Showing posts with label KLSE. Show all posts
Showing posts with label KLSE. Show all posts

Sunday, 17 January 2016

A(nother) market turmoil

Recently, another market turmoil has emerged. Major overseas market are having big drops. Well, except KLSE.

This time, apparently sparked by a plunge in crude oil price and fears about Chinese economy growth, has the overseas stock market to drop 2-3%, literally every second day. Chinese economy growth problem? Really?

Brent crude oil: Looking back only to realise that oil really start to drop since 2H 2014. And it drop really quickly. I thought it would stop at around USD 40/barrel, but the market always surprises you. I has now come down to below USD 30/barrel. The financial market is interesting: the crude oil price has rarely gained any considerable attention in the past, and it is now ubiquitous on the media.

(Print-screened from Bloomberg)

NASDAQ: I have a dream of NASDAQ to shot up to 10000 points in coming years for another round of technology bubble. But it now looks like an impossible task?


(Print-screened from Indexq.org)

DAX is literally dropping 2-3%+ every second day for the past week!


NIKKEI is literally dropping every second day too.


On the other hand, KLSE is like a heaven, completely oblivious to what is happening globally. Magic always happens in Malaysia, going along with the phrase "Malaysia Boleh".

KLSE

The last "noticeable" adjustment occurred in Aug 2015, coming with no signal (at all). In less than six months, another round is coming. Frankly, no one can stand seeing stocks dropping to such an extent every second day, let alone that the bearish market has yet to be confirmed.

I am wondering, the market hasn't even drop for 20% and the market sentiment is already so negative, what if something worse is yet to come?

I would like to see if this would turn out to be another adjustment.

Tuesday, 8 December 2015

KL: The consequence of betting on quarterly report

This article was written entirely based on experience.

I like to bet on quarterly financial reports. The idea is simple. At the end of every month (esp. Feb, May, Aug and Nov) is the due date for companies to announce their quarterly reports. I like to buy in few weeks before the report was announced, such that if the report is good, the share will jump, snapping potential profit in short time.

However, this method of "playing" stocks seems to be tumbling this year. For whatever company that I bet on a good report, the opposite happened: share plunged after the reported was announced, causing losses.

PRIVA is the first example. I accumulated this counter in the beginning of May.  That is very naive of me. The result was announced on 28-5-2015 and it was a normal one, with a profit slightly less than the year-to-year quarter. On the next trading day, the share dropped 8%+. I cut loss not long after that. This has cost me 27% in less than 1 month.

The second experience is SIGN. This was mentioned before in a mistake on SIGN.  Because SIGN is an export counter, I was hoping that with the depreciation of MYR, I could profit from a good financial report.

SIGN is much more extreme. The very same thing happened twice! In Aug, the share plunged nearly 15% on the next day after the announcement. I lost the bet which cost me 25% in 2 weeks.

Not long after that, the share went up to the level before the announcement of Aug report. This gives an impression that the company is doing good in the coming quarter. However, the report which was announced at the end of Nov wasn't good as all. On the next day, SIGN plunged 15% for the second time.



SIGN drop after financial report


The third is GOB.

Prior to the announcement, the share has a big white candle, which of course I am very happy. I entranced in my own aspirations, as I always do. Then the company reported a loss. The next day GOB dropped 8.8%. This cost me to vomit out all profit.


GOB dropped after financial report


These examples may just be the tip on the iceberg. From these examples, it seemed that buying just before the quarterly report is no longer working, at least for small-cap companies. Looking at this trend, somewhere, someone seems to have the seer-like ability to predict in advanced.

Maybe there isn't any conspiracy theory, the company really wasn't performing.

Maybe there is a conspiracy theory, that the company manipulated the fiscal report such that a bad result was portrayed to wash out retail investors. If this is true, does it imply that holding a share for more than 3 months is not a good idea?

A very interesting trend is unfolding in KLSE.

Wednesday, 25 November 2015

KL: Aiming Solution Engineering

Solution Engineering (KLSE: SOLUTN) is a listed company in Bursa Malaysia. The company manufactures laboratory-scale equipment for (tertiary) education and research purposes. The product covers a wide range of research field, including heat transfer, separation processes, process control etc.

