Wednesday, January 28, 2015

Old Notes on Asset Mgmt (2007-2008)

Top 20 Asset Managers

In trn of USD
UBS 2.45 Sw
BGI 1.81 UK
SSG 1.75 US
AXA 1.74 FR
Alliance 1.71 Gr
Fidelity 1.64 US
Capital 1.4 US
Deutsche Grp 1.27 Gr
Vanguard 1.17 US
BlackRock 1.12 US
CS 1.09 Sw
JPM 1.01 US
BNP Paribas 0.82 Fr
ING 0.79 Holland
Natixis 0.77 Fr
AIG 0.73 US
C. Agricole 0.7 Fr
Aviva 0.7 UK

ETFs

Currently over 1000 ETFs with 700bn in AUM
Est to reach 2trn in 2011

Wisdom Tree
Runs ETFs based on fundamental factors (cash dvd, profits, sales etc)
Not by mkt cap

ETFs based on fundamental factors
Also known as active ETFs
but do they justift fees?

Quant Funds

Major quant players
AQR
DE Shaw
Highbridge
Renaissance

They form a substantial portion of daily trading on NYSE
Conduct trades in milliseconds
Put computer servers closer to exchange to reduce time data takes to travel to exchange

GS Global Alpha lost 38% in 2007, all quant factors fail together - Black Swan

FRIDAY, NOVEMBER 23, 2007

US biggest mutual funds

75% of the money in index funds is in S&P 500
Vanguard Index 500 has $44 billion, tracks S&P 500
US biggest mutual fund is Fidelity Magellan ($58 billion)
ie Vanguard Index 500 is No.2?
Pension fund has $600-$700 billion in S&P 500

FRIDAY, AUGUST 24, 2007

Hedge fund return

1987 to 2004 15% return per yr
Bay Pond 40% per yr in 10 yrs

Harvard Endowment Return

Harvard Endowment Return 18.4%pa over 5 yrs 2002-2007
Endowment Benchmark Return 13.8% over 5 yrs 2002-2007
S&P Return 17% over 5 yrs 2002-2007

In China and Myanmar, bank sees a match made in heaven

In China and Myanmar, bank sees a match made in heaven

TOMOMI KIKUCHI, Nikkei staff writer
Singapore-based OCBC's acquisition of Wing Hang Bank widened its branch network in mainland China, Hong Kong, Macau and Taiwan from 25 to 120.
SINGAPORE -- As its name suggests, Oversea-Chinese Banking Corp. has leveraged the wealth and business activities of the Chinese diaspora. This has been the Singaporean institution's raison d'etre since the founding of its predecessor, Oversea-Chinese Bank, in 1919.
     True to form, OCBC now aims to cater to Chinese companies that are expanding into Myanmar.
     In 2014, the Singaporean bank made headlines with a couple of major moves: its entrance into Myanmar's banking sector and its acquisition of Hong Kong's Wing Hang Bank. In October, OCBC secured a banking license in Myanmar alongside eight other foreign institutions. Linus Goh, head of global commercial banking at OCBC, told the Nikkei Asian Review that the bank is eyeing an increased flow of foreign direct investment into the Southeast Asian country. "We see heightened interest in infrastructure development, such as energy, telecommunications and oil and gas, as well as hospitality industries," Goh said.
     OCBC hopes to capitalize on that flurry of activity while working with Myanmar's own banks to develop their capabilities.
     This is a moment OCBC had been waiting for. The bank's history in Myanmar goes back to 1923, when its predecessor set up the first branch in Rangoon, present-day Yangon. After the Burma Road opened in 1939, connecting Myanmar and China, the bank established a new branch near the Chinese border, financing trade until 1963. After a three-decade absence due to the 1962 coup, the bank re-entered the country with a representative office in 1994.
     OCBC's new operation in Myanmar effectively has a built-in network of Chinese clients, thanks to the Wing Hang acquisition. The deal increased OCBC's branches in China, Hong Kong, Macau and Taiwan from 25 to 120. "Myanmar, because of its rich resources, will be an attractive location" for Chinese companies, including state-owned ones based in southern China, to make cross-border investments, said Samuel Tsien, OCBC's chief executive officer.
Was it worth it?
Wing Hang did not come cheap -- it cost $5 billion. "Wing Hang's owner, the Fung family, wasn't willing to let go of shares for a low price," said Kenneth Ng, head of research at the Singaporean arm of Malaysia's CIMB Research. "In the end, OCBC was the only one negotiating, reaching closest to the family's requested price."
     Investors will be focusing on OCBC's efforts to bring about synergies with its new unit.
     OCBC uses its strong existing network to handle cross-border trade and offshore financing between China and Southeast Asia. The bank also has an edge in wealth management, with around $51 billion in assets under its watch and a list of high-net-worth clients in Southeast Asia, China, India and other markets.
     Wing Hang, meanwhile, serves many owners of small to midsize enterprises. OCBC hopes to tap into this client base while utilizing its private banking managers and products to enhance Wing Hang's offerings.
     Ng said he sees the deal as a positive and rates OCBC's stock as an "add." "The market has reacted to the expensive purchase of Wing Hang, and OCBC is now trading at a low valuation," he said. "The synergies will not come immediately, but we expect profitability to improve in the long run."
     Another point of concern is China's slowing economic growth. OCBC last year placed fourth in a ranking of the world's strongest banks by Bloomberg, thanks to its low ratio of nonperforming loans to assets and high Tier 1 capital ratio. But some worry that Singaporean financial institutions will have a hard time this year due to a number of factors: a higher volume of bad loans due to China's weaker economic momentum, a downtrend in the city-state's property market, and neighboring Malaysia's struggles with falling crude oil prices and the related loan-default risks.
     Among the three biggest Singaporean banks, OCBC's main rival is probably DBS Bank, which has around 120 branches in China, Hong Kong and Taiwan. DBS Bank's total lending in the region came to a little less than 100 billion Singapore dollars ($75.3 billion) in the quarter ending in September 2014, while OCBC's corresponding figure was about half, at S$52 billion. OCBC does, however, have a stronger presence in surrounding Southeast Asian countries, such as Indonesia, Malaysia and, now, Myanmar.
     As cross-border business activity picks up in the region, the market will be monitoring how OCBC links its Southeast Asian platforms with its Chinese network.

