is flawed by a time frame mismatch.

How? What say you?

I do invite more feedbacks on this topic.

-------------------------------------------
Updated: 29th April 2008.

The Wanderer, posted a screenshot of what ICapital said in its January 25th write up!




Quote: .. ICapital and its CEO have been singing a very different BULLISH song....

30 comments:

madcap said...

Moolah, let me confess I am a newbie in the investment game (and NOT like the newbie in seng's chat). And I am not interested in defending TTB. I just wanted to point out that the evidence you cited is not strong and there are alternative conclusions. So, to go to your main statement:

"Well, madcap, like you, I honestly do not know if ICapital shares were sold during this February time frame but if it did happen during this period, I find it incredible, really."

Is it incredible for someone to thinks the market is fundamentally sound to turn around and sell off (just a figure here) 50% of his holdings? Ask Seng. He has said that many times - don't be surprise that now I am buying and suddenly tomorrow I might sell off everything. Ask him if he thinks that the market has fundamentally changed when he does that.

Is it incredible to sell RM50 million worth of shares in say, I week? I looked at Parkson and UMW, assume in February they are RM7.50 a share each. You need to sell 33,000 small lots of each counter to get RM50 million. (I hope I calculated rightly - maths is not my strong suit) There are days in February that have exceeded this turnover, in a single day for these two counters.

Is it an incredible practice for a fund manager to do this? I really don't know. I think it is not far fetched to think that TTB thinks he can beat the market. As I said, I think he is very arrogant.

Seng said...

Dear madcap,

The issue is not whether a fund manager can / cannot sell 50% of his fund.

The issue is Integrity. Integrity is defined as someone who Walks his Talk.

TTB talks about Integrity in his website (see http://www.icapital.biz/english/). He also talks about bullish markets.

And he sold in between his Talks. Silently.

Now, from an Integrity perspective, one then wonders if this is consistent. I'm NOT saying he is a bad man in character. I'm NOT saying he's a bad fund manager. I'm just agreeing with Moolah's observation that there is a disconnect between his Talk and his Actions.

You, see, what I like to see him do is to tell the world REALISTICALLY how he see's it. E.g. he can still make THE SAME bullish pronouncements - I have no problem with that since it is his opinion, and I will defend everybody's rights to express their opinion. He can still sell at any time that he deems fit LIKE WHAT HE DID - I have no problem with that, since this is the right for everyone in Bursa Malaysia.

However, what I would like him to SAY (which I didn't see him do - but if he did, please feel free to point it out to me so that I can be corrected) is "whilst I am making these bullish pronouncements, and whilst I tell you that I will buy more, don't be surprised if I were to sell silently for market timing or other purposes".

To me, NOT saying this can convey the impression of someone lacking Integrity. Especially when he says he believes in the Bull, and he says he will Buy more, but he didn't tell you he will sell.

Is this simple concept understandable?

Seng.

PS. I still have a high respect for Uncle Tan, despite his worts and his lack of Integrity in this particular instance. To me, it is a relatively small black spot in comparison to everything he has said, done and achieved. It is a minor disclosure issue which can be easily amended with no fuss. (unless the fans want to make a fuss and can simply find no fault in TTB)

PS2. There is actually a bigger moral issue than this specific instance. For example, in the securities industry, it is not uncommon for the Research side to say "Buy", when around the same time, the Trading side "Sells" the same stock. In my opinion, IF there is no full disclosure, then, this is morally wrong and deceitful. The current industry standard is to disclose that they own the stock. But I sometimes wonder if this is enough, since this industry is full of "newbies" who may not appreciate the fact that owning the stock means it's distribution (= selling) time when they call Buy ...

But going back to Uncle Tan's case, I would have liked Uncle Tan to mention that despite making these bullish pronouncements, he may either Buy More (which he says he will), or Sell Some temporarily (which he didn't say and chose to be silent). The absence of the latter means there is an element of deceit in my own opinion. Of course, if you can show me his public proclamation that he said "he will sell some despite the bullish pronouncements", then, I am ready to be corrected. I admit I'm not an ICAP watcher like some of the ICAP fans may be, and so, I may have missed it. Thanks.

The Wanderer said...

