Piloting confusing waters
You don't need to be a sailor to know that when the tide goes up, every ship in the sea rises. That is what happened to Asian equities this year, with the MSCI index of Asian stocks - excluding Japan - up by nearly 40 per cent. In such an environment, it is easy to make money as most stocks go up with the flow.
The tide is not turning completely but some ships have begun to sink, or at least stopped rising as much as the rest. And once the easy money has been made, stock picking becomes more important than ever.
That is easier said than done, especially in Asia. Short of using the dart-board approach of buying randomly - a reckless but not necessarily unprofitable occupation - investors have to rely on companies' valuations.
And here lies the rub. Partly to justify their existence, analysts have dreamt up a confusing array of investment ratios. Are you an enterprise value/earnings before interest taxation depreciation and amortisation kinda guy or more of a price/earnings ratio investor? And why not use the asset/shoe size ratio and the sale/coffee cups multiplicator? (The last two are made up but you get my drift).
Thankfully, Markus Rosgen of ING in Hong Kong has trawled through 13 years of data for some 7,000 Asian companies to determine which valuation yardstick is the best. The winner is . . . return on equity. This is the company's after-tax income divided by its book value. In simpler parlance, ROE is a measure of how much profit the company can squeeze out of what its shareholders have put in.
Had you invested in the 10 per cent of Asian companies with the highest ROE in 1990, you would have outperformed the market by an average 11.5 per cent per year, according to ING.
Two important conclusions can be drawn from this. First, contrary to popular perception, Asian companies do not all "chase growth" by trying to boost sales regardless of profits.
In fact, the companies that do better on the stock market are the ones focusing on profitability. This is See Europe stocks column at
www.ft.com/markets/europe reinforced by the fact that companies with the highest growth in earnings per share have outperformed the market by 10 per cent on average for the past 13 years.
The second lesson is that some valuations are completely useless for picking Asian stocks.
A recent favourite among investors, ev/ebitda - which compares the overall "value" of a company to its earnings - does not make the top ten of Asian valuations. Dividend yield - normally used to distinguish between mature and high growth companies - seems to work in Asia but only in bear markets.
Other strategies, such as "buying the winners" year after year are also not very good because the region is prone to volatile markets and sharp swings between bull and bear periods.
More familiar yardsticks, such as the price/earnings ratio, and price to book value do not fare badly but ROE is still king in Asia.
So what does that mean for investors? If Mr Rosgen is right, investors should concentrate on Hong Kong/China, Taiwan and South Korea, home to the companies with the highest ROE. They should concentrate on sectors such as consumer cyclicals and technology.
For those who like, and are allowed, to short stocks, there is an even better strategy. The gap between the best and worst share price performances is biggest in the earnings-per-share growth category. It pays to buy the stocks with high earnings and short the ones with sluggish profit growth.
For those of us who think of shorts as fashion accessories on a hot summer day, the temptation is to buy ROE and decide which resort in the Mauritius to book with the gains.
The only problem is that, in financial markets, the past never quite repeats itself. The only way to find out whether ROE is as good in the future as it has been in the past is to track the performance of stocks with a high ROE.
At the last count, five companies had the best ROE in Asia - South Korea's online game developer Webzen, the Chinese battery maker BYD, the Malaysian construction conglomerate UEM World, and the Taiwanese groups Acer, a chip maker, and Quanta Storage, a computer parts group.
Let's reconvene at the end of March, when we will have full year results, cash flow and balance sheet statements and see if ROE is better than a trusty dart-board.
为亚洲股市迷潮导航
就算你不是水手，你也知道“水涨船高”的道理。这正是今年亚洲股市的写照。摩根士丹利亚洲（不包括日本）指数(MSCI index of Asian stocks)上涨了近40%。在这种环境下，赚钱很容易，因为多数股票都在顺势上涨。
大潮尚未退去，但有些船只已开始下沉，或者至少已不再与其他船只一同上涨。而且一旦钱轻松赚到手，选股就变得异常重要。
说来容易做来难，尤其在亚洲。除了用掷飞镖方法随意购买股票（这种方法虽然卤莽，但未必不是一种可以赢利的消遣），投资者还不得不依赖上市公司的估价。
但问题就出在这儿。部分是为证明自己的存在是合理的，分析师们炮制出一系列令人费解的投资比率。你是个参照“企业价值/未计利息、税项、折旧、摊销前收益(ev/ebitda)”的投资者，还是更看重公司市盈率的投资者？另外，为何不用“资产/鞋子尺码比”以及“销售/咖啡杯乘数”？（后两种指标是我编的，但你明白我的意思。）
多谢ING驻香港的马克斯?罗斯根(Markus Rosgen)，他搜索了大约7000家亚洲公司13年的数据，以确定最佳估价指标。最后，获胜者是……股本回报率(ROE)，即公司税后收入除以其帐面价值得出的数字。简言之，股本回报率是衡量公司能从股东投入的资本中榨出多少利润的指标。
据ING称，假如你在1990年投资股本回报率最高的那10%的亚洲公司，那你平均每年的投资收益就已超过股市11.5%。
从中可以得出两个重要结论。首先，与人们的普遍观点相反，亚洲公司并不都是只顾试图推高销售额以“获取增长”，而不管公司利润。
其实，股市表现较好的公司往往是注重盈利能力的公司。这个论点已得到事实的支持：在过去13年中，每股收益增长率最高的公司，其股票表现平均超过股市10%。见
www.ft.com/markets/europe的Europe stocks专栏。
第二个经验是，在亚洲，某些估值指标对选股完全无益。
最近深受投资者欢迎的“企业价值/未计利息、税项、折旧、摊销前收益(ev/ebitda)”指标，并未跻身亚洲十大估值指标之列。该指标衡量一家公司的总“价值”与其盈利之比。在亚洲，股息收益率对选股似乎有作用，但只限于熊市。该指标通常用于区分成熟公司和高增长公司。
其它策略也不太奏效，如年复一年的“追涨杀跌”，因为亚洲地区的股市易于波动，常在牛市期与熊市期之间剧烈摇摆。
一些较常见的指标对选股有一定作用，如市盈率和市价对账面价值比等，但股本回报率仍居亚洲股市指标之冠。
那么，这对投资者意味着什么呢？如果罗斯根先生的结论正确，那么投资者应集中投资于香港/中国大陆、台湾和韩国股市，因为股本回报率最高的公司在这些地区。投资者还应集中投资于周期性消费股和科技股等板块。
对那些喜欢而且可以卖空的投资者来说，还有一个更好的策略。把股票按每股盈利增长高低归类，股价表现最佳与最差表现之间的差距最大。在这种情况下，买进高盈利股票，同时卖空利润增长缓慢的股票便可获利。
对于我们这些把卖空作为炎炎夏日下时尚点缀的投资者而言，一大诱惑是买进股本回报率高的股票，并决定用所得收益预定去毛里求斯某个度假胜地的旅行。
唯一的问题是，在金融市场上，历史决不会完全重演。要明确股本回报率今后是否仍像过去一样高，唯一的方法是跟踪股本回报率高的股票的表现。
在最近一次统计中，亚洲有5家公司的股本回报率最高。它们是韩国在线游戏开发商Webzen、中国电池生产商比亚迪(BYD)、马来西亚建筑集团UEM World及台湾两家集团――芯片生产商宏
