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Tuesday, December 29, 2009

The Breaking of 2nd Triangle

Just to let you know that KLCI has successfully breaking the second triangle, the first one was 2 weeks ago. If you read my previous post on breaking triangle formation, you should know what I'm talking about.


As you know, many technical analysis traders have identify that there is a head and shoulders found from the index chart on 2 weeks back. For me, I opposed them and I identify it as the 1st attempt of triangle breakout. On yesterday, it is the second triangle breakout, which mostly proven the bull trend is likely to be continued as what I expected earlier. Don't misunderstood me, I don't predict what is going to happen, but I just tell what the index chart tells me.

If you enter during these 2 days, congratulations, because these few days are the golden time to invest some strong growth companies, with the following 4 reasons:
(1) Most of the companies will be announcing 4Q09 financial result soon, starting from mid of Jan 10. Do enter early to grab a lower investment cost.
(2) The total company rising index is positive for 3 consecutive days, it has been negative for the past 3 months.
(3) Positive news from global market, especially from US.
(4) The global and Malaysia economy are recovering, the bull trend will continue to sustain for the coming year. It can tells from the BNM interest rate.

I foresee this second triangle breakout will have more 'power'. However, if it really falls down, we will need to wait for the third attempt.

Happy investing, folks.

Tuesday, December 22, 2009

Unit Trusts Investment

What do you know about Unit Trust? If you know how to make profit from stock market, does it mean you don't need unit trust anymore? Or what do you think about Unit Trust? Are you already investing it?


Well, for me, Unit Trust is for long term investment. It is lesser volatile and risk than stock market. Of course, with lesser risk and volatile, the gaining percentage will be lower than individual stock when the market is good, while the losing percentage will also lower. With such system, you won't able to see much profit in short term compare to individual stock, no matter how good the fund performance is.

So why we want to invest in Unit Trust then? Simple, with 4 main reasons that I can think of.

(1) Affordable
Yes, this is always the first reason people invest in Unit Trust. With minimum of RM1,000 in Malaysia, you can invest an Unit Trust fund. And with only RM100, you can do dollar-cost averaging twice or once a month. What an affordable investment!

(2) Lesser risk and volatile
When stock market tumble, the best performance funds will always out beat the index. For example, index falls for 40%, the fund might only falls for 30% or less. So there is no way for you to make a loss in long run, good return is guarantee.

(3) Consistent return without knowing what you invest
You don't have to study individual company annual report, wait for quarterly earnings or broker report, perhaps only fund quarter report. You just need to pick the top performance fund/s and follow a workable system, then you will guarantee get good return in long run.

(4) No monitoring required
You don't need to invest your time to monitor daily or weekly price. You just need to make sure the fund you investing is still the top fund and bring you great profit, that's it.

I noticed many unit trust agents are not professional at all. They don't know what they are selling and they just want to earn commission. I talked to few friends of mine, and I verified my findings is true. I'll try to help them, so they can improve their investment return.

The rule of thumb is, you have to know what you invest, and react when necessary.

Friday, December 18, 2009

Glove Maker II

If you refer to my previous post about my recommended glove maker companies, you should have notice how glove maker companies perform during these correction period. They are just too good to buy/hold.


All the glove makers share prices are rising steadily despite the index correction and most of the shares are falling. Why? It's just very simple. These companies just continue to make a lot of money, by improving the capacity, productivity and efficiency, with the extremely high global demand from the H1N1 pandemic outbreak.


Just confusing me is that, I suppose the leader like TopGlov or Harta should be rising the most. But unfortunately, the laggards are rising the most, because people just like to fry their share price, like Adventa and Latexx. Let's see how long they can last.

With TopGlov announced it's latest quarter profit of nearly 100% than previous year quarter, it prove the extremely strong demand is still there. I believe this will continue until the end of 2010, or perhaps H1N1 outbreak is completely over. May be before the end of H1N1, there is another outbreak require the supply of glove again? It is possible, folks.

In conclusion, I will continue to keep my glove maker stocks and let the profit running, while tightly monitoring their movement. I will also try to clear out some non-performing stocks at a better price, and enter additional lots in my favorite glove maker stock soon.

Happy investing.

Tuesday, December 15, 2009

Breaking of Triangle Formation

Did you see that? KLSE index finally breaking the triangle formation that I mentioned about in my previous post, before the market close today. It indicating the bull trend will be continued to serve the traders.


Not only that, quite a number of leader stocks in my list are also already breaking of their formations these few days, including CIMB, TopGlov, PbBank-01, etc.
On the other hand, analysts claimed that these 2 days bullish were due to the good news from Dubai. But in view of the dead fish trading volume and index from KLSE, it doesn't affecting KLCI much, perhaps only to LCL.

