Earnings are important, but it's the quality of the earnings that counts.
When it comes to fundamental analysis, the most important item is earnings. Indeed earnings are the lifeblood of a company. Without earnings, a company cannot survive. When a company reports earnings that are above expectation, the price of the stock rises. And when it reports earnings that are below expectation, the stock price drops.
When we look at earnings, we should look at earnings per share (EPS) and not only at the amount. A company earning RM10 million with an issued capital of RM10 million comprising of 10 million shares issued at RM1 each is better than a company earning RM100 million but with a capital of RM500 million comprising 500 million shares of RM1 each. While the former's EPS is RM1, the latter's EPS is only 20 sen. Many people look only at the amount earned when they should be looking at the EPS.
Another feature often overlooked is the quality of the earnings. Earnings from sales and received in cash is the highest quality of earnings. Earnings placed under Accounts Receivable may not be fully realized, and therefore has a lower quality. Earnings from sale of assets, not repeatable, are the lowest form of earnings. So when you look at earnings, you must take into consideration the quality of the earnings.
Ideally, earnings should go up in tandem with sales of the company's products or services, year after year. Sometimes earnings improvement is the result of cost cutting. If the cost cutting comes from decreasing the labor force thus demanding more work from each worker, this is not so good even though competency is enhanced.
The best scenario is that the quality of its products is upgraded resulting in more sales and better margins.
Next time you look at EPS, don't forget to look at the quality of the earnings.
Please click f if you find this article useful. Thanks.
马 到 功 成. Success is when the horses come. Success goes only to those who dare and act, it seldom goes to the timid. The pessimist complains about the wind; the optimist expects it to change; the realist adjusts the sails.
Sunday, April 14, 2013
Thursday, April 11, 2013
ECS ICT EARNINGS TO IMPROVE
Malaysia’s leading ICT distributor ECS ICT Berhad and Samsung Malaysia Electronics (SME) have signed a business-to-business (B2B) distribution agreement that will see ECS distributing the global leading consumer electronics provider’s entire range of IT and mobility products to the enterprise market.
ECS and IBM Partner to Deliver SmartCloud Solutions
ECS inks deal with CA Technologies
Read about them here.
ICT products are part and parcel of life in our modern world. The importance of these products needs no explanation. One company that stands to benefit much from these products is ECS ICT Berhad which is a leading ICT distributor. The 3 activities mentioned above will go a long way to improve its revenue and earnings. At the last traded price of Rm1.16, there is plenty of value for your money.
Buy at your own risk.
ECS and IBM Partner to Deliver SmartCloud Solutions
ECS inks deal with CA Technologies
Read about them here.
ICT products are part and parcel of life in our modern world. The importance of these products needs no explanation. One company that stands to benefit much from these products is ECS ICT Berhad which is a leading ICT distributor. The 3 activities mentioned above will go a long way to improve its revenue and earnings. At the last traded price of Rm1.16, there is plenty of value for your money.
Buy at your own risk.
Wednesday, April 10, 2013
TDM Bonus and Share Split
TDM has announced a bonus issue of 1 for 5, and a share-split of 5 for 1. This means that for every five shares you have, you get 1 share free. And after the share-split you will then have a total of 30 shares.
TDM closed at RM4.21 yesterday. It will be interesting to see how the investors react to announcement.
TDM closed at RM4.21 yesterday. It will be interesting to see how the investors react to announcement.
Tuesday, April 09, 2013
TDM first and final dividend of 22 sen tax free
TDM said that for the financial year ended 31.12.12, it would propose a first and final dividend of 22 sen tax free under the single-tier tax system. This is good news for all shareholders.
Monday, April 08, 2013
TDM Cheapest Among Plantation Stocks
Jewels Among The Rubble
In scouring for jewels in Malaysia’s plantations universe, TDM and Chin Teck stood out among the 10 cheapest plantation stocks in terms of EV per planted ha valuation. We think these stocks’ EV valuations should still be, but are not, higher than Indonesia’s. These stocks could re- rate on account of their severe under-valuation, even if the plantation sector stays unexciting.
Source: RHB The Research Team. Read more here.
In scouring for jewels in Malaysia’s plantations universe, TDM and Chin Teck stood out among the 10 cheapest plantation stocks in terms of EV per planted ha valuation. We think these stocks’ EV valuations should still be, but are not, higher than Indonesia’s. These stocks could re- rate on account of their severe under-valuation, even if the plantation sector stays unexciting.
Source: RHB The Research Team. Read more here.
Interest Seen In Faber
Faber opened at 1.57. It quickly breached its overhead resistance at 1.58, and went up to a high of 1.63 before pulling back to 1.59 for the close. This is a good entry point. Total volume traded amounted to 1,978,400 units which is high for this stock.
Buy at your own risk. Good luck.
Thursday, April 04, 2013
ECS Heading To Cloud Nine
ECS is a leading ICT distributor. It is a small-cap stock with zero borrowings and plenty of cash in hand. The stock has all along been very quiet, but in the last few days, interest in the counter has picked up. This is clearly displayed in the above chart. Volume has also picked considerably.
The recent announcement that ECS is partnering IBM to provide cloud services, and an earlier announcement that the company has inked a deal with CA Technologies to distribute CA Technologies data management solutions are probably the reason that causes demand for the stock.
Going by the chart, the stock is likely to move up more.
Monday, April 01, 2013
Multico A Big Disappointment
Multico actually did well fundamentally as shown in my previous post. I had hope for a good performance today, but it did dismally. Although volume was high, the stock ended at 1.55 which is 5 sen below last Friday's close. The pattern of the chart has turned bearish with the formation of a Bearish Engulfing.
Is the stock price of Multico under manipulation? We have heard of "pump and dump." The exact opposite of this is "depress and collect."
Multico is a small-cap stock. Normally, only a small volume is traded in a trading day. Because of this, the stock can be easily pushed north or south as desired by the manipulators. Going by the chart, support should come in at 1.53, and if this is breached, the next support will be 1.46.
Saturday, March 30, 2013
Multico, Time To Move Forward
THE TECHNOLOGY BEHIND THE WINNING POWER Multi-Code is synonymous with the highest standards of quality through utilizing state-of-the-art technology and extremely stringent quality control to ensure product excellence for its customers. The high quality of Multi-Code’s products meet the exacting standards demanded by the local and international markets.
Multi-Code’s relentless passion for quality has won acknowledgement and recognition when the company was awarded the ISO 9001-2000 and ISO/TS 16949:2002 accreditation for its Quality Management System from TUV Rheinland. Read more.
Multico reported 2Q13 earnings of 7.54 sen per share and revenue of 27.146 million. This compares well with the preceding year's corresponding period of EPS of 4.90 sen and revenue of 25.282 million. From this, we can easily note that its profit margin has improved. This is a good sign.
Another good sign is that its MD, Lim Ming Kee has on Feb 5, 2013 bought 64,500 shares for RM89,010.
In its latest filing with Bursa, the company said that it had won a contract of 74.1 million from PROTON for the supply of functional switches and anti-theft systems. This will enhance its future earnings.
The stock was last traded at 1.60 which is the previous high level. I believe this level will be crossed soon.
The company has declared a single-tier interim dividend of 3 sen which is the same as that for last year. Its NTA now stands at RM1.6267.
In respect of its lawsuit to recover some RM43 million from some of its former directors, the matter is still waiting for news from the court.
All in all, at RM1.60 per share, this stock is a good buy.
As usual, you buy at your own risk.
Multi-Code’s relentless passion for quality has won acknowledgement and recognition when the company was awarded the ISO 9001-2000 and ISO/TS 16949:2002 accreditation for its Quality Management System from TUV Rheinland. Read more.
Multico reported 2Q13 earnings of 7.54 sen per share and revenue of 27.146 million. This compares well with the preceding year's corresponding period of EPS of 4.90 sen and revenue of 25.282 million. From this, we can easily note that its profit margin has improved. This is a good sign.
Another good sign is that its MD, Lim Ming Kee has on Feb 5, 2013 bought 64,500 shares for RM89,010.
In its latest filing with Bursa, the company said that it had won a contract of 74.1 million from PROTON for the supply of functional switches and anti-theft systems. This will enhance its future earnings.
The stock was last traded at 1.60 which is the previous high level. I believe this level will be crossed soon.
The company has declared a single-tier interim dividend of 3 sen which is the same as that for last year. Its NTA now stands at RM1.6267.
In respect of its lawsuit to recover some RM43 million from some of its former directors, the matter is still waiting for news from the court.
All in all, at RM1.60 per share, this stock is a good buy.
As usual, you buy at your own risk.
Monday, March 25, 2013
Control Your Emotion or Other People Will Control You
Many people are controlled by fear. Fear of losing an opportunity causes you to act in haste. Fear of losing your paper profit causes you to sell out too early. And fear of losing everything causes you to sell right at the bottom. Although selling right at the bottom is caused more by frustration than anything else, fear also plays a part. How do we overcome these kind of fears? Knowledge is the best weapon. When you know, people cannot scare, frighten or intimidate you. They can't con you in anyway. Knowledge is your first key to success.
Hope causes you to hold on to a falling stock. Sometimes your hope is rewarded; your stock turns around and you make a profit. Unfortunately, hope often becomes hopeless. Experience tells me that it is much better to keep an uptrend stock and let go a falling one. This strategy is vital, simply because a trend in motion is likely to continue. Hope also causes people to buy into excessively high PE stocks. I prefer what is good today and better tomorrow.
You often hear people say: "Don't be greedy." Actually greed is necessary if you want to make big money. How else can you get a ten-bagger if you are not greedy. But unsatisfied greed is bad. Bulls make money, bears make money but never a pig, so goes the saying. (A pig is someone who will not sell, not matter how high the price goes up.)
Everything has a fair price. When a stock is overpriced, your concern is to sell it at a good price. The best way I know, is to use a trailing stop-loss. If you have no idea what a trailing stop-loss is, you can check it up at Investopedia.com.
This device is to prevent you from selling out too early.
Hope causes you to hold on to a falling stock. Sometimes your hope is rewarded; your stock turns around and you make a profit. Unfortunately, hope often becomes hopeless. Experience tells me that it is much better to keep an uptrend stock and let go a falling one. This strategy is vital, simply because a trend in motion is likely to continue. Hope also causes people to buy into excessively high PE stocks. I prefer what is good today and better tomorrow.
You often hear people say: "Don't be greedy." Actually greed is necessary if you want to make big money. How else can you get a ten-bagger if you are not greedy. But unsatisfied greed is bad. Bulls make money, bears make money but never a pig, so goes the saying. (A pig is someone who will not sell, not matter how high the price goes up.)
Everything has a fair price. When a stock is overpriced, your concern is to sell it at a good price. The best way I know, is to use a trailing stop-loss. If you have no idea what a trailing stop-loss is, you can check it up at Investopedia.com.
This device is to prevent you from selling out too early.
Thursday, March 21, 2013
The Sure Way To Stock Market Success
Knowledge, wisdom, discipline and patience are what you must have to succeed in the stock market. Without knowledge, you can't compete. Without wisdom, you can't strategize. Without discipline, you can't implement, and without patience, you can't control your emotion. Never allow greed, hope and fear to control you.
