Hong Kong: The Ugliest Girl At The Dance

Hong Kong: The Ugliest Girl At The Dance

Watch the video with Andrew Stotz or read a summary of the country profile on Hong Kong.

Four Pillars of GDP: Least attractive in Asia

Hong Kong is, unfortunately once again, the object of many a euphemism: the moldiest pear in the pear in the pear tree, the cheapest rock in the jewelry shop, the ugliest girl at the dance. Take your pick!

How Fund Managers And Investors Are Investing And Implementing ESG

investIt's no secret that ESG (environmental, social, governance) factors have become more important in investing. Fund managers are increasingly incorporating ESG factors into their portfolio allocations. However, those that don't are in danger of being left behind as investors increasingly avoid allocating with funds that don't incorporate ESG into their allocations. Q3 2021 hedge fund Read More

The market’s low GDP growth, annualized at 2.83%, is falling below even the low-growth environment of 2016. Investment was the largest contributor to GDP growth, but net exports were a significant obstacle to growth.

Still the Lowest ROE in Asia

Despite a slight recovery in 2016, the first quarter of 2017 was a letdown, and consensus estimates for 2017-2018 earnings growth sit below the Asian average.

Return on equity expectations of 7.5% for this year are the lowest in Asia.

A. Stotz Four Elements: Hong Kong’s rank relative to Asia

Overall Hong Kong is the least attractive in Asia considering all our four elements: Fundamentals, Valuation, Momentum, and Risk.

Fundamentals: Hong Kong has the lowest ROE in Asia, hence weak profitability.

Valuation: Low price-to-book value and moderate dividend yields tempt some investors.

Momentum: Hong Kong has moderate price momentum.

Risk: The market’s beta and price volatility compared to Asia ex-Japan are relatively high.

Strong performance in Information Technology

Top 3 largest sectors: Real Estate: 17% of the market; Information Technology: 16%; Financials; 15%.

Best sector & stock: Info. Tech. +23.6%, Landing International Development Ltd +129.7%

Worst sector & stock: Materials -2.8%, Shougang Fushan Resources Group Ltd -23.8%

*CE is consensus estimates

Article by Dr. Andrew Stotz, Become A Better Investor

Updated on

In 1992 Dr. Andrew Stotz, CFA, left a management career at Pepsi-Cola in California to teach finance in Thailand. In 1993, he found his life calling as a financial analyst, a job for which he was eventually voted #1 in Thailand. In the second half of his 20-year career in investment banking, Dr. Stotz was a Head of Research, leading teams of financial analysts. He served as a two-term president of CFA Society Thailand and now runs his firm, A. Stotz Investment Research, which provides research and tools for institutions and high-net-worth investors and helps CEOs make their companies financially world class.
Previous article Indonesia, Getting Hotter By The Day
Next article What’s the Liquidity on an Asset No Sane Person Would Want?

No posts to display