Tuesday, January 27, 2015

Apple

Sep-Dec Q NP $18bn, highest for any co. ever.

Shipped more than 1 bn iPhones, iPads and iPods.

Regained #1 in smartphones.

Apple selling 200m iPhones, 70-80m iPads per year.

FT

Monday, January 26, 2015

Listen, listen, listen

Listen, listen, listen.

Listen attentively to others' needs. That could be the easiest and the greatest help to people.

Sunday, January 25, 2015

Japan Audio Industry

Big players:

D&M Holdings which owns Japan Marantz, Denon, McKinTosh, was restructured under Ripplewood.

JVC Kenwood , restructured under Sparx

Onkyo and Tech, restructured under MUFG related Phoenix Capital

Source: TK

Sunday, January 18, 2015

Sogo & Mizushima

Interesting history of Mizushima and Sogo. Sogo was the #1 dept store of Japan in the 1980-1990s but later went bankrupt.

Growth: it grew big with the use of unconventional methods including buying land and using that as collateral to borrow to grow. As land prices grew, Sogo did very well, expanding up to 30 stores in Japan and then going overseas. As a result of difficult discussion with original Sogo owners, Mizushima also took the route of establishing new dept stores under new entities, with only he himself owning majority stake in all of them.

Mizushima was quick tempered, scolding and dismissing a staff for mishandling a TV commercial and newspaper ad project, and changed the project lead over such a trivial matter. But his charisma allowed him to obtain big loans from banks and to at least make an impact in the retail world (introducing the concept of dept stores, and grew to be #1 in 1980-1990s).

Undoing: However, his methods came to his undoing when land prices fall, Sogo's debt ballooned and grew to saddle the co. While the actual business also suffered when old stores become dated, newer concepts such as standalone monobrands, malls, shopping streets came about. Mizushima foresaw the changes but was unable to change fast enough.

Kishicho Sogo: He wanted to start this last Sogo but was stopped by the bank. To make things work, he put in his own wealth of 50bn yen (c.500m USD) to open the store. In 1996, things became very bad, stores cannot keep up with grandeur, visitor traffic fell, Sogo went bankrupt in 2000 under 1.8 trillion yen of debt.

Mizushima was also investigated for wrongdoings, in the end, they found that he withdrew some money (c.USD 1.5m) before the bankruptcy officers can check. This was intepreted as criminal offense (withdraw to avoid seizure of assets after bankruptcy procedures) and he received a sentence.

However he was also still well respected. In an OB meeting of Chuo University, he received the loudest applause despite being labelled as a criminal. Nikkei wrote a special about him in 2013.

Lessons Learnt:

1. Growth always have to be sustainble, the fast and bigger the growth, the harder the fall. Sustainable growth means doing things slowly but steadily, not using too much leverage, keeping things simple.

2. Always strive to do good: While Mizushima seemed to have done good, he perhaps did enough bad that caused his downfall. For a bankruptcy to affect his personal finance and for putting him in jail over a small matter also meant he really had some really tough enemies and they were all out to get him.

