Bottom—up investing-strategy involving the identification of specific undervalued investment opportunities one at a time through fundamental analysis

Top-down investing—strategy involving making a macroeconomic forecast and then applying it to choose individual investments

Bond—a security representing a loan to a business or government entity

Callable bond—a bond that may be retired by the issuer at a specified price prior to its contractual maturity (see puttable bond)

Puttable bond—bond with embedded put features allowing holders to sell the bonds back to the issuer at a specified price and time (see callable bond)

Bear market—an environment characterized by generally declining share prices.

Bull market—an environment characterized by generally rising share prices.

Average down—to buy more of a security for less than one’s earlier purchase price(s), resulting in a reduction of the average cost

>>>>
Posted by calvintaneng > 17 minutes ago | Report Abuse

A reality update on palm oil

When Cpo was Rm2200 cost of Cpo production was Rm1400

profit Rm800 just enough to pay bank loan

Now Cpo at Rm4000 cost of cpo production Rm2000

Profit Rm2000

so after paying bank loan Rm800 there is Rm1200 surplus to pay good dividends

>>>>>

What is your intrinsic value for TSH?
Then we can understand your promotion.

When someone is buying, another is selling the same share?
When someone is selling, another is buying up the same share?

Who knows the company better?
Why are the sellers in the market? Do they know more than the buyers in the same market?
Why are the buyers in the market? Do they know more than the sellers in the same market?

In TSH, the insider has been buying up the shares in TSH for a very long time. However, he started buying when his personal shareholdings was around the teens. Now he holds greater than 20% of the shareholdings. TSH is a company listed by the CEO's family. Perhaps, he wishes to own more of this company.

TSH has about 800 big investors. The sellers of the shares have to be within this group. The other shareholders have very few shares to sell. When the CEO buys, who are the sellers?

As the CEO is buying 500,000 shares quite regularly, yet, the share price has dropped from high of 1.80 to 1.06, why? Are there more sellers to buyers in the market? What will happen to the share price assuming the CEO stops buying? Will the share price goes up or down?

What is the probability that the hero of NETX, calvintan's analysis is right? But, I did not see any intelligent analysis from him, other than his TOP-DOWN approach that CPO price is rising! :-)

What is the consequence to your investing should the hero of NETX analysis is wrong?

Possible theoretical scenarios facing iCap.

1. Continuation of iCAP the closed end fund for a new extended period.
2. The forced conversion of iCAP closed-end fund to iCAP open-end mutual funds.
3. In extreme case, the forced liquidation of iCAP closed-end fund.



These last 2 strategies are not risk-free, however, they could produce stock trading profits for closed-end fund investors.

The conversion of an undervalued closed-end fund to the open-end variety creates the profits. By definition, an open-end mutual fund trades at a price that reflects the market value of its holdings. So the price of an undervalued closed-end fund will rise if the fund is converted to an open-end fund.

Closed-end fund managers may oppose conversion for several reasons.

- First, they receive a management fee that is a percentage of total fund assets. After a fund is converted to open-end and the price rises, many fund investors typically sell, shrinking assets under management and management fees by one-third.

- Fund managers may also oppose conversion because of a belief that an open-end structure--which requires them to redeem investor shares on demand in cash--will hurt the fund in the long run.



Big funds or guns buying shares in a closed-end fund make the management of the closed-end fund uneasy. By presenting a restructuring proposal to fund managers, they are giving the managers a severe "this is your one chance to save your jobs" warning. "Some of the guys are waiting for it to happen to them".

iCap

Market price $2.00
NAV 3.27
Price / NAV = 61%
Price is trading at 39% discount to NAV. (4.1.2023)

Closed end fund often trades at a discount to its NAV. This discount is not unusual.

Why is iCap trading at a huge discount of 39% to its NAV?

Mr. TTB has written volumes on the likely reasons with little or no impact on this discount gap. He highlighted the activities of a significant institutional shareholder and has even taken it to court to prevent them from adding more shares as is written in the constitution of this fund.

Why is iCap not able to shrink this gap?

iCap

Market price $2.00
NAV 3.27
Price / NAV = 61%
Price is trading at 39% discount to NAV. (4.1.2023)

Closed end fund often trade at a discount to its NAVs. This discount is not unusual.