I would say it's time to re-enter the market and reap profit now. We just need to take note the low volume traded, because many traders and fund managers are going for vacation these few weeks. Since they are not throwing the share, what we waiting for?

Happy Investing.

Friday, December 11, 2009

Triangle Formation

How's your stock investment portfolio going on? Did you manage to enter Affin or Affin warrant this morning? After Hong Leong Bank acquisition news was firmer and released on yesterday, Affin price is reverberated from 50% retracement, a pretty 7-11% quick profit. If not because of the mid-term correction, I believe it will be even higher.

Just to share with you. When I analyzed the price charts just now, I surprisingly noticed some of the prices have formed a triangle formation and ready for breakout anytime, including KLSE index. The time frame is about less than 2 weeks time.

That's means, the breakout would be the end of bullish, or continue to bullish after the 2nd mid-term correction. This is interesting. Well, let's see what will happens within the next 2 weeks.

Happy investing.

Wednesday, December 9, 2009

Easy or Hard Trading?

The market seems flappy and negative these few weeks, especially after the Dubai World debts incident. Even though analysts and my opinion are still positive with the current stock market situation, it's just disappointed these few days. It's weak and it's quite hard to aim for the right stock to take profit.


However, if you aim at the right stock with right time, you still can make profit from existing KLCI. Just look at Faber, it rises more than 10% within these 3 correction days. This is really an outstanding stock to hold. But in fact, how many of us can spot the shinning star during this correction period?

What I try to mean is, if it is so difficult to trade and make a profit, just don't trade for the moment. Opportunity is always there, we just need to wait for the right timing to go in again.

Cheers.

Sunday, December 6, 2009

Gold Investment

Guess what, everyone is talking about gold investment now. The old folks are talking about to buy gold for keeping, the businessman is talking about gold investment, aunties and uncles are talking about invest into gold account from banks, and even some people are working on gold investment direct sales. It exists if you just name it!


Gold investment became a hot topic recently, just because the demand is very high, it's price has growing from US$680+ to US$1200+ within 14 months. The return is about 70%+. Well, I was thinking of invest a little bit on gold when it was about US$900+. Unfortunately, I cannot do it online via local bank like stock and I'm just lazy to go to bank to do such transaction, I missed the golden opportunity to have some pretty return in such a short run.


Now you should understand why Brunei Sultan used gold to build His mosque, palace & toilet?
So, what is the outlook for gold price now? So far it is sitting safely on the top of US$1,200, and all analysts foreseeing it will continue to climb up to US$2,000-3,000 within 1 to 2 years time. From my technical analysis point of view, I believe it is positive. The strong resistant point of US$1,000 already became strong support point for now. From my fundamental analysis point of view, the demand is far exceeding the supply in long run, and it is like oil, they are mineral and they will be finished one day, unless people discovered something new and give up on them.

In summary, according to the past history analysis, I believe it is worth to invest in gold for long run, even it is at US$1,200 level. If you have excess money, it's good to diversify your investment and part some funds into gold.

Happy investing.

Tuesday, December 1, 2009

KLSE Will Continue to Up or Down?

Hi folks, is it consider quite okay that KLCI opened with 20 points lower and ended with 11.5 points lower on yesterday? Even though all analysts and experts clarified Dubai debts have nothing to do with KLCI, but most of the investors are worry and simply sell off their shares in a low price. This is what we called stock market, it totally acts based on emotion!

My stock portfolio profit simply gone down 30% in 1 day, how fragile it is. Okay, let's forget about my portfolio at this moment. With the index breaking of 30-days moving average and almost touching 50-days moving average, is it indicating the bull trend is ended?


I heard all analysts and experts reiterated mention that the bull trend is not end yet, and the selling pressure is not really heavy, KLCI is just temporary under correction. On the other hand, many investors thinking if they don't take profit or cut loss now, when it will be?

In my opinion, I believe the bull trend is still exist for KLCI, due to the followings:
(1) Index is still above SMA50, and the selling pressure is alleviated today.
(2) The global index are still positive. For me, KLCI is just a laggard index, and it will normally follows what people do.
(3) Most of the local companies are starting to turn loss into profit, some even making more money for 3Q09. It's just the beginning of the game, you don't tell me you are going to quit it for now?


But I don't anticipate index will shoot back to 1300 so soon, due to some reasons, which I might share with you next time. Be patient, folks, we are not looking for fast money here.

Happy trading. ;)

Friday, November 27, 2009

The Failure of Dubai World

Okay, we are experiencing a Black Friday today, with the index falling of 2-5% in a single day over the world stock markets. US and Malaysia are lucky because they are enjoying holiday today without any trading.

The bad index falling was due to after a proposal from the magnificent, Dubai to delay debt payments set off a slide in stocks and higher-yielding assets worldwide. The news was not only impact the stock slide, but also currency slide. The serious slide over the months. From reliable source, not only Dubai has financial crisis of owing USD60 billions.

