Mr. IPO weekend musings

Regular readers know that I have been staying on the sidelines and this weekend, I have nothing new to report on my SRS account. 

I am of the view that our market will be listless (leading up to the elections) with downside bias. US is likely to have a correction (given the resurgence of Covid) but to what extent and for long is anyone's guess. 

There had been a few articles hogging the headlines in recent weeks - let me share with you on what caught my attention. 

Robin Hood saved the US stock market and made Warren Buffet looked so foolish? Really ... 🤔 

I am not sure if you read articles on how Warren Buffet has lost his touch and the market was basically rescued by "Robinhood" retail investors. The title of the article below was "Robinhood Traders will have fun until they get wiped out". 

Same observations in Singapore ?

This "phenomenon" of retail investors stepping into the stock markets seemed similar all over the world, including Singapore where it was reported that retail "bought over" the stocks from institutional investors. 

Let's see if Warren Buffet is going to have the last laugh or it will be the case of "Robin Hood" saves the world. 

Auditors cannot be trusted ?

Long time readers know I started life as an auditor and ironically, that caused me to be quite skeptical about the "reliability" of the figures in audited accounts. 

The audit is not intended to detect fraud and can't provide 100% assurance. Period. 

To me, the number 1 investment risk is and always been the management team. There had been so many cases of bad management globally. In Singapore, you have Trek2000 and Noble as recent case studies. 

But having said that - to not check bank statements is like failing basic audit 101. I am sure this is not representative of all audit quality but it also highlight that having the same auditors for too long can lead to "familiarity breeding contempt". 

Management team and board members should constantly be renewed ! 

You can say the same with directors of companies (e.g Hyflux). Long serving board members should step down after serving for a certain period to allow for renewal. 

ETF for WFH ? Or is it WTF ... 😆

The last thing that caught my attention was an ETF called WFH. 

I guess working from home is going to be a new reality and managers might as well "profit" from it by creating a ETF that invests in companies that help make working from home a reality! 

Let me think what would qualify ... Zoom Video, Docusign, Microsoft to name a few companies in the US and probably Singtel, NetlinkTrust and perhaps "SGX" for some online "gaming" since everyone has nothing else to do at home! 

Status quo more likely during a crisis? 

That is it for my weekend musings and enjoy the upcoming elections.

Things might start heating up soon and may the best candidates who can bring Singapore 🇸🇬 to greater heights win!