After correctly predicting this year’s slump in Malaysia’s technology shares, Danny Wong Teck Meng is loading up on beaten-down energy stocks.
The chief executive officer of Areca Capital Sdn. has been buying oil and gas companies in the past two months, betting that energy prices will rebound and valuations are pricing in too much pessimism.
“Oil and gas is one of my biggest bets now," said Wong, who declined to name specific companies and whose Areca Equity Trust Fund has beaten 98% of peers over the past three years with a 14% return.“Oil is more or less feeling the bottom. I can see daylight soon."
Energy companies are among the worst decliners in the US$380 billion ($534 billion) stock market over the past 12 months as crude plunged. SapuraKencana Petroleum Bhd., the country’s largest oil and gas services provider, and UMW Oil & Gas Corp., a unit of UMW Holdings Bhd., one of the nation’s biggest conglomerates, have tumbled more than 30% in the period to trade at less than the value of their net assets.
The Kuala Lumpur-based fund manager sold all his technology shares before December, saying the stocks were too expensive and a stronger ringgit would reduce the value of exporters’ overseas earnings. The Bursa Malaysia Technology Index has tumbled 10% this year, after rallying 52% in 2015, while the currency has climbed 2% for the second-best performance in Southeast Asia.
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The chief executive officer of Areca Capital Sdn. has been buying oil and gas companies in the past two months, betting that energy prices will rebound and valuations are pricing in too much pessimism.
“Oil and gas is one of my biggest bets now," said Wong, who declined to name specific companies and whose Areca Equity Trust Fund has beaten 98% of peers over the past three years with a 14% return.“Oil is more or less feeling the bottom. I can see daylight soon."
Energy companies are among the worst decliners in the US$380 billion ($534 billion) stock market over the past 12 months as crude plunged. SapuraKencana Petroleum Bhd., the country’s largest oil and gas services provider, and UMW Oil & Gas Corp., a unit of UMW Holdings Bhd., one of the nation’s biggest conglomerates, have tumbled more than 30% in the period to trade at less than the value of their net assets.
The Kuala Lumpur-based fund manager sold all his technology shares before December, saying the stocks were too expensive and a stronger ringgit would reduce the value of exporters’ overseas earnings. The Bursa Malaysia Technology Index has tumbled 10% this year, after rallying 52% in 2015, while the currency has climbed 2% for the second-best performance in Southeast Asia.
Click Here To Register For Free Trial Services OR Give A Missed Call : +6531581402 Follow Us On Twitter : www.twitter.com/epicresearchsg Like Us On Facebook : www.facebook.com/EpicResearchSingapore Need Any Assistance Feel Free To Mail Us at : info@epicresearch.sg
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