To have a good knowledge means knowing what is happening around you locally and internationally.
What is happening in some countries, especially the big ones, like America, China, India, Brazil and the European countries can have a profound effect on small countries like Malaysia, Singapore, Indonesia, HongKong, Japan, and Taiwan, to name a few.
Of utmost importance is that you must know how to analyze an annual report of a company. Once you know this, you will be able to distinguish a good stock and that of a rotten one. A rotten stock is like a bad egg which will not hatch no matter how long you sit on it.
Wisdom is the excellent use of knowledge. Without wisdom, knowledge cannot be put to good use. For example, if you know that smoking, gambling and alcoholism are bad for you, but you continue to smoke, gamble and drink. This means you are not putting your knowledge to good use, and thus your knowledge is useless to you.
Having knowledge and knowing what to do are not good enough. You must have discipline to implement those actions needed to bring about success.
If you know that buying in a downtrend is stupid, but continue to catch the falling dagger, you have no discipline.
Impatience is the cause of many a loss. The market is designed to transfer money from the impatient to the patient. So you have to be patient. If you overpay, even for a great stock, it will be a long time before you see a good profit.
When it's not the time to buy, don't buy, otherwise you will soon say to your money, "bye, bye."
Investing in the stock market is a serious affair. Don't take it lightly. Success is sure to be yours if you have knowledge, wisdom, discipline and patience. Unless you are well prepared and well planned, success may just remain a dream.
Good luck and may God bless your every trade.
To have a good knowledge means knowing what is happening around you locally and internationally.
What is happening in some countries, especially the big ones, like America, China, India, Brazil and the European countries can have a profound effect on small countries like Malaysia, Singapore, Indonesia, HongKong, Japan, and Taiwan, to name a few.
Of utmost importance is that you must know how to analyze an annual report of a company. Once you know this, you will be able to distinguish a good stock and that of a rotten one. A rotten stock is like a bad egg which will not hatch no matter how long you sit on it.
Wisdom is the excellent use of knowledge. Without wisdom, knowledge cannot be put to good use. For example, if you know that smoking, gambling and alcoholism are bad for you, but you continue to smoke, gamble and drink. This means you are not putting your knowledge to good use, and thus your knowledge is useless to you.
Having knowledge and knowing what to do are not good enough. You must have discipline to implement those actions needed to bring about success.
If you know that buying in a downtrend is stupid, but continue to catch the falling dagger, you have no discipline.
Impatience is the cause of many a loss. The market is designed to transfer money from the impatient to the patient. So you have to be patient. If you overpay, even for a great stock, it will be a long time before you see a good profit.
When it's not the time to buy, don't buy, otherwise you will soon say to your money, "bye, bye."
Investing in the stock market is a serious affair. Don't take it lightly. Success is sure to be yours if you have knowledge, wisdom, discipline and patience. Unless you are well prepared and well planned, success may just remain a dream.
Good luck and may God bless your every trade.
Saturday, March 09, 2013
MNRB Spectacular Earnings Surprise
MNRB Holdings - Spectacular Earnings Surprise
Author: kiasutrader | Publish date: Fri, 1 Mar 10:10 | >> Read article in Blog website
MNRB's 9MFY13 net profit at RM97.1m was above our expectations, accounting for 124% of our full FY13 earnings estimate. The 91.6% surge in profit was mainly due to lower net claims ratio, 24.4% higher investment income, and an improvement in
underwriting margins. We take the opportunity to upgrade our earnings estimates by as much as 50% for FY13/14 and thus upgrade the stock to a BUY, pegged to 0.6x FY14 BV. The stock is a laggard amongst reinsurers in the region which trade at closer to 1x BV with a 29% upside to our fair value.
Exceeded expectations. MNRB's 9MFY13 net profit at RM97.1m was above our expectations, accounting for 124% of our full year earnings estimates. During 3QFY2013, the group registered a net profit of RM59.0m, 333% higher than the previous year's corresponding period and higher q-o-q from 2Q's RM12.3m loss. The 9MFY13 profit surge of 91.6% was mainly due to: i) significantly lower net claims ratios across a few key business segments, ii) 24.4% higher investment income, iii) improvements in underwriting margins as well as increase in net profit margins from 3.2% to 5.6%. This was however
offset by: i) overall moderate growth of 8.4% in premiums/contributions, and ii) higher fee and commission expenses growth.
Source: OSK
Labels: MNRB
Comment
For fiscal year ended 31.3.12, a final dividend of 17% less tax was paid on 26.10.12. This is about 39% of its full-year earnings.
For fiscal year ended 31.3.13, dividend is expected to be not less than 25% less tax, assuming that the 4th quarter earning is the same or not less than 19.60 sen per share.
As at 31.12.12, the NTA of the stock was RM5.50 per share. The stock was last traded at RM2.89.
My concern about this stock is that there is no consistency in its earnings. This is perhaps the reason why the stock is being traded at such a big discount to its net tangible assets. Nonetheless, at RM2.89, the stock should eventually turn out to be an excellent buy.
As usual, you buy at your own risk.
Author: kiasutrader | Publish date: Fri, 1 Mar 10:10 | >> Read article in Blog website
MNRB's 9MFY13 net profit at RM97.1m was above our expectations, accounting for 124% of our full FY13 earnings estimate. The 91.6% surge in profit was mainly due to lower net claims ratio, 24.4% higher investment income, and an improvement in
underwriting margins. We take the opportunity to upgrade our earnings estimates by as much as 50% for FY13/14 and thus upgrade the stock to a BUY, pegged to 0.6x FY14 BV. The stock is a laggard amongst reinsurers in the region which trade at closer to 1x BV with a 29% upside to our fair value.
Exceeded expectations. MNRB's 9MFY13 net profit at RM97.1m was above our expectations, accounting for 124% of our full year earnings estimates. During 3QFY2013, the group registered a net profit of RM59.0m, 333% higher than the previous year's corresponding period and higher q-o-q from 2Q's RM12.3m loss. The 9MFY13 profit surge of 91.6% was mainly due to: i) significantly lower net claims ratios across a few key business segments, ii) 24.4% higher investment income, iii) improvements in underwriting margins as well as increase in net profit margins from 3.2% to 5.6%. This was however
offset by: i) overall moderate growth of 8.4% in premiums/contributions, and ii) higher fee and commission expenses growth.
Source: OSK
Labels: MNRB
Comment
For fiscal year ended 31.3.12, a final dividend of 17% less tax was paid on 26.10.12. This is about 39% of its full-year earnings.
For fiscal year ended 31.3.13, dividend is expected to be not less than 25% less tax, assuming that the 4th quarter earning is the same or not less than 19.60 sen per share.
As at 31.12.12, the NTA of the stock was RM5.50 per share. The stock was last traded at RM2.89.
My concern about this stock is that there is no consistency in its earnings. This is perhaps the reason why the stock is being traded at such a big discount to its net tangible assets. Nonetheless, at RM2.89, the stock should eventually turn out to be an excellent buy.
As usual, you buy at your own risk.
Saturday, March 02, 2013
Multico To Move Higher
Multico closed up 12sen from Thursday's close at 1.53 last Friday with 1537 lots traded which is above normal volume transacted daily. This is a bullish display. I believe the stock is on track to move higher. As shown in the chart, the resistance is at 1.60. This means that there will be a lot of sellers at 1.60. Whether this resistance will be breached or not remains to be seen. If the resistance is surpassed, then the stock is likely to move up further. Another 20 to 30 sen rise is most likely.
Multico is in the course of claiming back some RM41.77 million from some of its former directors. It is likely to be successful as the high court has ruled in favor of the company. This amount is a big sum to the company as its paid-up capital is only RM44.4047 million.
Multico was traded to as low as 10.5 sen in 2008. I became interested in the stock in 2011 when on Dec 28 of that year I bought 19000 shares at 76 sen per share. Since then I have been accumulating the stock every now and then. In fact I added another 13,000 shares at RM1.39 per share on 27 Feb 2013.
In the annual report for the year ended 31 July, 2012, I noted that Fong Siling (Cold Eye) has 1.2 million shares in the company. This give me added confidence as Mr Fong is well known as a savvy investor.
I believe Multico has a bright future, and I shall hold on to my stock.If you wish to join me on this profitable ride, you are welcome.
I am at Facebook. Anyone who wishes to befriend me there, please do so. Thanks.
Whether you buy, sell or hold as as result of this article, you do so at your own risk absolutely.
Friday, March 01, 2013
Multico More Upside On The Card
Multico moved up 4 sen in the morning session with 647 lots traded. The chart displays encouraging signals with the MACD and Stochastic hooking up. I expect the stock to have more upside from here.
Always buy at your own risk.
Wednesday, February 06, 2013
Gong Si Fa Chai, Happy New Year
Once again the New-Year Greetings are back in touch
To those we seldom write to, but think of much
It's time to send a greeting that's sincere and dear
Wishing them happiness, prosperity and good health
Throughout and beyond the new year.
Plan with Wisdom, stay with Wisdom, and money will come in at random.
To all my readers, I wish them good luck, good health and good profits for all their trades. "Enjoy, it's Happy New Year."
To those we seldom write to, but think of much
It's time to send a greeting that's sincere and dear
Wishing them happiness, prosperity and good health
Throughout and beyond the new year.
Plan with Wisdom, stay with Wisdom, and money will come in at random.
To all my readers, I wish them good luck, good health and good profits for all their trades. "Enjoy, it's Happy New Year."
Tuesday, February 05, 2013
Change, Change, Change
God grant me the serenity to accept the things I cannot change, the courage to change the things I can, and the wisdom to know the difference.
Reinhold Niebuhr
Read more at http://www.brainyquote.com/quotes/topics/topic_change.html#ByEJFPCCO5tKqJO5.99
To improve is to change; to be perfect is to change often.
Winston Churchill
Read more at http://www.brainyquote.com/quotes/topics/topic_change.html#ByEJFPCCO5tKqJO5.99
A small group of thoughtful people could change the world. Indeed, it's the only thing that ever has.
Margaret Mead
Read more at http://www.brainyquote.com/quotes/topics/topic_change.html#hwmOBTGQfceOxBBw.99
Reinhold Niebuhr
Read more at http://www.brainyquote.com/quotes/topics/topic_change.html#ByEJFPCCO5tKqJO5.99
To improve is to change; to be perfect is to change often.
Winston Churchill
Read more at http://www.brainyquote.com/quotes/topics/topic_change.html#ByEJFPCCO5tKqJO5.99
A small group of thoughtful people could change the world. Indeed, it's the only thing that ever has.
Margaret Mead
Read more at http://www.brainyquote.com/quotes/topics/topic_change.html#hwmOBTGQfceOxBBw.99
Saturday, February 02, 2013
Are We To Have a Chinese New Year Rally?
The chart shows 4 weekly red candles in the last 4 weeks. For the trend to reverse, a green weekly candle must appear first. So keep watching for this to happen. If you don't see any green candle in place, you have to assume that the downtrend will continue. This is likely as the stochastic is also trending down
Going by the chart, some support will come in at 1590, and if this is breached, the next likely support will be 1527.
