Investment Note: Mar 2014

Dear Investor,

Good Days!

Last week, I received few query from investors, seem some of them are worry about crisis in Ukraine. I told them, this is opportunity for you to buy / invest in stock market if you believe market will continue to make higher record in 2015. Usually, from the past experience, if a war really happen, Market may only down for short period of time then it will go up again, so don't fear and don't worry.

Then come the second question, what to buy? In the past, many investor like to buy MAS and AAX stock... when I ask them, why? Their answer is simple, because it already drop in price and look cheap. I would like to remind that, invest in stocks should always look at the future earning power of that company. It's no point to buy a company that you know they will continue making loses in coming quarter. (when company making loses, the stock price will go down further) Why don't we invest in company that we know for sure that the business already making profit and will continue to grow the profit in the coming year? (if you really want to invest in MAS, why don't wait till next quarter if they really return to profit, it will not too late!)

Out of stocks I recommend on last month, I particularly like Brahim as one can buy on dip and the stock price having potential to double in next few years. For those who miss my blog, you may read the below: 

Five reason why one must invest in Brahim.

Do you believe market will continue to run higher in 2015, read the below:

Six reasons why Bursa will break 2000 points in 2015.

Finally, the advice from Super Investor, buy Jtiasa:

How to become Super Investror.

That's all for now. Happy Investing!

Investment Note - Feb 2014

Dear Investor,

The market quite interesting last week, Dow (USmarket) was having a minor pull back. Our local market, Bursa, also follow the same pattern, especially the Index counters. Experience investors would welcome this kind of pull back, this is opportunity for you to make money. There are stocks on the up trend that we can invest (buy on dip) and these stocks will not follow the Index stocks.

You may want to know what's are those stocks...well, let me name you some example, they are: Supermx,Kossan, MKH, Brahim & Sona. All these stocks are on the up trend (daily chart) and you may pick up some them when the stock price dip a bit.

Some of you may wonder why buy up trend stock,why don't buy down trend stock? Buying stock on the way down is a bad practice, but you may buy the stocks after they have stop falling (the best timing is buy when a stock start to go up) Take a stock, Zhulian for example, last 2 week when it started to fall from RM5, those who invest at RM4.50 or RM4.00 or RM3.50 was not a good idea. You should buy at least when seeing the stock price stable or better still buy only when it start to go up. I hope you know what I mean. (if not sure what's down trend, just see this:http://bursastory.blogspot.com/2014/01/uptrend-and-down-trend.html)

Last, let me share with you a message from a senior investor, who is a multi-millionaire, I guess if you not sure what he mean, just follow what he recommend (Jaya Tiasa) and keep the stock for 3 years then see what will happen, if he is right, you may double your fund invested. (click here to read the full content: http://bursastory.blogspot.com/2014/02/super-investor-can-we-duplicate.html )

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Happy Investing!

Investment Note - Oct 2013

Dear Investor,

Good day! Coming month is a budget month for Malaysia, for some investor they think this is important month, as the Government might create a new blue print and set new rules for coming year or next few years. By knowing what is good for a country's economy, one can actually plan ahead. The hot topic now in GST (Good Service Tax) and investors are looking for the company that will benefit from this. However, this is just part of it, how to choose a right company for long term investment is more important.

Let think what's the purpose of investment? Last week, I meet a friend, he told me, he sold all the stocks before the General Election because he fear the price may go down... Investment is not about predict the market! Investment is about how to create wealth or increase net worth over time. If you are not sure what I mean, just see the below example:

Someone who invest 1000 shares of Public Bank 40 years ago and never sell the shares, today, his net worth will easily above 2 million, not yet include the dividend.

If you invest 1000 shares of Maybank 13 years ago and never sell it, today, your holding will value about RM60,000+.

If you invest 1000 shares of Telekom 10 years ago and never sell it, today, your holding will become 2000 shares of TMplus 2000 share of Axiata. Total holding is worth about RM25,000+.

Even 4 years ago, if you bought 100 share of Dlady at RM18 (RM1,800), today, the price for Dlady is RM45++ (RM4,500).

