Whether it’s a crash or a surge being expected, volatility in stocks makes them extremely risky yet attractive propositions to either buy or short. The highly fluctuating nature of these stocks offers an opportunity for investors to make a lot of money in unusually low periods of time. Today, we look at 4 Asian stocks that are stable at present but are en route to volatility due to various reasons ranging from geopolitical issues to failed business practices.
1) Samsung Electronics
The world’s largest consumer electronics manufacturer saw its share value surged by more than 50% in 2016: This was a remarkable growth rate by itself, and yet it seems gets even more incredible when the Note 7 and washing machine recalls are considered. The company, however, has entered troubled waters this year amidst a slew of corruption scandals surrounding its chief Jay Y. Lee and the suspended South Korean president Park Geun-Hye. While the company’s shares have remained stable so far, a rising political crisis linked to the organization and the largely bad PR that the company is currently receiving at home may affect investor confidence in the coming months, putting this stock at risk of volatility.
2) Indian Consulting Firms
The big four of the Indian consulting industry: TCS, Infosys, Wipro, and HCL, in addition to other smaller consulting firms, are all under risk of volatility this year. While the consulting industry has traditionally remained stable, the visa and business restrictions proposed by the Trump administration against outsourcing firms have driven the industry towards uncertainty. With a bulk of business originating from the U.S.A, any approval of restrictions on free movement of their employees or their businesses will prove costly for Indian consulting firms.
Once a powerful conglomerate is known for its innovation, Toshiba gradually lost relevance to competitors in each sector it once dominated. Over the last few years, Toshiba has increasingly reported losses in its annual filings and 2017 looks like the year it all goes down. The company has already begun selling its profitable units in order to make up for losses. The coffin in the nail, however, is being delivered by its Westinghouse nuclear energy division. Acquired at $5.4 Billion, the Westinghouse division had initially signed on multiple high profile nuclear power plant projects in the U.S. However, delays in construction lead to rising costs that eventually spiraled out of control. Today, the Westinghouse division has incurred losses to the tune of $6 billion. Investor confidence is already at extreme lows, with an unusually high number of shorts being made against the Toshiba stock.
2017 is a “do or die” year for Nintendo, as the yesteryear video game legend attempts to make a comeback with its widely hyped “Switch” console. In the past decade, Nintendo has lost precious market share to Sony’s PlayStation and Microsoft’s Xbox consoles. The company’s last 2 consoles: the Wii, and the Wii U, were criticized respectively for their favoring of “casual” over “serious” gaming and poorly designed hardware. The latter also received poor overall sales. The switch is Nintendo’s attempt to fix both of these issues. So far, an initial wave of positive reviews has sent Nintendo shares spiking by more than 9%. If mainstream gamers adopt the switch with the same enthusiasm as its initial adopters, Nintendo stakeholders can expect the abnormally high growth rate to continue its upward trajectory.