Breaking 1000 Billion Market Capitalization

Reading back the old posts, "In Defending 1000 Billion Market Cap" and "What Is 1000 Billion Meant To Me" which were published on 16/10/2014 and 24/12/2014 respectively.

The FBM KLCI 30 component stocks was hard hit to close 1722.16 on Monday at 15/6/2015 and the market capitalization was also down below 1000 Billion! Look into details and compare the index levels and the market capitalization that we did write in the previous posts, then continue the reading below...

Felda Global Ventures or FGV (code 5222) will soon be replaced by Westports Holdings or WPRTS (code 5246) in the FBM KLCI 30 component stocks. But, the market capitalization will probably be added nearly 9 Billion (FGV 6B against WPRTS 15B)! Thus, it is believed that the 1000 Billion will be well defended unless the FBM KLCI index is getting even lower!?

Forget about FGV or WPRTS since they are just less than 2% of the 1000 Billion. We did face below the 1000 Billion when the FBM KLCI index was at 1740 last year, and now below 1730 level only we have the same problem, why? do your own soul searching!

1730 verses 1740 had shown 10 index points advantage in defending the 1000 Billion, adding WPRTS will probably allow more buffer right!

All the above numbers is enough to grill your mind overnight. Since we already have a government trying very hard to skew the numbers to avoid hitting the debt rate ceiling, what is the problem by taking out and putting in different weighting stocks to defend the 1000 Billion? Time will tell you that "you" may not worth even half of the 1000 Billion and where will be the FBM KLCI Index level!? 1500, 1000 or 500?

You may probably see a double on 1000 Billion in future but definitely not in years to come! Let's hope that Bursa Malaysia has a magic wand to turn the 1000 Billion to 2000 Billion on its 30 Blue chips and our retirement money will grow tremendously by the time we are at the age of 55!

In Defending 1000 Billion Market Capital

Read back the old post, What Is 1000 Billion Meant To Me, in early October on the 30 component stocks of FTSE Bursa Malaysia KLCI or FBM KLCI index in short, readers should be knowing the issue of defending the market capitalization in the last day of year 2014!

At 1740 level, FBM KLCI index is now having just about 1 Billion Ringgit below the 1000 Billion benchmark - 999 Billion Ringgit (the emergency number!).

Remember at 1800 level, we had 1050 Billion Ringgit value of the market capitalization in the 30 component stocks, we (our country) now poorer by 50 Billion ringgit after FBM KLCI drop 60 points to 1740. 

Just imagine how much poorer we (again, our country) are when the FBM KLCI index drops another 60 points? We will be 100 Billion Ringgit poorer based on a basic observation on the above paragraph. 

Therefore, just pray hard that our 30 component stocks do well in their respective businesses and wish that our 1000 Billion benchmark double in coming years! 

What Is 1000 Billion Meant To Me

1000 Billion!? A trillion!? Yes, it is 1000 Billion the figures that appear daily in my new computer system to reflect the financial health level of our top 30 component stocks in Bursa Malaysia. It is the market capitalization of the total 30 largest stocks that is reflected in the FTSE Bursa Malaysia Kuala Lumpur Composite Index, or FBM KLCI index in short, at about 1800 level.

Believe it or not, FBM KLCI index may have impact to our daily life! For example, they (the 30 stocks) have issued shares and borrowed money from all investors (included all of us who purchased the shares) through the shares listing in Bursa Malaysia. When listed in Bursa Malaysia, they have their values (that is, shares prices). With the shares prices and the issued shares, we indirectly get the 1000 Billion value which is reflected in FBM KLCI index!

If FBM KLCI index at 1800 level, we may have 1050 Billion in value for all the 30 stocks, and if FBM KLCI index down to 1750, we have 1000 Billion in value. FBM KLCI index fluctuate everyday and so it the 1000 Billion value!

Just imagine: if the 1000 value is going down below 500? FBM KLCI index "crash boom bang"! The money we "lend" to the 30 stocks will lose half the value and it will affect our daily life too! Again, you may think you do not lend the money to them and will not be affected, you are wrong because your government agencies do invest in the 30 stocks using your "money"!!! (your "money" did go up from 500 to 1000 before that!!!)