This is one of the method how long term investor beat the market, find the monopoly business and let the magic and power of compound interest doing their job. Don't say “I don't have the money to invest!” In fact, you don't need a lot of money to invest 1000 shares but you have a lot of time if start early! Time is good friend for monopoly business.

In recent market correction, I have added Axiata as one of my investment portfolio. My average cost was about RM6.50. I have received one time of dividend payment and going to receive another one soon. May be you will ask, what's my plan if the stock price go down below my investment cost of RM6.50? Since my plan is to invest for the next 5 to 10 years, why should I bother about the price movement every day? In fact, I do happy if the price keep falling so that I can buy more shares in next few months and just wait for it to bear fruit.

If you fear of market turn down, then don't invest. If you remember my previous email few months ago, I told one of my friend who bought Dlady 3 years ago at RM18 and he only make small profit even though Dlady's market price is RM45 today... the reason? Because he sold it when the share price start to move up because fear of choppy market price!

That's the beauty of stock market, price fluctuate! If tomorrow Axiata stock price fall below RM6.50, I will buy more. You may ask, what's so good about this company? The reason, I let you think of it. It's nothing wrong if you buy and sell stock in short term, but make sure you buy and keep 1000 share of Monopoly type business at least, and keep it in your portfolio when you plan to save money!

All right, this all for now. Happy Investing!

Investment Note - Jul 2013

Dear Investor,

Good Day! Not long ago, we just past the first half of 2013. Overall, most of the stock markets still in the happy mood, especially US, where we see Dow Index near all time high of 15,450. Thanks for the QE (or I call it printing money policy), hot money is floating every where from stocks to property.

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Now, the question to ask, when the party going to end? Or when US will stop QE? From the latest indication, seem coming December, US will going to review it. Maybe they will stop QE at 1st quarter or 2nd quarter of 2014, but again, depend on the employment and economy data. We may not know when, but at least we know the party will not going to end this year. We can follow closely the indication, perhaps when the Gold price start to go up or when their interest rate (10 year treasury rate) start to go up, then it may be the time.

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Back to Malaysia, Bursa is also doing very good, the KLCI index rises to all time high level. Making money in stock market is easy or not? It's very easy, if you know how to make use of good news and ride on it. For example, Puncak and other water related stock, when the news came out, we already know these stocks will become black horse. (but now, I am not suggest to buy this stocks, as it's already over run right now).

So, what is the next Blue Chip one can buy? I suggest, IOI and Tenaga, they going to announce good news (in fact, most of public already know) in next few months, hence, I will suggest investors try to accumulate these 2 stocks when their share price turn red. When to sell? Sell when IOI announce the date they distribute IOI Property. For Tenaga, sell when they announce getting approval to raise electric tariff.

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For those who follow my advise last month to buy CIMBC25, now it the time to see the result. You may slowly sell batch by batch in next few days when you see the high volume day. (those who want to know how to trade this stock, please refer my blog)

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Last, if you want to chase the running stock, don't chase it at high price. Try to enter when there's a pullback (the pullback must on low volume) If it’s on high volume, it means that institutional investors are selling!

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That's all for now! Happy Investing!

Investment Note - Apr 2013

Dear Investor,

Greeting! It's first week of April 2013! Almost all the world stock markets are near their high level. US Dow Index already above 14,000 points for few weeks. The recent update came from Hong Kong, where we saw Hang Seng Index fall by about 600 points last Friday, thanks for the new Bird Flu! Anyway, this is good opportunity to play around. (for local stock, glove stocks sure will become hot now, for HK, I will explain below)

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Cheap money to support the Market rally this year

Finally, for Malaysian, the long awaiting event, General Election going to happen! Many think that Bursa's Index will go down after the announcement. As usual, I always advise investors, don't predict the market, instead respect the trend and use it to our advantage. Currently, Malaysia market is extremely strong, investors can ride on "current moving stocks", especially Glove makers (usually Bird Flu happen people will buy these type of shares) and Iskandar play related to properties stocks.

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One should know that in the Market, there are stocks which you can keep for long term. There are some suitable for short term trading and some penny stocks (or I call it problematic stocks) which people like to speculate. There's nothing wrong to play with penny stock, but just be extra careful, jump out of the boat if it start leaking water, a sign of going to sink!

