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Experts offer investment strategies to beat political turmoil

Oct 21. 2020
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By The Nation

Thai stock market gurus have suggested ways investors can escape the impact of prolonged political unrest.

Wijit Arayapisit, a research department strategist at Maybank Kim Eng Securities, said the Stock Exchange of Thailand (SET) is currently weaker than regional peers due to political turmoil that has driven out foreign investors and delayed investment by locals.

"If the situation prolongs, the stock market will sink further," he said.

He advised investors to beef up their portfolios with assets unaffected by the unrest. He said these included electronics stocks which benefit from the rise in technology shares, food shares that benefit from the weakening baht, and retail shares boosted by government stimulus measures.

"We recommended buying KCE, TU, COM7, RS and SINGER," he added.

An analyst at Asia Plus Securities said political unrest always caused the baht to weaken and the stock market to fall.

"Last week, the baht weakened by 0.65 per cent and SET Index fell over 2.64 per cent as more than Bt4.1 billion in foreign funds flowed out from the stock market," he said.

"Meanwhile, the pro-democracy protests are likely to be prolonged and expand throughout the country, so investors should monitor the situation closely."

With negative sentiments pressuring the Thai stock market, he advised investors to hold 35 per cent in cash and invest 65 per cent in stocks that pay high dividends – such as DCC, JMART and MCS – and multinationals such as TU and PTTGC.

Nuttachart Mekmasin, assistant managing director at Trinity Securities, said the political unrest had hit the value of certain stocks.

He recommended that investors buy small- and medium-cap stocks in companies with growing profits, adding that foreign and institutional investors would not sell these stocks.

"However, we advise investing only 10 per cent in stocks," he said, adding that stocks capable of escaping impact from political unrest included electronics, food and agriculture shares.

Supachai Wattanavitheskul, senior director at Yuanta Securities, said the price of electronics shares on Tuesday rose despite ongoing political unrest because these global stocks have good long-term prospects and benefit from the weakening baht.

"We advise investors to buy KCE because the price of other electronic shares is currently high," he said.

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