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Featured News & Features

Cryptocurrency: The Money of Our Future?

Cryptocurrency has brought excitement to some but confusion to many.

Given its relatively new status in the finance world, there are many questions surrounding it – How do I use it? Is it safe?

Many do not have a good grasp of what it is, and for good reason.

It definitely is a concept that is hard to wrap your head around, but look no further for answers; below, we try to break it down for you in the simplest way possible. Read on to find out more!

What is it?

In essence, cryptocurrency is a system utilised to make secure payments online. A key element that distinguishes it is that it does not utilise third parties: you can directly make payments from person-to-person, without having to pass by a governing body to verify the transaction. Cryptocurrency is safeguarded by encryption algorithms done by computers, and these same computers are the ones verifying each transaction done. Cryptocurrency as we know it first emerged in 2009 with the creation of Bitcoin. This form of digital currency was set apart because of its use of blockchain technologyThe use of this technology is a key element of cryptocurrency, as it ensures secure transactions whilst not having to pass by any third party.

To further understand blockchain, the word can be broken down into two parts: block, meaning “digital information”, and chain, meaning “stored in a public database”. When a transaction is made, it is stored into a block. That block contains three types of information: first, general information about the transaction such as the date it was conducted and the amount; second, who is participating in the transaction; and third, a unique code called a “hash” that is used to distinguish it from other blocks (like a barcode). A block is made up of thousands of transactions coming from many individuals. Each transaction made in a block is first verified by a network of computers. These computers solve complex mathematical problems, called “Proof of Work” to prove they have done the task. They are then rewarded with cryptocurrency – this process is called “mining”. An alternative way of validating transactions is “Proof of Stake” wherein miners can validate a block based on how much cryptocurrency he/she currently holds – the more money, the more mining power you have. This way is sometimes more preferred as Proof of Work requires huge amounts of power and energy to solve the problem.

Once transactions and blocks have been verified, they get added to the chain of previous blocks (hence the name “blockchain”), and the transaction information becomes publicly available. Individuals are secure, however, and remain semi-anonymous as information regarding who is participating is summed up to a digital signature. Users of cryptocurrency can connect their computers to this network of blockchain, which allows them to receive copies of the blockchain every time it is updated, working somewhat like a Facebook News Feed. With thousands of computers connected to the blockchain, hacking and manipulating information becomes nearly impossible – to do so, you would have to hack into every computer that has a copy of the chain. In the same way, this chain is built on trust: with no identifiable information on anyone adding to the chain or receiving copies of it, it raises the question of whether you can continually trust the information being added and the network of computers upholding it.

Pros and Cons of Cryptocurrency

On one hand, a cryptocurrency is a viable option for many because there is no central authority, be it a bank or government, that has control over the network. This means that no single body has access to your funds and personal information, protecting you from the risk of exploitation. It also makes fund transfer easier between parties as there is no third/external party involved. You transact with another individual directly without a body to double-check the transaction – this responsibility falls on computers. Without a third party, fund transfers also have more minimal processing fees, leading to lower costs overall.

However, it has also faced criticism due to the anonymity of its users, making it a breeding ground for illegal activities such as money laundering. Additionally, there is wariness with the system that upholds cryptocurrency. Because everything is digital and not stored on a central database, cryptocurrency balances can be wiped out in seconds due to the destruction of a hard drive, loss of access to your digital wallet, and more, with no way to retrieve that money. Backup copies do not exist in the world of cryptocurrency.

Types of Cryptocurrency

Below are the two most common cryptocurrencies used. There are many more emerging types, as this is a relatively new and exciting industry. The total value of all cryptocurrencies in existence is around $214B.

1. Bitcoin
The most popular and valuable cryptocurrency, Bitcoin was the first of its kind. Launched in 2009, it was described as a peer-to-peer electronic cash system. Bitcoin represents more than 68% of the total value of all cryptocurrencies.

2. Litecoin
Created with the intention of being the silver to Bitcoin’s gold, it operates very similarly to Bitcoin. However, it is able to generate blocks four times faster than Bitcoin, speeding up the transaction activity by an incredible amount.