Why is iCap trading at a huge discount of 39% to its NAV?

Mr. TTB has written volumes on the likely reasons with little or no impact on this discount gap. He highlighted the activities of a significant institutional shareholder and has even taken it to court to prevent them from adding more shares as is written in the constitution of this fund.

Why is iCap not able to shrink this gap?

Investment Policies (Based on Benjamin Graham)

INVESTMENT CHIEFLY FOR PROFIT:
FOUR approaches are open to both the small and the large investors:

(1) Representative common stocks bought when the MARKET level is clearly LOW.
(2) GROWTH STOCKS, when these can be obtained at reasonable prices in relation to actual accomplishment – GROWTH INVESTING.
(3) Purchase of securities selling well BELOW INTRINSIC VALUE – VALUE INVESTING.
(4) Purchase of WELL-SECURED PRIVILEGED SENIOR ISSUES (bonds and preferred shares).
(5) SPECIAL SITUATIONS: Mergers, arbitrages, cash pay-outs.

The risk is not in our stocks, but in ourselves.

If you want to know what risk really is, go to the nearest bathroom and step up to the mirror. That's risk, gazing back at your from the glass.

What kind of investor are you?

Is your confidence well-calibrated? Ask yourself: "What is the likelihood that my analysis is right?" Think carefully through these questions:

- How much experience do I have? What is my *track record with similar decisions in the past*?

- What is the typical track record of *other people who have tried this in the past*?

- If I am buying, someone else is selling. How *likely is it that I know something* that this other person (or company) does not know?

- If I am selling, someone else is buying. How likely is it that *I know something* that this other person (or company) does not know?

- Have I calculated how much this investment needs to go up for me to *break even* after my taxes and costs of trading?

"Do I fully understand the consequences if my analysis turns out to be wrong?" Answer that question by considering these points:

- If I'm right, I could make a lot of money. But what if I'm wrong? Based on the historical performance of similar investments, *how much could I lose*?

- Do I have *other investments* that will tide me over if this decision turns out to be wrong? Do I already hold stocks, bonds, or funds with a proven record of going up when the kind of investment I'm considering goes down? Am I putting *too much of my capital at risk* with the new investment?

- When I tell myself, "You have a *high tolerance for risk*," how do I know? Have I ever lost a lot of money on an investment? How did it feel? Did I *buy more, or did I bail out*?

- Am I relying on my willpower alone to prevent me from *panicking at the wrong time*? Or have I controlled my own behaviour in advance by *diversifying, signing an investment contract, and dollar-cost averaging*?

The Nobel-prize-winning psychologist Daniel Kahneman explains two factors that characterize good decisions:

1. Do I understand this investment as well as I think I do?
("Well-calibrated confidence")

2. How will I regret if my analysis turns out to be wrong?
("Correctly-anticipated regret")

"Risk is brewed from an equal dose of two ingredients - probabilities and consequences."

Before you invest, you must ensure:

1. that you have realistically assessed your PROBABILITY of being right and

2. how you will react to the CONSEQUENCES of being wrong.

https://klse.i3investor.com/web/blog/detail/bfm_podcast/2022-07-28-story-h1627001483-Dutch_Lady_s_Delicate_Balance_Of_Purpose_Profit_And_Price

Historical data

23.11.2011

Price RM 2.510
PE 6.47x
DY 3.05%
Market cap 802.6m
ROE 53%

Historical data 2011

Current Price (7/1/2011): 2.49
2009 Sales 642,649,516
Employees: 180
Market Cap: 597,600,000
Shares Outstanding: 240,000,000
Closely Held Shares: 167,840,000


Market cap of Guan Chong was RM 597,6 million in 2011.
Today its market cap is RM2.82 B.