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Biggest listed company in Malaysia

Maybank is one of stock I like for long term. It never fail me (Last year, I recommend this in my blog when it was RM8.5x and now it's near my target RM10.10 this year). (you may read it here, from my blog). Now, I don't suggest to buy it at current price, but can keep it in your buying list for next round when market crash.

For Maybank, as long as a valuation for a stock is not overly stretched and the company's dividend raised year after year, it will likely to attract investor. Don't forget, beside EPF, now we also have PRS (private retirement scheme), which they have ample of funds need to invest. Next time, when market go down, if you want to invest in Malaysia's biggest listed company and enjoy good dividend, remember to include Maybank as your long term investment portfolio.

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CIMBC25 strategy - don't cut loss but cut profit when market up

If Maybank is for long term buy, is there any others stock to trade for short term? Yes, take advantage of current HK down trend, I suggest to accumulate CIMBC25 (it's an ETF that buy 25 Blue Chips in HK/CN) Last week, it close at 86 cents, investors can start slowly collect it. (remember, slowly, don't collect it one time) Don't fear if the price go down further. For this stock, you can average down even the price keep falling in next few weeks. When Hong Kong market rebound, 10% of return is not a problem. (Click here to see my buy & sell record)

That's all for this time, wish you doing well in investment trading. I do welcome if you have any question related to CIMBC25 or Maybank.

Investment Note - Feb 2013

Dear Investor,

 

 

For those who celebrate Chinese New Year, Gong Xi Fah Chai! The celebration is not over yet!

Almost all the stock markets in the world are near the all time high! US Dow Index just close near 14,000 points. We can see all the money stay sideline in last few months, start to move into equity (stock market).

However, there's one exception, Malaysia stock market! As all know, the General Election is approaching, many investors stay sideline for the time being... Some one even predicted if the opposition party win the election, Bursa will drop by at least 500 points! I don't know what was his intention (to scare people?), but as a mature investors, we should welcome this! How can we buy low if the market is always high? Another question, if the ruling party win the election, will the stock market going up? Ok, I don't want to touch politic issue here, this is just to let investors be prepared for the worst case, if market crash, the only worry is without bullet (money)

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Stay away from problematic stocks

Just a gentle reminder to investors, stay away from speculate stock, even they may look as if very cheap (few cents only). Why chasing low price speculation stocks is very risky? The reason is one may potentially buy and hold a problematic stock if you were to continue buy this kind of stocks. The stock sell cheap for a reason.

Market tips for now?

As of last month's, YTLPowr still under our buying list should it drop near to around RM1.51. Investors can accumulate at this level and wait for Malakoff IPO launching. SP Setia was another good buy at around RM3.00, which we managed to collect 2 months ago. I hope if general election will create the fearing factor and we can have the opportunity to collect these stocks at low price. For this month, I also put Digi into our watch list... if the price drop near RM4.60 or below, then it's a good buy, for dividend and capital gain as well.

That's all for this time, I wish you all doing well in 2013!

Personal Investment Note - Jan 2013

Dear Investor,

Happy New Year!

We have come to the year 2013, it's time to review our portfolio and plan for the coming year. US stock is performing well in the end of Dec 2012 and at beginning of 2013. Ample of hot money stay sideline last few months started to reposition their holdings, that's why most of the stock markets Index broke the highest record and it could be the start of another bull run cycle.

Back to Malaysia, Bursa reach the all time high record with Index 1690 points. Actually, many retail investors sell their holding because fear of General Election, anyway, seem foreign fund now is not afraid of this event anymore, as they need to park their fund some where.

Create a written Investment Plan if you buy for long term

In the past, I witness some investors sold their “blue chips” stocks and buy a small company's stocks (penny stocks). Many times, they just bought any stock base on rumours. I think the biggest problem faced by them was without a written investment plan. The reason to sell the Investment Grade should be, you have found a better investment option or the company's business started to go down (profit down). Never sell because of the stocks go up in price, or you expect some event going to happen (for example General Election).