I understand that a number of universities purchase their lab-scale equipment from this company, both local and overseas university. University of Malaya is an example. When I did my bachelor and saw the company logo on the lab-scale equipment, I did a brief study on it. At that time the company was losing money continuously, so I have little interest in it. Had it not because of "Cold Eye" (an investment expert in Malaysia) who accumulated this counter, I believe it will continue to remain undiscovered. He now owns 4.92% of company share, which is just shy of the 5% where the investor is required to report to Bursa Malaysia as a substantial shareholder.

Last week, the share jumped with high volume followed by low volume adjustment. I noticed it has the typical movement that I was looking for, similar to INARI not long ago.



The steps are the same:

1. Price soared with high volume
2. Adjustment with low volume
3. Buy in

As simple as that.

During the adjustment process, the lowest traded price will usually be higher than the price before soaring (i.e., RM 0.395 in this case). However, yesterday it has gone down to RM 0.390. I would like to observe for a few more days before making a decision.

Saturday, 10 October 2015

2015 Q3 Review

KLCI has not been performing well for this quarter. It took a roller-coaster ride to drop continuously in August before it finally rebounded in September. This round of adjustment is worse than Oct and Dec 2014, probably similar to Aug 2011 in terms of magnitude and pattern.

The Oct 2014 experience which cost me to vomit out everything is still lingering. Perhaps because of this, I have learnt from the past and "escaped" relatively unscathed in this adjustment.

On the bad side, I bought back SIGN not long after selling it.

On the good side, I bought MYEG-CK @ RM 0.055 in the morning of 25 Aug -- the lowest point of adjustment when KLCI was touching 1503. It wasn't an easy decision. The famous market quote of "buying fear, selling greed" is easier said than done. Seeing KLCI dropping everyday, it is tough to do the opposite. But if you have the confidence to do the opposite, the return can be very rewarding in a very short time.

The biggest lesson to learn from this big drop is to walk off after selling. My emotion remains wavering after selling. Making decision under this condition does not do me any good. If I could just walk off for 1-2 weeks after selling, things would have been much better now.

Past experience offers a chance to improve in the future. And this is a very good experience for me but to learn to walk off next time or history is destined to repeat itself.

Thursday, 24 September 2015

KL: A mistake on SIGN

I bought in SIGN in early July based on a friend's recommendation. During August (when KLCI was dropping everyday, literally), I did learn from the past to take profit on 7 Aug @ RM3.00 -- the second day of big drop. This is an exceptional decision -- the selling price is within 10% from the high of RM 3.27.

I was very happy at first. But then seeing the stock continue to go down, I tried to "catch low", hoping that the stock would rebound soon. This is a common error people make: catching low. Another reason is the thought of betting on the August financial report. I was thinking that by benefiting from the depreciation of MYR, export counters should be doing well.

I bought back on 12 Aug (it was just 3 trading days after I sold!), wishing to earn for a second round. Although suffering from unrealized losses straight after buying, I hold on to the optimistic side of a beautiful fiscal report -- another common error people make: take chances. The financial report was released on 27 Aug and it was bad. SIGN dropped 15% on the next trading day. Not only I "vomit out" all profit in the first round of trading, I incurred a further loss.


SIGNATURE INTERNATIONAL BHD


Buying back just after 3 days of selling is really unnecessary.  This decision has cost me an arm and a leg this time. I took one step forward (took profit), but then I took another step backward (bought back) to the origin. Perhaps  I should never look back to stock after selling.

Sunday, 13 September 2015

KL: the rise of put warrants in KLSE

Index call and put warrants (FBMKLCI-CX and FBMKLCI-HX) have been a hot topic for discussion lately. Opening the trading platform, you see that FBMKLCI-H and FBMKLCI-C warrants are trading in the top volume, literally everyday.

This is something that has never happened before in KLSE. Usually you only see penny stocks appearing in the top volume section. Now the game has clearly changed. It has already gone insane until the stage that when KLCI rises, you will even see put warrant to go up and call warrant to go down; and vice versa.

As far as I could remember, call warrants started to gain public acceptance around 2006. Back then, put warrant does not exist in KLSE. According to this website, it wasn't until 2010-2011 that the first index put warrant FBMKLCI-HA was issued (apparently by OSK?). But this put warrant was born in unlucky time of bull period and ended up worthless.

Then, FBMKLCI-HB was issued by CIMB in July 2014. It became the spotlight in KLSE during the big drop in Oct 2014. And because of that, put warrants are mushroomed by investment banks. To date, the latest put warrant is FBMKLCI-H9: more than 30 index put warrants were issued in less than 1 year. This is unprecedented and extraordinary

After all this time, I would say that the late 2014 to 2015 is where put warrants have gained the public awareness.  This is good, investors know that now they can trade the index or stocks in both ways. However, I do doubt if now is a good time to trade put warrants: everyday in the top volume has already made me lost interest, what more to say when these warrants are extremely overvalued now?

