SET index trend for the next six months
Currently, the investment cycle of government and private investment in Thailand is at its peak, as consumption has accelerated from a higher revenue base caused by the increase in the daily minimum wage to Bt300 nationwide, resulting in a positive medium
This is indeed a perfect time for investment in the Stock Exchange of Thailand, especially those in stocks that will likely benefit from domestic economic growth. This is true despite the fact that, in a few months, the index could face corrections to 1,450-1,480 points because of various negative factors. These include the uncertainty of Thai politics, anxiety over North Korea’s war threat to its southern neighbour, the outbreak of the H7N9 avian-influenza virus in eastern China, that country’s economic stimulus policy, and foreign trading value for profit-taking (about Bt8.9 billion from April 1-5).
If you are keen on investing in the Thai stock market, we recommend the following sectors:
lDomestic plays, such as property-sector stocks that would benefit from the low-interest-rate policy, rising consumer confidence and purchasing power, and expansion of a rail-based mass-transit project.
lInfrastructure plays supported by government and private investment, such as rail-based investment by the public sector and third-generation telecom projects by the private sector.
lGreen energy plays under the latest alternative-energy development plan, designed to increase power-generation capacities from solar energy (from 75 to 2,000 megawatts) and wind energy (from 7MW to 1,200 MW).
lHigh-dividend-yield stocks, such as telecommunications and technology stocks capable of generating strong cash flows together with high dividend pay-outs.
lSpecific factor plays, meaning stocks with specific fundamentals suiting short-term to medium-term investments, or those of businesses that are recovering or turning around.
A proper strategy during this period consists in choosing the right investment, meaning outstanding stocks with unique factors, such as defensive and turnaround stocks. You should leverage market-timing techniques for proper investment weighting to generate higher returns during this period of market vitality.
However, investors with no time to track the market are strongly advised to consider Target Fund investment in mutual funds with target returns within a specified period. This option is perfect for those needing well-qualified fund managers to manage their portfolios, track the market, analyse research, and time the market for risk containment.
The Fund Management Department of Asset Plus Fund Management contributed to this article.