Why we need an Investment Plan

If you have written down the Investment Plan, every buy / sell decision will make you think twice if the decision is base on “follow the others” or “follow your plan”. (I believe investment is not how well you do it, but how less you create a mistake) Write down the reason buy / sell a stock so that you keep track the record and create an investment lesson, as there's no better teacher than experience. Believe me, human is forgetful, if you don't write down your plan and review, few months later you tend to forgot and will repeat the same mistake! During the market swings (up or down when people become greedy or fear), it's these written down principles that will help as a guide post. Further, write down the points make one think more clearly and be more intelligent and less emotional. Unwritten investment belief tend to change without direction.

If you ask me what's my investment plan? Mine is simple, I want to create portfolio with consistent / stable income by investing into excellence business that has an expanding value, provide income and adjust for inflation. Then I will come out with action items to list down those potential companies. Anytime when the market correction occur, it's the opportunity for me!

Tips for next few weeks?

Again, as always, I don't really like to tell this, however, most investors still want to ask me if I have any tips... Well, if you want to trade for short term, then can try YTLPower. This stock will become active for next few weeks until Malakoff come with IPO. Don't chase high, buy at the pivot point. (similar to last month, when I write about SPSetia, noticed some investors not making money because of chasing high) SPSetia still good buy if fall near to RM3.00.

That's all for now, Happy Investing!

Investment Idea - Nov 2012

Greeting! We are in the second last month of 2012. Today is another Malaysia Holiday, hence in the midst of enjoying the holiday, I am thinking it would be good to give a brief update on what's happening in current market. Last month, US Dow index went as high as 13,610 point but today, the index is around 12,571. It's clearly this is a minor correction. However, my view is this create a opportunity for us to invest into “Great” company, if you plan to invest for long term.

Inflation or deflation better?

Some people blame the government that causing the inflation. For example, few years ago, with RM3, I can have a good breakfast. Today, I need to spend about RM6, to have a breakfast at McDonald. Many start to think, how nice if the price start to decrease... things just get cheaper, sound great? If this happen, the problem is your house value will go down, and your salary will go down as well. Assume you borrow $400k to buy new house, then 3 years later, the value become $300k but you still need to repay loan of $400k with the lower salary now, would you happy with it? This is what happened in Japan few years ago – deflation, which causing the changing of government. Since then, all the government in the world learn the lesson, try to print more money (to cheat people in a way), make everything goes up in price, so the houses value rise, people's salary increase, they feel more happy with inflation!

Why 90% of people lose money in stock market?

About 90% of people make a lot of money by investing in property, thanks to the inflation. However, it's less than 10% of people making money in stock market, if you are not in the 10%, then something could be wrong with your investment strategy.

For long term, only “Great” company will benefit from the inflation, remember, not simply choose any company for long term. You need to choose the company to invest, seriously and carefully.Few years ago, I recommended people to invest in Nestle and 2 years back in Dlady, these companies are great example for long term investment, the share price just go higher every year. You may email me if want to find out next company in this category.

The great company can be invest anytime, their price is hardly fall (because of inflation and growing population), hence any price correction is the best time to invest. Not long ago, I meat with a fried who bought Dlady's share 2 years ago and I thought he make a lot of money. However, he told me, no, he only make small money even Dlady's share price up by 300%. Why? Because he already sold the shares when the price up by 50%... The reason is he fear of choppy market especially follow by the news about Europe problem! This is another mistake, sell the great company too fast, great company need time to grow! Since the purpose of this investment is for long term, don't border about short term noise or news, you should use the bad news as your advantage to buy (if the price go down) but not as a reason to sell.

Long term means never sell, similar to holding the property asset!

Then another question come, should you sell Dlady if the price hit RM50 or Nestle hit RM70? My answer is NO. You should try to hold the great company as long as you can if the business continue to grow and the dividend continue to increase every year! I will consider to buy more if the price really fall! (never think of you try to sell Dlady at RM50 and buy it back at RM45, the tactic for short term is correct but for long term strategy is wrong!)

Short term investor can trade CIMBC25

The above is mean for long term, if you would like to trade for short term, then I recommend CIMBC25. You can refer to my previous email for details of CIMBC25. The price movement is slow and steady, currently is making the down trend movement, I am just waiting for the suitable time to buy. (CIMBC25 is for short term, hence, don't mix up with strategy for Dlady or Nestle)

Happy Investing!

Investment Idea - Oct 2012

US is printing the money, but no impact to the stock market?