3. Other known cryptocurrencies are Namecoin, Ethereum, and EOS.

Conclusion

Cryptocurrency is definitely an interesting commodity, and one to look into if you are into riskier investments. It is considered high-risk high-reward because its market value fluctuates wildly. Its value is based on supply-and-demand, and with it being relatively new, individuals get into a frenzy over it, but also more than always drop it just as quickly. As an example, in December of 2017 it was traded at $20,000; exactly a year later, its value dropped to $3,200 – a huge change in just a year. If you do plan on going into this currency, tread the waters lightly: do you research well, track market fluctuations, and keep a rational, level-headed attitude at all times.

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Featured News & Features

Investagrams Featured Trader of the Week: Apo Lakay Cassandra

For this week, we would like to congratulate our Featured Trader: @bassitalakay!

Recently, our markets have been strong as many issues have started to bottom out and regain footing. Even more, it seems that everyone has become very optimistic that the businesses will bounce back very soon. This begs the question: how are the fundamentals doing?

While many on the Investagrams platform focus on charts and technical analysis, Apo Lakay Cassandra is one of those people that focuses on sharing fundamental insights. Let’s take a look at what he has been sharing.

Diving into @bassitalakay’s trade

In his post about Jollibee Foods Corporation or $JFC, he gives a deeper look at what the numbers could be telling us. Due to the pandemic, it’s easy to blame bad numbers on the hazardous environment. However, this featured trader looked deeper if there are problems in the company and shared his insights with us.

Last year, $JFC made headlines when it further expanded its global portfolio and acquired CBTL. As they have to work towards rebuilding the business in order to turn it around, the endeavor has become harder due to the disruption in businesses globally. Although possible, Apo Lakay Cassandra shares how doubtful he is that this is a problem that will be dealt with quickly due to the bad numbers and continuously harsh global business environment.

In another post (https://www.investagrams.com/Post/bassitalakay/1061768), he also showcases his insights on how the macroeconomic scene might change.

Even though community quarantine protocols are being loosened, we are only transitioning to a new normal that will most likely be different from how things used to be prior to the pandemic.

As people’s lifestyles are disrupted, new economic trends are bound to happen. Apo Lakay Cassandra states that his own insights are possibly based from his own experience. Some possible trends are easy to spot, such as the digitization of businesses and the importance of internet services in all households.

Our featured trader has shared four of his own insights, but just as he says, there will surely be more business trends that could present opportunities to both investors and entrepreneurs.

To show our gratitude for Apo Lakay Cassandra’s efforts to add value to our community, we are giving him FREE one month’s access to InvestaPRO! Happy trading to all!

FEW MORE DAYS BEFORE the much-awaited Investa Online Summit!

Be ready to get high-value learning that you can apply to your business and trading. Join Investa Online Summit now!

Learn more: www.investagrams.com/investasummit

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Featured How to & Advice

Finding Bulls, Bears, and Some Occasional Dragons

On June 24, 1987, a baby boy was born in a town in Argentina. While he was perfectly healthy by normal standards, he grew up much smaller than kids his age. Later on, he was diagnosed as having GHD or Growth Hormone Disorder and wasn’t expected to become taller than 150 cm in height.


Source: Google CTO

As soccer in Argentina and in most of Latin America was as close to people’s minds and hearts as their religion, the child inevitably became hooked with the sport.

His coaches of course thought that while his obsession and dedication to practice was admirable, he is not likely to become anything more than one of the countless youths that took on the sport and enjoyed the competition.

The limitations posed by his GHD was an obvious hindrance to whatever future he may have in soccer. After all, this is a sport where size mattered, and it would be unthinkable for anyone of such small stature to become of some significance. But while the odds appear bearishly insurmountable at this point in his life, a fast forward will reveal otherwise. We’ll come back to his story a bit later.

On a parallel but alternate universe, this man we all remember by the name of Michael Clarke Duncan was a familiar face in Hollywood movies. His imposing physique lent credible personas to a few memorable characters that am sure a good many may have seen.

At a glance he is an epitome of health, strength, and everything fit and muscular that many men can only dream of becoming.


Source: PETA

Michael Clarke Duncan was as bullish as any representation of what we aspire for and his conversion as a VEGETARIAN was to become a welcome endorsement to the healthy lifestyle movement.

But as fate would have it, it was not meant to be. He died of a heart attack in 2012 at age 54. Not exactly the story book ending that we may have expected.

As for the kid from Rosario, Argentina who for his “shortcomings” wasn’t given much of a chance by coaches and soccer fanatics, he is at present worth around USD400M and is considered one, if not the greatest in the world of soccer. His name, LIONEL MESSI.


