Statistic and opinion on stock market between the period the HK hit its recent highest record(Feb 2018) and 22 Dec 2018

The content of this analysis will be similar to the previous article about the US. stock market. But only focus on the strategies and the stocks we should buy.

HSI hit its record high on in Feb 2018, 33484 points and dropped to 24540 points in Nov 2018(26.7%).

WHICH STOCKS WE SHOULD BUY?

1. HSBC (may suffer from different countries)
2. Tencent 
3. CK Asset
4. AIA
5. Ping An
6. HKEX
7. Xinyi Glass
8. Sun mobile
9. 1373.HK
10. 1729.HK
11. A50
12. Hang Seng Bank
13. ????

*More high dividend yield HK stocks should be chosen as there is no dividend tax in HK

WHEN THE STOCK MARKET HIT BOTTOM?

In the correct mild market crash, the movement of the HK stock market was earlier than the US. by 4 months. let's see if it is the same as the previous market crashes.

In Oct 1987, HSI dropped about 50% in 1 month.
In Aug 1997, HSI dropped about 61% in 1 year
In July 2000, HSI dropped about 54% in 2.5 years
In Nov 2007, HSI dropped about 63% in 1 year
In May 2015, HSI dropped about 36% in 10 months
In Feb 2018, HSI has been dropping about 26.7% in 10 months 

Compared to the performance of the US. market: 
In Sep1987 market crash: S&P 500 dropped about 35% in 1 month.
In Oct 2000 market crash(pop of IT stocks and 911 event): S&P 500 dropped about 51% (Nas: 80%!!, Dows: 36.5% only) in 2.5 years
In Oct 2007 market crash: S&P 500 dropped about 57.7% in 1.5 years (similar to Nasdaq and Dows)

Given the HK stock market dropped earlier that the US. stock market by about 8 months, will they hit the bottom at the same time?

After checking the past data, usually both the HK and the US. stock market will both hit the bottom at a very close time. However, with the influence of the China stock market towards the HK stock market, it may change a lot. I will still assume they will hit bottom at the same time.


Technical analysis using RSI                    
                                                                                 back to buying position            increased   5%
on 2 Aug 2019,   RSI of HSI dropped to 27.7                   not yet                                27
on 23 May 2019, RSI of HSI dropped to 26.0                   17                                       6     
on 10 Nov 2018, RSI of HSI dropped to 26.9                    1                                       20
on 23 Dec 2016, RSI of HSI dropped to 28                       1                                       17
on 7 Jan 2016, RSI of HSI dropped to 24.8                       60                                     97
on 19 Aug 2015, RSI of HSI dropped to 26.3                    380                                    380
on 7 Aug 2015, RSI of HSI dropped to 20.3                       1                                       2            
on 29 Sep 2014, RSI of HSI dropped to 26.5                    4                                        110
on 2 Apr 2014, RSI of HSI dropped to 25.2                      5                                       14
on 11 Jun 2013, RSI of HSI dropped to 27.3                    2                                      40
on 17 May 2012, RSI of HSI dropped to 27.9                   30                                    110               
on 23 Sep 2011, RSI of HSI dropped to 27.5                     4                                       20
on 8 Aug 2011, RSI of HSI dropped to 26.2                      30                                    175                 
on 17 June 2011, RSI of HSI dropped to 26.4                    7                                      558