 US government plan to print money again, another QE3, market observer expect Dow Index continue to climb higher. However, Dow Index did not make high record after the announcement as what we had seen when QE2 announcement. Seem the market is waiting for next indicator to spark the movement. My thought is, the Bull now a bit tired (after 3 years and 7 months), it could due for correction anytime soon. What would be the investment strategy for last quarter of 2012?

Sales strategy for Astro IPO

For Bursa Malaysia, Astro IPO will list on 19 Oct 2012. Everyone is talking about it now, I suggest those who strike the shares, use the strategy similar to Felda IPO. The idea is sell on 1^st or 2^nd day after listing. (just check on the price of Felda on 1^st day of listing and compare with the price today, you will understand why) This is the strategy we use when anticipate market at the high level.

Try to avoid Malaysia Stock for next few months

The next 6 months, something BIG may happen in Malaysia, in view of currently high level, my advise is try not to buy any Malaysia stock for the time being. If something happen, there are a lot of opportunity for you to buy at low level. However, high dividend stock is not a problem for you to hold on.

China Stock market + an opportunity
 

While Malaysia and US stock market are near the high level, China stock market was actually on the down trend for the past 2 years. Recently, we noticed that China stock market seem to stable and did not break lower low anymore. It may be a good idea if you can invest into China stock market and I do believe if US market crash, China will benefit from it.

If you want to invest into China market, I recommend CIMBC25 (ETF, stock code 0823EA, list on Bursa). Technically, invest in CIMBC25, you actually own 25 China blue chip stocks list on HK Exchange. (I have been trading on CIMBC25 for the past one years) If you know how to make use of 5 to 10% monthly movement (depend on your skill) combine with creative trading, then making money with this single stock is not a problem. I just sold some unit last week, you may refer to my trading record as below:

https://docs.google.com/spreadsheet/ccc?key=0AoGWjHCeLl9rdFU2TzZvbVV1OXBsUi1ZSnRRNVVKRGc

Again, I want to remind, one man's meat is another man's poison. If you have NO idea how trade CIMBC25, please observe first, if you just want to buy and hold, then should not buy this stock, for details, you may refer to my blog as below:

http://bursastory.blogspot.com/p/cimbc25.html

Do write me an email if there's any query. Good luck and Happy Investing!

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Investment Idea - Aug 2012

Time running fast, it's August again. Currently, I am using Thailand's link to online and checking stock on US Market. (quite surprise, the free wifi is very fast) I am thinking it would be good for me to send you message just to share my opinion, while having a holiday so that you all can plan ahead on the weekend. Similar to past few months, US stock market still stay at almost all time high level. We should appreciate this environment, not too hot and not too cold either. I don't like if the environment become too hot, as the burble easily get burst if too hot!

Back to local stock market, last month is very exciting, as we have seen how Felda and IHH IPO flying high. Both stock gave investors a handsome profit, especially those strike the IPO. We can expect the next IPO, Astro and Mid Valley will be the same, so be prepared!

Trading in stock market is not easy, many investors has burnt due to lack of experience. The most common one is they cut the profit (sell the uptrend stock too soon) and let the loses run (hold the down trend stock hoping it will recover). There's why I always suggest investors should learn the basis first before buy and sell stocks, instead of just simple buy any shares.

Back to basic, investor should buy the investment grade stock. If you do a mistake with investment grade stock (buy too high the price), you can still hold the stock as it will recover. (because of their business is growing year after year, so no need to afraid) This is the reason I always urge investors to buy only good stocks.

One more example, if I ask, how much dividend do you receive from your stocks? If the answer is “No” or “not much”, then maybe you are not buying the good stocks. Many times, when stocks give good dividends, investors will rush to buy, hence, the price will increase year after year and no need to worry about it.

There is all for now, I just reach Thailand few hours ago and will stay here for this week end. For those serious investors, you can drop me an email, we have the latest iTrade version where you can view the 5 years financial report with technical chart. I may not able to reply you email on week end, but will let you know by next week for the details.

Investment Idea - Jul 2012

Good Day! We are in the month of Jul 2012, overall, all major stock exchange perform very good! Noise from Europe did not give any impact, from US to Hong Kong, all managed to perform well and record almost all time high level, Dow Index closed at 12,944 points yesterday!

