What has not been said about Koon Yew Yin for the last couple months?
A brief background on the man
If you’re reading this, chances are you know who he is. And if you didn’t, you can bet he will remind you. Haha.
Basically, he is the co-founder of Mudajaya, IJM and Gamuda, who had the nerve to sailing in the Hong Kong crisis near the bottom.
He also got famous in the market, after being saved from Xinquan, Jtiasa, Mudajaya and more from kcchongnz and OTB.
And during the massive bull in 2013 to 2015, he followed OTB picks to the hilt, margining all the way up on VS, Latitude, Liihen, Gamuda-we etc. Turned something like RM5-10mil into more than RM100 million in a couple years.
Subsequently, he recommended a lot of stocks using that track record, Chinwel, Jaks, Sendai, Canone, Kianjoo etc, all of which either didn’t go anywhere or, as people say in I3, go Holland.
Due to his prior reputation, and his money enabling him to be a one man institutional fund in small stock exchanges in Bursa, a lot of people try to trade off his movements. The foolish ones take him at face value, the smarter ones try to make money off him and the retailers.
And after one fiasco after another, from Gadang, Gamuda-we, Hengyuan, Lionind. His name and reputation is dirt.
Good reputations are easier to build in bull markets.
In his private life, many people are likely to have fond memories of him. He is one of the few rich people in Malaysia giving out scholarships very publicly. And out of his own pocket, not out of the Company’s.
He also plans to spend RM50 million building a hostel, which I am sure he intends to do, considering his actions thus far.
He also has the gumption to strongly criticize the BN government back when they were in power, which , if you were a rich and public person, takes balls.
He also took the time to write on his thoughts and perspective on various matters, political, historical, psychological etc. All of which were relatively interesting. His blog was one of the few I finished in I3.
Given the above, many would find it very difficult to reconcile the man above, with the way he conducts himself in the market.
Highly unethical? Yes.
Unethical like bonescythe? No.
His ethics, is somewhere between, the famous quarter predictors of i3 and bonescythe’s.
He would tell you about the wonders of the company, while he could be selling.
And he would tell you how you should not buy it, and then buy the bottom?
Both of which, may very well be done in an unconscious way.
Ie, when he told you it was cheap and he was buying, at that exact point in time when he was writing, it may be cheap. But as he bought, it shot up, and given his propensity to read sentiment and trade, he starts selling.
When he says it is rubbish, and he’s not buying or selling, the price may very well fall to a place, where he sees the value, and starts buying. And then, he’ll tell you he’s buying.
But, I am fairly certain, he is conscious of his own effects in the markets, and thus trades it, making money off the very people he claims he wants to teach to make money.
Very interesting paradox.
In essence, he’s a dentist, who tells and teaches you how to take care of your teeth because planting teeth or making fake teeth is expensive. And then tells you to visit him once a month for deep washing, scrapping and sells you special toothpaste. Which may very well cost just as much.
Except, he makes your future profit off you now instead of over a few years. Hahahaha
Reconciling the enigma
Whenever I read about Koon Yew Yin, I can’t help but think of this lady boss my dad used to work for. She runs a medium sized freight, logistics, shipping company in south east asia. It’s not listed, but you are likely to see her trucks on the highway relatively often.
In business, she is ruthless, she will cut cost very viciously. Like every good businessman, for her cost is like fingernails, it needs to be trimmed constantly. Bonuses and increments are scarce.
She will chop her customers, and squeeze her suppliers as hard as possible. She negotiates like a tiger, and if you waver, she will eat you up. If you’re a competitor, she will run you down to bankruptcy without thinking twice.
She will do pretty much whatever it takes to cut down on her corporate tax.
And yet, when it comes to her personal life, she is utterly kind and generous. During the penang floods, she mobilized her trucks to bring to penang all kinds of essential goods, free of charge, without any publicity.
There isn’t any bonus most of the time, but it’s not uncommon for her to notice a staff planning to buy a house, and just transfer the deposit to him, without him asking, and with no strings attached.
She sometimes notices staff with debt problems or need cash suddenly, and she’ll just transfer it or pay it off without you asking, and no strings attached.
Many of her managers started off as truck drivers, and now becomes sales or logistics managers. Her lawyer, was an 18 year old truck driver with no education, who wanted to do law. She paid for his study fees, in Malaysia and in England. Gave him an allowance there, and basically bore all cost. Again, no strings attached. She encouraged him to go and establish his own practice the moment he got back, and became his first customer, and recommended many more to him
Needless to say a complex person.
How does that relate to Koon Yew Yin?
Well, Koon Yew Yin’s flaws are complex.
- Like the lady boss, unless you know him personally, in the market, you are food for him.
He finds it perfectly fine to play and manipulate the nameless faceless retailers, the institutions and the market in general , and make money off them.
Immoral and unethical? Well morality and ethics is subjective. Eating meat causes the most amount of pain to sentient beings, and yet we eat meat.
You see people who cannot bear to see their dogs even cough, and yet, are more than willing to subject pigs (who are smarter than dogs), to inhumane amount of pain via industrial farming.
Why, because most people do not truly see the consequences of their actions. If you had to kill the meat you eat (or at least watch a video on industrial farms every time before you eat), you would likely eat a lot less meat. God the screams when you hook a pig in the air and cut him in half alive.
It’s not unethical, it’s just the way it is.
If he does not see you or know you. Well, he intends to make money off you.
- Now, secondly, he fails to understand market dynamics and the uniquely personal characteristic of Malaysian stock markets.
Market is dynamic. The more people do something, the less profitable it becomes, and the more profitable the other thing is.
Before 2012, certain things weren’t around, and people did not place such an important emphasis on predicting quarters, but when certain things came into being, and predicting quarters became profitable, more and more money poured into it.
It used to be predict a quarter, when the good result comes out, you get the pop, when most people decide to buy letting you sell it off.
Now, everyone predicts quarters, and usually of the same companies, therefore the price rises up way before the results come out, severely distorting the risk and reward. And thus people who actually waited for the quarter to come out, loses out to the quarter predictors who would have sold way before.
Now naturally markets are dynamic. Now you see people buying, therefore pushing the stock up, and subsequently, selling and pushing the stock down before the quarter comes out. Which is hilarious sometimes.
God, if not for the internet, brokerages would be killing it.
And back then, when Koon Yew Yin said he was buying, not that many knows instantly. Now, his words and articles is plastered on the front page, not just the retailers now, even the institution money know about it and want to play off it.
Making the rise and fall even more extreme and swift. At the end of the day, the losers are the old auntie and uncle. At the peak of Hengyuan, even taxi drivers were talking of it.
His golden rule is too well practiced, too many people are buying up stocks of useless companies and hoping to sell them off, except, everyone is thinking the same thing.
How else does Muda, Hengyuan, Supermax, etc happen?
So what is this enigma that is Koon Yew Yin.
The smart, yet foolish person. This kind, yet vicious man. This deeply emphatic and yet completely indifferent man.
He is wide.
He is complex.
He is contradictory.
Most of all, he is human.
And he’s not your friend in the markets.
And like everyone else, just another force to be taken advantage of.
2 thoughts on “Understanding Koon Yew Yin, The real enigma.”
Well said! totolly agree.