Source: Google CTO

So what is my point?

In life, as it is in TRADING and INVESTING, what we see is not always what we get. As most who dabble in the realm of Technical Analysis (TA), the quest to find the next best trade lies in identifying if a stock is BULLISH or BEARISH. And since the PHL is a long only market the only option is to find one dominated by the bulls and avoid names where bears tend to prowl.

Hence the problem, how do you get into that trade where the end result is one that leaves a smile on your face from locking in gains or profits? Does TA really provide good probabilities in searching for that prospect?

The answer: IT IS ALL A MATTER OF PERSPECTIVE.

As in the above examples, what may look bearish may actually be a sunken ship with long lost treasures. Or bull-strong moves to new all time highs might already be the top of a cliff with bottomless chasm as you take the next step.

Let’s take for example this chart of Jollibee Foods Corp ($JFC). Since it was introduced in the stock market in 1993 at a little over 6 per share, it never looked back as its value grew by leaps and bounds.

Even after the 2007 crisis, it merely consolidated for a couple of more years before we saw it breakout from around the 50s level and into the triple digits. And up to until early 2019, $JFC found the zenith at 328+/share. For the last decade, it was the most bannered company highly regarded by many as the ultimate corporate success story for the country.

And of course, this yearly CHART says it all.

And for INVESTORS, the long term promises more rewards and the continued local and international expansions appeared as very good prospects. That was what many thought. In hindsight, the market was already then factoring certain “value-challenged” acquisitions, such that in February 2019 it started to hold back the bulls from charging higher.

Of course , and now also an afterthought, many were of the mind that $JFC was again just consolidating gains; a pause before resuming the trek to the stars. After all a stellar past performance and this long term chart speaks for itself.

As a personal flashback, I distinctly remember certain conversations with relatives and friends on a Christmas occasion in 2018 where I was asked if JFC would make for a good long term investment. Knowing what I saw in the monthly frame chart, I politely told them that upsides were already limited at that point.

Of course there were exchanges as to how the fundamentals are great and all those similar praises, but having my faith in technicals, I simply smiled off from getting into any argument.

Because for TA believers as myself, there can only be very little doubt that a BEARISH RISING WEDGE had already formed in the near term perspective.

And as can be seen clearly in this monthly frame chart, its post effect was simply catastrophic.

MULTIPLE TIME FRAME ANALYSIS

In the mid 80’s, now a renowned trader and book author Dr. Alexander Elder made popular the concept of TRIPLE SCREENING. Being a man of science in the medical field, the standard practice was to have a patient go through a series or a battery of tests. This is obviously done for the purpose of correctly diagnosing a disease or simple ailments that a patient may be going through. As only after all proper examinations are run and cause identified, can prescriptions and or interventions be given to a patient.

Dr. Elder translated this simple idea into the realm of technical analysis. He espoused that looking at a chart in its different TIME FRAMES, specifically in the daily, weekly, and monthly frames can give a trader the objectivity to make a plan on how to trade that name. Dr. Elder’s bestsellers TRADING for A LIVING, and COME INTO MY TRADING ROOM are must-read books for beginners and intermediate traders.

And as we are now more advanced in our charting capabilities, we take this TRIPLE SCREENING concept a step farther and add other layers of INTRADAY frame charts to give us more in-depth views of price behavior and action. Thus without a doubt, our ability to make MULTIPLE TIME FRAME analysis, immensely and especially enjoyable using INVESTAGRAMS charts, are indispensable tools that can provide us with the most reliable information.

BULLS AND BEARS LIVE IN ONE ECOSYSTEM

Markets or stocks are usually labeled as either bullish or bearish. Both go through range-bound price action which we call and mark as areas of consolidations; In plain speak, PAUSES before it resumes to the path or whatever the trend it is on.

Corrections happen in bullish names, as bounces also occur even in a bearishly trending environment. The practical reality is that there are bears in a bull market and bulls in a bear market. The only question is who dominates the majority of the time.

Multiple time frame views will almost always correctly tell us how to formulate and manage expectations. As the analyses and conclusions will differ in each time frame (intraday, daily, weekly, and monthly) it is IMPERATIVE that one must focus on the time frame from which your trade is taking place in. The patterns that show up in the different time frames will have its own probability of realizing its potential. In the long term however, the ongoing trend should also likely prevail.