What happen in Malaysia last month?

June was a very exciting month for Malaysian, many of those stocks that I managed to buy were making handsome profit, especially GCB, MISC, Harta and MBM, except for Genting. Genting will follow the uptrend sooner or later. I am not recommend any stock for this month, as those uptrend stocks are enough for investors to perform the trading.

Also, I want to congras those who strike the Felda IPO (FGVH), as per major news paper, it delivered very handsome profit of 20%. If you missed the boat, doesn't matter, we have another one coming soon, IHH. (Integrated Healthcare Holdings)

Who is IHH?

In Malaysia and Singapore, most people know Gleneagles, Pantai and Parkway, but seldom people know they are part of IHH, the International Hospital chain. IHH have plan to build another 17 new hospitals by 2015, this will make it the largest listed hospital group in the world! You know how hospital relate to population, the fact is our life start with Hospital, along the way and till the end. Another selling point, IHH will list at Bursa and Singapore Stock Exchange at the same time, added point for foreign investors, as the shares are fungible. Ok, no more advertisement, for more details, just visit their web: http://ihh-healthcare.com

My opinion,  go ahead and apply this IPO, this is Boleh Land, don't worry, be happy!  

Why Rich like to Invest?

IHH will allocate portion of fund for those patients who required financial assistance to access the benefit from IHH world class doctor and medical facilities. Investors feel proud, especially the rich one, even if they don't make money from this investment. This is the opportunity for those who want to participate in the potential growth and wait for the handsome reward! If you want to get rich, focus on making, keeping and investing your money! Happy Investing!

Investment Idea - June 2012

Here come mid of 2012, the past few weeks, US market experience minor correction. This has created some panic selling especially Hong Kong and Singapore stock market. However, in “Boleh Land”, if you know how to invest, in fact, you can make money, I will share with you later.

What Happen in Malaysia 

Since the FaceBook IPO, many countries already stop or delay the large IPO. However, here Malaysia, we are still planing for Asia's biggest IPO this year, Felda. Many want to find out if Felda can make money or not.   My advise, go ahead and apply this IPO, this is Boleh Land owner's IPO , don't worry, be happy!   The closing date for this IPO is 12 Jun 2012 before 5:00pm. (Felda may not be the best plantation stock, but you can consider sell it and switch to some other better stock if you strike the IPO)

Last week, one of my friend told me he want to sell Maybank stock. Then i ask him for the reason. You know what, he told me, because General Election is coming. So, he want to sell first and buy later when the share price fall. How can one so sure that Maybank stock will fall in next few weeks? I can confidently tell you, if Maybank stock price go down, I will buy some more to keep. (don't forget, here is Boleh Land, you need to know which stock they want to control) The other reasons, you can read from my blog: http://bursastory.blogspot.com/

How Investor can maintain consistent income? 

As usual, i always invest in the stocks that give consistent dividend income. I have been sharing with all my clients my investment portfolio. In fact, every down turn in the market, my portfolio still keep on growing. You may ask, how can this be possible? Well, because good company is very difficult to find, since many people want it, for sure the price will keep on growing.

Let me share with you what are my part time income on April 2012:

Axreit: cash dividend RM972

Dlady: cash dividend RM2,600

Sime: cash dividend RM1.90

NCB: cash dividend RM100

Yesterday, I just got my Maybank cash dividend of RM1,139 and free share 1,136. I have sold 1,000 shares of Maybank, not because Maybank turn bad, but I want to free up some cash to apply for Felda IPO.

Last, I want to share with you the purpose of investing.   The purpose of investment should be growing our asset and have a happy life.   Many people thought that investment is making fast money, so they trade and trade every day. They want to make fast money and fear of stock price falling, as this will make them sleepless. In fact, I want the stock price to go down, so that I can have an opportunity to buy the value of $1 for the price of 50 cents only.

I wish you all have a Happy Life through investment in stock market, that's why I always end with the word,   Happy Investing!

Investment Idea - May 2012

Greeting! We are now almost at the half of 2012! US stock market continue the up trend, the Dow Index back to 13,000 points again. However, it show slightly weaker over the last few week. When I review my record, in fact, 2007 Dow Index already break the 13,000, seem today it's back to square one! There's one popular quote, “sell in May and go away”, hence, be watch out for this month!