3. Flexibility: It is very important to be flexible, always change when things change. Mizushima foresaw the end of dept stores but could not change either bcos it was his baby, he couldnt change it, or he was too slow. He was also not flexible enough to just say no to the last Sogo which caused his own demise in some ways. Ego is a dangerous thing.


Saturday, January 17, 2015

Indonesia millionaires and Singapore

Indonesia millionaires and Singapore


2011
There are 60,000 millionaires in Indonesia and the total wealth in the
country stood at $1.8 trillion in 2010, according to Credit Suisse Global
Wealth report released last year.

Indonesia's average wealth per adult has increased the fastest in the
Asia-Pacific region since 2000, growing fivefold to $12,112, according to the
report.

Forex trading

FT
Retail forex trading has grown exponentially over the past decade. Alpari, which folded on Friday, was one of the top 10 retail forex providers and boasted back in 2011 of having 170,000 “live” clients: a more recent report from Citi estimated that there were 4m cottage currency traders globally.

Back in 2009, a company called Gain Capital, parent of Forex.com, issued an IPO prospectus. This revealed that total customer trading volume was growing at a compound annual rate of nearly 90 per cent, hitting $1.5tn in 2008. Gain’s profitability, meanwhile, was growing even faster: net income ballooned from $7m in 2004 to $230m in 2008. And this was just one of dozens of retail forex operators.

Wednesday, January 14, 2015

Funny business: Gregory Robic

Funny business

LUCY BIRMINGHAM

Katsura Sunshine performs at the Edinburgh Festival Fringe in August 2014 © Courtesy of Dokachin
Humor is hard to translate, but Canadian Gregory Robic, who performs under the stage name Katsura Sunshine, is bringing down the house with his take on Japan's art of comic storytelling: rakugo. "It's so different from stand-up comedy," he said. "I think I've found a niche." Indeed, this cross-border comic is the first professional Western rakugo performer of this kind, tickling audiences worldwide in English and fluent Japanese.
     Rakugo is no easy act. A Westerner aspiring to this 400-year-old tradition is, well, almost laughable. All professional rakugo performers must undergo a rigorous three- to four-year apprenticeship. During Sunshine's training, from 2008 to 2011, he was given no special treatment as a foreigner. "The reason there are no other foreigners is because of the apprenticeship," Sunshine explained.
     He would begin early every day at his master's house, preparing and folding his kimono. He would then clean, cook, and do the laundry and other chores. He wasn't allowed to drink, smoke or go on dates, and had no days off. He also wasn't able to go home until his master said so, and that was often close to midnight. "It was kind of like being a slave for three years," Sunshine said, "but the master pays for everything."
     Sunshine also learned the workings of Japan's social hierarchy, in which traditional arts such as rakugo are steeped. "I learned so much about proper manners and how to treat my seniors," he said. "I poured a lot of tea." He also learned polite keigo Japanese -- a requirement for all rakugo professionals. "The hierarchy is the reason why the shows run so smoothly."
     During the shows, he was essentially a stage manager, setting up the props, lights and sound equipment. There, he watched and learned the storytelling techniques of his master, the famous rakugo performer Katsura Bunshi VI, who gave Sunshine his stage name in 2008.
     Bunshi is known for his repertoire of more than 230 stories adapted from traditional forms. "He's been a popular stage and television personality for over four decades," said Sunshine.
     Sunshine, 44, performs rakugo in the Osaka-based kamigata tradition. Australian Kairakutei Black I (1858-1923) was the first Westerner to perform in the Tokyo-based Edo tradition. There are now over 700 professional rakugo storytellers performing in the kamigata or Edo styles. While men dominate the rakugo stage, the number of professional women performers is now about 40, and steadily growing.
     Sunshine's journey to Japan's rakugo stage began at the University of Toronto, where he was introduced to the works of Aristophanes, the ancient Greek comic playwright. Aristophanes' comedies became the focus of his work as a playwright and composer of musicals. His 1995 musical adaptation of Aristophanes' "The Clouds" was a smash hit and toured widely in Canada.
     During his studies he discovered writings by a scholar exploring the similarities between ancient Greek comedies and tragedies, and the Japanese Noh and Kabuki theaters. They were similar in "the use of masks, the instruments they used and the similarities in declaration -- speaking, chanting, singing," Sunshine explained. Since it was no longer possible to see the original Greek theater, he decided in 1999, at the age of 29, to go to Tokyo. "In a word, I came to see Kabuki," he said with a laugh. "I planned to return home, but I got really hooked on Japan. I thought this place was too interesting for words."
     In fact, his fascination with words was a major pull during his first, eight-year sojourn. He had already studied Latin, Greek, Russian and French. Why not Japanese? The stars aligned during his fifth year in Japan, at a small yakitori restaurant he frequented near his apartment in Yokohama. "The owner used to put on little rakugo shows in the restaurant every couple of months. When I saw those performances I thought, 'I was born for this. This is it.'"
     The owner encouraged Sunshine to put together an accordion comedy routine after learning he'd been playing the instrument since childhood. He could then do his shtick between rakugo performances as an iro-mono, or variety act. He gained an insider's view of the world of Japanese comedy. "The formal greetings and the way the junior person takes care of things were so cool to see," he said. "It was like the samurai world was still in existence."
     Rakugo's wide appeal lies in its clean humor, he explained. There are no vulgar words. "It's family entertainment," he said. "Very different from stand-up comedy, where you try to show your confidence and make fun of people in the audience. In rakugo, you try to get the audience to like you." Humility is key.
     "It's also about keeping an eye on the next performer," he explained. A rakugo lineup typically includes several performers, who take to the stage in order of seniority. The headliner goes last as the most senior person. "You never want to go overtime, and you never want to make the audience laugh so hard they're tired for the next performer," he said. "Half of your mission is to make things easy for the next person. It's an individual art form but because of the way it's structured you create an overarching show for the audience as if the storytellers perform together all the time. It's kind of like being a jazz musician. You come with your standards and then you plan the show with the other players."
     Sunshine's professional rakugo debut was in 2009 in Singapore. Ever since, this 182cm tall, blond raconteur with the mile-wide smile has been wowing audiences worldwide with his high-octane, one-of-a-kind performances. Dressed in kimono and kneeling in the traditional seiza style on a zabuton cushion, he plucks laughter, giggles and guffaws from audiences with the rhythm, timing and energy of an athlete. Rakugo performances are a workout. His props include a fan and a handkerchief that he uses to wipe sweat from his face.
     Accolades are mounting. Sunshine has been widely praised in the press and featured on TV in Japan and abroad. In 2013, he was appointed the cultural ambassador for the Canadian Chamber of Commerce in Japan, which backed his North American tour of 20 cities that year. The CCCJ also supported his 2014 world tour from July through December, gaining the savvy chamber some major cultural mileage from his performances in the U.K. (Manchester, Edinburgh, Glasgow, Oxford, London); Ljubljana, Slovenia; and Paris.
     Sunshine is setting his sights high, but in keeping with Japanese tradition, he never forgets who helped launch his career. "I'd like to become an international star ... bringing my master's rakugo to the world in English and other languages. This is my dream," he said. Indeed, humor can be translated successfully -- with the right kind of language.
Lucy Birmingham is a Tokyo-based journalist, scriptwriter, author and former photo journalist.