Take for instance this illustration of a 15-minute chart for DITO CME Holdings Corp. ($DITO) recently.

While this bearish head and shoulders pattern attempted and successfully achieved the expectation, the correction in this shorter time frame view presumably only spurred more participants to enter at the lower price points during this pullback.

Eventually, the bulls took over and the uptrend resumed as can be seen here:

To sum up, here are the key takeaways, we must all remember:

1. Technical analysis must always be FLEXIBLE, as patterns will occur in different time frames. While forming a bias is necessary to commit to a trade, it should never be rigid that it rejects what price action is actually saying.
2. The higher time frames will at most times be more significant. Most corrective pauses or consolidations will likely just become CONTINUATION patterns to the prevailing trend.
3. Multiple time frame analysis is essential in framing one’s expectations. It gives an objective basis to formulating trading plans and creating strategies.

Playing the market means learning to live with the bulls and the bears. It is most important that we recognize that they both lurk in the backstage. And when they each make an appearance to find the spotlight in moments we may least expect, we should all be ready to welcome them with open arms.

Although not necessarily with open positions since ours is a long-only market.

At present, the idea of short-selling being finally allowed might be as far-fetched as finding mythical fire-breathing DRAGONS sweeping through the ticker.

Oh well, nothing wrong with DREAMING. Hope springs eternal.

Contributor:

Name: Jojo Gaston
Investagrams Username: @JojoGaston0

About the Contributor:

Jojo Gaston is a partner/mentor at BoH Society, an online trading support group that provides traders’ education, and data-driven trading format for local stocks, forex, and other foreign markets.

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Featured How to & Advice

What’s Cheap Can Get Cheaper

In my previous article, When is the Best Time to Invest? where I discussed when is the best time to invest, I made it clear that buying fear and selling greed does not apply all the time.

The $PSEi has enjoyed a long run bull run from 2008 bottom-up until middle of 2013 posting a +300% from the bottom. But still hasn’t changed the trend from 2013 to 2018 and just resulted in multiple pullbacks.

The country pre-Covid19 was one of the top producers of millionaires. These are not just peso millionaires but in dollars as well. With an economic boom of the rich getting richer, money flows from one place to another. Thus producing more millionaires along the way and this growth is attributed as well to stock market gains.

One of the most popular brands and stocks, Jollibee ($JFC) gained more than +800% from the bottom of the 2008 crash till its peak in the middle of 2018. A capital of Php100,000 invested in this stock would have become Php900,000 in just 10 years if one sold in the middle of the 2018 peak.

As posted in the previous article, in a bull market when everyone is earning and everyone feels like a genius including myself, you will hear a lot of success stories made from the surge in stock prices. There have been many successful IPOs (initial public offerings) such as Wilcon ($WLCON) trading from Php5 now at php15.28 as of the posting of this article. That resulted in 200% gain.

But it’s not Christmas every day. There are also recent IPOs that did not materialize positively. Such as Axelum ($AXLM) from its IPO price of Php5 is now trading Php2.75 as of this posting which resulted in -41% loss. Another example would be $DMW, a property company with an IPO at around Php12 to now trading Php6.50 as of this posting. That resulted in a -50% loss in value.

Most IPOs come from a bullish stance. When a company wants to list in a stock exchange, they either want/need to get more funding or pay the debt. They are bullish that the public will buy shares of their company. We had 22 IPOs on record from 2013-2017 and based on their first trading day out of the 22 stocks on average it returned 14.3% on the 1st trading day. There are 17 issues up including Wilcon which was mentioned in this article.

One of the IPOs in the table mentioned was $CHP or Cemex Holding Philippines. A cement company that decided to go public due to the BuildBuildbuild (BBBx3) program of the administration anticipating that demand for cement will be high.

On its first trading day, it reported a 3.3% gain. It was trading around Php11 in 2017. But as of this posting, it’s trading close to Php1. From its IPO price to the current trading price it has now resulted in more than -90% loss. Imagine being a director and shareholder of a company you helped build, but your investment in terms of paper value has already lost -90% if you held since the stock went public.

There are more cases like this, for this example, a big name like SHELL ($SHLPH)

Not all stocks go to heaven. Cheap stocks can get cheaper and at the same time expensive stocks can get more expensive regardless if indicators are showing signs of weakness and/or overbought level. See $MAC and $HOUSE charts above.