 

 

Build Investment Strategy - for Long Term Investor

If you don't have proper investment strategy, after few years, some may realize that their investment is back to square one. Some even make a negative return! The very first rules in any investment is protect your capital, once you know the way, making money is not a problem anymore.

Let me share my experience for Investment Strategy on Maybank.

1. Purpose – write down the purpose, for example, mine is to find the good company that consistently distribute the profit to share holders with at least 2 times better than FD and at the same time the company is growing.
2. Measure – now I know bank's FD rate is 3.5%, so 2 times mean 7%. When I screen through all the blue chips, Maybank is one of the best company to fit the purpose. With this way, we can know if the stock is under or over value. For instant, Maybank gave 60 cents of dividend, if current market price is RM8.60, then it's equal to DY of 6.97%. If Maybank at RM8.20, the DY is 7.31%, (very attractive price!)
3. Review – after measured, we can review or change the plan accordingly if require. For example, if the market price up till too high, or when the DY become very close to FD rate, then I may consider to sell some of the shares. Similarly, I will plan for buy order if the price become very attractive.
4. Weaknesses - we need to know, when economy look promising, bank's profit will double. However, if economy turn bad, it's profit will badly hit. That's why we need to look for something very big like Maybank in order to sail through the bad time.
5. Strength – Maybank having clear dividend policy of distribute 40 to 60% of profit as dividend. Also, it's one of the only 3 company in Malaysia that provide the Dividend Reinvestment plan, where share holders can opt to buy Maybank's share at 10% discount from the market price!

Investment Idea - April 2012

Greeting! We have another good month, US stock market is making high record. Malaysia Market, KLCI also record all time high of 1600 point! While there are many who believe “global economic collapse”, we might need to think “the sky really is falling” or “the sky is in danger of falling”.

I always like to say, “Do Not Predict the Market”. Predict the market is wasting your time, as nobody can actually predict it. What we need to do is find out the trend and ride on it. The trend could be stock price trend or company's profit trend. I like the profit trend of the company, especially the earning trend which keep on increasing every year.

While most people like to save Money or buy property, I prefer to save the “Investment Grade Stock” and I suggest you to do so. In the long run, if you “save” the right stock, you can see the money double in few years. One stock that I have ask you to buy two years ago already double in price and other few stocks also grow about 60% in last 2 years.

Now, you may ask, what's the stock you recommend to buy? My answer is simple, look for plantation stock. The logic is, on last December, CPO price was about RM3,000/ton, currently CPO is around RM3,500/ton. Hence, plantation stock will doing very good in next three months. (however, plantation stock is cyclical stocks, once the CPO price start to go down, you know will need to decide what to do!)

Market is created for you to make money! If you like to play short term with speculate stock, remember to use trading plan, you should never try to “save” the speculate stock if the price fall below your buying price. Cut lose with small amount (usually 7 to8%) is a wise move to protect the capital. If you lose the capital, it's very hard to trade anymore. Also, only trade the stock with trend in the move. Once the trade is moving down, cut lose, take a rest and wait for the trend to move up again.

Let your winning trades run and limit your losses. 

Remember, never let your loses grow bigger, but let your winner grow bigger if possible.

Investment Idea - Mar 2012

Time is running fast! Here come March 2012. How's the market doing?

Very good.... this is the only answer when you see NYSE, Hong Kong, Singapore stock market, almost all maintain at their historical high level.

While many investors still worry about the high oil price and Europe problem, there seem to be no impact to many of the stock markets. This is the indicator that the market almost discounted all the bad news and there are ample of hot money flying around.

Local stock market, right now all the funds are waiting for the Felda to be listed. This is the must have stock to many fund managers as this is the largest plantation stock in the world. Hence, you will see many GLC stocks moving high now and in the next few weeks the rotation play will going to happen.

While waiting for all these thing going to happen, we have one breaking news from Taiwan. "Bird Flu" is coming to town again, so you know, if history going to repeat, the glove sector will move. So, we expect Harta, Supermx, TopGlove and Kossan  and few others going to move in this cycle, don't miss the party.

That's all for now. Happy Investing!