Zico Files : Corrections – they come and go
Corrections are part and parcel of the life as an investor – they come and the go.
In the week that past, there is always that “end of the world” feeling which often give rise to irrational decisions – that this time it’s different. This happens to even the most experienced investors. That is why it’s important to pause and take a deep breath after such a turbulent week. And to focus on the oft forgotten rule that to build long term wealth it is not timing the
market but rather time in the market that matters.
market but rather time in the market that matters.
Hindsight has shown that such market fluctuations which were also narked by perceptions of disastrous collapses were almost always proven to be temporary fluctuations. Yes these fluctuations come and go. The reversal of the last week is probably a pause in a what is still an up-trend. While the volatility is expected to remain high, it is very likely that stock prices will recover and gain in value.
So what add to the buy-list on top of the biotech names we already have? Own the leaders. Leaders in the technology & internet space. The two that fits that bill – Apple (AAPL US) and Facebook (FB US).
In the technology, having the best technology and product is only one factor of success. More importantly the product must be sought after and be ubiquitous. And these two companies have achieved that.
Yes “everybody owns Apple”. But the company did make some very important product announcements other than their recent iPhone 6 and iPhone 6 Plus launches. These include Apple Pay and Apple SIM. At $98, the stock price has held up very well in the market correction. We think there is $120. And Facebook is the elephant in the room that you must own. From the current $72.50, we think there is a $90 price.
A Bit About Zico
Zico is our in house equity consultant who is currently a private fund manager with more than a fair share awards in the course of his illustrious career.
Having managed both global and also regional themed equity portfolios, he specialises in stock picking that maximises returns for his various absolute return portfolios.
Zico is our in house equity consultant who is currently a private fund manager with more than a fair share awards in the course of his illustrious career.
Having managed both global and also regional themed equity portfolios, he specialises in stock picking that maximises returns for his various absolute return portfolios.