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Phuket Finance: Note the contrarian investor

Legacy Phuket Gazette

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PHUKET: Contrarian investors are those who generally do the opposite of what the majority do. There are many forms, but basically they can all be summed up by the old Wall Street adage, “Buy Low, Sell High.”

As simple and as logical as this advice sounds, in practice the majority of investors in fact do the opposite. The lonely contrarians are the ones buying in the midst of stock market crashes, while everyone else is bailing for the doors and losing their shirts in the process.

The reason people are usually panicking is simple. They waited for confirmation that the world was as it should be and the stock markets have usually already risen by that point. They have essentially bought near the top, by which time the contrarian is already busy slowly liquidating the holdings he bought in the last bear market.

I have read and heard a lot about investors feeling now is a safer time to go back into the stock markets, and it has me wondering if we aren’t due for another big downward stretch of the market.

There have been many studies about the headlines on the covers of leading financial media sources at major turning points in markets. At the top, they are always rosy predictions about how this time is different and a new era of never ending growth is beginning, or something similar.

Near the bottom, when companies are usually trading at valuations that finally make sense, the news is usually so horrible that investors are terrified of putting money into the markets. Crashes are the absolute best time to invest for the long term, yet it is very difficult to go against the popular sentiment at the time. Also, trying to pick an absolute bottom is a fool’s game.

The same approach is not limited to stock market investment. There are a multitude of investment strategies out there, and usually the best time to invest is after a period of poor performance and when they have fallen out of favor. If you had invested in gold during the early 2000s when nobody except a few crazy gold bugs were talking about it, you would be extremely pleased with yourself today.

However, many are just getting into this market now, after it has risen over 300% already. What goes up will always come back down; of course it may go up much further from here still if the world economy enters another round of the financial crisis.

The big difference contrarian investing brings is how safe your investment is. The more an asset rises the greater the potential downside becomes. The best investors aren’t trying to pick the tops and bottoms, they simply buy in somewhere after a given market has fallen substantially and they get out after they have had a reasonable run. There is usually a nice safe chunk in the middle of every big market move which can be had if fear and greed are overcome.

Sometimes it can pay big time to be the odd man out. Warren Buffet, the most successful investor of our times, is famous for making huge stock market investments in the midst of crashes.

David Mayes MBA resides in Phuket and provides wealth management services to expats around the globe, focusing on UK pension transfers.

He can be reached at david.m@faramond.com or 085-335-8573. Faramond UK is regulated by the FSA and advises on pensions and taxation.

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Archiving articles from the Phuket Gazette circa 1998 - 2017. View the Phuket Gazette online archive and Digital Gazette PDF Prints.

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Turbulence ahead for Thailand’s aviation industry | VIDEO

The Thaiger

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Turbulence ahead for Thailand’s aviation industry | VIDEO | The Thaiger

When the airlines, in particular, were asking the government to put their hands in their pockets for some relief funding in August last year, it was genuinely thought that international tourists would be coming back for the high season in December and January. At the very least local tourists and expats would head back to the skies over the traditional holiday break. And surely the Chinese would be back for Chinese New Year?

As we know now, none of that happened. A resurge in cases started just south of Bangkok on December 20 last year, just before Christmas, kicking off another round of restrictions, pretty much killing off any possibility of a high season ‘bump’ for the tourist industry. Airlines slashed flights from their schedule, and hotels, which had dusted off their reception desks for the surge of tourists, shut their doors again.

Domestically, the hotel business saw 6 million room nights in the government’s latest stimulus campaign fully redeemed. But the air ticket quota of 2 million seats still has over 1.3 million seats unused. Local tourists mostly skipped flights and opted for destinations within driving distance of their homes.

As for international tourism… well that still seems months or years away, even now.

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Domestic air passenger numbers double those of January

Maya Taylor

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Domestic air passenger numbers double those of January | The Thaiger
PHOTO: Vietjet

Passenger numbers on domestic flights within Thailand have doubled within a month, rising from 4,000 in January to over 10,000 this month. Having nearly recovered to pre-pandemic levels, domestic travel plummeted once more when Covid-19 resurfaced late last year.

Apirat Chaiwongnoi from the Department of Airports says 15 of Thailand’s 29 airports are now operating domestic flights, with more expected to follow. He believes the aviation sector will continue to recover further in the coming 6 months, bolstered by the national vaccine rollout.

Around 120 domestic flights a day are now operating, which is twice the number that were operating at the lowest point in the crisis. Prior to the resurgence of the virus in December, domestic passenger numbers had recovered to 30,000 – 40,000 a day, around 80% of pre-pandemic numbers.

The DoA says airports must continue to adhere to the Covid-19 hygiene measures put in place by the Health Ministry and the Civil Aviation Authority of Thailand.

SOURCE: Bangkok Post

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Coronavirus (Covid-19)

Samut Sakhon’s shrimp market to remain closed until February 15

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Samut Sakhon’s shrimp market to remain closed until February 15 | The Thaiger
PHOTO: Kom Chad Luek

Samut Sakhon’s Central Shrimp Market, the epicentre of Thailand’s recent wave of Covid-19, will remain closed until February 15. The market can reopen once the overall hygiene situation at the market and surrounding area has improved, according to the province’s disease control committee.

Local officials say the shrimp market needs to remain closed until the market structure and nearby residential facilities are inspected. People who violate the order face up to a year in prison and a fine up to 100,000 baht.

More than 12,000 people in the province have tested positive for Covid-19. The increasing number of infections is a result from the active case finding to contain the spread of the virus.

SOURCE: Thai PBS World | Thairath Online

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