I’ve recently started, or rather restarted (more on that later), my position with SEA (again).
Sea Limited (SE) further dipped with a 6.63% drop last night, triggered by Tencent (HK:700) reducing its stake in Sea.
My GTC (Good Till Cancel) order @ $189 was filled – as per portfolio management, I’m now 20% in with SE and looking at further DCA (dollar cost averaging) with SE likely to tread lower at these volatile periods.
At times like these, it’s totally understandable, especially on psychological level, whether to continue to accumulate SE with the rest of my 80% fund I’ve initially intended to invest in SE.
Then I come across this article, sent to me in my WhatsApp small investment community group by my investment buddy, https://mp.weixin.qq.com/s/rCYiB9YYG-CQznC1ZnTYxg … it’s a rather long article, in Chinese, and after investing considerable time reading and digesting it, I must say this is one of the most outstanding articles on current SE situation!
Below is my reply/message back to my WhatsApp investment group .. kind of like a super quick summary of the above article … which I would like to share with you here :
Extremely good (and long) article on SE .. in summary, one of the key reason for Tencent to sell SE is to reduce its controlling stake to allow SE to better penetrate the biggest gaming market – India (which bans Chinese) .. as SE’s major cash machine Garena is needed to churn more cash for it to “burn” to allow Shopee to fight the brutal e-commerce wars incl latin US … Tencent recent 2 big moves (1) giving JD shares (2) selling SE allow Tencent to milk its massive profits since Tencent is their early investor … in conclusion: SE has super high potential but also extreme competition … hidden analysis: Tencent is 😳
So, while I’ll still be accumulating SE, gearing down my GTCs to safer margin of safety ie. my next GTC_EXT is $168 (down from $180) … so that this give me enough time decide if I’ll to divest/allocate more fund into Tencent which I already got a small position.