So, are we going to have a Chinese New Year Rally? I don't think so. My opinion is that there will not be much fanfare until the GE13 is over. But if there is political chaos in the country over the GE13, and foreign funds pull out, the market will take a dive.
Good luck and Happy Trading. Always bet at your own risk.
Tuesday, January 29, 2013
The 10 Commandments
1. Thou shall not go against the trend.
If it be down, let it be down. The market is bigger and stronger than you.
Follow the market but be one step ahead of the crowd.
2. Thou shall not follow the herd instinct
Just because many people are buying a certain stock does not mean you should follow suit. If people want to buy rubbish stocks, that is their bad luck. Don't make it yours.
3. Thou shall treat the market as a business, not a casino
The stock market is not meant to be a casino and you should not be there to gamble.
4.Thou shall not buy high-debted and no-earnings stocks
All companies that folded are highly geared with negative earnings. Don't buy rubbish shares; don't buy somebody's liabilities.
5. Thou shall only buy solvent companies with good-growth prospects
Present earnings are important, but future earnings are more important. That's why we have companies selling at high PER (Price earnings ratios).
6. Thou shall not be overconfident
Overconfidence leads to overtrading. Once you overtrade, you may not be able to control your own emotion. Fear may set in when the market is not going the way you expect it. It may disrupt your plan, turning your profitable trade into a loss.
7. Thou shall invest within the comfort zone
Don't be too greedy; don't play with borrowed money. Debt is a disease. It can cause you a lot of problem if you are not careful.
8. Thou shall be patient
The market is designed to transfer money from the impatient to the patient. You must have very good reasons before you switch counters. Very often, the shares you sell move up faster than the shares you buy.
9. Thou shall be disciplined
Don't change your strategy at the eleventh hour. If you have placed a stop-loss in your chart, don't remove it unless it is replaced with a trailing stop-loss.
10. Thou shall be knowledgable
Investment in knowledge pays the best dividend. No one is so skillful that he cannot better his best. Keep learning for knowledge is boundless.
Happy investing.
If it be down, let it be down. The market is bigger and stronger than you.
Follow the market but be one step ahead of the crowd.
2. Thou shall not follow the herd instinct
Just because many people are buying a certain stock does not mean you should follow suit. If people want to buy rubbish stocks, that is their bad luck. Don't make it yours.
3. Thou shall treat the market as a business, not a casino
The stock market is not meant to be a casino and you should not be there to gamble.
4.Thou shall not buy high-debted and no-earnings stocks
All companies that folded are highly geared with negative earnings. Don't buy rubbish shares; don't buy somebody's liabilities.
5. Thou shall only buy solvent companies with good-growth prospects
Present earnings are important, but future earnings are more important. That's why we have companies selling at high PER (Price earnings ratios).
6. Thou shall not be overconfident
Overconfidence leads to overtrading. Once you overtrade, you may not be able to control your own emotion. Fear may set in when the market is not going the way you expect it. It may disrupt your plan, turning your profitable trade into a loss.
7. Thou shall invest within the comfort zone
Don't be too greedy; don't play with borrowed money. Debt is a disease. It can cause you a lot of problem if you are not careful.
8. Thou shall be patient
The market is designed to transfer money from the impatient to the patient. You must have very good reasons before you switch counters. Very often, the shares you sell move up faster than the shares you buy.
9. Thou shall be disciplined
Don't change your strategy at the eleventh hour. If you have placed a stop-loss in your chart, don't remove it unless it is replaced with a trailing stop-loss.
10. Thou shall be knowledgable
Investment in knowledge pays the best dividend. No one is so skillful that he cannot better his best. Keep learning for knowledge is boundless.
Happy investing.
Friday, January 25, 2013
The Importance Of The Trend
One of the most importance features in TA (Technical Analysis) is the trend. Before you buy or sell, you should have a look at the trend of the stock. How do you do that? The only way I know is to look at the chart. ( I wonder how people who do not believe in charts do it.)
With a chart it is easy for you to know the trend. When you see higher highs and higher lows, you have an uptrend. When you see lower highs and lower lows, you have a downtrend. Your can also have a sidetrend which means that prices are moving sideways in a narrow range.
Once you have determined the trend, you can then decide what action to take.
Buying in a downtrend should be avoided, especially when the downtrend is initially moving down after a long uptrend.
Similarly, selling in an uptrend should also be avoided, especially when the uptrend is just beginning to trend up after a long downtrend or a long sidetrend.
Many people make the mistake of selling in the initial stage of an uptrend. This is because they have been holding the stock for too long at a loss, and when they see a chance to get out at a small profit or a small loss, they quickly do it. This is a grave error, because more often than not, the price continues to move up after their sales.
How many times have you heard people say this, "I sold out just before the big rise?" Remember this: A trend in motion is likely to continue.
Never be the first to sell in an uptrend nor the last to buy. Never be the first to buy in a downtrend nor the last to sell.
If you find this article useful, please click "f" or tweet it. Thanks.
With a chart it is easy for you to know the trend. When you see higher highs and higher lows, you have an uptrend. When you see lower highs and lower lows, you have a downtrend. Your can also have a sidetrend which means that prices are moving sideways in a narrow range.
Once you have determined the trend, you can then decide what action to take.
Buying in a downtrend should be avoided, especially when the downtrend is initially moving down after a long uptrend.
Similarly, selling in an uptrend should also be avoided, especially when the uptrend is just beginning to trend up after a long downtrend or a long sidetrend.
Many people make the mistake of selling in the initial stage of an uptrend. This is because they have been holding the stock for too long at a loss, and when they see a chance to get out at a small profit or a small loss, they quickly do it. This is a grave error, because more often than not, the price continues to move up after their sales.
How many times have you heard people say this, "I sold out just before the big rise?" Remember this: A trend in motion is likely to continue.
Never be the first to sell in an uptrend nor the last to buy. Never be the first to buy in a downtrend nor the last to sell.
If you find this article useful, please click "f" or tweet it. Thanks.
Thursday, January 24, 2013
A novice trader is a sheep
Making some mistakes is part and parcel of the game. But to continue making the same mistakes again and again is unacceptable. If you are losing money consistently, better stop immediately. Upgrade yourself first and fight later.
The shrewd learn from the mistakes of others. The foolish don't even learn from their own mistakes.
A novice is bound to have many disadvantages and make many mistakes when he starts to trade. What are these mistakes and disadvantages? Below are some of them:
1. Yielding to the herd instinct
A newbie in the market is a sheep. He has not idea of his own. So he simply follow his friends, thinking there is safety in numbers. Very soon he will find out that there is no safety in numbers and some of his money has gone.
2. Listening to a tip
A tip is seldom a good tip, especially one that comes from a remiser. Why? It's simple logic. When a big boy wants to unload his stocks, he will get someone to tell his remiser that the stock is a good buy. Thus you buy what he sells.
There is only one good tip you can get from your remiser. Ask him for the name of the person who consistently wins. (Assuming there is one). Then you can watch him closely and learn from him.
3. Haste
Many mistakes come from haste. The Chinese says: 万事皆从急中错.
When you are new in the market, you have little patience to wait. Hence you move in and out of the market too frequently. You forget that every time you trade, you pay money to the government, the broker firm and Bursa.
4. Lack of experience, lack of knowledge & lack of wisdom
Experience is the best teacher. It is also the most important. Unfortunately, it is the most costly as well. And the market is the most expensive place to find this out.
5. Trading without a plan
It is said that if you failed to plan, you planned to fail. No one ever goes to business without a plan; no one ever built a house without a plan, and no one ever goes to battle without a plan. Trading in the stock market is akin to going to a battle. Do you think you can win without a plan?
6. Overestimating your own ability
This is a very common error. When you win, you say you are skillful; when you lose, you say luck is not with you.
My advice is:
Be knowledgeable, be patient, trade with a plan and always remember that
Luck Favors The Prepared Mind.
The shrewd learn from the mistakes of others. The foolish don't even learn from their own mistakes.
A novice is bound to have many disadvantages and make many mistakes when he starts to trade. What are these mistakes and disadvantages? Below are some of them:
1. Yielding to the herd instinct
A newbie in the market is a sheep. He has not idea of his own. So he simply follow his friends, thinking there is safety in numbers. Very soon he will find out that there is no safety in numbers and some of his money has gone.
2. Listening to a tip
A tip is seldom a good tip, especially one that comes from a remiser. Why? It's simple logic. When a big boy wants to unload his stocks, he will get someone to tell his remiser that the stock is a good buy. Thus you buy what he sells.
There is only one good tip you can get from your remiser. Ask him for the name of the person who consistently wins. (Assuming there is one). Then you can watch him closely and learn from him.
3. Haste
Many mistakes come from haste. The Chinese says: 万事皆从急中错.
When you are new in the market, you have little patience to wait. Hence you move in and out of the market too frequently. You forget that every time you trade, you pay money to the government, the broker firm and Bursa.
4. Lack of experience, lack of knowledge & lack of wisdom
Experience is the best teacher. It is also the most important. Unfortunately, it is the most costly as well. And the market is the most expensive place to find this out.
5. Trading without a plan
It is said that if you failed to plan, you planned to fail. No one ever goes to business without a plan; no one ever built a house without a plan, and no one ever goes to battle without a plan. Trading in the stock market is akin to going to a battle. Do you think you can win without a plan?
6. Overestimating your own ability
This is a very common error. When you win, you say you are skillful; when you lose, you say luck is not with you.
My advice is:
Be knowledgeable, be patient, trade with a plan and always remember that
Luck Favors The Prepared Mind.
Tuesday, January 22, 2013
Pantech Going From Strength to Strength
Pantech made a net profit of RM15.6m (EPS 3.33 sen) for the 3rd quarter ended 30.11.12. In the previous corresponding quarter, it made only RM10.3M. The improved result is because of strong demand for its products in the oil and gas sector. It has declared a 3rd interim dividend of 1.2 sen.
At the last traded price of 75.5 sen per share, there is value in the stock. Click here to know more about Pantech.
At the last traded price of 75.5 sen per share, there is value in the stock. Click here to know more about Pantech.
Sunday, January 20, 2013
Smartag displays bullishness
Wednesday, January 16, 2013
Psychology & the Stockmarket
Dreman in his book, "Psychology & the Stockmarket" says:
The best chance an investor has is to stand apart from popular thinking. He must be willing to forego the thrill of being in unison with the market, in agreement with the expert opinions and with the exciting, seemingly surefire ideas currently in vogue.
This is no small sacrifice. To own the right stocks in a rising market is a heady experience. There is a wonderful blend of monetary gain and ego satisfaction in being right in a popular manner.
Man is a social animal. To succeed, the investor has to be able to withstand the tremendous pressure leading to conformity. He will face a continuing flow of negative feedback from the market, from experts and from groups of people whom he respects.
The reader may feel a little bit like the patient whose doctor has advised him to give up sex for his health.
Some of us might just prefer to die happy.
The above excerpt simply means that to succeed in the stock market, one must be able to avoid the herd instinct, have full confidence in oneself and act without referring to any one.
