Review

I've received several calls and E Mails from closed friends recently, asking if NOW is the time to Buy HSBC shares, which just hit at a 10-year Low.

I know it's very very temping for many investors to now see the price for HSBC has dropped to HK$66, when it was about HK$153 in Nov 07 (i.e. a drop of over 55%)

But, I've stated all along (ever since June 2007 - yes, NOT 2008!! That's 18 months ago!!) this is NOT the time to buy Any Shares in Any part of the World!

(Well, unless you're the very few ones having Great Luck at this moment of time in your Life and spent Great Time everyday to sit next to your price monitor!)

In the Current WWIII, a day can make a Huge Difference.

Anyone taking a 5-day holiday could find themselves Broke after returning from overseas! In HK, during the few "Miracle Days", people became Loser from Winner after returning from their lunch break! A very Costy Lunch!

Although my post dated 27 Oct 07 stating I'd start buying HSBC at HK$60 with 1/3 of my cash, I did a Review about 2 weeks ago and decided I may start buying HSBC at around HK$50 only. (And the Targeted Prices for the remaining 2/3 Cash have also been Lowered accordingly)

Below please find my recent reply E mail to my Keen To Invest Friend

From: Fate
Date: 2009/1/14
Subject: WAIT
To: XXX

Hi XXX

You've to be careful with HSBC - it has to raise capital soon, so don't rush to buy.

Given that Standard Chartered and DBS had recently raised capital by offering about 49% and 43% discount respectively, HSBC could be forced to offer a big discount to attract existing shareholders.

If it is offering even a lower a 30% discount, with yesterday's closing price of HK$73, it will be HK$51. If it follows the above 2 bank's step closer, say offering a 45% discount to attract existing shareholders, its price will be around HK$40!!

I have adjusted my first phase buying price for HSBC around HK$50 - but just wait for a bit, it is soon to announce its result.

I have been keeping an eye on Industrial Bank of China, just would like to see how much it is going to fall when the Strategic Shareholders are soon allowed to sell its shares. There are too many "Traps", like there is another firm supposedly to have $800 million cash in its accounting book but has just declared bankrupt!

Just wait for another month - Britain is now in serious trouble, they have to spend at least another 400 Billion Pounds to stimulate the market, so is US. In fact, everywhere, look how bad Sony has performed!

Hope the above helps.

Regards
Fate
Waiting is Testing
www.fatesecrets.blogspot.com

Remember, in this Ever Changing Climate, one has to be Very Careful and has to conduct Constant Weekly Review to avoid being Victimised.

Remember, Citi Group was the World's No. 1 Bank in 2007, when HSBC was only about 6th or 7th at the time. Citi Croup was last traded at US$4.6 (about HK$36). So, how Low do you think HSBC could go?

Ask yourself the Most Important Question when Investing,

"Do I have to Buy it NOW?"

Fate
Never Earn Your Money So Hard Only To Lose Them So Easily