Homepage
PR Newswire
26-10-2022, 01:06 PM
(This post was last modified: 26-10-2022, 01:10 PM by specuvestor.)
Actually just to say that the Structure incorporates the government... which is why there's VIE/ WOFE structure, NVDR in Thailand, tax structures, holding company structures for control, or even corporate laws structures including bankruptcy or sovereign reciprocity agreements for different jurisdictions.
So yes government and regulation is very important part of Structure besides being a wrapper or how cashflow moves. But usually Structure is overlooked and not important until it is the most important. Draconian binary policy changes are excluded cause one can't forecast that structural change. Actually even if majority owned, one has to look at the majority owners' incentives. For SOE their purpose might be too secure resources or public goods rather than profitability.
Frankly fixed Income guys look at Structures more in depth than equity guys.
So yes government and regulation is very important part of Structure besides being a wrapper or how cashflow moves. But usually Structure is overlooked and not important until it is the most important. Draconian binary policy changes are excluded cause one can't forecast that structural change. Actually even if majority owned, one has to look at the majority owners' incentives. For SOE their purpose might be too secure resources or public goods rather than profitability.
Frankly fixed Income guys look at Structures more in depth than equity guys.
(25-10-2022, 11:15 PM)CY09 Wrote: On top of Specuvestors' Asset, Business, Structure. We need to add in a fourth variable- 'government'. Politics, politics, politics.
Never invest in cheap fundamentals when politics play a part. A simple tweak in policies has resulted in a company's earnings to halve (look at Alibaba/Tencent) or even 90% (the online education sector); post policy change
On an international stage, never think of investing with China unless China is taking a majority stake. Singapore has been burnt twice- one the suzhou industrial park investment, temasek's investment in China companies just before the policy changes for online education and the clamp downs. Hope some Ministers or senior civil servants are reading this
Before you speak, listen. Before you write, think. Before you spend, earn. Before you invest, investigate. Before you criticize, wait. Before you pray, forgive. Before you quit, try. Before you retire, save. Before you die, give. –William A. Ward
Think Asset-Business-Structure (ABS)
Think Asset-Business-Structure (ABS)