The best chance an investor has is to stand apart from popular thinking. He must be willing to forego the thrill of being in unison with the market, in agreement with the expert opinions and with the exciting, seemingly surefire ideas currently in vogue.
This is no small sacrifice. To own the right stocks in a rising market is a heady experience. There is a wonderful blend of monetary gain and ego satisfaction in being right in a popular manner.
Man is a social animal. To succeed, the investor has to be able to withstand the tremendous pressure leading to conformity. He will face a continuing flow of negative feedback from the market, from experts and from groups of people whom he respects.
The reader may feel a little bit like the patient whose doctor has advised him to give up sex for his health.
Some of us might just prefer to die happy.
The above excerpt simply means that to succeed in the stock market, one must be able to avoid the herd instinct, have full confidence in oneself and act without referring to any one.
Sunday, January 13, 2013
Shark's fin soup kills sharks and could poison you too
Think twice before you order shark's fin soup in the future, not only is it an endangered species but Chinese experts say it is potentially dangerous to your health.
Zhejiang authorities recently discovered that many shark's fins sold in the market were artificial products and some contained excessive levels of cadmium, an extremely toxic metal.
The artificial shark's fins are made of edible gelatin and seaweed gum. "These outlets purchased fake shark fins at a low price, but sold them to customers as genuine product for up to 1,000 yuan (RM488) a bowl," it said.
Similar results were found in an investigation by the province's Consumer Rights Protection Agency, which randomly selected about 10 samples of shark's fin soup collected from local restaurants for DNA testing. No shark's fin was found in any of the soups!
Insiders revealed that artificial shark's fins are widely available in the market. "Many restaurants and hotels have bought such product from me," said Lin Wenyu–a wholesaler that sells "vegetarian" shark's fin at Shanghai Tongchuanlu Seafood Market.
But it's not just the fake shark's fin soup that's dangerous. The agency also found about one-third of dried shark's fin in the province's markets contained excessive cadmium and methyl mercury.
Local news website Zjol reported that ocean pollution could lead to high levels of metals in the sharks and experts said excessive ingestion of mercury could harm pregnant woman and the development of the fetal brain and nervous system.
In recent decades, demand for shark's fin has increased, raising concerns about the sustainability and welfare of sharks. Each year, about 73 million sharks are killed around the world to meet the increasing demand for shark's fin soup.
The population of some species of shark have declined up to 99% according to WildAid, a wild animal conservation organisation that advocates shark protection.
Sharks are often alive when their fins are sliced off. Since their meat is not considered as valuable as their fins, they are thrown back into the water to drown or bleed to death.
Many Chinese celebrities, including legendary gymnast Li Ning, former NBA icon Yao Ming, retired diving queen Guo Jingjing and singer Liu Huan, have joined in shark protection campaigns.
Some luxury hotels and popular restaurants have also taken the traditional delicacy off the menu to stop the fish from becoming extinct. But many eatery operators continued to serve shark's fin soup, citing commercial concerns.
"The soup is one of the major dishes at banquets. People believe banquets would be degraded without it and they'll not hold events at our outlet if we don't provide this dish," said a restaurateur in Tianjin, who declined to give his name.
Experts said shark's fins are not as nutritious as many people believed. "What it contains is incomplete protein, of which the nutritional value is not as high as people expect," said Chen Shunsheng, professor of College of Food Science at Shanghai Ocean University.
Source: China Daily; ANN
Published: 10th January 2013
It's time to switch to bird nests.
Thursday, January 10, 2013
DRB-HICOM, HI HOPE, HI DANGER
If a thing appears too good to be true, it probably is.
Rumor abounds that DRB-HICOM may be privatized at between RM3.50 to 4.00.
The stock reacted fast to the rumor. It moved up 7 sen to close at 2.70 in heavy volume.
This type of news can be extremely dangerous especially to the naive players. In my opinion, Bursa should immediately suspend the stock and make an investigation as to who started the rumor. It should also take appropriate action if the rumor is created by someone who wishes to unload his stocks.
It will be failing in its duty if it fails to protect the small players.
Rumor abounds that DRB-HICOM may be privatized at between RM3.50 to 4.00.
The stock reacted fast to the rumor. It moved up 7 sen to close at 2.70 in heavy volume.
This type of news can be extremely dangerous especially to the naive players. In my opinion, Bursa should immediately suspend the stock and make an investigation as to who started the rumor. It should also take appropriate action if the rumor is created by someone who wishes to unload his stocks.
It will be failing in its duty if it fails to protect the small players.
Tuesday, January 08, 2013
Adventa PN 17
Adventa is now classified as a PN 17 company. What does this mean?
PN 17 stands for Practice Note 17/2005 (formerly known as PN 4).
The reasons for companies to be classified under PN17 are as follows:
1. Shareholders' funds less than 25% of their total paid-up capital.
2. Receivers have been appointed to take control of the companies’ assets.
3. The winding-up of some of their subsidiaries and associated companies.
4. The auditors have expressed adverse opinions on the companies.
5. Default in loan interest and principal repayments.
6.The companies have suspended or ceased their operations.
Adventa lost 5 sen at the close of trading this morning. It was lasted traded at 43.5 sen.
The company is not in any financial distress. I don't think there is much cause for concern. It was suspended because it sold its core business in the glove industry. It has 12 months to submit a regularization plan to Bursa and get it approved. I have no cause to opine it will fail to do this.
PN 17 stands for Practice Note 17/2005 (formerly known as PN 4).
The reasons for companies to be classified under PN17 are as follows:
1. Shareholders' funds less than 25% of their total paid-up capital.
2. Receivers have been appointed to take control of the companies’ assets.
3. The winding-up of some of their subsidiaries and associated companies.
4. The auditors have expressed adverse opinions on the companies.
5. Default in loan interest and principal repayments.
6.The companies have suspended or ceased their operations.
Adventa lost 5 sen at the close of trading this morning. It was lasted traded at 43.5 sen.
The company is not in any financial distress. I don't think there is much cause for concern. It was suspended because it sold its core business in the glove industry. It has 12 months to submit a regularization plan to Bursa and get it approved. I have no cause to opine it will fail to do this.
Monday, January 07, 2013
Sleeping Beauties, Love Them, Hold Them
Sleeping Beauties can make you rich.
The key attributes of a sleeping beauty are as follows:
1. Strong balance sheet with much cash and little or zero borrowings
2. Ill-liquid
3. Low PER (Price Earnings Ratio)
4. High NTA (Net Tangible Asset)
5. Popularity: low
6. Future Potential: great
7. Safety: High
8. Management: Passive and cautious
If you have deep pockets, and want to play safe, the best way to riches is to invest in sleeping beauties. These beauties are hard to come by, easy to love, and safe to keep. They pay you decent dividends while you wait for them to wake up.
The big money will come in when a meager or acquisition happens. Because sleeping beauties are prime candidates for takeovers, a meager or acquisition is sure to happen some time in the future.The problem is that we do not know when. If you are not patient enough, sleeping beauties are not for you.
In my investing career, I have invested in many sleeping beauties and profited much from them.
Whether they are suitable for you or not, the best person to judge is you, yourself.
The key attributes of a sleeping beauty are as follows:
1. Strong balance sheet with much cash and little or zero borrowings
2. Ill-liquid
3. Low PER (Price Earnings Ratio)
4. High NTA (Net Tangible Asset)
5. Popularity: low
6. Future Potential: great
7. Safety: High
8. Management: Passive and cautious
If you have deep pockets, and want to play safe, the best way to riches is to invest in sleeping beauties. These beauties are hard to come by, easy to love, and safe to keep. They pay you decent dividends while you wait for them to wake up.
The big money will come in when a meager or acquisition happens. Because sleeping beauties are prime candidates for takeovers, a meager or acquisition is sure to happen some time in the future.The problem is that we do not know when. If you are not patient enough, sleeping beauties are not for you.
In my investing career, I have invested in many sleeping beauties and profited much from them.
Whether they are suitable for you or not, the best person to judge is you, yourself.
Sunday, January 06, 2013
Adventa HitsThe Limelight
Adventa is no longer in the glove business. It is now focusing in healthcare industry which it says is more profitable and predictable. The stock was up 19.5 sen after it went ex-dividend (XD) of RM1.70 per share. Prior to XD, the stock was last traded at 1.93. After XD, it closed at 42.5 sen on very heavy turnover. Bursa has queried the company on its sudden price-surge. If it gives a good and positive answer, the stock is likely to move up further. Interest in the stock is likely to be ongoing for a while. I like this stock because the company is in good hands with excellent principles.
Below is an extract from its website.
Company Principles
ADVENTA operates in many regions around the world, in varying political and social environments, with people of different races and cultures. The Group adheres to the following 6 organizational principles in its dealings with its customers, suppliers, shareholders, and partners:
1. Integrity
2. Corporate Responsibility
3. Quality and Value
4. Focus
5. Non-political Involvement
6. Environmental Care
Integrity
ADVENTA maintains integrity in all dealings and trade, working to achieve excellence through honesty and responsibility, and without compromising on its duty of care. Undue and illegitimate practices are not tolerated.
Corporate Responsibility
ADVENTA operates with a clear open policy when dealing with its shareholders and the authorities, making proper and timely disclosures of any and all material factors it faces. ADVENTA is to uphold and maintain the trust of its customers and shareholders.
Quality and Values
ADVENTA strives for quality in all it does, giving customers the value they expect and deserve. ADVENTA endeavors to meet customer requirements and exceed expectations with the products it manufactures and sells.
Focus
The Group maintains a clear and defined focus on its objectives and targets. ADVENTA is set to be a multi layered and multi-product group producing and distributing products used in the healthcare industry.
Non-political Involvements
ADVENTA operates for commercial enterprise and to create value and returns for its shareholders. The Group is determined to operate within the legitimate laws and regulations set down by the democratically elected governments and do not involve themselves in any political, philosophical activity or movement of any particular group, country, or region.
Environmental & Social Cares
ADVENTA operates within accepted social and environmental requirements. Its responsibility to society and social wellbeing is a priority in all its commercial decisions. ADVENTA works to achieve a cleaner and healthier environment for all employees and the societies it operates in, and uses its knowledge and ability to contribute back to its environment. The lives, careers and the rights of its employees are respected and enhanced in recognition of their loyalty and dedication in the organization.
Below is an extract from its website.
Company Principles
ADVENTA operates in many regions around the world, in varying political and social environments, with people of different races and cultures. The Group adheres to the following 6 organizational principles in its dealings with its customers, suppliers, shareholders, and partners:
1. Integrity
2. Corporate Responsibility
3. Quality and Value
4. Focus
5. Non-political Involvement
6. Environmental Care
Integrity
ADVENTA maintains integrity in all dealings and trade, working to achieve excellence through honesty and responsibility, and without compromising on its duty of care. Undue and illegitimate practices are not tolerated.
Corporate Responsibility
ADVENTA operates with a clear open policy when dealing with its shareholders and the authorities, making proper and timely disclosures of any and all material factors it faces. ADVENTA is to uphold and maintain the trust of its customers and shareholders.