Average Growth Rates Guan Chong Bhd
Past Five Years
Ending 12/31/2021 (Fiscal Year)
Revenue
+16.53%
Net Income
+14.01%
Earnings Per Share
+9.76%
Capital Spending
+50.60%
Gross Margin
+11.45%
Cash Flow
+22.68%

Market price $2.40 per share
Market cap RM2.82 B

>>>>
Posted by Fabien _the efficient capital allocator > 1 hour ago | Report Abuse

Enjoy the interview
https://www.youtube.com/watch?v=9PC6oZYRKss&t=629s

>>>>

Thanks for this video.
Guan Chong is not an easy business to run. From the video you can see how the first generations were affected. Today, it has grown big; yet not without its challenges. Look at the amount of debt it has to use to grow this business. The biggest is to hedge the cocoa inventories. Guan Chong has grown its market share as during the 2008 crisis, many European companies in similar business have given or scaled down.

In the video, Brandon Tay mentioned a particular company a few times. I think this company mentioned by Brandon Tay is definitely in a business with very strong economic moat; and probably will turn out to be a better business to invest into for the long term.

A company with poor economics, managed by the best manager, in the end, the company turns out the winner. Also it is better to own a great company at fair price than to own a fair company at great price.

Guan Chong may offer short term trading opportunities at times, but I think I will not be a long term investor in this business (just like many members of his very big family).

Just my opinion.


KEY STOCK DATA
P/E Ratio (TTM)
14.59(12/30/22)
EPS (TTM)
RM0.16
Market Cap
RM2.82 B
Shares Outstanding
1.17 B
Public Float
397.05 M
Yield
2.29%(12/30/22)

Absolute-performance orientation—the tendency to evaluate investment results by measuring one’s investment performance against an absolute standard such as the risk-free rate of return.

Relative-performance orientation—the tendency to evaluate investment results by comparing one’s investment performance with that of the market as a whole.

For individual investors, better to focus on Absolute-Performance.

Did this young student, who is now a mother too, achieved her investment objectives through investing in iCAP from 2008 to now, a long term of 14 years? Sadly, I have to conclude and she knows too, the answer is NO.

Based on market price, her RM 10,000 investment grew to RM 14,344 over 14 years.

Based on NAV price, her RM 10,000 investment grew to RM 22,156 over 14 years.

[Based on a growth rate of 3% per year, in 14 years time, her investment of RM 10,000 would have grown to: RM 15,125.90.]

[Based on a growth rate of 4% per year, in 14 years time, her investment of RM 10,000 would have grown to: RM 17,316.76]

One of the definition of risk of investing is failure to achieve your investment objective after a designated long period of investing.

Young student's investment with iCAP in 2008.
RM 10,000 @ RM 1.60 per share.

When she invested into iCap, she probably got this advice from me.
Your FD in your bank was giving you a certain return. It might be better to take some risks in the stock market for better returns. You were not in need of money for the next few years and in the long term, in general with the right stock, you hope to get better return fhan the risk free FD rate. She had no knowledge of stock investing. Her financial capacity, that was all she had; her ang-pow money saved over many years.

Why iCAP in 2008? iCAP started in 2005 with NAV of 1.00. In the early years, its NAV grew quickly. Its share price was at premium to NAV for sometime too (rather irrational!). In 2008, its share price came down with the Global Financial Crisis, and it was an opportune time to buy this fund at a good price. She bought at 1.60 per share.


Did this young student, who is now a mother too, achieved her investment objectives through investing in iCAP from 2008 to now, a long term of 14 years? Sadly, I have to conclude and she knows too, the answer is NO.

In 2008, the whole market was down. A young student has RM 10,000 in her FD. I encouraged her to put this into iCap, which she did, buying at 1.60 per share.
Today she has collected dividends of 9.5 sen + 20 sen = 29.5 sen.
Share price of iCap today is RM 2.00 per share.

Based on the market price today, should she sell her shares, she would have collected RM 2.00 + RM 0.295 = RM 2.295. She would have a positive return of RM 2.295 - RM 1.60 = RM 0.695 per share.
Period of investment = 14 years.

Based on market price of RM 2.00 today:
Over the course of 14 years, her investment grew from RM1.6 to RM2.295. Its compound annual growth rate (CAGR) is 2.61 %.

Based on if she could cash out at NAV of 3.27 today
Over the course of 14 years, her investment grew from 1.6 to 3.545. Its compound annual growth rate (CAGR) is 5.85 %.

Net Asset Value per share of icapital.biz Berhad as at 28 December 2022 is 3.27.