Our managing director has been a student of the stock market for 36 years. He has conducted very extensive research on the 1930 Great Depression as far back as in the early Eighties. He has also studied the 1870 Depression and more. In all these times, he has never seen the extreme level of pessimism that is now prevailing. From the men or women in the street to the well-known economists and fund managers to the Soros of the world to IMF and now, even to Singapore’s GIC, there is just so much pessimism. Even Warren Buffett recently advised on American TV that the US economy is already in a recession. To our managing director, this is perhaps one of the best indicators that the level of negative sentiment has reached its extreme lowest. To quote our managing director, “Buffett is a brilliant investor but a lousy economist.”

The Wanderer said...

“Buffett is a brilliant investor but a lousy economist”
– Tan Teng Boo

This is in bold letters with bigger fonts in iCapital.biz

What do you call him now? :)

deceitful, confident, arrogant, lack of integrity???

Or on Top of the World?

How? What say you?

madcap said...

> Is this simple concept understandable?

Sigh. This is not fun anymore. So I will stop. I may be a newbie, but I am not stupid (though you don't have to believe me. And well, there may be times when I do stupid things, and say stupid things and participate in discussions where I look stupid or (I swear) I was made to look stupid - I hope I have put in enough caveats) Let me end with 1 question: Is it a practice for analysts who are interviewed to say ""he will sell some despite the bullish pronouncements" or vice versa. As I said, I'm a newbie so I don't have enough experience nor have I read enough analysts reports. You guys are much more experienced than I am. I must say though, I have never heard this nor read it. And no, Icap's website does not carry such a statement either. I guess everyone is lacking integrity. Thanks guys. Fire away.

The Wanderer said...

http://img2.freeimagehosting.net/image.php?f99e5590bf.jpg

http://img2.freeimagehosting.net/image.php?fcb5c88901.jpg

http://img2.freeimagehosting.net/image.php?f3afdd3e27.jpg

screen shots of the latest commentary from icap.biz

what say you?

Anonymous said...

It's interesting that many find here that TTB is arrogant. I have not met him personally but have read some of his articles or interviews. Indeed, he sounded very arrogant to me. He has long professed himself as a student of Buffett and Graham. I think money and success has grown his ego too much. By highlighting his statement on Buffett in his newsletter and the Star, he is trying to send a message that he is not under the shadow of Buffett anymore. He has such arrogance to make a negative statement on the world's richest man and investor. He did say Buffett was a great investor but that's because he can't challenge that although his ego would like to. To bring his ego back down to earth, his pathetic RM140 mil is like a tiny sand in Buffett's beach. Really. This guy needs a dose of reality. He MIGHT be good but his character and arrogance is certainly not a sign of any greatness at all. I use the word MIGHT because his track record is not long enough. Most of his track record dates back from 1998, a period of extreme low in the local stockmarket. That itself could be a fluke. When you start a fund at extreme low, the only way is to go up. He did outperform the index though but many funds did that too over the last 10 years. To do it over 10 years is VERY VERY different from doing it over 30 - 50 years.

The Madviruz said...

There is a conflict of interest here.
To be a successful fund manager one need to be ahead of the curve.
To publicly airs his professional analysis gives one an opportunity to manipulate the crowd.
One cannot be successful or fair to both investors of his fund and the public at the same point in time.

Arrogance frequently is associated with failure - a delusion of infallability.
Feign arrogance or deceit is needed as a means of manipulation of the crowd for one's own selfish purpose.

The answer to the question is who benefits? - cui bono?

Ernest Lim said...

Dear All,
My view is that there might be other reasons for TTB to sell off those shares in his portfolio. Maybe:
1) he found those shares overvalued at that price?
2) some changes on the fundamentals of those particular companies make him uncomfortable?
3) he wanted to rebalance his portfolio?
4) he found other undervalued companies that offer better return?

My point is, locking in profits from one's investment does not mean that he is bearish on the market. He can still be bullish on the world economy as a whole, and believe that the market will continue to perform well going forward, but that doesn't mean he have to invest in every counter out there and NOT locking in profits. Just like Buffett, although he thinks that the outlook is gloomy, he is buying more and more shares recently. And hence, I don't think Mr TTB is misleading his readers or followers.

Well, Mr TTB could have avoided all these misunderstandings if he gave his reasonings on selling those shares. But, do you think he care what other people think?

The above are just my 2 cents view. Thanks.

Ernest

Moolah said...

Hello Ernest,

You said the following:

Dear All,
My view is that there might be other reasons for TTB to sell off those shares in his portfolio. Maybe:
1) he found those shares overvalued at that price?
2) some changes on the fundamentals of those particular companies make him uncomfortable?
3) he wanted to rebalance his portfolio?
4) he found other undervalued companies that offer better return?

