Fast growing segment of "nouvea" investors.
There is an increasing number of individual "mini angel" investors around the world.
Globally, they count in numbers by the millions. They are for the most part educated, travel internationally and most don't really like to buy mutual funds with their capital. Instead, they look and check on various superior individual investment ideas. This often means seeking primarily oversold stock values and or high dividend income, as interest rates around the world have been very low for very long. Unlike the day traders, they would never argue that "dividends don't matter". They are delighted to find out, that in Thailand you can have both good earnings per share growth besides high current tax favored dividend income.
The various new technologies (the internet being just one) has empowered and enabled them. "Mini-Angels" prefer non-correlating global investments. Meaning stocks which do not vary in price with their main core home holdings. We call them the "nouveau" investors. They like stocks like for example Chiang Mai Frozen Foods (32.5), a low SET correlated value stock with high current income -and just one example on which we wrote about here on November 1 '00
They are huge in individual numbers and capital invested. Bigger then all VC funds combined -according to a book called "Angel Investing" by Osnabrugge and Robinson, 2000. But they are private and very fragmented and so not much is known about them.
They are often the recent technology related new millionaires from many developed countries. After all, not all Europeans missed the huge and unprecedented US stock market move in the past five years! Just in new IPO's, since 1999 some 80 Billion US $ of new wealth has been created in USA.
Consider just 2 other reasons why we believe these "mini-angels" will increasingly invest around the world and seek out bargains like the many we know of on the SET:
---A recent poll at CNN showed that fully 7% of Americans would like to retire one day abroad. This is a big change of attitude from the past.
---The age of new supersonic flights (right across the North Pole) is coming. This will allow new "long range" planes to fly right into Bangkok or Phuket, directly and non-stop from the main cities around the World.
Thaistocks.com knows for a fact that thousand of viewers look us up every month. They value independent insights and are willing to pay for such objectivity. Despite the local prolonged bear market on the Thai Stock exchange, our new viewer base is expanding at a double digit annual growth rate.
Like in so many other areas, the internet has mostly empowered the individual investor. Wealthier investors can and do seek out deep bargains which, are off the radar screens of the bloated institutions. They realize that some of the best and most undervalued listed companies are totally ignored by many, all just based on smaller size or low trading volume. Unlike a computer screen, on the SET bigger is rarely better.
These larger rational long term investors are a blessing in disguise as they in time, will take much advantages of the local market pricing inefficiencies here. This, by increasingly demanding from their brokers and others, objective ideas on undervalued shares in sectors which are bound to benefit from the then prevailing environment.
These larger investors find trading and speculating at best a waste of time. They are mature and seasoned in this field. They ask allot of questions -well beyond just looking at a stock graph. And while much of the local brokerage community is in disarray -mostly because the new razor thin commissions rates now in place here- the new generation of investment professionals are those which can offer meaningful long term ideas, well beyond trading.
This article was submitted to the Bangkok Post for publication on November 8th. We have a regular column in this paper, every Thursdays.
Paul A. Renaud & Team.