Past Dividends distributed by iCap
31 Dec 21 Special Dividend 20 sen per share
07 Oct 13 Special Dividend 9.5 per share

>>>
ICAP's sustained performance, whether in terms of share price or NAV, is not a fluke shot. Take a look at the share price of Malayan Banking. On 19 Oct 2005, Maybank closed at RM8.26. By Nov 2022 or 17 years later, Maybank's share price has hardly moved.

Comparing the share price performance of Maybank with that of ICAP, one can see a huge difference in their performances. The share price of ICAP, even though it sold at a discount to NAV since 2010, has far outperformed the share price of Maybank. Few investors know this startling fact and instead focused on the wrong parameter.


i Capital Newsletter Volume 34 Issue 16

>>>>


Cannot be right. Many who are in MBB has enjoyed its high dividend yield for many years. MBB also has a dividend reinvestment pogram (DRIP) for those who choose not to receive their dividends in cash.

>>>

Posted by Sslee > 36 minutes ago | Report Abuse

Dear 3iii,
You are wrong about me on trying to obtain perfect knowledge, I am just trying to seek fairness, justice and the truth. Below another email I intend to send out tomorrow.

Dear Datuk Muhamad Umar Swift,
CEO Bursa Malaysia

First and foremost please allow me to wish everyone at Bursa Malaysia a Happy New Year 2023 and please pardon me for writing this letter to you uninvited on the first working day of 2023.

>>>>

Betul juga.
Ini saya boleh sokong.
Mungkin banyak orang di-sini pun mahu sokong juga.
Dapatkan-lah tanda-tangan beramai-ramai sebelum hantar.
Lebih berkesan.

Sekian

Terima kasih.

Selamat Hari Baru 2023

On SSLee and Hengyuan

Two shortcomings on trying to obtain perfect knowledge

Some investors insist on trying to obtain perfect knowledge about their impending investments, researching companies until they think they know everything there is to know about them.

They study the industry and the competition, contact former employees, industry consultants, and analysts, and become personally acquainted with top management.

They analyze financial statements for the past decade and stock price trends for even longer.

This diligence is admirable, but it has two shortcomings.

1. First, no matter how much research is performed, some information always remains elusive; investors have to learn to live with less than complete information.
2. Second, even if an investor could know all the facts about an investment, he or she would not necessarily profit.

What is popular may not be undervalued.
What is shunned and ignored, may be undervalued.

Is Dutch Lady a bargain?

Dutch Lady has dropped a lot from its latest high price. Why?

Your first reaction would not have been, “What a great bargain!” but, “What’s wrong with Dutch Lady?”

Dutch Lady should be inspected and re-inspected for possible flaws.

Among possible reasons for its share price being sold down are:
- Irrational or indifferent selling alone may have made it cheap, but there may be more fundamental reasons for the depressed price.
- Perhaps there are contingent liabilities or pending litigation that you are unaware of.
- Maybe a competitor is preparing to introduce a superior product.

You can have some comfort should you conclude that the price is not depressed for an undisclosed fundamental business reason.

When reason for undervaluation can be clearly identified, the outcome is also more predictable

Strategies for buying:

A. Assess Quality and Management first, and then only Valuation (QMV)

B. Buy good quality stocks.

C. Buy these stocks at a discount (Margin of Safety)

(If you select your stocks carefully, often one can hold them for long periods. The idea is to allow compounding over the long period to work in your favour.)

The 4 reasons for selling (in order of priorities):

1. You will need to sell URGENTLY (QUICKLY) if there is something wrong with the fundamental of your stock (example: fraudulent accounting, etc). At other instances, you do have the time to SELL at leisure.

2. Your stock has gone up too high. By your assessment, at that price the upside return is less, but the downside risk is more, then you may wish to sell to REINVEST INTO ANOTHER STOCK WITH MORE FAVOURABLE UPSIDE REWARD/DOWNSIDE RISK RATIO.

3. On occasions, you have identified a very good BARGAIN, you may wish to sell some of your stocks to REINVEST into these stocks to capture a higher upside/downside reward risk ratio that these stocks offer.