Wednesday, 19 August 2015

KL: PRIVA rebound catching

Catching a rebound requires more than bravery. It requires the correct timing, the confidence to buy, the calmness to hold and the resolution to cut loss should the stock keep falling down.

I queued PRIVA @ 0.195 early in the morning, when the queue was 0.200 best buy and 0.205 best sell. Soon after the market opened, I saw KLCI "waterfall-ed" again and immediately wanted to cancel my order. But before I clicked on the "cancel order" button, the transaction was matched.


PRIVA rebound

Soon after that, the best sell became 0.195 in no time.

Soon after that, the last done price was 0.190.

Soon after that, the best sell become 0.190 and the best buy was 0.185.

This implies an immediately loss and is not a good feeling at all. It was tough to hold the counter in that situation, especially when KLCI has been plunging continuously. My confidence is certainly shaken right after buying. I decided to observe first and closed my trading platform. Until now, so far so good.

While PRIVA is not a 5-star stock (my basic requirement to catch a rebound), being a technology stock and a price of < 0.200 makes me irresistible. I target a return of at least 50% in short time.

Sunday, 2 August 2015

KL: KLCI technical analysis

KLCI is really weak recently. Trying to earn money from KLCI lately has been challenging. Regardless of what shares you are trading, the index is still the most important benchmark in KLSE as it determines the general trend of the market. How is it doing? Let's examine this from the monthly, weekly and daily charts.

1. Monthly chart:

KLCI monthly chart

Monthly chart does not look good. MACD and stochastic are heading negative. The last candle, July 2015, was primarily due to the last trading day where KLCI was pulled up by 23 points. Was this a sign just to draw a "nice" chart or is it that KLCI is ready to go? It has 3 black candles followed by one white candle where similar trends have been observed in 2008 and 2011. While 2008 was a real bear, 2011 was an adjustment. Which way will it go this time?  Only time can tell. 

2. Weekly chart:

KLCI weekly chart

Weekly chart looks a bit nicer. The chart looks like forming a double bottom. All MACD, RSI and stochastic seems to recover from the bottom. However, no sign of strength was observed.

3. Daily chart:


Daily chart cannot tell much. Chart shows KLCI seems to have "triple bottom" recently. MACD, RSI and stochastic are heading positive, but the trend in daily chart can change very abruptly.

A lot of rumours say that if the PM were to step down, it will lead to political instability and chaos (as in the stock market) would ensue. I couldn't be bother about this factor. Partly because I don't think he will step down; and partly also because who knows which way will the stock market go if he really steps down?

While a number of investors do not look good on the current market, I still yet to spot a "madness" in the stock market. After all, standing at 1723 is less than a 10% drop from the peak of 1890+. Is that really bad? But perhaps the drop occurs successively due to the involatility of the KLCI, it felt as if the drop has been long and significant. My view is that while bear has not yet formed, the chance of "final bull" remains unclear. The way to deal with this is as always: prudent investment involving good fundamental stock.

Saturday, 4 July 2015

News by media, view by myself (part 3)

Example 3: Index -- KLCI

This example is interesting.

Prior to 30th Jun 2015, there were rumours about a possibility of downgrade in Malaysia credit rating by Fitch. First the earliest rumour was during March published in Bloomborg: Fitch Sees More Than 50% Odds of Malaysia Downgrade on 1MDB. Since then, KLCI has been declining continuously.

Next, the "drama" has come to the point where a review will be completed by the end of June. When the due date is approaching, more negatives news about a possible downgrade since 1998 were released, causing fears in the market sentiment.

Now the review outcome was announced. As reported in The Edge, Fitch has maintained Malaysia rating at A- and upgraded the outlook from "negative" to "stable". This is in sharp contrast to the market's expectation.

What now? What did the news tell you prior to the outcome? The coverage was all about a high possibility of downgrade. What will you do if you trust the media? Knowing that the stock market would plummet, you would sell all, hold cash or buy put warrant. However what actually happened was on 1st July 2015, KLCI gained more than 20 points, something that you don't see for at least 6 months. 

What about myself? I don't buy any of this news. Think about this:

1. If they really want to downgrade, will they let you know in advance so that you have time to sell? Frankly, although Malaysia is a "commonwealth" country, but "wealth" is not meant to be "common" in reality.

