Q&A with Tan Chong Koay: What is the market outlook for 2023?

Market Outlook for 2023

A question taken from Tan Chong Koay‘s webinar titled Growing Your Wealth Through PHEIM.

The market in the US is very important, as investors in other markets would typically take cues from the US market performance, and there are factors in the US market you need to worry about.
I am cautious. In China and ASEAN, quite a number of stocks are trading at low prices and are undervalued. However, other markets will also be adversely affected if the US market comes down. The key is to select stocks that are undervalued and able to grow with a good CEO. This is key if you are picking your stock.

If you don’t have the time or the expertise in stock picking, pick a fund manager. This is my strong recommendation. You also need to be careful that there are problems worldwide, not just in the US. Even Europe has their issues, politically and economically.

This is why I strongly believe in value investing and why value investing is popular.

If you think a stock has good fundamentals and is undervalued, you buy and hold it long enough to make a profit. For most of our accounts, we have raised their cash level. And this goes back to my investment philosophy of “Never fully invest at all times.” If you are fully invested and the market crashes, you will suffer maximum loss. But if you have cash from selling stocks, you have cash to buy when the market crashes. If you are fully invested and when the market crashes, you will have no money to buy shares that have fallen to attractive levels.

This is why anticipation in advance is essential. It would help to research how the market is going and whether a crash is possible.