4. If you need cash for emergency. (But then, hopefully, you will have separate money for such emergencies. The cash invested into the market should be separate.)

Dutch Lady
Fiscal year is January-December.

2021 2020 2019 2018 2017 5-year trend
All values MYR Thousands.

Net Operating Cash Flow (16,259.0) 142,038.0 114,602.0 117,876.0 43,200.0
Capital Expenditures (61,692.0) (93,228.0) (20,038.0) (34,278.0) (16,280.0)
Cash Dividends Paid - Total (32,000.0) (51,200.0) (64,000.0) (128,000.0) (179,200.0)


Cash & Short Term Investments 118,300.0 55,605.0 61,532.0 32,109.0 61,339.0
ST Debt & Current Portion LT Debt 8,487.0 19,598.0 17,358.0 15,172.0 -
Long-Term Debt 6,652.0 3,590.0 340.0 - -


What can be observed in DLady over the last 5 years?

1. Dividends paid had been cut.
2. Capex which used to be 20 m to 30 m per year had increased.
3. No increase in its borrowings.
4. Very cash rich.

Whenever a stock price of a company you own dropped > 20% from its previous level, you will need to re-look and try to understand what is happening in or to the company. Firstly, you will need to assess if its business fundamentals have deteriorated irreversibly? This is the most important question to find answers to. Having satisfied yourself on this question, then looked at the many other reasons for the market price falling so drastically. In Dutch Lady's case, its earnings and its dividends have been on the downtrend. Why? Has its revenues dropped? Why has its earnings dropped: increasing costs, increasing competition,...? Why has its dividends been cut? Also, going forward, DLady has to commit a big sum to capex (new factory in Negeri Sembilan state). How is DLady funding its capex? Is its interest bearing debt increasing? Does it have to borrow to finance its capex? Is this good or bad for its future earnings and cash flow? What is its free cash flow the next 3 years? What is its guesstimate free cash flow after 2025, when the big production plant is up? There are many reasons too: perhaps it was overpriced, perhaps one or a few big institutions have sold out because these institutions have parked themselves in DLady for its DY, which has now not met their investing portfolio requirements.

Top down assessment of the milk industry. There are various debates which you can assess in the internet on the challenges facing the future of the milk industry. Many are negative. But you also need to study the factors that will sustain this industry. Then make your assessment objectively.

No 2 investors will share the same opinion. Each will decide using different assumptions. A buyer will think at the present price it is undervalued. A seller will think that at the present price it is overpriced.

This is what the whole market is about. Of course, ....

Is it not true, that the *really big fortunes* from common stocks have been garnered by those
who made a *substantial commitment in the early years* of a company in whose future they had *great confidence* and who *held their original shares unwaveringly* while they increased 10-fold or 100-fold or more in value?

The answer is "Yes."

Think of your physical, mental and social well-being. Money may not buy happiness.

THE BEST STOCK INVESTMENT STRATEGY

Keep it simple. Keep it safe (make money with *less risk taking*).

You don't need to pick the best stock or even the best stock funds to do well, if you have an *investment strategy* that *keeps you out of trouble*.

PHILIP FISHER'S WISE WORDS

"The refusal to sell at a loss, while completely natural and normal, is probably one of the most dangerous in which we can indulge ourselves in the entire investment process.

More money has probably been lost by investors holding a stock they really did not want until they could 'at least come out even' than from any other single reason.

If to these actual losses are added the profits that might have been made through the proper reinvestment of these funds if such *reinvestment* had been made *when the mistake was first realized, the cost of self-indulgence becomes truly tremendous.*"

(Common Stocks and Uncommon Profits)

ALL EQUITY SECURITY INVESTMENTS PRESENT A RISK OF LOSS OF CAPITAL

Investment performance is not guaranteed and future returns may differ from past returns.

As investment conditions change over time, past returns should not be used to predict future returns.

The results of your investing will be affected by a number of factors, including the performance of the investment markets in which you invest.

MARKET FLUCTUATIONS OF INVESTOR'S PORTFOLIO

Note carefully what Graham is saying here.

It is not just possible, but probable, that most of the stocks you own will gain at least 50% from their lowest price and lose at least 33% ("equivalent one-third") from their highest price -regardless of which stocks you own or whether the market as a whole goes up or down.