2. Even if there will be a downgrade, provided that the media were covering this, the effect would have been "adsorbed" by the market since then, and the opposite trend may happen just like the case of AUD:USD.

3. Seriously, who cares about Malaysia rating? Perhaps they couldn't care less about this.

This comes from experience though. After reading all rumours, I recalled what happened in August 2011 where US was downgraded without any preceding news. That did cause a small bear in the global market. You will have no time to sell should there be a “real downgrade". This is why I know there would be no downgrade. However I did not dare to all in when the market dropped, but this is still better than previously where I just followed other people to panic sell.

[to be continued]

Friday, 19 June 2015

News by media, view by myself (part 1)

It is interesting to see how media influences the market sentiment, by "releasing" a particular news "just at the right time". The original purpose of media is to disseminate news to the public. While this may still be true at some time, financial news are highly manipulated. Here are some examples:

Example 1: Stock -- IFCAMSC
(this stock is too hot to ignore, and yea... everything written here and now is in hindsight..again)

This stock was crowned "The world's top software stock"(Bloomberg!) by having a 1321% return in just 12 months. The date of the news was 13 April 2015, trading at RM 1.35. The stock topped at RM 1.87 on 21 May 2015, just over 1 month after the news was released. Now it was trading at RM 1.13.



Something worth noting is that 21 May 2015 is the day just after the release of quarterly report, that the profit jumped 22x YoY. Because of the implementation of GST in April 2015, everybody knows that it is going to be a promising quarter. Yes, it is. And everybody just hoping that it will either gap up, or at least increase a lot after the quarter report. The opposite has happened. In the stock market, things just wouldn't go the way you think it would when everybody else thinks the same. 

Retrospectively, the message given by the media is obvious: the world best performing stock, luring investors to buy the stock. "They" want you to buy the stock, as if there is still a huge return waiting ahead.

My own view: sell on news. Think about this: can the "best performing tech stock" not listed in NASDAQ, London, Hong Kong or Tokyo but listed in KLSE? Why did the news released in April, not any other time? The stock has been climbing for sometime since last year, this is not a coincidence.

[to be continued]

Saturday, 23 May 2015

KLSE: VSOLAR-WA with a negative premium that is too good to be true

Is a warrant trading at a premium of -25% sounds too good to be true? It probably is.

VSOLAR-WA was trading at a premium of -25%. This implies that one could earn 25% by simply buying the warrant and converting it to the mother share, with the condition that the mother share price remains unchanged. A few years in KLSE, I can still see new things by now, how exciting is the stock market?

How can I come to know this stock? Well it occupied a conspicuous spot in the trading platform -- most actively traded counter. While a negative premium is certainly "attractive", let's have a glance at its financial summary first:

VSOLAR financial summary
Financial summary for VSOLAR (Source: Malaysiastock.biz)

As you can see, this company has no fundamental and it is not making any profit. The table below details the price of both VSOLAR and VSOLAR-WA with its premium, and how the negative premium "quickly vanished", turning into positive premium. (Historical price obtained from KLSE.my)

Date VSOLAR VSOLAR-WA Premium
22-4-2015 0.380 0.165 -25.0%
23-4-2015 0.340 0.150 -20.6%
24-4-2015 0.360 0.145 -26.3%
27-4-2015 0.305 0.140 -13.1%
28-4-2015 0.250 0.110 -8.0%
29-4-2015 0.255 0.115 -7.8%
30-4-2015 0.255 0.110 -9.8%
5-5-2015 0.260 0.110 -11.5%
6-5-2015 0.210 0.090 0%
7-5-2015 0.205 0.085 0%
8-5-2015 0.210 0.080 -4.8%
11-5-2015 0.170 0.070 11.8%
12-5-2015 0.155 0.065 19.4%
13-5-2015 0.155 0.075 25.8%
14-5-2015 0.155 0.070 22.6%
15-5-2015 0.145 0.070 31.0%

What is left now? Nothing. If there is no improvement in the fundamental of this company, I do not think the price will go up in the "foreseeable future".

You may want to ask: why does this happen? The big fish wanted to sell the shares. Making the warrant to have a negative premium is very easy to attract people to buy, because everyone is hoping that the warrant will "catch up" with the mother share to its reasonable price. Obviously the opposite happened in this case.