Quality and Values
ADVENTA strives for quality in all it does, giving customers the value they expect and deserve. ADVENTA endeavors to meet customer requirements and exceed expectations with the products it manufactures and sells.
Focus
The Group maintains a clear and defined focus on its objectives and targets. ADVENTA is set to be a multi layered and multi-product group producing and distributing products used in the healthcare industry.
Non-political Involvements
ADVENTA operates for commercial enterprise and to create value and returns for its shareholders. The Group is determined to operate within the legitimate laws and regulations set down by the democratically elected governments and do not involve themselves in any political, philosophical activity or movement of any particular group, country, or region.
Environmental & Social Cares
ADVENTA operates within accepted social and environmental requirements. Its responsibility to society and social wellbeing is a priority in all its commercial decisions. ADVENTA works to achieve a cleaner and healthier environment for all employees and the societies it operates in, and uses its knowledge and ability to contribute back to its environment. The lives, careers and the rights of its employees are respected and enhanced in recognition of their loyalty and dedication in the organization.
Stock Market Report
Helium was up, feathers were down.
Paper was stationary.
Fluorescent tubing was dimmed in light trading.
Knives were up sharply.
Cows steered into a bull market.
Pencils lost a few points.
Hiking equipment was trailing.
Elevators rose, while escalators continued their slow decline.
Weights were up in heavy trading.
Light switches were off.
Mining equipment hit rock bottom.
Diapers remain unchanged. Shipping lines stayed at an even keel.
The market for raisins dried up.
Coca Cola fizzled.
Caterpillar stock inched up a bit.
Sun peaked at midday.
Balloon prices were inflated.
Scott Tissue touched a new bottom.
And batteries exploded in an attempt to recharge the market...
From Clyde's collection
Paper was stationary.
Fluorescent tubing was dimmed in light trading.
Knives were up sharply.
Cows steered into a bull market.
Pencils lost a few points.
Hiking equipment was trailing.
Elevators rose, while escalators continued their slow decline.
Weights were up in heavy trading.
Light switches were off.
Mining equipment hit rock bottom.
Diapers remain unchanged. Shipping lines stayed at an even keel.
The market for raisins dried up.
Coca Cola fizzled.
Caterpillar stock inched up a bit.
Sun peaked at midday.
Balloon prices were inflated.
Scott Tissue touched a new bottom.
And batteries exploded in an attempt to recharge the market...
From Clyde's collection
Wednesday, January 02, 2013
One Up For Multico
Multico has announced that Dato Abdul Hasan (2nd Defendant) has agreed to pay back to the company Rm22,000,000, after the market closed today.
This means that for the financial year ending July 31, 2013, Multico's EPS will be boosted by 48.5 sen per share. For details of the payment, please refer to Company Announcements at Bursa.
The chart above clearly shows that accumulation of the stock has been ongoing for the past several trading days. So are charts useless or useful?
If you know how to read it, it is useful. If you don't, then of course, it is useless.
Multico is likely to move up further.
Happy New Year.
Thursday, December 27, 2012
Multico Poised to Move Higher
Multico gapped up at the opening bell. It closed at 1.42 after a high of 1.43. The chart clearly shows that sentiment in the stock has turned positive. Volume in the last 4 days shows an upward trend. A golden cross is also displayed in the chart. All these mean that the stock is likely to move higher. Once the resistance at 1.47 is cleared, new high is expected.
(The opinion expressed is that of the writer. If you disagree with him, don't tell him. Just unfriend him.)
Sunday, December 23, 2012
The Best Way to Stock Market Success
The more I am involved with the stock market, the more I am convinced that the best way to build up wealth is to, first and foremost, master the skill to identify great stocks. Buy them at bargain prices and hold them for the long term is the best strategy. This is the surest way to financial freedom for your golden years.
Easy as it may sound, it is, in actual fact, not that easy. If you don't know how to read an annual report and understand the figures there, you will never be able to become a good stock picker.
So the first you need to do is to arm yourself with some accounting knowledge. You must at least be able to understand the Balance Sheet, Cash Flow Statement and the Income Statement. Once you know these, you can go on to calculate the key ratios such as:
PER, EPS, NTA, Current Ratio, PSR, PEG, PBV, Debt-to-Equity Ratio and others.
Knowing how to calculate these ratios is not enough. You must understand their meanings and implications. Once you have learned and understood these key statistics, looking for a winner becomes a possibility.
obviously, there is an awful lot of work to do before you can say, " I found a winner".
Once you have decided on a stock you wish to invest, don't rush in to buy. Have a good look at its daily chart and weekly chart. This will clearly show you how the stock has been performing. With the charts you can easily see the highs and lows of the stock. Pay special attention to the latest transactions of the stock to figure out what is happening.
Buying at major support level is generally safe.
For those who wish to see quick money, buying at upside breakouts at low level is advised.
At high levels, upside breakouts are extremely dangerous but can be extremely profitable as well. If you are an inexperienced player, you should never attempt to buy at high level breakouts.
While there should not be a limit to your gains, there must be an absolute limit to your losses.
Never bet without a stop-loss in place.
This blog is a monarchy and I am the monarch. If you don't like what is written here, don't tell me. Just unfriend me.
Saturday, December 22, 2012
Keck Seng Cash-Rich and Asset-Rich
Keck Seng is cash-rich and asset-rich as well.
After a long period in the doldrums, Keck Seng's hive of activity last Friday came like a bolt from the blue. Its traded volume improved substantially at 1, 372,900 shares. The stock was up 14 sen. It closed at RM4.01.
Normally, it used to be around a few thousand shares transacted daily.
This sudden turn of sentiment is most likely to be a reflection of some bullish news known only to some insiders at this stage.
The company made a gain of RM259 million in 2010 from the disposal of its investment in Parkway Holdings Limited. Instead of giving out some currency notes to its shareholders, it chose to give out only a piece of paper (a bonus issue) and keeping all the cash. As at 31.12.2011, it has net cash of more than RM700 millions. I wonder what it intends to do with the money.
Most of its landed assets are in the Iskander Region. In KL, it has the Menara Keck Seng and the Regency Tower. If a revaluation of all its properties is made, the company will be worth many times more than its present book value of about RM5 per share.
Is the heavy volume transacted last Friday a prelude to something important about to happen at Keck Seng? I sincerely hope so, and I intend to hold on to my shares.
After a long period in the doldrums, Keck Seng's hive of activity last Friday came like a bolt from the blue. Its traded volume improved substantially at 1, 372,900 shares. The stock was up 14 sen. It closed at RM4.01.
Normally, it used to be around a few thousand shares transacted daily.
This sudden turn of sentiment is most likely to be a reflection of some bullish news known only to some insiders at this stage.
The company made a gain of RM259 million in 2010 from the disposal of its investment in Parkway Holdings Limited. Instead of giving out some currency notes to its shareholders, it chose to give out only a piece of paper (a bonus issue) and keeping all the cash. As at 31.12.2011, it has net cash of more than RM700 millions. I wonder what it intends to do with the money.
Most of its landed assets are in the Iskander Region. In KL, it has the Menara Keck Seng and the Regency Tower. If a revaluation of all its properties is made, the company will be worth many times more than its present book value of about RM5 per share.
Is the heavy volume transacted last Friday a prelude to something important about to happen at Keck Seng? I sincerely hope so, and I intend to hold on to my shares.
Thursday, December 13, 2012
TMCLife has turned the corner
TMCLife appears to have turned the corner. It has been losing all along until the last two quarters.
According to the StarOnLine, Vincent Tan has increased his stake from 30.78% to 31.06%. The other big shareholder, Lim Eng Hock has 32.59%
A battle between the two is likely to happen. And if it does happen, the stock is bound to head north.
At the last traded price of 33.5 sen per share, the stock looks a good buy.
According to the StarOnLine, Vincent Tan has increased his stake from 30.78% to 31.06%. The other big shareholder, Lim Eng Hock has 32.59%
A battle between the two is likely to happen. And if it does happen, the stock is bound to head north.
At the last traded price of 33.5 sen per share, the stock looks a good buy.
Sunday, December 02, 2012
Palm oil to drop 7%
Palm oil, the world’s cheapest available cooking oil, must drop 7% in the next four to six weeks to attract demand and lead to a decline in record stock levels, top vegetable oil analyst Dorab Mistry said Friday. To read more, go to: www.palmoilhq.com/
Presently, crude palm oil is around RM2370 per ton. Keep a close watch to see if Dorab is right.
Presently, crude palm oil is around RM2370 per ton. Keep a close watch to see if Dorab is right.
Sunday, November 11, 2012
Time Is Everything
You can't do anything without time. If time and money are on your side, you will eventually win.
To make money in 12 months is much easier than to make money in 12 weeks
Here are some clichés that refer to time:
• Time will tell: This means that something will revealed or become clear over time
• In the nick of time: This means something happened just in time
• Lost track of time: This means you stopped paying attention to the time or to how long something was taking
• Lasted an eternity: This refers to something that lasts for a very long time (or that feels like it does)
• A matter of time: This refers to something that will eventually happen or eventually become clear
• A waste of time: This refers to something that was silly or not valuable to do
• Rushed for time: This means you do not have sufficient time to do something
• In a jiffy: This means something will happen soon
• The time of my life: This refers to a really great time
• At the speed of light: This means something done very quickly.
The cliches stated above are from: http://examples.yourdictionary.com/examples-of-cliches.html
To make money in 12 months is much easier than to make money in 12 weeks
Here are some clichés that refer to time:
• Time will tell: This means that something will revealed or become clear over time
• In the nick of time: This means something happened just in time
• Lost track of time: This means you stopped paying attention to the time or to how long something was taking
• Lasted an eternity: This refers to something that lasts for a very long time (or that feels like it does)
• A matter of time: This refers to something that will eventually happen or eventually become clear
• A waste of time: This refers to something that was silly or not valuable to do
• Rushed for time: This means you do not have sufficient time to do something
• In a jiffy: This means something will happen soon
• The time of my life: This refers to a really great time
• At the speed of light: This means something done very quickly.
The cliches stated above are from: http://examples.yourdictionary.com/examples-of-cliches.html
Wednesday, November 07, 2012
Where ignorance is bliss, 'tis folly to be wise
I am not a software vendor promoting TA (technical analysis). So whether people believe in charts or not is not my concern. In fact the more people believe that charts do not work, the better for those who believe in them. I believe charts are useful; I always refer to them before I buy or sell.
If you don't like charts and think of them as useless, I have no qualms about that. You have every rights to your own belief. I agree to disagree. So let us not quarrel over that for nothing.
I said in my previous article that the best way to stock market success was to choose good stocks and hold them for the long term. Buy and hold is a good strategy only when you buy the right stocks. However, I think that strategy can be improved to: buy, hold, monitor and switch.
To do this, you have to be on your toes all the time. You have to be on the lookout for something good to switch to. As soon as you find one, you let go the weakest stock in your portfolio and replace it with the new stock. This process has to go on and on and on. There is no end to it.
You must have full confidence in yourself. If you need to discuss with somebody before you buy, that is a sign of weakness. It shows that you are not ready yet to be an active investor.
