Sunday, June 28, 2009

Do Read : "It's not what stocks you buy, it's when you sell that counts" by Donald L.Cassidy

The more I read this book, the more I will want to recommend it to many to read. The many are those majority who do not like SELLING. SELL is a four-letter word. hehe

We could be selling for profits but the FEAR in us will be ... what-if the stocks move higher the next moment we sold it off?

We could be selling at our purchase price as we are uncertain about its next moves(up or down).

We could be selling at a loss as we FEAR that it might dive further down and we don't wish to 'catch' the knife.

Selling Resorts(GenM)

I have been following its movements for a year or so now. Let say you bought into it at 2.80(before it dived down) as it was hovering at 2.70-2.90 range for some time. You were targeting at 3.15 or so to sell ... but instead, market was turning around. The news that Resorts bought some losing-money chip company(US) hit the press, and its price naturally dives.

How come it dives down? Many reasons WHY investors were SELLING ... it continues to dive in daily basis(I caught some at 2.40 level) and only temporary halted at 2.20 level. I averaged it at 2.20(instead of SELLING!!). Tell me ... will you sell it at 2.40 or at 2.20 as you have bought at 2.80?? Isnt it too 'late' to sell at 2.20 level? You mean, you never place a stop-loss but only a higher target price to sell?

LL bought into Resorts at 2.30(knowing that I bought at 2.40) but when it dived to 2.20, she asked if she should hold on. I did not really want to make a commitment in answering. I will rather ask a person : May I know why you bought it in the first place? If you could hold, better still BUY more when it dives down, it will be OK. The price will quite certain to recover. That is all I said.

I have an average of 2.32 or so ... and sold it off at 2.40 level as it rebounded. But, then ... the diving session continued ... all the way down, broke support level at 2.15-2.20 ... and went below 2.00. That was the time JL 'appeared' in my trading life, and I asked him to monitor this very beautiful waterfall. It touched 1.80 level before rebounded. At 1.95-2.00 level, there is a BUY signal and I told JL about it. JL bought at 2.05 level but sold earlier at 2.20(resistance level). yes, SELLING at 2.20 is OK as planned. We never know if it could break that level. Once sold, I dont believe in looking back into it. I m more interested with the LESSONS.

Since the March rally, Resorts have been moving steadily up breaking LL's 2.30 purchasing level ... and all the way up to 2.90+. During last week pull-back, it went down to 2.60+ level. As you bought at 2.80 level(remember??), when will you sell again?? Remain at 3.15 level? Excuse me, do you know how many MONTHS your money NOT WORKING from 2.80 till now it has NOT reach your 3.15 target?? Err ... by the way, who place the RM3.15 target? Some broker houses?

This is something I find it amazing ... Many do not look beyond one or two counters. Many do not even know much about investment plans. But, they will still put their money inside ... KLSE's hole?

Lowest P/E

1. DRB-Hicom 1.49
2. Lion Ind 3.50
3. Tan Chong
4. Sunrise
5. Hap Seng

7. Boustead
8. Kulim
9. Scomi
10. BRDB 7.43

Highest Cash Per Share

1. YTLCorp 6.85
2. Oriental
3. DRB-Hicom
4. Tanjong
5. Puncak
6. Bursa
7. Genting
8. MAS
9. Proton
10. Selangor Properties 1.52

Highest Dividend Yield

1. MayBulk 11.76%
2. Zelan
3. Litrak
4. AnnJoo
5. TM
7. UchiTech
8. Tanjong
9. Boustead
10. UMW 6.78%

Foreign Shareholding

1. Gamuda 43%
2. IJMCorp
3. Genting
4. Commerz
5. Resorts
7. SPSetia
8. PBBank
9. IOICorp
10. Parkson 20.5%

Note : The data as at 3rd June 2009 and taken from "Malaysian Business". The highlighted are in my stalk list.


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