While everything written here is in hindsight, I did not touch this stock though. The purpose of writing this is to alert fellow investors and not to fall into this trap in the future.

Saturday, 16 May 2015

NYSE & NASDAQ: what are GAAP and non-GAAP profits?

As a newbie in the US stock market, a first sight at a financial report will often baffle at "GAAP profit" and "non-GAAP profit". What are they?

To start with, Yahoo finance offers a very convenient avenue of looking at the earning release of listed companies in the US. The date and time of the release of the fiscal report are clearly stated (as opposed to KLSE in which you really don't know when will it be released but within 2 months from the quarter end).

For example, this is the Q1 earning of TESLA (NASDAQ: TSLA). 8-K form is the name of form that contains financial results.

TESLA 2015 Q1 Earnings

GAAP stands for Generally Accepted Accounting Principles. It is the standard norms of how companies should present their earnings in NYSE and NASDAQ. In a simple way, what we see on the balance sheet is based on the GAAP profit, i.e. the common way of reporting profit.

However, a company may write-down an asset or restructure its organisation. These actions usually come with large one-time cost that may not be truly reflected in the GAAP profit. As such, a company will also provide “adjusted” earning figures that excludes these nonrecurring items. These effect, usually is one-off, will be regarded in the non-GAAP profit. And because of this, I personally think that it will more accurately reflects the company's performance.

The balance sheet of TESLA:



We see that a GAAP net loss -$ 154 M or $-1.22/share was incurred according to the conventional way of account reporting. After considering compensation expense, non-cash interest expense and deferred profit, its actual net loss is only -$ 45 M or $ 0.36/share, which is significantly less than the GAAP standard way of reporting.

The above exemplifies the use of non-GAAP reporting to account for a more accurate earning which truly reflects the company's performance. There are good and bad with both measures of reporting in the sense that the report could be manipulated to favour the desired outcome. Which one to look at is then completely up to your discretion.

Friday, 8 May 2015

KLSE: INARI-CA, a "successful" trade

Following the recent failed short term trade, maybe I should also write some "successful" transactions.

If AWC made myself stumbling, then INARI-CA could at least offer me some condolences. It was the "secret weapon" that I bet on for the recovery of my capital since Oct 2014. Never happen before that I will buy call warrant "in quantity", after realizing how much opportunity I have lost since then.

At first I was really reluctant to sell -- want to earn more. But the imminent expiry date (the last trading day was 30 Apr 2015) makes me worried and decided to sell a few weeks before expiry. In the end INARI-CA expired at RM 0.090. I cannot imagine the "what if"? Glad that I have overcome my own "mental blockage" to sell a share.

Perhaps SHH can give me another comfort, that I am actually learning to sell a share at good timing. It is trading at about RM 1.20 at the moment. Again, what if?

What if it soars after selling? Let it be. Maybe I buy another share that has better return?
What if it drops after selling? Then no worries.

Saturday, 11 April 2015

About long term investment

This is my 5th year of involvement in KLSE. While surviving KLSE in this period is nothing more than ordinary, I am still glad that I have made it, with a capital growing at a satisfactory rate.

In retrospect, the way I "handle" KLSE is by intraday, short term (<6 months) and medium term (<3 years) tradings.

Intraday tradings were extremely rare, simply because the energy and time spent is too much to bear. Some examples, MAS and CYBERT(don't learn this). All have gone to holland by now.

Short term (<6 months) trading is something that I prefer more. INGRESS, SBCCORP and PRLEXUS are typical examples. Mostly use chart to look for entry price, seeking a return of 10-30% in less than 3 months. Sporadically, there will be chances to earn "fast money" in a few days, i.e. playing rebound, e.g.  PHARMA and TAKAFUL. When this occurs, if you are bold enough, ALL IN.

Medium term (>6 months <3 years) can be torturous at times. But good things come to those who wait. INARI, PNEPCB and SHH are my old buddy now. Return has been very satisfactory. 6 months - 2 years is a period that I am more comfortably to hold a share, because they always end up good return.

Where is my long term investment?

I understand that my current investment style will not last long. When the capital becomes large, so does the stake. At some point, I will like to invest long term -- in the sense to hold a share for at least 3 years.  This is where your "skill" is tested, to see how well you can spot a good counter, as if PBBANK and GENTING in the 1980s, DIGI in the 2000s and DLADY in the 2010s. What type of companies should I look for long term investment?