If you don't like charts and think of them as useless, I have no qualms about that. You have every rights to your own belief. I agree to disagree. So let us not quarrel over that for nothing.
I said in my previous article that the best way to stock market success was to choose good stocks and hold them for the long term. Buy and hold is a good strategy only when you buy the right stocks. However, I think that strategy can be improved to: buy, hold, monitor and switch.
To do this, you have to be on your toes all the time. You have to be on the lookout for something good to switch to. As soon as you find one, you let go the weakest stock in your portfolio and replace it with the new stock. This process has to go on and on and on. There is no end to it.
You must have full confidence in yourself. If you need to discuss with somebody before you buy, that is a sign of weakness. It shows that you are not ready yet to be an active investor.
Tuesday, November 06, 2012
The Best Way to Stock Market Success
The more I am involved with the stock market, the more I am convinced that the best way to build up wealth is to, first and foremost, master the skill to identify great stocks. Buy them at bargain prices and hold them for the long term is the best strategy. This is the surest way to financial freedom for your golden years.
Easy as it may sound, it is, in actual fact, not that easy. If you don't know how to read an annual report and understand the figures there, you will never be able to become a good stock picker.
So the first you need to do is to arm yourself with some accounting knowledge. You must at least be able to understand the Balance Sheet, Cash Flow Statement and the Income Statement. Once you know these, you can go on to calculate the key ratios such as:
the PER, EPS, NTA, Current Ratio, Quick Ratio, PSR, PEG, PBV, Debt-to-Equity Ratio and others.
Knowing how to calculate these ratios is not enough. You must understand their meanings and implications. Once you have learned and understood these key statistics, looking for a winner becomes a possibility.
There is an awful lot of work to do before you can say, " I found a winner".
Easy as it may sound, it is, in actual fact, not that easy. If you don't know how to read an annual report and understand the figures there, you will never be able to become a good stock picker.
So the first you need to do is to arm yourself with some accounting knowledge. You must at least be able to understand the Balance Sheet, Cash Flow Statement and the Income Statement. Once you know these, you can go on to calculate the key ratios such as:
the PER, EPS, NTA, Current Ratio, Quick Ratio, PSR, PEG, PBV, Debt-to-Equity Ratio and others.
Knowing how to calculate these ratios is not enough. You must understand their meanings and implications. Once you have learned and understood these key statistics, looking for a winner becomes a possibility.
There is an awful lot of work to do before you can say, " I found a winner".
MNRB Moving Higher
Every trade is a battle between a bull and a bear. The bull wins if the price moves up after the opening price; the bear wins if the price moves down. This should be easily understood.
Volume signifies interest. The higher the volume transacted, the more interest is shown in the stock. Thus big volume means more bulls and bears are participating in the fight.
The closing price of the day is the one to note. If the closing price is higher than the opening price, a white candle will be shown in the chart. If the closing price is lower than the opening price, the candle shown is black. Thus,a white candle means the bulls have the upper hand and a black candle means the bears are stronger.
MNRB opens at 3.09 with 10 lots traded. As a continuation of yesterday's run, the price promptly moves up to a high of 3.22 by 9.20 a.m.
Volume transacted is above normal. Because the price is moving too fast, profit-taking sets in. This pushes the price down. At the close of this morning's trading, the priced ends at 3.14, up 5sen. Total volume comes to 5174 lots which is above average for MNRB.
I notice that there is a lot of support at 3.10. I think this level should not be breached by the end of the day. Action to take is to average up if you have bought when the price was lower.
As usual, you listen to me at your own risk. The opinion expressed is that of the writer. You have your rights to disagree.
Volume signifies interest. The higher the volume transacted, the more interest is shown in the stock. Thus big volume means more bulls and bears are participating in the fight.
The closing price of the day is the one to note. If the closing price is higher than the opening price, a white candle will be shown in the chart. If the closing price is lower than the opening price, the candle shown is black. Thus,a white candle means the bulls have the upper hand and a black candle means the bears are stronger.
MNRB opens at 3.09 with 10 lots traded. As a continuation of yesterday's run, the price promptly moves up to a high of 3.22 by 9.20 a.m.
Volume transacted is above normal. Because the price is moving too fast, profit-taking sets in. This pushes the price down. At the close of this morning's trading, the priced ends at 3.14, up 5sen. Total volume comes to 5174 lots which is above average for MNRB.
I notice that there is a lot of support at 3.10. I think this level should not be breached by the end of the day. Action to take is to average up if you have bought when the price was lower.
As usual, you listen to me at your own risk. The opinion expressed is that of the writer. You have your rights to disagree.
Monday, November 05, 2012
MNRN ON TRACK TO CHALLENGE PERVIOUS HIGH AT 3.39
MNRB put on 13 sen today with 3696 lots traded while the FBM KLCI is down 2.09 points.
The bullish candle displayed in the chart is likely to prompt shrewd investors/traders to buy in. Whether there will be a pull back or not is difficult to say.
In the last few trading days, it volume has been improving. The overall view at MNRB is positive. The stock should move on to better things.
As usual, you buy at your own risk.
The market is most dangerous when it is most attractive
“Bull markets are born on pessimism, grow on skepticism, mature on optimism and die on euphoria. The time of maximum pessimism is the best time to buy, and the time of maximum optimism is the best time to sell.”
Sir John Templeton puts it aptly. I fully agree with him.
The problem is that you may have to wait 10 years before you see a time of maximum pessimism. What about maximum optimism, maybe another 10 years?
When stocks are being sold ex-hope and cum-despair; when no one wants to talk about stocks, and when remisers are looking for another job, that is a good time to buy. During such time, professionals are accumulating at their own leisurely pace. You should be there to join them.
On the contrary, when people are rushing in to buy; when stocks are being the talk in coffee shops, restaurants, and wet markets among the hawkers, barbers and shoe-shine boys, that is an excellent time to sell everything.
You see new comers everyday and all the seats in the broker firms fully occupied. You will also hear lots of people bragging about their gains. During such time, the rewards are fantastic, but the risk is extreme. If you can't stand the heat, don't get close to the fire.
Patience is a must, an important ingredient, in the recipe of success.
Know the market, know yourself, and you win.
Sir John Templeton puts it aptly. I fully agree with him.
The problem is that you may have to wait 10 years before you see a time of maximum pessimism. What about maximum optimism, maybe another 10 years?
When stocks are being sold ex-hope and cum-despair; when no one wants to talk about stocks, and when remisers are looking for another job, that is a good time to buy. During such time, professionals are accumulating at their own leisurely pace. You should be there to join them.
On the contrary, when people are rushing in to buy; when stocks are being the talk in coffee shops, restaurants, and wet markets among the hawkers, barbers and shoe-shine boys, that is an excellent time to sell everything.
You see new comers everyday and all the seats in the broker firms fully occupied. You will also hear lots of people bragging about their gains. During such time, the rewards are fantastic, but the risk is extreme. If you can't stand the heat, don't get close to the fire.
Patience is a must, an important ingredient, in the recipe of success.
Know the market, know yourself, and you win.
Sunday, November 04, 2012
It's Best To Be Flexible
The Chinese has a saying: 随机应变. In English, it means: change with the circumstances, or set your sails accordingly to the direction of the wind.
The world is forever changing; we need to change with it. He who does not change when there is a need to change, is sure to be left behind.
What about a stop-loss you placed in a trade? As with everything, there are exceptions, this is one of them.
A stop-loss is a device you use to limit your loss. A trade without a stop-loss is equivalent to driving a car without brakes.
If your stop-loss is usually triggered, obviously something is wrong. Probably, you are not as good as you think.
After you have bought a stock, the share price moves up fast. It reaches the overbought level. The price is moving ahead of the fundamentals. What is your next move? Average up or take profit?
Different people have different opinions. Some will average up while others will take profit.
Smart traders will use a trailing-stop to lock in their gains. This is how they do it:
When the price moves up to a certain level, they will place a trailing-stop a small percentage below the price. And as the price moves up further, the trailing-stop moves up as well. As soon as the trailing-stop is hit, they will sell. This strategy is to ensure that they do not sell prematurely.
The stop-loss and the trailing stop-loss are devices designed to minimize your losses and maximize your gains. Using them gives you the competitive edge.
The world is forever changing; we need to change with it. He who does not change when there is a need to change, is sure to be left behind.
What about a stop-loss you placed in a trade? As with everything, there are exceptions, this is one of them.
A stop-loss is a device you use to limit your loss. A trade without a stop-loss is equivalent to driving a car without brakes.
If your stop-loss is usually triggered, obviously something is wrong. Probably, you are not as good as you think.
After you have bought a stock, the share price moves up fast. It reaches the overbought level. The price is moving ahead of the fundamentals. What is your next move? Average up or take profit?
Different people have different opinions. Some will average up while others will take profit.
Smart traders will use a trailing-stop to lock in their gains. This is how they do it:
When the price moves up to a certain level, they will place a trailing-stop a small percentage below the price. And as the price moves up further, the trailing-stop moves up as well. As soon as the trailing-stop is hit, they will sell. This strategy is to ensure that they do not sell prematurely.
The stop-loss and the trailing stop-loss are devices designed to minimize your losses and maximize your gains. Using them gives you the competitive edge.
Saturday, November 03, 2012
Are You Fit To Trade
Are you fit to trade?
ABC bought a stock at $1. He placed a stop-loss at 95 cents. The stock dropped to 96 cents. He said, " I will give the stock a little more room". He moved his stop-loss to 90 cents. He has breached his discipline; he is not fit to trade.
To be a successful trader, you must have ironclad discipline. Once you set your stop-loss at 95 cents, what does that mean? Does it mean you should place your sell order at 95 cents? In my opinion, it is not. It means that as soon as a trade is done at 95 cents, you should sell at the next bid. This next bid could be at 95 cents or lower, maybe 94.5 or 94. You must not delay; you must sell it immediately.
Ask yourself, can you do this? If you can't, you are not fit to trade.
ABC bought a stock at $1. He placed a stop-loss at 95 cents. The stock dropped to 96 cents. He said, " I will give the stock a little more room". He moved his stop-loss to 90 cents. He has breached his discipline; he is not fit to trade.
To be a successful trader, you must have ironclad discipline. Once you set your stop-loss at 95 cents, what does that mean? Does it mean you should place your sell order at 95 cents? In my opinion, it is not. It means that as soon as a trade is done at 95 cents, you should sell at the next bid. This next bid could be at 95 cents or lower, maybe 94.5 or 94. You must not delay; you must sell it immediately.
Ask yourself, can you do this? If you can't, you are not fit to trade.
Friday, November 02, 2012
The only way to convince a fool is to let him have his ways.
The person who likes to ridicule others out of envy or jealousy or for whatever reason is doing a great disfavor to himself. What he does not realize is that by trying to pleasure himself (shock sendiri), he is creating bad blood; he is not doing himself any good or to anybody.
This type of personality is not limited to the uneducated. Well-educated men or women also have these kind of traits.
They are mean in their praise and generous in their criticism. They are always on the lookout for the bone in the egg.
