Dear Investors & Friends,

Grand Champion Sifu Dr. Neoh Soon Kean mentioned the Wisdom of Peter Lynch apart from Ben Graham & Warren Buffet

As we know Peter Lynch has mastered Cyclical Investments which both Ben Graham & Warren Buffet did not

As a result Peter Lynch Magellan Fund even beat Warren Buffet Berkshire Hathaway for 13 years at 29% per year cmpared to Berkshire at 25%

To-night We want to highlight how Dynaquest of Dr Neoh invest in Cyclical Nylex

For that let's go back into the Annual Reports of Nylex for years 2014, 2015, 2016 & 2017

 

 

 

Ok, from the above 4 Years 2014, 2015, 2016 & 2017

We noticed the Dynaquest - the Investment Company of Dr. Neoh suddenly appeared in Top 11 position for Year 2015 Annual Report of Nylex

See 11. Dynaquest Sdn Berhad 1,100,000 0.57

Dynaquest has 1.1 Million shares of Nylex which is about 0.57%

 

In Year 2016 Dynaquest again appeared in Top 30 Holders of Nylex

This time Dr. Neoh is at twelve position

 

See 

12. Dynaquest Sdn Berhad 1,100,000 0.57

Same number of shares held which is 1.1 Million Netx shares

 

Dynaquest was not in Year 2014 AR and also by Year 2017 AR Dynaquest again did not appear in Top 30 of Nylex

 

What can we conclude from here?

Or why did Dynaquest bought Nylex shares in Year 2015 & kept till Year 2016 but sold before Year 2017 Annual Report is out?

To understand this we need to understand the Nature of Nylex Business

Nylex is manufacturing Polymer based products which use Crude Oil. 

In year 2014 Crude Oil Price Crashed from USD100 to the low of USD27.00

 

 

SEE THE ABOVE 10 YEAR CRUDE OIL PRICE CHART VERY CAREFULLY

CRUDE AT PEAK WAS OVER USD100 FOR YEAR 2014

CRUDE OIL COLLAPSED TO THE LOW BELOW YEAR 2015 & 2016 AND HOVER BELOW USD50

DR NEOH CHUN CHUN BOUGHT NYLEX IN YEAR 2015 & 2016

 

 

This showed that Nylex polymer feed cost is reduced significantly & that means Nylex will be making more profit selling the same product even at the same prices.

Then in year 2016 to 2017 Nylex share prices have surged past Rm1.00 from the lows of 50 sen before year 2015

Nylex share prices up more than 100% and at the same time Crude Oil started to rebound upward which means Nylex cost of product increased again & that means less profit

So Dr. Neoh's timing was perfect and he sold at peak prices before Nylex share price turned down again

THIS IS WHAT PETER LYNCH TAUGHT ABOUT CYCLICALS

 

Cyclicals (3III CANNOT SEE CYCLICALS) HE CALLS ALL CYCLICALS GRUESOME (See https://klse.i3investor.com/blogs/www.eaglevisioninvest.com/2019-12-03-story242906-THE_PROBLEM_OF_3iii_IS_HE_HAS_TUNNEL_VISION_IN_INVESTMENT_HE_CANNOT_SEE_WHAT_OTHERS_SEE.jsp

“A cyclical is a company whose sales and profits rise and fall in regular if not completely predictable fashion.” In contrast to fast growers, cyclical industries expand and contract, almost continually. Some examples include the auto, airline and steel industries. Cyclical stocks do well as economies come out of recession and begin to expand.You can, however, also lose half your investment if you buy in the wrong part of the cycle. Lynch calls them the “most misunderstood” type of stocks. As large and well-known companies, they are often confused with stalwarts. People who work in cyclical industries have an edge over other investors.

Read again

“A cyclical is a company whose sales and profits rise and fall in regular if not completely predictable fashion.

Profits rise when Crude Oil crashed for Nylex & profit falls when Crude Oil rises

Read again

 Lynch calls them the “most misunderstood” type of stocks. 

Sifu Peter Lynch called Cyclicals "most misunderstood" type of stocks

BUT GRAND CHAMPION SIFU HAS MASTERED THE ART OF CYCLICAL INVESTING LIKE PETER LYNCH

NOW THAT CRUDE OIL HAS FALLEN AGAIN FROM USD70 TO BELOW USD30 CALVIN IS INTERESTED TO BUY NYLEX AGAIN (WE BOUGHT IN YEARS 2015 WHEN WE SAW DR. NEOH BUYING THEN)

Now of course DYNAQUEST IS NOT IN TOP 30 OF NYLEX FOR YEAR 2019 ANNUAL REPORT

(CRUDE OIL ONLY COLLAPSED IN MARCH 2020) 2 MONTHS AGO

NOW GOT ADDED OOOOMPH FOR NYLEX BECAUSE ANOTHER BOOSTER COMES FROM THE DEMAND FOR ITS ETHANOL IN FERMPRO, PERLIS

MANY COMPANIES (LATEST LYC) ARE SETTING UP MANUFACTURES OF SANITIZERS

THIS WILL INCREASE DEMAND FOR ETHANOL MANIFOLD

VERY GOOD FOR NYLEX & ALSO FOR ANCOM WHO OWNS 48.95% OF NYLEX

Best Regards

Calvin Tan Research

Please buy or sell after doing your own due diligence