If you can't live with that - or you think your portfolio is somehow magically exempt from it - then you are not yet entitled to call yourself an investor.

SOME THOUGHTS ON ANALYSING STOCKS (KISS)

Ideally a stock you plan to purchase should have all of the following characteristics:

• A rising trend of earnings, dividends and book value per share.
• A balance sheet with less debt than other companies in its particular industry.
• A P/E ratio no higher than average.
• A dividend yield that suits your particular needs.
• A below-average dividend pay-out ratio.
• A history of earnings and dividends not pockmarked by erratic ups and downs.
• Companies whose ROE is 15 or better.
• A ratio of price to cash flow (P/CF) that is not too high when compared to other stocks in the same industry.

SELL THE LOSERS, LET THE WINNERS RUN.

Losers refer NOT to those stocks with the depressed prices but to those whose revenues and earnings *aren't capable of growing adequately*.

*Weed out* these losers and *reinvest* the cash into other stocks with *better revenues and earnings potential for higher returns*.

CAPITAL EXPENDITURE

Capital Expenditures are expenses on:
- fixed assets such as equipment, property, or industrial buildings
- fixing problems with an asset
- preparing an asset to be used in business
- restoring property
- starting new businesses

A good company will have a ratio of Capital Expenditures to Net Income of less than 50%.

A great company with a Durable Competitive Advantage will have a ratio of less than 25%.

Less is better.

WHAT IS RISK?

The major RISK facing you is the possibility of not reaching your long-term investment goal through the growth of your funds in real terms.

And the greatest enemy of reaching those goals is INFLATION. Nothing is safe from inflation.
Short-term price volatility is NOT risk for investors who have time horizons 5, 10, 15 or 30 years away. Volatility is the friend of the long term investor.

The most important friends of your investment goal are COMPOUNDING and TIME.

Cintai lah Bahasa Malaysia, bahasa kita.
Yes, learn Bahasa Malaysia (Bahasa Melayu). Learn it well too.

However, do not neglect English. Increasingly, learn Chinese too. Why? Knowing Chinese opens up a lot of opportunities for an individual especially in this region. Moreover, the Middle Eastern nations, the Europeans and also the Americas are also learning this language as a third language.

For those of non-Malay ethnic origins, learn their mother tongue too. Cultural and language go hand in hand. Your life will be richer in many aspects when you know more languages.

Remarkably, for many non-Malays, they can at least converse in 3 languages: Bahasa Melayu, English (though not all are proficient) and their own mother language. Many foreigners are often amazed at the command of three languages in their Malaysian friends.

11 LESSONS FROM PETER LYNCH
Peter Lynch taught me:

1. Behind every stock is a company. Find out what it’s doing.
2. Never invest in any idea you can’t illustrate with a crayon.
3. Over the short term, there may be no correlation between the success of a company’s operations and the success of its stock. Over the long term, there’s a 100% correlation.
4. Buying stocks without studying the companies is the same as playing poker – and never looking at your cards.
5. Time is on your side when you own shares of superior companies.
6. Owning stock is like having children. Don’t get involved with more than you can handle.
7. When the insiders are buying, it’s a good sign.
8. Unless you’re a short seller, it never pays to be pessimistic.
9. A stock market decline is as predictable as a January blizzard in Colorado. If you’re prepared, it can’t hurt you.
10. Everyone has the brainpower to make money in stocks. Not everyone has the stomach.
11. Nobody can predict interest rates, the future direction of the economy, or the stock market. Dismiss all such forecasts and concentrate on what’s actually happening to the companies in which you’ve invested.


Lynch’s advice had a profound effect on my stock market approach. He taught me that investment success isn’t the result of developing the right macro-economic view or deciding when to jump in or out of the market. Success is about researching companies to identify those that are likely to report positive surprises.

>>>
Posted by calvintaneng > 1 hour ago | Report Abuse

Definitely

That is what Peter Lynch taught about 6 category of stocks

Tricky ones Peter Lynch mastered are

turn arounds like jtiasa

Asset play like Bplant and Thplant

Cyclicals like oil and gas Uzma

3iii knows nuts above these and shouid refrain from commenting
>>>>


I know all about Peter Lynch's teaching. I can recite the 6 groups of stocks he teaches.