Are they companies that I really like? For this, I look no further from AirAsia and AAX. It is the airline that enables me to fly between PEN-KUL and KUL-SYD. But sentiment cannot help making decision in the stock market. AirAsia has been dropping for a while, since it hit a top of RM 4.00 in 2012. If you buy AAX since IPO and hold until now then you would have lost a lot. Perhaps there are just too many uncertainties in the airline industry.

Are they companies that I don't like to involve as an individual? This means health care and pharmaceutical industry. Nobody likes to go to hospital, yet everybody needs to go there at some point. Examples include KPJ, PHARMA and IHH.

How about companies that are needed in daily lives? Consumer products. NESTLE, DLADY and others.

At this stage I wouldn't buy any of these securities. I don't look for long term investment now. Long term investment does not make sense to me if the capital is not big enough, e.g. RM 500k. Until then, I can use a portion of this capital to invest "long-term". For now, the first task is still to grow my capital, which is what I have been doing for 5 years.

Saturday, 25 October 2014

Global market adjustment, what am I doing? (2)

In one week time, things can change dramatically. The things that I hold so tight to previously, all gone in a few days. It was so near to me, yet it is now far away from me.

Ironically, I told myself that my target price is RM 2.70 for INARI before. When it reached that price, I didn't sell.

Ironically, I sold some shares at RM 3.18 before, which at that time it went to a high of ~RM 3.30+, which I thought that I've sold it at a low price. Seriously? What happen to me, that I still crave to sell at the highest point? The tighter you cling to something, the faster it is going away from you.

It has been so ironic to me, that my final selling price is not even my target price previously. Even worse, this is not the first time I experience this (see here).

I also panic sell GHLSYS at the same day. It now seems so stupid of me, that I could have had a return of 30% a few days ago before I sold, and now it became 3%.

What am I doing? The market has not adjusted for sometime, and I indulge myself to this kind of situation, to have 100% shares at ALL TIME, thinking to grab every single cent from the market.

What am I doing? I take things for granted, as if I should always be making profit, although past experiences have taught me not to (never) take things for granted.

What am I doing? I did not let my capital to rest for even a single day. I let them to subject to the daily market fluctuation, watching the portfolio rise and down, until I lost myself.

What am I doing? This experience is similar to May-Aug 2013, of which I've written some reviews in Jan 2014. I was vindictive last year, which has cost me even more, so now I decided to rest for sometime. 

[to be continued]



Monday, 20 October 2014

Global market adjustment, what am I doing? (1)

Global markets drops consecutively in two weeks ago. As usual, Asian markets will follow the trend of western markets.  I believe these two weeks has been a turmoil for a number of investors. Unfortunately, I have to admit that I am one of them.

The first day was 7 Oct 2014.


I use the term adjustment, because at this point it is sure that this is an adjustment since KLCI index drop far below its 200MA, i.e. year line. I don't know if it is a bear or not at this point.


Small and medium capital shares adjust really a lot. In just a few days time, my buddy INARI has drop more than 30%. 



My profit has evaporated significantly. This is what happen to INARI price, and how my feeling is manipulated by the market all these days.







7-10-2014: First day drop, no feeling at all. Not even thought of selling.



8-10-2014: First day GAP DOWN, continue holding, hoping it to get back. I told myself
that if the coming rebound has no volume, I will sell it.


9-10-2014: Small rebound. It happened that this rebound did not have the volume I expected. 
Yet I convinced myself to hold. Why? I am longing it to get back to its 
"normal" position that it used to be, i.e. above RM 3.20. (mistake 1)

10-10-2014:  Second day GAP DOWN. It is painful, terribly painful. One day of plunge
can get back to the price which is 4 months ago, i.e. if I sell now, I lost 4 months of

opportunity cost. I am still too proud to lose at this point.

13-10-2014: Third day GAP DOWN. Horrible sell off. Price went back to 7 months ago.
I can assure you that seeing your profit evaporate day by day is an extreme 
agony. 



14-10-2014: Fourth day GAP DOWN, cannot tahan (stand) anymore, SELL ALL. (mistake 2)


15-10-2014: Continue going down, totally out of my expectation. Of course I felt
fortunate that I've sold it yesterday.


16-10-2014: Fifth day GAP DOWN. A total drop of 35%+ from 3.18 to today's low.
All happen in 1 week time. The opening price is RM 2.04.

Even though I know that this is a bargain price;
Even though I know that technically, the price is completely out of BB lower band 
(i.e. a rebound is very soon);
Even though I know that it will not continue to gap down everyday; 
Yet the emotional fear has stopped me from buying. I am too scared to buy in.