Criticism is okay provided that it is constructive and logical, and expressed in a euphemistic manner. The person who cannot do this should refrain himself from making any comment at all.
A wise man speaks because he has to; a food speaks because he has to say something.
How do we deal with this kind of people? The best way is to avoid them. It is no use trying to change them.
You can alter the mountains or rivers, but you can't change the inborn character of a person. A leopard never changes its spots.
Thus, the saying: The only way to convince a fool is to let him have his ways.
If you are interested to upgrade your trading or investing skill, join my Super Telegram Group, Intelligent Investing, by using the link below:
https://telegram.me/joinchat/BO0NxTua7NZ57y2pV6Mzrg
This type of personality is not limited to the uneducated. Well-educated men or women also have these kind of traits.
They are mean in their praise and generous in their criticism. They are always on the lookout for the bone in the egg.
Criticism is okay provided that it is constructive and logical, and expressed in a euphemistic manner. The person who cannot do this should refrain himself from making any comment at all.
A wise man speaks because he has to; a food speaks because he has to say something.
How do we deal with this kind of people? The best way is to avoid them. It is no use trying to change them.
You can alter the mountains or rivers, but you can't change the inborn character of a person. A leopard never changes its spots.
Thus, the saying: The only way to convince a fool is to let him have his ways.
If you are interested to upgrade your trading or investing skill, join my Super Telegram Group, Intelligent Investing, by using the link below:
https://telegram.me/joinchat/BO0NxTua7NZ57y2pV6Mzrg
Thursday, November 01, 2012
Gold or Silver
Gold or Silver
Historically, the ratio of gold to silver is 16 times to 1. This means, if gold per ounce is USD1700, then silver should worth US$106.25 per ounce.
A quick check at the prices reveal that gold is now selling at around US$1720/oz whereas silver is traded at around US$32/oz. So the ratio now is 53.75. This disparity is not logical.
Silver has hundreds of uses, maybe a thousand. It can kill bacteria, and is used in water filters. Your computers, smart phones, i-pads and other ICT products all use silver. In fact what gold can do, silver can do. But what silver can do, gold may not be suitable to do it.
The price of gold is about to explode, come Jan 01, 2013, If this happen as predicted by some experts, the price of silver will shoot up as well.
Silver is so low now because some large banks are controlling the price. Once the government step in and changes the rules, you will see silver shoot up easily to US$100/oz.
What is the best way to invest in silver? My opinion is to buy stocks whose core business is mining silver or involving in silver. If this is not within your reach, you can open a gold account or a silver a/c at a local bank.
Should you be interested in silver stocks listed at the NYSE, Click here.
Historically, the ratio of gold to silver is 16 times to 1. This means, if gold per ounce is USD1700, then silver should worth US$106.25 per ounce.
A quick check at the prices reveal that gold is now selling at around US$1720/oz whereas silver is traded at around US$32/oz. So the ratio now is 53.75. This disparity is not logical.
Silver has hundreds of uses, maybe a thousand. It can kill bacteria, and is used in water filters. Your computers, smart phones, i-pads and other ICT products all use silver. In fact what gold can do, silver can do. But what silver can do, gold may not be suitable to do it.
The price of gold is about to explode, come Jan 01, 2013, If this happen as predicted by some experts, the price of silver will shoot up as well.
Silver is so low now because some large banks are controlling the price. Once the government step in and changes the rules, you will see silver shoot up easily to US$100/oz.
What is the best way to invest in silver? My opinion is to buy stocks whose core business is mining silver or involving in silver. If this is not within your reach, you can open a gold account or a silver a/c at a local bank.
Should you be interested in silver stocks listed at the NYSE, Click here.
Wednesday, October 31, 2012
Japanese Candlestick How Good
A Successful History
"Knowing the history of the formations inevitably imparts confidence in the Japanese Candlestick technique. Japanese rice traders developed the system over a 400-year period. Logic dictates that a system that has persevered that long must have credible features. The history of the rice traders that developed the signals reinforces that assumption. With its 400 years of development, the Candlestick methodology got its major refinement in the mid-1700s.
Kosaku Kato (1716—1803) was born in the city of Sakata (now Tamagata Prefecture) during the Tokugawa Period (Eighth Shogunate). Adopted by the Honma family, he became known as Sokuta Honma. His successful interpretation of the candlestick formations made him the most feared and respected rice trader in Japan, and the wealth he produced for his family became legendary."
Success is a ladder that cannot be climbed with your hands in your pockets. Japanese Proverb
Among the few TA books I have read, the best is: Profitable Candlestick Trading by Stephen W.Bigalow. This book is sure to change your mentality about TA. I strongly recommend it.
"Knowing the history of the formations inevitably imparts confidence in the Japanese Candlestick technique. Japanese rice traders developed the system over a 400-year period. Logic dictates that a system that has persevered that long must have credible features. The history of the rice traders that developed the signals reinforces that assumption. With its 400 years of development, the Candlestick methodology got its major refinement in the mid-1700s.
Kosaku Kato (1716—1803) was born in the city of Sakata (now Tamagata Prefecture) during the Tokugawa Period (Eighth Shogunate). Adopted by the Honma family, he became known as Sokuta Honma. His successful interpretation of the candlestick formations made him the most feared and respected rice trader in Japan, and the wealth he produced for his family became legendary."
Success is a ladder that cannot be climbed with your hands in your pockets. Japanese Proverb
Among the few TA books I have read, the best is: Profitable Candlestick Trading by Stephen W.Bigalow. This book is sure to change your mentality about TA. I strongly recommend it.
Stemlife
The First Wealth is Health (R.W.Emerson)
StemLife has a proven track record of success in releasing stem cells for treatments, especially in young patients with leukaemia, thalassaemia and cerebral palsy, and adults with knee injuries, chronic wounds, heart disease and more.
StemLife is a FULLY LICENSED cord blood and peripheral blood stem cell banking facility, under the PHFS Act 1998, Ministry of Health Malaysia.
More than 40,000 clients have already stored their stem cells with StemLife, what are you waiting for? Store today!
Stemlife has announced that it has fallen out of favor to acquire Tonik Asia Group because it cannot come to terms with the vendor on certain matters after a due diligence is carried out. The bonus issue of 1 for 2 is on track. It will be interesting to watch how investors react to the news.
For more information about Stemlife, click here: http://www.stemlife.com/malaysia/stem_cell/index.html
Tuesday, October 30, 2012
Fat Cats are harmful to companies
There are many kinds of animals in the stock market. We have the bulls, bears, stags, ostriches, pigs and fat cats. Among them, the fat cats are the most harmful to a company.
Literally speaking, a fat cat is a cat that eats too much and sleeps too much. The result is that it has become very fat. In stock market jargons, a fat cat is a different thing.
Investopedia defines a fat cat as:
Investopedia defines a fat cat as:
Definition of 'Fat Cat'
A slang word used to describe executives who earn what many believe to be unreasonably high salaries and bonuses. These top executives also receive generous pensions and retirement packages, consisting of extra compensation not available to other company employees.
Investopedia explains 'Fat Cat'
This term conjures up the image of cats that consume more than an appropriate amount of food and become grossly overweight.
Publicly-traded companies are required to disclose the amount of compensation that their top five executives receive. As a result, companies have been under a lot of scrutiny for excessive executive compensation, especially in the face of floundering revenues.
A real-life example of a fat cat would be former Disney CEO, Michael Eisner. For a period of five years in the late 1990s, Eisner received over $737 million in compensation, despite the fact that the company's five-year net income shrank an average of 3.1% each year.
Monday, October 29, 2012
Charts Can Be Misleading
Charts were initially designed to monitor the big boys long before you and I know about charts. Nowadays, charts are available to anyone who knows how to use a computer.
Apple, Google, Microsoft and SamSung have all contributed to change our lifestyles. What was once used to check the big boys are now used by the big boys to trick and trap us. It is for this very reason that charts have false breakouts, both up and down.
Many people after having read a book or two about charts thought they know how to read charts. They start using them to time their trades. For a while they may find them to be useful. But as they go deeper and deeper into charts, they find that charts are really not so easy to understand.
One thing you need to know is that the big boys are very strong financially and much smarter than us. They are so strong that they are able to manipulate the charts, the news and one or two quarterly reports as well. So you have to be very careful with what you see or read. What appears to be bullish may actually be a Pump and Dump situation. That's why we have bull traps and bear traps.
Of course, not all charts are manipulated. So you have to use your own judgement when you make an assessment. Every chart has a personality of its own. This is because the people behind it, are different.
Remember, the big boys know what you are looking at.
If you like the above article, please tweet and link it to Facebook. Thanks.
Sunday, October 28, 2012
PW Root is moving in the range of between RM1.08 and 0.975. The pattern appears to be one of distribution. I understand that FGV, a major shareholder of the stock has been selling PW Root for some time. It has not sold everything. So obviously it does not want the stock to go down.
The formation of the last two candles is called a Harami. If this formation appears at the bottom of a chart that has a long downtrend, it's a bullish sign. But it is now at the top although it is at the bottom of a range. I think the stock can only be considered to be bullish after 1.08 is beached. If the price breaks down to below 95 sen, the stock has turned bearish.
When a major shareholders sells, institutions may be buying, hence you see the large turnover. In such a scenario, whether the stock breaks up or down depends on who is the stronger and how keen other buyers are. Buyers will rush in to buy when the quarterly report is better than expected. This is true the other way round.
PW Root is about to announce its 2nd quarterly report, the latest being the end of this month. Watch out for this report. It will determine the direction of the trend. In the meantime, should you buy or sell?
It's your money, you make the decision.
Saturday, October 27, 2012
Feng Sui Matters
When you invest in properties, be they lands, condos or landed properties, the first thing you should look at is the Feng Sui of the place.
The most important thing to man is fresh air and water. Man can live without food for 3 weeks. They can't live without water for 3 days and they can't live without air for 3 minutes. Therefore air is your first priority.
A place without fresh air can never be an ideal place to stay. To have fresh air, you must have greens all around you. Dumpsites and factories which produce offensive smell and pollutants must not be nearby.
When we talk of water we think of rivers. Thus rivers and mountain streams are part and parcel of good Feng Sui. Once you have identified a place that has good Feng Sui, you have to look at many other things as well. The designs of the buildings must be in accord with the Feng Sui. The atmosphere of the place must be calm and serene and yet lively with birds flying about. The feel-good feelings must be there.
There is a residential project in Bentong that has all the basic principles of good Feng Sui. This site has a school nearby. It is only about 2 km from the town. Constructions of the buildings are presently underway. I understand that there are not too many units left after the commencement of booking.
Click here to have a good look. It may serve your purpose well.
Remember: Opportunity neglected seldom returns.
Friday, October 26, 2012
YONG Privatisation $6.60
YONG, a China-based company and listed at Nasdaq has received an offer from its chairman to privatize the company at US$6.60 a share. The stock is presently traded at around the $5.50 level.
Here is an opportunity to make a 20% profit within a short period of maybe 3 months. In my opinion, this is low risk and high reward.
Many China-based companies are going private because of their low market value.