Monday, January 12, 2015

Oil

Saudis cut pdtn from 10 mm bd to 2m bd in late 70s early 80s but failed to stop oil price decline. It will not stop this time. ISIS is not in pic. LT oil price at $70. Half of current oil pdtn cannot support $50 oil price.

Wednesday, January 7, 2015

Laos and Dams

Hydro is already impt, generating 10% of electricity in ASEAN. Laos play an impt role to be the battery for ASEAN. There are plans for 72 dams to be built, mostly on the Mekong.

But it is plagued by environmental problems and hence protests. Esp bcos it blocks fish migration routes. Dams are huge, mostly at least 1GW capacity. Thailand buys most of this electricity.

EDF, EGAT of Thailand are involved. Banks like ADM, Eximbank (China), World Bank, Thailand's import-export bank etc are providing the financing.

Monday, January 5, 2015

ISIS

Terrorist group linked to Al-Qaeda but now independent. Running a huge part of Middle East and claimed to have sovereignty over all Muslims globally.

Funding originally from Arab states but then grew to get from looting, oil money and extortation. Raiding a central bank and got USD 0.5-1.5bn. Oil money will keep giving them 0.8bn per year.

Sunnis and Shias fight is also what is behind ISIS, ISIS is Sunnis.

Isis rules over 8m people. People living under ISIS rule is becoming very unhappy. But no way out.


Sunday, January 4, 2015

Thursday, January 1, 2015

Cyber security


TrapX, an early stage Israeli start-up that launched its technology in the US last month, is working with customers in the financial and retail sectors. It is suitable for the age of cloud and mobile computing that makes it easier for attackers to find a way into a network.

Carl Wright, executive vice-president and head of sales at TrapX, said the goal is to “bring back the doctrine that has existed since the beginning of warfare: deception”. Current cyber security defences are no longer suitable to defend against increasingly sophisticated hackers.

“It is as if we’re back in the 1500s with a castle that has a moat but our adversaries have aeroplanes and can parachute down,” he said.

Source: FT