I guess this gives me a taste of bearish market,
that no matter how low the price is;
that previously you've thought that you would have bought in (probably all in?) at this bargain price, 
that who is so stupid to sell INARI at RM 2.04;
But the market will scare you from doing so. I admit that I am completely scared by the market at that time.
After all, seeing what happened on 15-10-2014 is that it open greenly in the morning, 
and at the end of the market it went down from RM 2.50 to RM 2.22 to close at the lowest
price. How dare for me to buy in if I see this kind of transaction?

Logic says: hey, INARI 35% discount price, when will you see this bargain again? 
Emotion argues: OMG, it has been free fall for so many days, how dare you 
catch the falling knife? never die before? 

At the decision moment, this time, my emotion won. I lost my logical
thinking seeing the market can be red like that.


17-10-2014: Strong rebound, I couldn't believe what has happened. A big slap to 

people that have sold it in the past few days.



After selling, I felt fortunate that the price continue going down.
After the rebound on 17-10-2014, what is my feeling then?

The market is controlled by big fish;
My emotion is manipulated by the market;
My decision is controlled by my emotion;

So my decision is controlled by the market, which should not be the case.


[to be continued]

Sunday, 16 March 2014

KLSE: INARI price soars, transferring to Main Market?

Last time when I wrote something about target price reached, where to?

My target price was RM 1.71, but now the share price stood at RM 2.27. I didn't make any transaction, as I found no reason to sell this share.  The decision is correct, at least, until now.

Last Friday, INARI volume was relatively higher - not a good sign. As volume comes, I would choose to go. The price has increased ceaselessly over the past two weeks. Seeing the share price soars day by day, I am very excited at first, but soon the feeling changed.

INARI


I found myself to be even greedier than ever: when my portfolio sees an earning that has never appeared before, I found myself to be even more unsatisfied. I want to see EVEN more profits. Is this human nature, of the more you have, the more unsatisfied you will be, or is this just about my boundless greed? I guess, in some sense, that this is part of human nature, a weakness that can be improved, but not eradicated.

Anyway, I believe the movement in the past two weeks is strongly related to the news regarding transfer from ACE market to main market. It has been more than two months since the application has been made on 10 Jan 2014.

It breaks new high everyday, sky is the only limit. I have no more target price for this share, will only watch and see what happens, only to decide what to do next.

Wednesday, 19 February 2014

A past experience, a reminder to myself

There are several types of stock account. One of the most common is a cash upfront account, in which you are only able to buy shares with the money in your trust account, i.e. trading limit = cash available. Another common one being the margin account, which allows you to trade, e.g., 2X based on your cash available.

Having mentioned margin account, once I saw a "joke" in Investalks, saying that for those working in Singapore, they don't even need to have a margin account to trade 2X of the cash available, because what they are earning already has the marginal trading effect in Bursa Malaysia. Kind of cold jokes, but it reflects how the continuous depreciation of MYR erodes its value against other currencies.

Back to story. When I opened my account, I opted for cash upfront account. I know that, deep in my mind, this will prevent me from "gambling", as my weaknesses will be completely reflected in stock market, of how greedy I am, of how uncontrollable I am, of how unsatisfied I am, when the crucial moments come. By only forcing myself to use cash upfront account, I can avoid gambling on trading limit which may be over my financial affordability.

This decision DID save me from some losses. Back in 2011, I have a cash value of about 10k in my account. It happened at that time that PROTON (now delisted, took over by DRBHCOM), came the news about take over by DRBHICOM. Read a related news here.

Due to the news, PROTON gap-up open on 6 Dec 2011, from RM 4.50 previous close to open at RM 4.75. Its call warrant, that I was aiming at, PROTON-CG, open at RM 0.430 from a previous close of RM 0.370. Seeing such a strong positive sentiment, I plan to hantam (ALL-IN) all my cash to buy this call warrant.

PROTON-CG


I remember vividly that, I key in BUY RM 0.435 for 250 lots. ORDER DECLINED. I don't know why the order was declined. I tried a second time IMMEDIATELY (such a rash decision), same amount same price. ORDER DECLINED. Only then I calculated the total amount I wished to trade = RM 0.435* 25000 = RM 10875, which is over my trading limit for about RM 1k. I gave up buying.