If you are interested in these companies, click here: http://seekingalpha.com/article/925621-6-china-stocks-going-private-since-september-2012
Thursday, October 25, 2012
There was interest in PW Root as indicated by the fairly large volume shown in the chart. Unfortunately, the tock moved down. This is not a good sign.
At the close, there were 24,819 lots traded. Support is likely to come in at 95 sen. If that level is decisively breached, the stock is likely to trend lower.
The quarterly report for the period ended Aug 31, 2012 may be announced today or tomorrow. The corresponding period for last year was announced on Oct 25, 2012.
As usual, you trade at your own risk.
Tuesday, October 23, 2012
Why you will not win as a small trader
I understand that at OSK, the minimum commission for a trade is RM40 if you go through your remisier. If you do it online yourself, the minimum commission is RM12.
Assuming that you are a small trader and you do not know how to trade online. That means that every trade you do, you have to go through your remiser.
Suppose Tom bought a stock for RM6000 and made a 15% profit. That means he made RM900. From this trade, he a has to pay commission, stamp duty and clearing fees. Both ways, the amount works out to be: roughly RM40 + 40 + s/duty 13 and clearing fees 4.80. The total is 97.80. And don't forget that if his fund is financed by the bank, he has to paid interest which has to be factored in as well but is not included here.
Thus his profit of RM900 shrinks to RM802.20.
Now let's see what happens if he loses RM900. Plus the expenses stated above, his loss of RM900 inflates to RM997.80.
To sum it up ( for this case), if Tom wins, he wins RM802.20 and if he loses, he loses RM997.80. From this calculation, you can see that the odds are heavily against him.
What is the odd against you when you play roulette, soccer betting, and 4D?
If you really want to bet, find out what is what before you wagger or very soon your cash will just say: Bye bye!
Never overestimate your own ability to survive in the gambling world.
Sunday, October 21, 2012
FBM KLCI from 1997
The 12th GE: Mar 28, 2008; The 11th GE: Mar 21, 2004; The 10th GE: Nov 29, 1999
The 09th GE: Apr 25, 1995; The 08th GE Oct 21, 1990. The 7th, 6th, & 5th, find out yourself.
The chart shown above dates back to 1997. The primary trend of the chart has been on the uptrend since 1997. This is a trend in motion and is likely to continue in the same direction. How the market will behave just before and after the 13th GE is anybody's guess. If you know TA, the above chart may be of some use to you. Please remember that TA is an art, not a science.
The only certainty in the stock market is uncertainty.
Good luck, and may God bless your every trade.
Saturday, October 20, 2012
CBIP one to note
CBIP has been trending up. It is likely to continue trending higher.
For a comprehensive study of CBIP, click here: http://journeytowealth88.blogspot.com/2012/09/cb-industrial-product-holdings-bhd.html
Friday, October 19, 2012
What is Value Trap?
It's all right to walk into a trap provided you know the way out.
Read more: http://www.investopedia.com/terms/v/valuetrap.asp#ixzz29i1z2OP5
Definition of 'Value Trap'
A stock that appears to be cheap because the stock has been trading at low multiples of earnings, cash flow or book value for an extended time period. Stock traps attract investors who are looking for a bargain because these stocks are inexpensive. The trap springs when investors buy into the company at low prices and the stock never improves. Trading that occurs at low multiples of earnings, cash flow or book value for long periods of time might indicate that the company or the entire sector is in trouble, and that stock prices may not move higher.Investopedia explains 'Value Trap'
Companies, and even sectors, can be doomed, because of situations such as the inability to survive competition, the inability to generate substantial and consistent profits, the lack of new products or earnings growth, or ineffective management. Often, a value trap appears to be such a good deal that investors become confused when the stock fails to perform. As with any investment decision, thorough research and evaluation is recommended before investing in any company that appears cheap when reviewing its relevant performance metrics.Read more: http://www.investopedia.com/terms/v/valuetrap.asp#ixzz29i1z2OP5
Thursday, October 18, 2012
Public Bank shows the way
For companies whose FYE 31.12.12, the 3Qtr result announcement has commenced.
As usual PBB is the first off the mark. It has reported an EPS of 28.08 sen. This is a shade better than its 3Q11 result of 25.66 sen earnings per share.
Now that the earnings report season has kicked into gear, the market should be more active from now.
Saturday, October 13, 2012
Selected Quotes
Love all, trust a few, do wrong to none.
By three methods we may learn wisdom: First, by reflection, which is noblest; Second, by imitation, which is easiest; and third by experience, which is the bitterest.
“Most people get interested in stocks when everyone else is. The time to get interested is when no one else is. You can’t buy what is popular and do well.” Warren Buffett
"Know what you own, and know why you own it." - Peter Lynch
Do your homework before making a decision. And once you've made a decision, make sure to re-evaluate your portfolio on a timely basis. A wise holding today may not be a wise holding in the future.
Friday, October 05, 2012
Adventa moving into healthcare
Adventa has proposed a special dividend of RM1.30 and capital repayment of 40 sen per share.
After these one-off payments, the NTA of the stock is lowered to 82 sen per share. The company will then no longer be in the glove business. It is moving into healthcare.
At the present traded price of RM1.86 per share, the stock looks a bargain to me.
Tuesday, September 25, 2012
Pantech (Stock Code: 5125) Website: http://www.pantechPantech (Stock Code: 5125) Website: http://www.pantech-group.com
For the fiscal year ended 29.2.12, Pantech paid 3 times dividend totaling 3.5 sen per share.
For fiscal year ended 28.2.13, it should pay more. This is because the company is doing very well. Its 1Q ended 31.5.12 shows earnings of 2.77 sen per share. In the corresponding period of the previous year, the EPS was 1.38 sen. This is an improvement of over 100%!
Assuming that it pays a total dividend of 5 sen per share for the current fiscal year, the dividend-yield works out to be 8%. This is based on the present price of 62.5 sen per share.
The stock is now traded on a cum-basis of 1sen dividend, The x-date is Oct 5, 2012. If dividend is your priority, don't miss on this one.
As usual, you buy at your own risk.
Sunday, September 23, 2012
Tip of the day
"The individual investor should act consistently as an investor and not as a speculator. This means ... that he should be able to justify every purchase he makes and each price he pays by impersonal, objective reasoning that satisfies him that he is getting more than his money's worth for his purchase."
-- Benjamin Graham
-- Benjamin Graham
One way to interpret this is to take advantage of the market when it wants to sell $1 worth of value at $0.50. Within our portfolio, we look at this quote a little differently. We want to invest $1 worth of capital in companies that can ultimately deliver $5 or $10 worth of value over the years.
Monday, September 10, 2012
MNRB Merits Attention
For fiscal year ended 31.3.2013, the 1Q result EPS is reported to be 23.7 sen per share. This figure when annualized, works out to be 94.8 sen per share. At the just traded price of 3.19, the forward PE is 3.19. This is indeed very cheap for a stock like MNRB.
What's more enticing is that the company is paying a dividend of 17 sen less tax on Oct 26, 12. The x-date for this dividend is Oct 02,12.
The NTA of the stock has improved to RM5.35 per share as at June 30, 2012. I have just bought in some shares of this stock at 3.19. I believe the price will move up in the near future.
Wednesday, August 29, 2012
CMSB PROFIT SURGES
CMSB's Q2 2012 EPS come in at 14.29 sen. For Q2 2011, the EPS was 8.44 sen. (The figures are after tax) This is an improvement of 69.31%. The MD is very pleased with the result. An interim dividend of 5 sen less tax has been declared. In the previous years, there was no such dividend. This is a sign of confidence. The stock is likely to trend higher. It closed at 3.28 today.
This stock was highlighted on 26.7.2012 under the heading: Should we follow smart money? Please refer back.
Sunday, August 12, 2012
Is TDM going the way of EPIC?
For the half year period of fiscal year of 2012, TDM made 11.35 sen per share. This compares dismally with the EPS of 26.58 sen made in the corresponding period of 2011. Indeed TDM will be hard pressed to maintain its 2011's single-tier dividend payment of 21.5 sen per share for fiscal year 2012. I doubt it will pay more than 15 sen dividend for fiscal year 2012.
Many plantation counters have reported poor result for the first 6 months of 2012. TDM is among the worst. I wonder why this is so. I mean why should it be among the worst. Is TDM trying to depress its share price? Whether it did that or not, the stock is down 21.98% from its high of 5.05 set on May 03, 2012. The stock closed at 3.94 last Friday (Aug 10, 2012)
Last year EPIC was privatized by the Terengganu government (TG). Presently, TG owns 63.17% of TDM. Will TG privatize TDM as well? Most likely it will. If it decides to do so, probably it will offer RM4.75 for each share of TDM. This being the amount it values for each share issued to acquire a piece of land for RM16.9m.
I don't think privatization for TDM will happen in the near future. Perhaps it will happen next year. Really, it is anybody's guess.
If you are about to dispose of your TDM shares, don't forget to consider the above factors before you decide on a price you wish to sell.
As usual, you listen to me at your own risk.
Friday, August 10, 2012
TDM Disappoints
For the quarter ended June 30, 2012, TDM's worse-than-expected result is a cause for concern. EPS for the quarter was 3.88 sen. This compares dismally with the result of corresponding period of the previous year. EPS then was 13.86 sen.
In spite of the bad result, TDM is optimistic for the whole year. Its commentary on prospects reads as follows:
"Based on the prevailing CPO and PK prices, the outlook for the financial year ending 31.12.12 remains favorable. Baring unforeseen circumstances, the Group is expected to continue to record satisfactory performance in the current financial year."
I wonder whether TDM is speaking what's on its mind. Maybe it was trying to soothe the frustration of the shareholders. Or maybe it was trying to prevent a free fall of the stock. Anyway the stock slumped 33 sen and closed at 3.96 at the close of trading this morning.
So, is it a good time to buy the stock now? I believe more downside is on the card. My prediction is that it will hit below 3.70.
Please have your own prediction. And please remember that you always buy, sell or hold at your own risk absolutely.
Thursday, August 02, 2012
Multico gets RM44.19 million.
The High Court has ruled in favor of Multico against 11 defendants, including its former directors.
The defendants are Gordon Toh Chun Toh (first defendant), Datuk Abul Hasan Mohamed Rashid (second defendant), Kalwant Singh (third defendant), Elliott Gordon Singapore Pte Ltd (fourth defendant), Elliott Gordon & Co International Ltd (fifth defendant) and Ace Prelude Holdings Sdn Bhd (sixth defendant).
The other defendants were Lily Chong Kui Foh (seventh defendant), Teng Sin Pyng (eighth defendant), Westcape Investments Ltd (ninth defendant), Wong Jit Kiang (10th defendant) and Liew Then Boh (11th defendant).
Multico has a small paid-up capital of only RM44.4047. The par value of its stock is RM1 per share. This means that for the fiscal year ending July 31, 2013, the NTA per share as well as the EPS of the company will be boosted by 99.5 sen. This is in deed a windfall for Multico!
The stock was up 38 sen yesterday. It closed at RM1.60. Another good rise is expected today.
My congratulations to Multico and all its shareholders.
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