No time to invest in Thai stocks, says financial expert

The Government of Prime Minister Yingluck Shinawatra a "major u-turn" in economic policy must make if they could make Thailand vulnerable to the effects of global economic volatility, said Paul Gambles, a regional financial expert.

Gambles, managing partner at MBMG International, a financial advisory company based in Bangkok, said that despite the current strong budgetary position, the country Government Yingluck huge infrastructure spending and car-buying and rice subsidies would increase the debt/GDP ratio to 60 percent in the coming years.

"Now, we have sort of open incentive programs and there is no reason to do this. We should not stimulate the economy at this time. We must accept the fact that with the global economy slowing down, the Thai economy needs to come down a bit, "said Gambles in an exclusive interview with The Nation.

Gambles said that he had told everyone that he was waiting to invest in Thai stocks when they dive 30-40% of the current prices.

Martin Gray, portfolio manager with Miton-optimal Multi Asset Management, said investors down their expectations of return on investments should bring if there is no sign of good news is-unemployment remains high, interest rates are low and continue to fall, and there a disinflationary environment and sub-par economic growth.

"There is a danger at this time. We have seen the past nine to twelve months the rally of stocks and other assets. It is easy to declare that now is a good time to invest, but I suspect that with the volatility we've seen in the past few years, it might be a better time to sell instead of investing, "he said.

Gray, that the special situations Fund for the UK asset management company manages, spoke in an exclusive interview The Nation during his recent visit to Bangkok to give a special briefing to customers of MBMG International.

He said that mitonoptimal was previously defensive in its investment policy at this moment, to focus on cash and investment grade debt. It takes a long-term vision for five to 10 years on Asia's stock markets, but not on the current valuations, he said.

Gray said that investors can make money cash. Asian currencies such as the Singapore dollar, the new Taiwan dollar and the South Korean won have all appreciated more than 100% of the u.s. dollar over the past three years and will continue to gain against the dollar.

Asia and Japan make up for 39 percent of the MitonOptimal the portfolio at this time. It is built from zero in 2009 Asian-dominated assets held to 20 percent now.

About 60 percent of Japanese exports go to Asia now, compared with about 25 percent in 1985, while the United States and the European Union are much less important to Japan.

"If we want to, we must also Japan Asia going forward like. The yen will hold its value relatively well, you are patient, "he said.