Soon after that, PROTON turned from green to red, and PROTON-CG closed at RM 0.315 on that day. Had the transaction been successful, I would have suffered a loss of 3k in a day. Although it has gone up finally - 1 month later, I wouldn't have waited until that should I have the call warrant, I would have cut lost on the first day of my purchase.

My cash upfront account SAVE me from the loss. Of course, it did "prevent" me from some earning, but using margin trading limit for me is risky currently, as I am still learning how to control myself. In addition, past experience has shown that even though I may win some money at first, I might have lost even more at a later stage due to uncontrolled trading. I still feel comfortable using this cash upfront account. The feeling of "not earning enough" abates as my experience accumulates.

This experience also proves the well-known quote "buy on rumours and sell on facts". When news have already been announced, don't chase, is time to sell if you hold the shares. Anyway, this is an experience for me to remember, which will hopefully remind me to avoid the similar mistakes in the future.

Thursday, 13 February 2014

KLSE: without a target price, what triggers a sell?

I top up pne two weeks ago, during the washing period, a very good chance to top up: steady price with low volume. My top up price isn't that beautiful, because at the end of Jan when US market plunged 2%+ in a day, it came down to as low as 0.490. That day causes quite a shock in global market, but the heavy selling abates few days after that.

Today has proven that my top up decision was right - 28%+ a day, where to find such a huge return in one day?

I observed very carefully during the trading hours. This is a very good chance to see how the big fish push up a stock. At 0.700, there is a very obvious washing process - last for a good 10 minutes before continuing buy up.

When the queue is:

Buy Qty   Buy       Sell    Sell Qty
   100     0.700     0.705   200

Then sell down transaction will occur, either traded in 27 followed by 73, or 100 lot in a single transaction. This will result in:

Buy Qty   Buy       Sell    Sell Qty
   XXX     0.695     0.700   200 (or 100)

Then the 200 ( or 100 lots) of 0.700 will be eaten in a minute again. And then the same scenario repeat for 10 minutes at 0.700, to create volume. I do not know the intention of this, but clearly, the big fish holds most of the share. This phenomenon is observed at other prices as well, but not that obvious.



A very beautiful trade detail, showing a strong buy rate of 82%, this is extremely high! With today KLCI sentiment, this share is just too strong. The volume is beautiful, but is a little bit huge already?



1000 lots of buy volume - I have never seen this happened in this share, something must be coming very soon? All buy up transactions, showing how strong is this share although the market is going down today.

What I am worry is the huge volume today. But the candle is very good though. I still doesn't have any target price for this, kind of losing direction in selling.

If tomorrow is a big gap up, I would run.
If tomorrow continue rising, I would see until which point it will go. Perhaps sell half?
If tomorrow small volume, forget about it.

Hopefully my previous experience learned from stock market will help in making the decision this time.

Friday, 10 January 2014

2013 review: part 5 (end)

In summary, 2013 breaks several personal investment records: (it's easy to break though, cause I am only 3 years in KLSE)

  1. record loss of a single share, in terms of amount -- not something worth bragging
  2. record earn of single share, in terms of amount -- something I am very thankful for
  3. record dividend income, a bonus for me, still wish to get more dividend this year
Several mistake that (hopefully) can never be repeated:

  1. There is nothing like what I should have earned from a bullish market. The stock market does not owe me anything. That kind of thinking and attitude will only make me lost even more.
  2. It turns out that holding 0% share in a bullish market can make me to lose control in stock market for months. I am very grateful for the time this lesson came, fortunately it did not plunge by the time I got in to "revenge". Hopefully I will remember this lesson for years. Never fight with the market.
  3. Before buy / sell a share, read the quotes and experience that I've gone through before.
  4. All in style works pretty well when the capital is small, however, the style will need to be adjusted ones the capital gets bigger. All in a share using large capital is too risky - you don't have any more cash to buy other share or average down when the opportunity comes.
This year, I enthusiastically wait for my 100% single share return, I am pretty sure it will come very soon, and then only see if I want to continue holding or sell. Just like what typical Malaysians would say "later only see how lah". 

Dividend "sneak-peak": one to come next week (INARI), one to come next month if I hold the share (INSAS), which I probably will. "money, nobody will think it is too much one mah"

One more expectation: surprise dividend



After 13 years, this company paid out a dividend last year, announced on 29 Jan 2013. I was very happy to receive the dividend last year, and expect something this year too, hopefully not too long. Based on last month and today's performance (+17%), I guess something is coming very soon (less a question than a statement).