In conclusion, risk management is the name of the game. Whether in stocks or other assets like real estate, commodities, paintings, cryptocurrencies, etc. It is important that you must know when to exit your investment or trade when it goes against your initial bias.

You need to understand the risk you’re taking relative to the potential reward. Do your own research so you can make INFORMED decisions. It’s not Christmas every day and nothing is permanent. This current Covid-19 crisis has wiped out a lot of wealth globally. The only thing we can control are our emotions and risk.

Contributor:

Name: R. Cruise
Investagrams Username: @limitlessinvestor

Channels:
www.investagrams.com/Profile/limitlessinvestor
www.facebook.com/imlimitlessInvestor
www.instagram.com/limitlessinvestor
https://t.me/limitlesstraders
www.tradingview.com/u/Limitless-Investor
www.youtube.com/channel/UCTAuxhwjliCGHBsPNQx32Xw

About the Contributor:

Limitless Investor / R Cruise – Elliottician, private fund manager, and cryptocurrency liquidity provider. Trading for 6 years already but considered a true trader for the previous 3.5 years only as he believes that a true trader must have gone through and traded a bear market. Whether in the long or short side is profitable. Specialty in reversal trades, psychology combined with Elliott Waves and fundamentals.

 

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Featured How to & Advice

Going Global: A Deeper Look at the US Markets

This article is a continuation of the Going Global article series. If you haven’t read the first article, check it out here: Going Global: How do I Start Trading Internationally?

Now that we’ve gone around the globe and taken a look at some of the most prominent stock markets, it’s time to delve deeper into the US markets. Typically, many Filipino investors looking to diversify their portfolio begin with the US stock markets as these are the most reliable and accessible from here. We’ve already gone over the two main exchanges, the New York Stock Exchange and NASDAQ, in the last article, but here, let’s go even deeper into these exchanges and the indexes that guide them, in order to truly understand their complexities. Additionally, we will take a look at the Dow Jones Industrial Average, another important index in the US markets.

The New York Stock Exchange

The NYSE is the largest stock exchange in the world. Dating back to 1972 and with over 1,900 companies listed, it’s no surprise that it’s a hallmark in the world of investing. For a company to be listed in the NYSE, it must have at least 400 shareholders each owning more than 100 shares of stock, at least $1.1M shares of publicly traded stock, a market value of at least $40M, and it’s Initial Public Listing (IPO) must have a market value of at least $100M. Additionally, it must meet basic earning standards, which is either a pre-tax income of $10M or $200M in global market capitalization. As the exchange also houses international companies, these companies must meet the additional standards of having at least 2.5M shares outstanding and 5,000 public shareholders. With that long and exhaustive list of requirements, the quality of every company is assured. Another benefit of the NYSE is its global diversification, with stock listings from around the globe, including countries like Canada, China, and the UK.

To track the performance of its stocks, the exchange uses the NYSE Composite Index. It measures all stocks that are exclusively listed on the NYSE. The weights of the index are calculated based on the company’s market capitalization – the total market value of its stocks – while the index itself is calculated on the basis of price return and total return. The NYSE Composite Index is maintained by the S&P Dow Jones Indexes, a resource that tracks many other indexes and data regarding financial markets.

NASDAQ

Short for National Association of Securities Dealers Automated Quotations, it is the second-largest stock exchange after the NYSE in the world. It’s known for being dominated by technology giants such as Apple, Microsoft, IBM, and Facebook. However, the NASDAQ also lists a number of other influential companies in the fields of finance, energy, transportation, and healthcare. It’s listing requirements include having a shareholder’s equity of at least $2M, at least 100,000 public shares, a minimum of 300 shareholders, total assets worth $4M, a minimum of $3 per stock price, and public market value of at least $1M. As with the NYSE, this exhaustive list of requirements ensures the utmost quality of each company listed.

The NASDAQ-100 is the index used to track its stocks. Unlike the NYSE Composite Index, it tracks the price movement of only the top 100 largest stocks listed in NASDAQ. Additionally, it does not include financial institutions listed. It utilizes a weighting system to calculate the index, which limits the influence of large firms’ indexes by taking into account overbearing market capitalizations. This allows for a more accurate representation of the exchange. The index price is also calculated during pre and post-market hours, with market hours being from 9:30 AM – 4:00 PM (EST).