The worst company affected would be the bank which was the underwriter of loans to Dubai World. The unlucky one would be Rotal Bank of Scotland Group(RBS), while Hong Kong Shanghai Bank Holdings (HSBC) has the most at risk in the United Arab Emirates. HSBC Holdings share was closed with -7.6% in Hong Kong stock exchange today. What a tragedy.

Well, we will handle our KLSE fate to US stock market on today. We definitely cannot avoid index and banks share price falling sharply on coming Monday, but we keep our finger cross and see is there any positive news from US stock market. If we look from another perspective, perhaps it's time to hunt and pick up lower price leader stock on coming Tuesday?

Happy trading, folks.

Wednesday, November 25, 2009

Proton

After a long from RM2.70 to RM4.50 on few months back, I foreseeing Proton will be back in action again. As a result, I forced myself to enter 1.5 lots into my trading portfolio before closing on yesterday at RM3.73.

I decided to invest on Proton on yesterday evening due to 3 main reasons as below:

(1) The share price has been retraced up to 50% and rested for 2 months, it's time for it to soar back to what it suppose to be.
(2) All technical analysis indicators show "buy" signal.
(3) A very good news on earning of 87% quarter net profit, together with previous quarter of earning profit. This should be able to attract many investors to boost up it's share price.

I couldn't think of even 1 reason not to enter Proton. Can you? Anyway, since I'm driving Proton and I really don't like this product, I plan to hold it for short-term and my minimum profit target will be between RM4.20 and RM4.60. Let's see.

Saturday, November 21, 2009

Is Mid-term Correction Around The Corner?

After the KLSE index has been bullish for about 65% from the highest point, everyone is worry about the current situation now. Will it continue to bullish or facing mid-term correction soon?

Basically there are 6 strong hints that KLSE will be facing a mid-term correction.
(1) KLSE index has been raised up to 65%, it should be correcting around 50-65% retracement. The index has been facing difficulty to move further since financial budget announcement in the end of last month. It solely rely on external market to move now.
(2) The top 20 volumes stocks are mostly formed by penny, warrant and PN17. This indicating the blue chips and small-cap stocks are too expensive for investors already. Once the penny/PN17/warrant stocks are expensive for them, you can imagine already what will be next?
(3) The average of price falling company are greater than the price rising company since mid of last month. This is normally the symptom before the bearish trend or mid-term correction.
(4) Foreign investors are started to retreat their funds from the growth stocks, which has reach the new high of the year everyday. Without the support of foreign investments, who else afford to do so?
(5) The most attention company, Maxis on board also seems couldn't alleviate the situation.
(6) Most of the companies announcement are positive for the 3rd quarters, but most of the investors are not excited with the positive news. Those company share prices are mostly fall than rise.

My analysis might be wrong, the only strong hint I'm lack of, is the volume. Once the volume is shooting up, then it's time for us to cut loss and take profit soonest. Anyway, just remember one thing. When everyone is fear, it's time for you to be greedy and attack. When everyone is greedy, it's time for you to fear and retreat.

Happy investing.

Monday, November 16, 2009

MAXIS Onboard on Coming Thursday

Good news, MAXIS will be onboard at KLSE on coming Thursday.

According to the news, the final price is RM4.75. This is a really attractive price to buy at. Why I recommended so? Maxis Berhad basically is a 2nd largest telecommunication company in Malaysia, which is below Digi Berhad. Imagine Digi share price is already above RM20. This is amazing in the first place if Maxis able to increase it's earning per share dramatically within few quarters and years.


Apart from potential earnings, Maxis has the ability to maintain a generous dividend payout to its shareholders, and emerge from the slowing growth in the domestic telecommunication market via strong data revenues. Besides, Maxis retail IPO also over subscribed of 200% from the investors, and it has been paying attention from the whole country investors, as well as foreign investors.

In summary, with a higher dividend payouts and a strong earnings, Maxis is definitely a strong growth company to invest to.


I foresee the price will shoot up to sky high in the first day, and it will slight correct in the following days. My strategy will be enter 1.5 lot below RM5 in the 1st day when it opens, and enter 1 lot after few days of correction, around RM4-RM4.75. Nonetheless, I'll need to see how the investor reaction to play this game.

Happy investing.

Friday, November 13, 2009

Is Global Economic Panic Over?

Today we finally heard from the world's two richest men said.

NEWS < "The financial panic is behind us," said Warren Buffett, who recently made what he called an "all-in wager" on the U.S. economy by acquiring railroad Burlington Northern Santa Fe. "The bottom has come in stocks. Don't pass on something that's attractive today."

