https://finance.yahoo.com/news/intel-slashes-forecasts-amid-decline-204616825.html
https://kfgo.com/news/articles/2019/apr/23/texas-instruments-revenue-profit-beat-estimates-shares-rise/
The semiconductor titans are reporting weaker sales forecasts due to poor China demand. Therefore, 2019 won't be a bumper year for the semiconductor industry. However, Micron Tech is still being extremely optimistic and fudging its numbers when it has more than 50% China sales.
https://www.investors.com/news/technology/micron-stock-rallies-second-half-2019-recovery/
We've stated the global semiconductor slowdown in October 2018.
https://sg-stock.blogspot.com/2019/03/the-semiconductor-is-facing-collapse.html
http://sg-stock.blogspot.com/2018/10/the-global-semiconductor-slowdown-is.html
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6 comments:
Semis are still very strong right now --- maybe too strong & need a 5%-10% pullback to cool things.
Those with longer investment timeframe can just use the 40 or 60 week moving average.
16+ years of semiconductors
I'm in a short-term Oct-Apr trade, so I'm keeping tight trailing stop to close out the trade when it reverses. Currently about a +30% paper profit.
We need to compare apples with apples to get a true picture of the situation.
Some people also told me that Dow Jones Index was very strong by using historical data from the past including its inception time. However, the 30 Dow Jones Index stock components are totally different now. The current 30 stocks in Dow Jones Index are not the same 30 stocks back then because the weaker stocks are being kicked out in exchange of stronger stocks. The regular updates of the index give a false sense of euphoria that the stock market is doing well.
If an investor bought any of the 30 stocks back then, he would have made a heavy loss and his portfolio won't match the performance of the Dow Jones.
Thats why in my 1st post, I'm allrdy comparing apples to apples. The SOXX etf *IS* the global preeminent etf of major semiconductor giants in the world. If theres a global recession in semis, SOXX will definitely show it
That's the beauty of using etfs -- you dont have to bother about individual stocks and can focus on the longer term big picture. Most of the useful mainstream etfs have been around for 20 years or longer.
Its important not to be fixated with biases & to have flexible mindset when trying to make money. E.g. the same semis etf SOXX will have destroyed ur investment by -90% if u stubbornly stuck to it from 1999 to 2003. U have to know when trends change & when to go along or get off. Same applies to investing in other industries & countries around the world.
ETF functions like an index and doesn't necessarily reflect the true situation. There is a saying in the financial industry, "Wall street is not the same as the main street". ETF gets updated just like an index because it has underlying assets such as stocks that are parts of it.
For example, Nol was part of STI before but weaker stocks like Nol was removed and replaced with better stocks to make STI look good. It's the same for ETF since it is a tracking fund.
When wall street is doing well, it doesn't mean the main street is doing well too.
Au contraire ... Wall street does reflect main street & vice versa. This is even more so for Singapore as a highly financialised & globally economised city.
Well constructed etfs, just like society, are self-evolving & self-improving. Weaker companies and weaker segments of society die off & are replaced by better performing ones.
The whole is more important than the individual. Nol became irrelevant and was sold
off and delisted, and it was a non-event to Sporeans & economy & society. Singtel and SPH can go bankrupt next week & while it will cause a few months of downturn in Spore, life & the economy will recover relatively quickly, like as if Singtel & Sph never existed.
There's been many debates about wall street vs main street. If wall street does reflect main street in absolute term, this won't become a subject of contention.
https://www.thestreet.com/story/894521/1/wall-street-vs-main-street-the-wealth-effect-in-perspective.html
The fact is that there are fewer people participating in the stock market (wall street) as compared to the whole population (main street) and the wealth effect is therefore not reflected in the main street. This is the fundamental rationale behind the reasoning that wall street doesn't necessarily reflect the main street.
Singapore GDP is highly dependent on external trades and won't reflect the true picture of the Singapore wealth effect on the main street. The headline number is not so important because it can be skewed.
Let me give you an example below...Unemployment rate!
http://sg-stock.blogspot.com/2017/08/economic-101-dont-let-unemployment-rate.html
There's another saying that I would like to highlight: The demon is in the details!
Another example: SPH used to be a pure media company. SPH is becoming more like a property development stock now because the media revenue is smaller and the property revenue is bigger now. Is it sensible to compare the present PE with the past PE when SPH is no longer the same company?
This is why I pay more attention to the details and not just the headline number.
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