Investors often have to scour for investment ideas in a myriad of ways. It could be a newsletter they subscribe to, a stock screener they use, a blog they follow, an influencer on YouTube or a fund manager on Twitter. The previous generations of investors could only dream of such tools at their disposal. I remember my parents’ generation had to use Teletext to check delayed stock prices!
On the other hand, we are now overwhelmed by the number of apps, websites and platforms that is available in the market to monitor our stocks. We might feel that ‘the more the merrier’ but having so many choices can lead to paralysis by over-analysis.
What if we can get all the information we need from one single app? Wouldn’t that be so handy and convenient for your investment research?
I would recommend you try the moomoo trading app. You should have seen their advertisements by now and if you have not used it yet, I am going to show you how you can use moomoo to find trade ideas.
Social Portfolios
The first trade idea generation tool is the portfolios shared by other users on moomoo. We humans are curious animals and like to know what others are doing with their portfolios. This is what you can use to find out.
moomoo publishes the returns of these portfolios and you can rank them by performance. But you need to be careful not to blindly follow these portfolios. Several of the portfolios have only one stock in it. Filtering by the highest returns tend to surface such ‘portfolios’ and you have to look through the list and only follow the users with more legit portfolios.
Moreover, users are allowed to add or remove stocks without incurring the actual transactions. So be discerning about who you follow.
How do I identify the good portfolios? Firstly, I look for portfolios with sufficient stocks, at least 10 in it. Secondly, I try to sense make if there is a particular theme or strategy for the portfolio. This may be a little harder if you have no investing experience. But I will give you some examples.
The screenshot below shows a thematic portfolio, and it helps greatly when the label of the portfolio is clear. In this case, this user has formed a portfolio that bets on the metaverse. Clicking into each portfolio will reveal the holdings, the individual weightage and profits and losses of each position.
The next screenshot shows a basket of China stocks listed in Shanghai, Shenzhen and Hong Kong. This is an interesting portfolio as it can give us some trade ideas if we are interested in China stocks but not familiar with the A-share and H-share markets.
The third example is a portfolio that adopts the renowned ‘All-Weather Portfolio’ strategy – based on Ray Dalio’s Bridgewater Associates. This user invests in a basket of stocks, bonds and commodities ETFs, with rebalancing done every 3 months. If you follow him, you will get the alerts to the changes too.
You can see how useful these social portfolios are and you just need to follow the users to get the alerts and monitor their performance going forward.
Institutional Portfolios
There are a number of websites that track the portfolios of institutions but you can find similar information conveniently in the moomoo app too.
The Star Institutions Positions showcase some of the most followed investors such as Warren Buffett, Temasek Holdings, Ray Dalio’s Bridgewater Associates and more.
Similarly, you can click on each individual portfolio to reveal their holdings.
It is important to note that this function is limited to US stock holdings and is not representative of their entire portfolio. This is because an institution can invest in private equities, bonds and other securities that are not traded on the exchanges as well as due to the disclosure challenges in markets outside of the U.S. Other websites will face similar problems too. This feature should track their performance sufficiently since many of these portfolios invest predominantly in the U.S.
Global List
The third way to find trade ideas is to refer to moomoo’s Global List. From the screenshot below, you can see there are many interesting lists that are ranked by different metrics such as market cap, revenue and profits. This is particularly useful for those who prefer to invest in big companies and familiar names.
The Global Market Cap list ranks all the available stocks on moomoo across geographies and exchanges. This gives us a quick glance of up-to-date rankings. I am surprised to see TSMC getting ahead of Tencent to be the most valuable Asian company by market cap. You might find more surprises going down the list.
Another interesting list would be the Global Profit List. I don’t see this ranking often and was surprised by the Chinese banks as they occupy 4 out of the top 10 positions. I knew they were profitable, but I didn’t know they were so profitable!
Analytical Tools
I wouldn’t suggest you buy simply based on the ideas from these portfolios or lists. I definitely would not do that myself.
I will prefer to carry out additional checks and run through my thought process before buying or selling any stocks. The good news is that the moomoo app provides even more analytical tools for us to do so.
Let’s say I picked up Tencent as a potential trade idea from the Global Market Cap List and Global Profit List as shown above.
The next thing to find out is Tencent’s valuation. Is it cheap or expensive to buy the stock right now? I would use the PE ratio range to determine the valuation as it is already a profitable company. moomoo provides the chart in the app and that saves me 30 minutes it would take to plot it myself. Below is a screenshot of the PE ratio chart and we can see that Tencent is trading near its 10-year low PE ratio! This means Tencent seems to be undervalued.
Next, I would like to find out its historical growth rates and moomoo provides these figures too. Revenue growth rates can be pulled from the financials section while other common metrics like EPS growth can be found in the ‘Key Indicators’. Historical growth looks good for Tencent as it has managed to grow its EPS each year with almost double EPS growth for some. Of course, this is historical, and we need to make our best guess for future growth rates amidst the China regulatory environment.
I would like to find out the business segments of Tencent and understand what drives its revenues. Fortunately, moomoo produces the information on its app and I do not need to look for it via their financial statements. In the screenshot below, we can see that 52.81% of the revenue was contributed by value added services. These are essentially the virtual goods sold in games.This means that Tenent is highly dependent on revenue from its Domestic and International Games as well as its Social Networks. Any further regulatory clampdown in these two aspects would hurt Tencent more than other segments. This becomes an area to watch out for if you are investing in Tencent.
Lastly, moomoo app provides the details of the shareholders in the company and spare me the time digging through the reports. Naspers, the South African company, is the largest shareholder of Tencent with almost 30% stake. Founder, Pony Ma, has about 7.44% stake. This is still a whopping US$42 billion net worth which suggests enough skin in the game for Pony Ma.
One-stop app for trade ideas and research
moomoo offers an info-packed app where you can find many trade ideas and information about stocks. It saves you a lot of time by not having to dig the financial statements, annual reports, other websites for information, or to manually plot some of the data for visualisation.
If you have been a moomoo user, try out some of these features mentioned above!
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This article is sponsored by Futu SG but the opinions belong to the author.