Sitting facing each other in an auditorium filled with nearly 1,000 cheering people at Columbia University in New York, the CEO of Berkshire Hathaway Inc. and Microsoft founder Bill Gates fielded questions from Columbia Business School students on the recession, investing and what's the next Microsoft.

The worst recession since the 1930s may be over, but the recovery isn't expected to be strong enough to stem job losses and get businesses hiring again. And the unemployment rate jumped last month to 10.2 percent, a 26-year high.

Students in the audience said they were glad the two were so confident about the economy.

"That probably weighs a lot to a lot of people to hear Buffett say we're out of the crisis," said Andrea Basche, an Earth Institute student at Columbia. >

So, what you waiting for? Invest in stock market today!



Saturday, November 7, 2009

Glove Makers

Have you feel the strong growth of glove makers?

Yes, the glove marker companies are just too strong and their bullish are never-ending since early of this year. You may notice their quarterly financial result and this year financial result are totally beyond expectation. Thanks to H1N1-driven of the high demand from the globe.

Well, if you would like to look into which has the best potential to grow in terms of profit and share price, try look at Hartalega and Supermx.

Hartalega is the most efficient, lowest production cost and fastest growth in terms of capacity and profit among all the glove makers in Malaysia. Imagine it just listed on 2008 and it can shoot up to RM5.40 in just 2 years time. Definitely this company can run higher with it's best fit situation.

For Supermx, it is a good buy because it has settled it's most serious problem, debts. And now it can fully concentrate on increase capacity with new plant and production lines, efficiency in terms of production, and lower the production costs. Apparently it has started to increase efficiency and lower the production costs practice since early of this year. And it's share price as been risen from the bottom of RM2.45 to RM3.50. If not due to the retreat of the Lembaga Tabung Haji, it's stock price has already maintain above RM4.00. We will see how this stock soars very soon.

I believe H1N1 will still continue on 2010, and the glove demand is still there. So let's anticipate this 2 strong growth companies share price to shoot up to RM6.30 within 4Q09 and 1Q10. Well, they are just my personal research and findings, as there are no guarantee to win in stock market. But we have a higher probability here with the correct strategy to invest.

Happy investing.

Friday, November 6, 2009

The Myth of Laggard Stocks

Interested to buy those high volume penny stock because of their quick and high return?

Yes indeed they are very interesting to buy. But, did you think about their risks and their volatility before? You will face problem when there is something wrong with the stock. Such as the news below. Take care.

Bursa Malaysia Securities has issued a unusual market activity (UMA) query on Green Packet and RedTone following a sharp rise in price and volume of their shares recently.

Green Packet shares fell three sen to RM1.46 and the warrants six sen down to 95 sen at 11.39am. The warrants were actively traded with 41.7 million units done.

RedTone added 1.5 sen to 43 sen with 35.9 million shares done.

Friday, August 7, 2009

What is Investing?

Investing is the proactive use of your money to make more money or, to say it another way, it is your money working for you.

Investing is different from saving. Saving is a passive activity, even though it uses the same principle of compounding. Saving is more focused on safety of principal (the amount you start out with) and less concerned with return.

Your focus in investing is on return and can run the spectrum from conservative to very aggressive in terms of risk. One way you measure results is by the expected return weighed against the anticipated risks.
It is easy to slip into an unnecessarily complex discussion about whether a particular financial transaction was an investment or a savings deposit. However, it is important to understand that investing has some distinctive characteristics, which separate it from pure savings. Since we are discussing stocks, I’ll limit the characteristics to that type of investment:
  • Ownership
  • Upside Potential
  • Risk
Each of these characteristics sets investing in stocks apart from savings in several different ways.

Ownership

When you buy stock, you are buying a piece of a company – you become a part owner. This ownership gives you certain rights, including voting on important matters before the company and participating in the profits if the company distributes dividends.
Virtually no savings instruments give you ownership. You may own a bank CD, but you don’t own part of the bank. You may own a U.S. Treasury bond, but you don’t own the government.

Upside Potential

When you own stock, you participate in the growth of the company. As the value of the company increases, so does you investment. If profits increase, you may receive bigger dividend checks. The stock price may continue to rise for a long period. Many of the early employees of Microsoft are millionaires because their stock has gone up dramatically.

If you have a bank CD that pays 3%, it is unlikely the bank’s president is going to call you one day and say, ‘we’ve had a great year, so I’m raising your interest rate to 6%.’

Risk

Along with the potential for extraordinary gain is the potential for loss. These two go hand in hand. You can lose money investing in stocks.

If the thought of losing money makes your stomach knot up, stick to savings instruments. However, you should know that even the safest savings instrument carries unseen risks. Most savings instruments trade security for return, meaning they pay very little. When you factor in inflation and taxes, many so-called safe savings instruments return almost nothing and some can actually lose ground.

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