-------------

Ernest,

The point is simple. In regardless of his reasoning (which I am sure it must have been correct), he had been quoted on the newsmedia to be saying "The KLCI is resilient as it is not over-valued with sectors such as palm oil, which is doing well. The KLCI would continue to perform despite a slowdown in the US" (I do believe his long term view on the CI is at 2000 pts!)

So why is he telling everyone he is bullish on the market when he was actually disposing a huge chunk of shares?

rgds

Ernest Lim said...

Dear Moola,
Well, my point is, he is (and i think most people should also be) looking at the market and stocks separately. A particular stock might go down even the market is on an uptrend; and vice versa. He could have been bearish on the future of some particular STOCKS, but bullish on the whole MARKET. Something called bottom up investing? (or something like that. i m not good at financial terms)

Secondly, he could have sold off those shares to lock in capital gains. If you would take a look at the "Investments" under the latest ICap's Balance Sheet, the amount is not much different compared to the previous quarter. (However, referring to its Notes will show a decrease of NAV from the previous quarter, which might be caused by the market crash). Hence, I would think that he was in fact switching targets rather than bailing out.

Please correct me if I am wrong.

Thanks and Regards,
Ernest

Moolah said...

Ernest,

ICapital has a massive reputation in the market. And there are many out there who would mimick what this fund buys or what Mr. Tan recommends WITHOUT hesitation.

One can call them as naive but bottom line is they held Mr.Tan in high respect.

Hence this current discrepency between what Mr.Tan said on the press (telling everyone he is bullish on the markets) and what he does for the fund (disposing his shares) is rather shocking!

rgds

Moolah said...

Folks,

I realised that Mr.Tan likes to use the phrase 'buy for the longer term' in his stock recommendations.

Correct me if I am wrong but I do believe that Mr.Tan had said that the longer term target for KLCI is 2000 pts.

And in January, he had said that KLCI is NOT overvalued.

And if this is the case, again I ask why the discrepancy between what he says and his selling of shares?

rgds

The Wanderer said...

http://img3.freeimagehosting.net/image.php?e437b20442.jpg

another screenshot 25/01/2008

Moolah said...

Wanderer,

Many thanks for your latest screenshot!

rgds

Tan Sri Dr. Chua Soi Lek 丹斯里蔡細歷 said...

Ever since starting to blog.. have been trying to get a grip on this new medium... frustrating...

But honestly, I don't see any contradiction in what that fella is doing.

I mean in my simple mind, its like I'm bullish on malaysian euqities in general and I can tell people that I am bullish.

But that doesn't mean if I'm holding some shares of Liqua health I wouldn't sell them.

Or perhaps its a matter as simple as rebalancing my portfolio?

Or selling shares that I think are overvalued so that I can buy shares which are better valued?

Theres not enough evidence merely based on a quarterly report which doesn't tell you very much to convict the guy.

For the record, I do susbscribe to his online newsletter and it makes for amusing reading.

Then again, what do I know? I'm merely an ex-politician, not economist or hot shot investor ;-)

KP said...

The thing is ... there is never sufficient evidence to "convict". (Personally, I wouldn't use this word as we are merely having a discussion. ie this is not a court of law. I wouldn't even use the word "deceit" in this case as nothing is proven. This is why white collar criminals usually get away easily.)


But a person with considerable power to influence...such a person...does he have a duty to be careful with his words? Does he have to make himself absolutely clear to his listeners...lest they are misled. Conscience, perhaps?

Even at this stage, is it too late to clarify one's stance?

I feel that in this industry, where integrity is in very short supply, someone in it for the long haul needs to take extra measures beyond what is necessary to protect one's reputation. Otherwise, questions will be asked.

I don't think it was wrong to ask the questions asked in this blog. Now, I would like to see some answers. There is, of course, absolutely no obligation on his part to give an explanation.

Seng said...

Dear Doctor,

What a pleasant surprise. Speaking for myself, I think it's quite refreshing that we have a true-blue politician here. I wish you all the best in your blogging experience!

As for this topic, I agree that in the court of law, everyone is innocent until proven guilty (including Hindraf 5!).