Dow Jones Industrial Average (DJIA)

The DJIA is an index in itself which is not tied to any specific stock exchange. It differs from the NYSE Composite Index and NASDAQ-100 because it is composed of 30 major companies that are leaders in their industry regardless of the exchange they are listed on. This index is run by the Wall Street Journal, whose editors make decisions about what companies make the cut. The DJIA only includes US-based companies that are traded either on the NYSE or NASDAQ. The purpose of the DJIA is to give an accurate and succinct overarching view of the US market – no trading goes through it, as trading only goes through the NYSE or NASDAQ. This index is widely viewed as the top representation of how the market is doing, with many top news channels and platforms displaying its calculations on a daily basis.

Standard & Poor’s 500 Index (S&P 500)

The Standard & Poor’s 500 Index, or commonly referred to as the S&P 500, is an index based on the market capitalization of the 500 largest publicly-traded companies in the US. This index is known to be the best basis or gauge of large-cap US equities. Investors use this as the benchmark for the overall market.

Why should I know all this?

If you’ve got this far thinking, “Well, this is all great to know, but how will this help me in my investing journey at all?” then that is totally understandable. Knowing what the stock exchanges are and the indexes that calculate their value may not seem that important, but having a good grasp of all this will also help you make wiser decisions when it comes to your investing practices. It’s much better when you are able to identify and understand the terminology used when referring to the different stock exchanges and their indexes, as well as the all-important difference between the DJIA and other stock indexes. This information is important as a first stepping stone into the US markets, with more exploration and discovery to come once you truly partake in the markets, because, as the saying goes, “Experience is the best teacher.”

The Going Global series aims to introduce traders, whether beginners or advanced, to the international stock markets. Throughout this series, we will explore the pros and cons of international investing, how to kickstart your international portfolio, and many more tips to navigate this more complex trading world.

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Featured News & Features

Investagrams Featured Traders of the Week: Yu Niq and Lone Trader

We would like to congratulate our featured traders of the week: Yu Niq a.k.a. @yuniq and Lone Trader a.k.a. @lonetraderph! Their efforts in helping and uplifting fellow traders are making the Investa trading community a better place for both newbies and experienced traders.

The Technician

When technical analysis comes to mind, many think of Fibonacci levels, divergences, and Elliot waves. These are all powerful tools for TA, but sometimes the simplest tools can be just as effective. Yu Niq is our technician of the week for spotting $MAC (Macroasia Corporation) with her clean style of charting. One of the strongest issues in our market, $MAC is up 72.44% since our technician spotted it.

Let’s take a closer look at how Yu Niq saw this opportunity. You can view the original post here: https://www.investagrams.com/Post/yuniq/1052889

The most noticeable part of her charting was the usage of a line chart versus a candlestick chart. Although candlesticks provide more information, line charts serve the purpose of providing a cleaner visual towards where price wants to go as only closing prices are used. In Yu Niq’s analysis, the added clarity of using a line chart shows a clearer picture of what the stock was trying to do: a shakeout.

One could say that there was a bullish divergence, but it should also be remembered that just from a simple support and resistance point-of-view, $MAC was exhibiting signs of strength when it quickly re-took its area of support. It struggled a bit, but it eventually showed that it could stay above it.

Selling could also be done just by looking at resistances as supply zones. It is clear that knowing a lot of indicators isn’t necessary, and that just mastering the basics could lead to effective results. As the saying goes, “fear not the man who has practiced ten thousand kicks once, but fear the man who has practiced one kick ten thousand times.”

Team Player

Our team player for this week, Lone Trader, is someone who has shown leadership qualities in our community. From talking about his own trading to making his own InvestaGroup “Taguig Traders”, he has done it all!

Being a part of a close trading community is a growth hack that every trader should be using. Aside from being able to learn from one another, having a proper community can lead to a group effort in making sure that each person is accountable for his or her own mistakes. Our team player for this week took the initiative and made one for fellow traders near his area. So, if you’re from Taguig, you know what to do – join his InvestaGroup here! ?

More than just making groups, Lone Trader also shares his own trading experiences. Not just by sharing executions and analyses, this team player shares his own filters as well as backtest results.

To show our gratitude to these Featured Traders of the week, we will be giving them FREE one-month InvestaPRO access. We hope that this award will encourage every Ka-Investa to be positive in the community. Happy trading!

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Featured News & Features

Investing in the Time of COVID-19

No matter where you are in the world right now, there is one pressing problem on everyone’s mind — the ongoing COVID-19 pandemic. With many countries in the world under lockdown, economic activity has stopped to a near standstill.

