Barely a week after Adam Khoo called it quits on the Chinese Stock Market, Chicken Genius Singapore (Ken Teng) predicted that 2024 would be a great year for Chinese stocks and that they are poised to recover from their slump for the past few years.
In the recent episode of Cafe Money Singapore, Chicken Genius shared that Alibaba is a worthy and low-risk investment due to the following reasons:
- The Chinese government is injecting liquidity into the market.
- An improved US-China relationship.
- Alibaba has the biggest AI Cloud infrastructure and that will drive massive revenue to Alibaba.
US tightening export controls of semiconductor chips used for artificial intelligence and the equipment used to manufacture them, to prevent China from acquiring or producing advanced chips will give Alibaba the advantage as a provider of AI Cloud computing.
Ken believes that the amount of risk in Chinese stock is at its lowest possible and thus, Alibaba is a very safe investment with huge upside potential.
My Trade
I took an option trade on Alibaba on 2nd Jan 24, when it was trading close to USD75. It is a BULL PUT spread contract, where I sell the USD80 PUT and buy the USD75 PUT and I choose a long-term expiration date of 16 Jan 26 (more than 2 years) to give the stock time to reach its potential.
Essentially, I am betting on Alibaba reaching USD80 by 16 Jan 26 and I will collect USD260 per contract in premium if that happens. The max loss is USD240 per contract if Alibaba falls below USD75 at the expiration date.
Along the way, I may choose to close the trade by taking profits (if Alibaba goes to the moon) or add on more contracts if I see a more attractive share price to average down on the current contracts. You can follow my Patreon page to be updated as I usually share them on the same day.
Concluding Thoughts
Chicken Genius Singapore and Adam Khoo are 2 massive Financial YouTubers who command a huge following (300k+ for Ken vs. 900k+ for Adam). Both of them have different investing styles but they are both very intelligent and experienced investors and traders.
However, one should not blindly follow either one of them, hoping that their prediction will come true. We should always be mentally prepared for the worst-case scenario if their predictions do not happen. They can take the hit because they are multi-millionaires and have great risk management strategies. The question is, can you?
I personally lost close to S$50k following the advice of gurus and you can read more about my experience first before deciding if you wish to follow Adam or Ken.
Losing $8k+ in this experience:
I Followed A Guru And Lost USD6.15K In A Month | Sharing My Experience From Joining A Paid Trading (Discord) Group
Losing $40k in this experience:
My Disastrous Start To 2023
I hope you find this sharing useful and can help you make a rational decision before you FOMO into any stock or investment. No one wishes to lose money in investing so it is good to be careful and do your due diligence to make sure you have made the right decision. All the best, Invest Safe (Ken), and May the Markets Be With You (Adam)!
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