However, in the investing world, waiting until such proof to occur is potentially risky and dangerous. I'm not dismissing your plausible explanations (e.g rebalancing, or selling over-valued shares) - we are unlikely to know the truth, since ICAP does not need to disclose their detailed transactions to the public. So, the plausible explanations remain just that - plausible. More importantly, for every plausible supporting reason, one can also raise plausible contra-arguments, which means there is no clear decision in the real world. In stock market trading, this is not productive. By the time one debates and waits for concrete proofs (to the same standard as in a court of law), prices would have inevitably tanked. It would be too late to get out then. (An example that comes into mind is TRANMIL).

It is worthwhile noting that the issue is not just the ICAP fund that he manages, but his entire stock advisory service that he sells. If investors cannot trust the guy, how can they listen to his advice with confidence in future?

I believe it is important that someone like TTB be very careful with what he says, as he is listened to very carefully by many of the serious local investors.

Seng.

The Madviruz said...

I am a firm believer of justice both in and out of the court of law.
When a doubt is created the enforcement division of the security commission should seek an answer. This is preemptive to delineate the conflict of interest - not liked the ISA but similar to professional bodies governing the doctors(MMC) or lawyers(Bar Council).

We do not give a damn to the success or economic well-being of the person in question, but we do care when the investing public misled.

The investing public need independent finanacial reports, which are sorely lacking in this country.

With the Internet and a forum as this, the many views propagated here to many, negates the view from one as projected in the traditional media.

Moolah said...

Dear Dr,

Let me share some views.

You said:

But honestly, I don't see any contradiction in what that fella is doing.

I mean in my simple mind, its like I'm bullish on malaysian euqities in general and I can tell people that I am bullish.

=> The problem is who Mr.Tan is.

He is well known and rather famous and reputated NDEPENDENT INVESTMENT ADVISOR, whom many looked up upon.

What he said is usually duly noted by the investment commounity.

And what has happened here is Mr.Tan had been quoted far too many times on the news media to be bullish on markets from Jan - March 2008.

However, despite as being bullish as proclaimed, he in return had been selling a lot of shares.

Don't you think this action is rather contradictory!

Why sell the shares when you have been telling everyone you are bullish?

Does it make sense?

Sorry but it just doesn't add up for me.

rgds

Tan Sri Dr. Chua Soi Lek 丹斯里蔡細歷 said...

I see your point.

But at this point in time I don't see enough evidence to 'convict' (for want of a better word) him as yet.

I'd rather wait for his next quarterly report and give him the benefit of doubt for the moment and not be too quick to judge him as yet.

You may be right of course. But then again, maybe not.

But my point is that at this time, I can't still conclusively say he is being dishonest. Perhaps he is, perhaps he isn't. Only time will tell.

Let us just at this juncture agree to disagree.

Anyway, to digress, must say that you have a really nicely set-up blog here and I like the way you write, pretty insightful and cynical and to the point.

Moolah said...

Dear Dr,

I do believe you have misunderstood the main purpose of this posting.

Seriously, it's not about 'conviction' (To be honest, English, is such a rather sensitive issue in the stock market) but it's all about telling what has happened.

And it's not about me being right or wrong.

And neither it's not about me trying to judge him.

What actually happened was, I was curious when ICapital reported its earnings. And naturally, I was most interested to know and understand how this closed end fund had performed during this period.

And I was shocked when I discovered the large selling of shares by this fund.

Why was I shocked?

Because I have read that he had been bullish on the market, this very same period.

Which to my interpretation, is rather contradictory, a discrepancy.

So how would I or anyone review what has happened here?

Let's see..

Did Mr.Tan tell the mass media he was bullish? Yes I am afraid he did.

Did ICapital sell some rm50 million worth of shares during this very same period? Yes I am afraid it did.

Now these are the facts what has happened, yes?

Could I have wrongly misinterpretate what has happened here?

Do I think these actions are contradictory? Yes I do.

Perhaps it's simply best if Mr.Tan could give a proper explanation on what has happened here to the investing community.

rgds

KP said...

Perhaps it's simply best if Mr.Tan could give a proper explanation on what has happened here to the investing community.
-------------------------------

Perhaps I am even more cynical than you. Cos I certainly am not expecting any reply. He knows me not, and he owes me nought.

What I do know is this. Until such time that there is an explanation for this, if I ever read another news article of him expounding his views on the market, I will know what to do. Raise the red flag. :)

Tan Sri Dr. Chua Soi Lek 丹斯里蔡細歷 said...

Dear Moo

Ok... I get what you're saying. You've made your point about his actions being contradictory to his public statements.

But I just wonder if you are oversimplifying the matter?

Nevertheless I really do see what you're trying to put across.

Certainly the weight of the available evidence does point to the direction you are alluding to.