In any case, an investor should know to choose the games he wish to play. Inability to do so, converts their advantage to disadvantage in the game.

At appropriate times, I have applied Peter Lynch other strategies too.

However, in my portfolio, the biggest gains have been from the great companies bought at fair or low or reasonable prices, with economic moats and kept for a long time, ignoring the market price volatilities most of the time. I am grateful that I did not deviate much from this strategy for decades. Moreover, my style of investing is fairly relaxing.

>>>>

Posted by calvintaneng > 21 minutes ago | Report Abuse

These 3 books are MUST READS FOR ALL SERIOUS INVESTORS

1. THE INTELLIGENT INVESTOR
BY BENJAMIN GRAHAM
(SIFU OF WARREN BUFFET)

IN MALAYSIA THE BENHAMIN GRAHAM OF MALAYSIA IS DR NEOH SOON KEAN OF DYNAQUEST (HIS 1985 CLASSIC ON MALAYSIA STOCK MARKET SHOULD BE REPRINTED

2. ONE UP ON WALL STREET
3. BEATING THE STREET

2 & 3'BY PETER LYNCH

ONLY FUND MANAGER WHO BEAT WARREN BUFFET FOR 13 YEARS IS PETER LYNCH OF MAGELLAN FUND AT 29% (BERKSHIRE 25%)

>>>>

I preferred the First edition of Intelligent Investor by Benjamin Graham. It is a smaller book and a lot of readable. All the basic concepts that Benjamin Graham wished to impart were written clearly and easily understood.

The later editions and the ones that are now in the bookshop are too bulky and heavy reading. Try to get the first edition, and you will be happy to know it is an easier book to read and comprehend.

Peter Lynch has written 3 books. Another is titled Learn to Earn. All very readable. However, the readers must be able to translate his teachings into a simple program to benefit from his teaching.

A good investor ALWAYS need to be able to study a company in a certain format. Preferably he has access to these in a format that he likes. Often these are not available free of charge. At times, the sites providing these datas are just too expensive.

I do not look at too many stocks. I do screen many with a simple check list. Where they satisfy the list, I will study in greater detail. I tend to reject most, and accept very few indeed. Those I am truly interested, I will spend a bit of time on them. The reward is definitely proportionate to the time spent. However, it is true, 20% of time spend provides you with the 80% essential facts on the stock. Spending too detailed into a stock may not be of benefit to your investing. Always study the risks before the rewards. You can sense that I often talk about the risks of a stock first in most of my studies.

A must read book is MARGIN OF SAFETY by Seth Klarman. This is an amazing book. If I were the author, I probably sensed his regret in sharing so much of his "secrets" and "skills." When I read Buffett's newsletter in Berkshire Hathaway, I find many quotes that are quite similar or perhaps picked up by Buffett for his writing. Some of Buffett's writing are also from Peter Lynch.

Unlike Peter Lynch, Seth Klarman's approach is different: focussing strictly on value investing. Peter Lynch. Investing style of Seth Klarman is bottom up, as is demanded of a value investor. You can pick up a lot of ideas from Seth Klarman's book.

>>>
Best Regards
Calvin

UZMA IF THEY LISTENED TO 3iii WOULD HAVE MISSED 100% UPSIDE AT RM1.10 When Calvin told all to sell & take profit

See

https://www.eaglevisioninvest.com/sell-uzma-sell-carimin-buy-opcom-redtone-netx-others/
>>>>

Chapter 20 - “Margin of Safety” as the Central Concept of Investment

A single quote by Graham on page 516 struck me:

Observation over many years has taught us that the chief losses to investors come from the purchase of low-quality securities at times of favorable business conditions.

Basically, Graham is saying that most stock investors lose money because they invest in companies that seem good at a particular point in time, but are lacking the fundamentals of a long-lasting stable company.

This seems obvious on the surface, but it’s actually a great argument for thinking more carefully about your individual stock investments. If most of your losses come from buying companies that seem healthy but really aren’t, isn’t that a profound argument for carefully studying any company you might invest in?