Posted by bsngpg > 2014-05-28 05:33 | Report Abuse

Great write up. Thks.
I bet for a crash(<50%, may be betw 20-30%) in 12 months. It is just a guessing with some experience behind.
Yes, i agree with your solutions. In this context, I have had rebalanced portfolio to more defensive, dividend and plantation stocks. At the same time, I am keeping much more cash than last year.

Side note: Ha! Ha! "Suay" one, one of the plantation stocks(although it is not a pure plantation play) which I switched into is KFima. Unfortunately, it gave an lousy earning two days ago. I am disappointed but still ok to sink down with it albeit unwillingly.

Posted by inwest88 > 2014-05-28 07:39 | Report Abuse

bsngpg - good morning. Don't worry too much about this counter. See kcchongnz's view below.


http://klse.i3investor.com/blogs/kcchongnz/53034.jsp

Posted by bsngpg > 2014-05-28 09:48 | Report Abuse

Mr. Inwest88: Thks.

I am not worry about its fundamental else I would have sold this counter yesterday. I am sorry about its “lost upside opportunity” in this round of Bull Run.
Sigh, part of my limited capital is now stuck with it for few years.

Posted by sosfinance > 2014-07-16 00:34 | Report Abuse

Nobody can be right in investment all the time. As long as you have 70% win on your side, that will be ok. Hence, once you hold a undervalued stock with potential earnings growth and sustainable, hold on to it tight until it reaches or surpass its intrinsic value. Therefore lately, I do not see many UNDERVALUED stocks with these characteristics other than Protasco and Silk.

Similarly, iCapital.biz has been very selling more than buying and has cash position of RM208 million and only 50% invested. Sadly, it is also selling at about 20% below its NAV for last 5 years or more. Market is very strange, it used to trade above NAV prior to 2008, what change? I will consider iCapital when the share market crashes (i.e. drop 20-50%), because, as normal investor behaviour, they will panic and run out of idea to invest, so, where else is a better place than our friend iCapital. I also notice, during 2008 crisis, plantation stocks barely drop.

I have read many articles saying the real economy is currently DIVORCED from the financial paper market. One observation I made is, GDP of Malaysia grow about 4.75% p.a. compounding over last 8 years, however, KLCI has went up 11% p.a. compounding over the same 8 years. Now, logically this is quite a big gap, but LIQUIDITY is one of the main issue causing this DIVORCE. You can say that LIQUIDITY is the mistresses that some hubbies are sleeping with until the affair is known by their wives and in financial terms, we called it CRISIS

Problem about this is, like LIQUIDITY, sometimes the wives just let it be until they cannot tolerate it anymore, CRISIS will come. This phenomena is very obvious, it is a matter of time before the volcano erupts. Therefore, always keep some special funds aside to take opportunity or hedge it now, and increase your hedge (short the market) over the next few years.

Btw, I am not here to send fear into investors, because I am substantially invested as well, but I do hedge.

Posted by calvintaneng > 2014-07-16 08:12 |

Post removed.Why?

Posted by Seek > 2014-07-16 09:02 | Report Abuse

Thanks Sosfinance n Calvin for the timely write up . It is hard to time the market. On hindsight so many opportunities have been missed. In the end it is better to be safe than to be sorry. Market will get euphoric n irrational. I remember 1993 clearly. I was advised not to use money needed for other purposes for buying shares during 1993 bull run. At that time I was building my house n had fund speculating in the greatest bull run in bursa. Making 20k a day was easy. Bought MFluor at the peak of 6+. When the market turned, so blessed to cut loss at 5.80. If not for the advice heeded would not have completed my house. So for funds set aside for children's education don't use to punt the market. Only play with the money you can afford to lose! How irrational the market can be; non convertible 1dollar loan stock can go up to more than 1.20 those crazy time! Some may say we are not in euphoric state yet. It is individual opinion. Whatever it is don't touch your children education fund, your house fund n your retirement fund. Put them in safe investment.

Posted by sosfinance > 2014-07-16 09:32 | Report Abuse

Thanks for sharing and good input. Small world, I use to worked in Mulpha in 1994 in the corporate advisory services division, peak price was RM10 plus. In Mulpha, I have fun the most of my entire career (perhaps I was young) My big boss missed that opportunity to sell above RM10, would have allowed him for early retirement from the ESOS. Well, that is how market works, the learning never stops because the share markets is very dynamics, it changes over the years, sometime we cannot use the same principles to apply on it.

In 1993, there is T+7 and easy to get margin account, that is why the market went crazy. Many of my peers left the market, only few die hard fella like me, taking it as a game.