In the Philippines, when the lockdown was first announced, the stock market plunged 6.8%, the worst drop since the 2008 Global Financial Crisis. In March alone, PSE’s circuit breakers were triggered twice. This pandemic has brought about a “new normal” and with it, many changes in the way we do businesses. With this new normal bound to take root for the upcoming years, what industries are safe to invest in, and what should we steer away from?

With so many changes in the world, should we even be investing? The short answer — yes. However, it is important to know where to invest to reap the most benefits.

Read on to learn more about the emerging industries and those at risk of falling apart below.

Industries Most Impacted

These are the industries that are taking a huge hit from the ongoing pandemic, whether social distancing measures are making them unable to resume operations, or they are just not equipped to transition to the new normal.

Airline and Tourism

Taking the biggest and most obvious hit are airline companies that are tourism-related businesses. With the world in lockdown and everyone wary of travel, this industry is unable to resume operations. Even after the pandemic is over, they will not recuperate as quickly as others. When lockdowns are lifted, many people will have doubts about traveling in the near future, and travel traffic will not reach the heights it was in pre-lockdown for many years. Additionally, social distancing measures put into place during flights will only allow for at most two-thirds of an airplane to be filled, leading to losses on the part of the airline. Even now, airlines have fixed costs to pay for their airplanes being grounded; but with no passengers to manage the costs, it’s only a matter of time before many airlines become strapped for cash.

Entertainment/Leisure

Another industry facing huge risks, the entertainment/leisure industry will take a long time to recover from the effects of this pandemic. Leisure items are considered non-essential, meaning that people will not prioritize buying these right now. Additionally, retailers will face difficulty in their supply chain due to uncertainties in other countries where these are sourced. Malls will need to adopt intensive health measures to ensure the safety of shoppers, but there is no certainty that many individuals will even want to go out during these times. However, one aspect that may see a rise in demand is the home furnishing industry. With many shifting to working from home, there is a need to improve home facilities by buying new items. Despite this, the industry as a whole will still be facing tremendous challenges in the future, and no certainty as to whether it can recover from this.

Automotive

Automobiles are just not going to be individuals’ top priority coming out of the pandemic. With many also losing their jobs due to the recession it caused, cars will not be able to fit in many’s budgets. Additionally, they face challenges by a disrupted supply chain: with many parts coming from various places around the world, there is no guarantee that these factories will resume operations right away. Many factories have also shifted to making medical equipment to cater to the huge demand for it. There is no clear timeframe as to when these factories will shift back to making car parts, or whether they will at all.

Industries Least Impacted

There are some industries that will come out relatively unharmed, with some even growing from this pandemic. This is a good opportunity to invest in these industries and become more knowledgeable on them.

Food Manufacturing

Perhaps the industry that will reap the most benefits, the food manufacturing industry is one that is definitely not suffering from this pandemic. Food is a top priority for many, and food manufacturers are reaping the benefits of increased demand. For many, there has been little to no devaluation of their stock. Food manufacturing is definitely a stable industry, and one to look out for today and in the future.

Health and Fitness

Medical equipment, PPEs, and vitamins are selling out quickly these days, with many rushing to protect themselves as best they can from the virus. This increased demand will not slow down — with no vaccine in sight, individuals will still try to protect themselves through the available means they can. Additionally, the home fitness industry will see a rise as gyms shut down. It has become an opportunity for retailers of fitness equipment to increase their sales and reach more individuals.

Technology

This industry has seen the largest boom due to this pandemic. With social distancing measures in place, almost everyone has had to rely on technology to reach out to others. The use of platforms such as Zoom has been essential in moving forward businesses and education. There is also a shift to online means for banking and shopping, which was once not so common. These changing behaviors are likely to stick even after the pandemic, as many see the convenience of online means. There is a huge opportunity to invest in technology-based companies, and even start one today.

Looking Forward

The post-pandemic world will see permanent changes in consumer behavior and spending. Perhaps most prominently, there will be a shift in online means to conduct business, communicate, and go about our daily lives. Given this, there is a huge opportunity for growth in that field. However, the most important thing to remember is that times are changing — there is a new normal evolving, and it does not look like we will be going back to how business was in the past. It is critical to keep an open mind in order to keep looking forward and achieve success in this new world.

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