Year: 2007

Categories
Stocks

Old horses in China Online Game

Reading Time: 2 minutes

Last Updated on November 20, 2007 by stlplace

(Update Nov 20) Grus had a good post on trader818 explaining the online games and its competitive nature. So I can shut up.

(Original) I have traded the three old horsemen among Chinese online game companies 2 years ago(unfortunately, lost money on all three): Shanda (SNDA), NetEase (NTES) and the9 (NCTY). I paid attention to them from time to time, and I think recent developments in those 3 companies are interesting, especially from business point of view.

First, the good news from Shanda. Two years ago SNDA stock is in a downward trend, because its main revenue source: lineage II was getting old. Since then SNDA did a few things: it sold Sina stock and took a big gain; it changed its business model from making money from subscription to making money from selling stuffs used in game; it also acted more like a VC, I mean it bought some popular game in its early stage, then leverage its distribution network to make money.

NetEase, the old game (westward series) are really getting old, the new in-house games are not taking the slack from westward. Other effects such as web search is too little too late. In my mind, Mr. Ding Lei was very lucky in the past, in terms get into the right field in the right time (email service, mobile value added service, and online game). Will he be lucky all the time?

Continue reading “Old horses in China Online Game”
Categories
China Stocks

China to tax stock real estate gains?

Reading Time: < 1 minute

Last Updated on November 17, 2007 by stlplace

There are conflicting news about this hot topic. The initial news, according to Hexun, the Chinese tax bureau is going to collect tax on the gains made from stocks and real estate for people earn more than 120,000 Yuan per year. Note in China 120,000 Yuan is the threshold for people to file personal income tax.

personal income tax(source: xazr.com)

But according to Xinhua and Netease, the Chinese tax bureau is not ready to collect capital gain tax from stock sales yet.

My take: the personal income tax and especially the filing of personal income tax (for person earn over 120,000) are still fairly new. The Chinese stock market is also fairly new (compared to western markets). It IS good for China to align the tax system, encourage investing (in stocks) while keep the fairness of society (people from different income level). But keep this balance and how to accurately calculating taxes will NOT be easy for the goverment, and brokage firms.

Continue reading “China to tax stock real estate gains?”
Categories
Fun Stocks

Do not touch the stocks

Reading Time: < 1 minute

Last Updated on November 17, 2007 by stlplace

I usually have a weekly call with my parents. My mom knows I investing in stocks. On today’s call she suggested I touch less on stocks. I think this sums up the sentiment of Chinese stock market very well. After recent drop of the A share market, people are weary of what the goverment will do (further) to cool down the market.

do not touch sign (source: online-sign.com)

Continue reading “Do not touch the stocks”
Categories
China Stocks

Starbucks, Panera

Reading Time: < 1 minute

Last Updated on November 15, 2007 by stlplace

Yesterday morning when I went to Panera (St. Louis) Bread to get morning bagel, I noticed they raised the price from 89 cents to 95 cents. I can fully understand the pressure they are facing: the rising wheat, diary, and energy cost.

Today Starbucks came out with earning, and understandablely a disappointing outlook (bloomberg).

SBUX and PNRA are hit on two sides: the rising costs of raw materials; and shrinking pockets of US consumers.

Long term, I do believe Starbucks will do very well in China, and other emerging markets; but right now, the sales from China is just too small to overcome the difficulty in the US…So I will NOT try to be hero at this time.

Categories
Stocks

Homework

Reading Time: < 1 minute

Last Updated on November 15, 2007 by stlplace

I resumed my homework on stocks today. By homework I mean the research I did on stocks, basically I copied the financial numbers, such as revenue, earning, company own forecast to a Google spreadsheet, and do some simple calculation such as growth rate, price sales ratio (market cap divide by the revenue). This is very rudimentary but notheless it does give me a feeling whether the stock is expensive or not. On reflecting the mistakes on CROX, I think one reason is I did not keep the speadsheet up to date 🙁

Actually on my spreadsheet for CROX (last updated on July 26), I had a few lines like: “sell some before Q1 earning”, “sell some before Q2 earning”? I did sell some on early May (before Q1 earning), but I did not cash out any before Nov. 1 melt down. I am not saying “had I did the homework, things would be different”. In stock market there are no “had I”, or “would be”. But one thing I can make sure is sit tight, and do the home work.