Guess the only person who can shed light on this whole thing is probably Mr TTB himself.

As for me, I'll take the stand I've always taken all these years.(learnt the hard way with money, seat and tears) :-) Take all 'expert' or 'analyst' opinions with a pinch of salt! At the end of the day, you still have to make your own investing decisions and take responsibility for the choices you've made.

Seng said...

A related observation.

From the Star on 5 Jan 2008 (SATURDAY). (http://thestar.com.my/news/story.asp?file=/2008/1/5/bizweek/19912568&sec=bizweek)

"Capital Dynamics Asset Management managing director Tan Teng Boo, who is PRESENTLY A NET BUYER (my capitalize) of equities, opines that equities should fare well: “The CI performance should be good. The investment exposure in Malaysia is slightly different. We have palm oil that is doing well, and you don't get palm oil in any other part of the world.” "

Two days later, On MONDAY, 7 Jan 2008: ICAP fund hit an ALL TIME high of $2.82. A coincidence?

(Interestingly, FRIDAY 4 Jan, US markets closed with a Big Red ...)

Fast forward to the recent release of ICAP Quarterly Report for QE 28 Feb 2008. During 1 Dec 2007 to 28 Feb 2008, ICAP was actually a NET SELLER, (raising nearly $50 Million Cash).

(Eh? I thought the Star says TTB was a NET BUYER of equities on 5 Jan? Must be a relatively big reversal from a Net Buyer to a Net Seller. No wonder Moo Moo Cow had a SHOCK!)

Just wondering though:

1. For the period 1 Dec 2007-5 Jan 2008, was ICAP a Net Buyer or a Net Seller?

2. Perhaps ICAP was a Net Buyer until 5 Jan 2008, i.e. the Star and TTB was telling the truth up to that point. Then, perhaps after the news is published, TTB became a net Seller from 6 Jan 2008-28 Feb 2008. Nothing wrong here???

(As a layperson - I'm just wondering aloud - what's the difference between this type of behaviour by a Fund Manager who talks loudly to the Press, and a Used Car Saleman who loudly says that the car he is selling is the Best Car to Buy, when he is actually looking to get rid of it as soon as possible?)

Seng.

PS. I do feel sorry for the poor bloke who bought ICAP at $2.82, just after TTB's bullish news and Star reporting that ICAP is a NET BUYER ...

PS2. Interestingly, on 7 Jan 2008 (Mon), Parkson price FELL from a high of 9.5 to a low of 8.95 to close at $9 (i.e. a signficantly bearish move suggesting someone is selling more than usual).

PS3. How did all this mess arise in the first place? Should we allow fund managers who manages real money to make such public comments where they might be perceived/misperceived as having special advantages?

The Wanderer said...

http://img2.freeimagehosting.net/image.php?3c8ba1044c.jpg

09/05/2008

Moolah said...

Wanderer,

Thanks.

Just for your reading pleasure: http://www.financialsense.com/Market/barbera/2008/0506.html

"All of this sounds very mild, nothing to be concerned about, but unfortunately, all of this is just a statistical mirage. In the official release from AP, the total job losses of 240K were obtained by adding up the prior reported figures for March –81K, Feb –83K, and Jan –76K. However, what the media are not reporting, and what is not getting sufficient attention is the BLS Birth-Death Model."

rgds

The Wanderer said...

Moola,

No problem. The only way to check the last of the 3 I in ICAP is keep putting up what they "say"s and see what they do.

http://img2.freeimagehosting.net/image.php?42c73e7ec2.jpg

The NYSE outlook.

Thanks for the article.

rgds

BBC said...

Whether ICAP is truthful or not,we will never know.But what we know is that stock market is very volatile.One should not put all his money in ICAP.He should diversify his portfolio.I have advised my readers many times.

Moolah said...

My Dearest BoyBoy,

Quote: Whether ICAP is truthful or not,we will never know.But what we know is that stock market is very volatile.One should not put all his money in ICAP.

The issue here is NOT about trusting ICAP and is NOT about Icapital as a fund.

The issue here is about contradictory in what Tan Teng Boo was quoted to be saying in the press and the action of his funds.

End of the day, Tan Teng Boo, said he was bullish on the market. And CONTRARY to what he said, his fund sold some rm50 million worth of shares.

Is this morally and ethically correct as an INDEPENDANT fund manager who has is known to be "LONG-HELD and CONSISTENTLY BULLISH" on the local stock market?

rgds