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Cam Hui, CFA  

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  • Cheap Or Expensive? The One Thing About Equity Valuation That Few Talk About [View article]
    Yes. That was a typo. I did mean that.
    Mar 18, 2015. 11:34 AM | 1 Like Like |Link to Comment
  • Good News And Bad News On The Commodity Downturn [View article]
    Yes, that was until the investment management industry discovered the roll costs of holding commodity futures.
    Feb 3, 2015. 11:21 AM | 1 Like Like |Link to Comment
  • When Fundamentals And Technicals Clash [View article]
    Remember the dynamics of the P/E ratio. If rates rise, it would change the discount rate, or E/P. On the other hand, rates are likely rising because of stronger growth, hence E could be growing faster.

    It is unclear how those two dynamics play out. In most cases, E is growing fast enough that rising interest rates don't affect stock prices, that's why the first few Fed rate hikes generally don't derail a bull market. Eventually, though, stock prices fall because the rising rate effect overwhelm the growth effect.
    Aug 18, 2014. 09:08 PM | 1 Like Like |Link to Comment
  • Trend Model Report Card: July 2014 [View article]
    I try to post real-time updates either on the blog or on Twitter. However, I can't guarantee that SA will pick them up.
    Aug 5, 2014. 10:50 PM | Likes Like |Link to Comment
  • Apocalypse Later [View article]
    See my recent articles:

    "Correction interrupted"

    "How stocks are both cheap AND expensive"
    Jun 16, 2014. 11:15 AM | 3 Likes Like |Link to Comment
  • Time To Override The Trend Model? [View article]
    Sorry, my mistake. You are correct.
    Jun 13, 2014. 12:16 PM | Likes Like |Link to Comment
  • Investment Management: Beyond 'He's A Terrific Stock Picker!' [View article]
    If you want to do it yourself, you are free to do so. See my other comment above about getting casino-like results.
    May 29, 2014. 11:44 AM | 2 Likes Like |Link to Comment
  • Investment Management: Beyond 'He's A Terrific Stock Picker!' [View article]
    You are treating the stock market like a casino. If you treat it that way, you will get casino-like results with your portfolio.

    A manager should be able to tell you the kinds of risk and return you can expect with different portfolios. Good managers then deliver on those promises.
    May 29, 2014. 11:43 AM | 2 Likes Like |Link to Comment
  • Measuring Market Expectations On China [View article]
    Just to clarify - the graph is correct, just the ticker in the text is wrong.
    May 25, 2014. 04:37 PM | 1 Like Like |Link to Comment
  • Measuring Market Expectations On China [View article]
    Yes. Typo
    May 25, 2014. 01:05 PM | 1 Like Like |Link to Comment
  • A Funds-Flow Reason For Equity Market Weakness [View article]
    I agree with you 100%. I think that the writer was overly focused on the momentum names. Nevertheless, if institutions are re-balancing away from equities, then mainstream indices like the S&P 500 should correct.
    May 9, 2014. 09:21 AM | 2 Likes Like |Link to Comment
  • More Evidence Of A Low-Return Equity Outlook [View article]
    I have analyzed Market cap to GDP as a proxy of Price to Sales and found valuations elevated. The disadvantage to that approach is that net margins are very high (P/E = P/(Sales X Net margin). So the question then revolves around whether net margins are likely to stay at these levels.

    Further analysis of margins show that while net margins are stratospheric, EBIT margins are only elevated and not at nosebleed levels. Net margins are high because 1) Tax rates are low because multi-nationals have moved their profits offshore (think Apple) and 2) Interest rate expenses are low.

    So that's why the analysis of P/B, P/E and dividend yield is useful for putting the current equity valuation levels into context.
    May 1, 2014. 09:22 AM | 3 Likes Like |Link to Comment
  • Should You Sell In May? [View article]
    Do you use daily, weekly or monthly MACD as a filter? The article was unclear on that point.
    Apr 28, 2014. 05:28 PM | 1 Like Like |Link to Comment
  • Should You Sell In May? [View article]
    That's why I have an inner investor and an inner trader. Each has different needs and time horizons.

    That's also why articles like these should not be considered to be investment advice, because everyone has their own objectives and circumstances.
    Apr 28, 2014. 05:27 PM | 7 Likes Like |Link to Comment
  • 'Did You Expect GOOG To Trade At A PE Of 10?' And Other 'Smart Beta' And Factor Investing Questions [View article]

    If I could respond to your points:

    "In my blog "Smart Beta 4: Factor Exposure's Curveball", I demonstrated the opposite of what you claim, namely that virtually all funds have factor exposure, and therefore conflating smart beta and factor exposure implies that practically all ETFs are smart beta funds."

    We need to define some terms here. Exactly what do you mean by "factor exposure"? I define it in a Barra-like framework, i.e. if your factor exposure is different from the benchmark (whatever that means) you have an active factor bet.

    Second, the point I was trying to make is that smart beta is just factor exposure re-packaged. Back in 1970s and early 1980s there was a host of anomalies literature from finance academics, e.g. small cap, low PE, low PB, etc. Institutions jumped on those anomalies and invested accordingly, until they discovered the value-growth cycle. Most smart beta funds are a form of re-packaging of those (value) anomalies.

    "Also, your guidance that "If it is marketed as a passive or semi-passive portfolio, then the investor has to make a decision of whether those more or less permanent industry bets make sense as a way of creating alpha." is a touch overstated. "

    Most value anomalies are not one-size-fits-all factors across sectors. A naïve implementation, which ignores sector and industry, will give you sector biases in your portfolio. It is unclear whether most individual investors understand that nuance. A sector or industry neutral value factor, e.g. low PE, may not work well in all sectors, such as Tech because Tech is more growth and momentum driven.

    To be sure, there are some factors that work well across all sectors, such as estimate revision, earnings surprise, insider activity, price momentum, but not all do.

    I hope that my clarifications help.

    Apr 25, 2014. 09:43 AM | 2 Likes Like |Link to Comment