Now back to the homework for Mindray (NYSE:MR) and Longtop (NYSE:LFT).

Categories
401k and Personal Finance

New 401k plan

Reading Time: 2 minutes

Last Updated on November 15, 2007 by stlplace

No I haven not changed my employer or anything, but my company was acquired by a global 50 company this year, and from next year we will have new 401k plan. Currently my 401k is in Vanguard and I am happy with them so far. One advantage with Vanguard is they have the lowest fees in the industry. If all other things are equal (in the long run, I do believe the performance of most large cap stock funds tend to converge), lower fee means better performance for investors.

nest egg pic

(Picture from Money Magazine)

That being said, I also found some interesting things about my new 401k plan: the new funds categories by the investment regions; and the company stock.

Continue reading “New 401k plan”
Categories
China Stocks

Currency wars

Reading Time: < 1 minute

Last Updated on November 15, 2007 by stlplace

Early August 2007, when I was in Shanghai, the US stock market underwent a crisis from the sub-prime mortgage. At that time the focus was on BearStern and its two hedge funds. In China, and in overseas Chinese financial community, the book named Currency Wars authored by Mr. Song Hongbing was very popular. So I bought one in Shanghai. The heart of this book is (in my own words): we are inceasingly live in a world that controlled by international bankers. In a way, ordinary people (like you and me) are very much like their (bankers) slaves.

Currency wars logo (picture from Amazon China)

As I am reading the book about Fed history (Wiki: US Fed reserve), and listening to Ben Berneke (the Fed chairman) speech this morning, I think this is very interesting: is Ben Berneke, an Econ professor from Princeton, look like the representative of the bad guys (a.k.a., the bankers)?

Here are some comments about the book at douban.

Categories
China Stocks

Is the Chinese bull market over?

Reading Time: 2 minutes

Last Updated on November 17, 2007 by stlplace

(Update Nov. 17) Shuipi of ChinaTimes(水皮华夏时报) wrote this interesting piece on his newspaper.

(Original) It looks like it, from the highs at 6,200 in early Oct to 5,200 now. But wait a minute, recently the US stock market suffered big loss because of the sub-prime meltdown, and weakening of the dollar. How could the mess in the US drag down the Chinese stock market?

Well, one can say we are in a global economy now, the ripple effect of US sub-prime meltdown means the US business and consumer will watch their wallet more carefully, which is bad for Chinese exporters. We all know the Chinese economy depends a lot on exporting to the US.

China Mobile logo

Continue reading “Is the Chinese bull market over?”
Categories
Stocks

What if brokage firms go bankrupt?

Reading Time: 2 minutes

Last Updated on November 13, 2007 by stlplace

The drama in wall street did not end on last Friday. Today E-Trade, the few dot com survivor, came into news about is exposure to Mortgage Backed Securities (MBS). In these days, MBS are pretty much like useless paper, because of the sub-prime crisis. Accoring to analyst, the chance of E-Trade go bankrupt is still remote, or 15%. But this will make the E-Trade investors and customers nervous, and its competitors happy. So, what if E-Trader eventually do go bankrupt? What does that mean to its investors and customers?

For E-Trader investors (stock holders of ETFC), it is simple: that means total loss.

e-trade logo

Continue reading “What if brokage firms go bankrupt?”
Categories
China Stocks

China Merchants Bank opened NY branch

Reading Time: < 1 minute

Last Updated on November 17, 2007 by stlplace

Week in review 11/04 to 11/10

1) Shanghai Univ of Finance and Economics, or SUFE, is celebrating its 90 years annaversary. SUFE also launched Shanghai consumer/investor confidence index, similar to Univ of Michigan consumer confidence index.

SUFE logo

Continue reading “China Merchants Bank opened NY branch”