MALAYAN FLOUR MILLS BHD
KLSE (MYR): MFLOUR (3662)
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Last Price
0.53
Today's Change
+0.005 (0.95%)
Day's Change
0.53 - 0.53
Trading Volume
13,700
Changes
| Ann. Date | Date | Type | Name | Title | View |
|---|
Discussions
23 people like this. Showing 50 of 7,375 comments
https://klse.i3investor.com/web/blog/detail/ceomorningbrief/2024-10-17-story-h471865822-Malayan_Flour_Mills_Falls_to_Five_month_Low_After_Announcing_No_Second_E
wondering how will be this RM140mil impact to the company? this amount is huge
2 months ago
any expect can advice? the sales proceeds reduced by RM140mil is too much might turn the deal from profit to huge loss
2 months ago
Unlikely to recover much. Malaysia's dependence on imported wheat and controlled flour pricing means local prices are influenced more by currency exchange rates and freight costs than global wheat trends. Today 1USD is equal to RM4.41. Go figure
4 weeks ago
mflour become bjfood.
Nobody want to eat McDonald where all chicken supply by mflour.
Cut loss faster.
3 weeks ago
Omg. This fella got frustrated or disappointed when mflour announced dividend and rebounded?
1 week ago
BUY33333
Price Target
A price target is an analyst's projection of a share's future price.
Average Target Price, Price Call and Upside/Downside here are derived from Price Targets in the past 6 months.
Last Price
0.545
Avg Target Price
0.84
Upside/Downside
+0.295 (54.13%)
Price Call
1 week ago
BUY3 DIV COMING
MFLOUR - Notice of Book Closure
MFLOUR - Notice of Book Closure
ILC-04122024-00007
Second Interim Single Tier Dividend of 1.5 sen per ordinary share Kindly be
advised of the following : 1) The above Company's securities will be traded
and quoted "Ex - Dividend? as from: 17 Dec 2024 2) The last date of lodgment :
18 Dec 2024 3) Date Payable : 30 Dec 2024
MANAGER, REF. DATA MANAGEMENT
You are advised to read the entire contents of the announcement or attachment.
To read the entire contents of the announcement or attachment, please access
the Bursa website at http://www.bursamalaysia.com
04/12/2024 07:00 AM
Ref Code: 202412045100004
1 week ago
92.5SEN IN JUNE 2024 THIS YEAR.... A knee jerk reaction.... above 75sen easily.... low hanging fruits... grab fast 3 yay
1 week ago
got money buy more... food company.... essential items... flour....and related products... bukan luxury items//// barang keperluan ya
1 week ago
52w 0.530 - 0.925
ROE 1.88
P/E 27.33
EPS 1.99
DPS 3.00
DY 5.50%
NTA 1.0600
P/B 0.51
RPS 249.95
PSR 0.22
Market Cap 675.3M
Shares (mil) 1,239.15
CAGR
RSI(14) Neutral 34.4
Stochastic(14) Oversold 15.0
Average Volume (3M) 3,212,000
Relative Volume 1.4
1 week ago
Terbaik, lawan di High Court💪KUALA LUMPUR: Malayan Flour Mills Bhd's joint venture company Dindings Poultry Development Centre Sdn Bhd (DPDC) today announced that it has failed in its bid to hold off paying a RM70 million fine by Malaysia Competition Commission (MyCC) for forming a price-fixing cartel.
In a filing with Bursa Malaysia Securities Bhd today, the company said the Competition Appeal Tribunal (CAT) last Friday dismissed DPDC's application for a stay of the MyCC's decision on the fine pending the disposal of DPDC's appeal to the CAT against the MyCC's decision with no order as to costs.
DPDC will file a judicial review application at the High Court against the CAT decision on the stay application.
1 week ago
It would rebound; terbukti!!!
Malayan Flour Mills Stock Price History
Time Frame
Monthly
Download
12/09/2022 - 12/09/2024
Date
Price
Open
High
Low
Vol.
Change %
Dec 01, 2024 0.545 0.540 0.565 0.530 34.61M +1.87%
Nov 01, 2024 0.535 0.660 0.665 0.530 97.03M -18.32%
Oct 01, 2024 0.655 0.725 0.780 0.655 60.23M -10.27%
Sep 01, 2024 0.730 0.735 0.770 0.695 23.68M -0.68%
Aug 01, 2024 0.735 0.775 0.785 0.685 36.76M -5.16%
Jul 01, 2024 0.775 0.860 0.885 0.755 60.08M -9.36%
Jun 01, 2024 0.855 0.745 0.925 0.745 111.78M +14.00%
May 01, 2024 0.750 0.655 0.840 0.655 115.40M +13.64%
Apr 01, 2024 0.660 0.670 0.670 0.640 43.02M -1.49%
Mar 01, 2024 0.670 0.645 0.675 0.635 33.85M +3.08%
Feb 01, 2024 0.650 0.645 0.690 0.635 52.52M +1.56%
Jan 01, 2024 0.640 0.640 0.695 0.620 50.44M 0.00%
Dec 01, 2023 0.640 0.665 0.670 0.630 48.97M -3.76%
Nov 01, 2023 0.665 0.640 0.715 0.635 85.10M +3.91%
Oct 01, 2023 0.640 0.625 0.670 0.610 47.85M +2.40%
Sep 01, 2023 0.625 0.625 0.660 0.615 29.81M -1.57%
Aug 01, 2023 0.635 0.635 0.660 0.620 40.91M 0.00%
Jul 01, 2023 0.635 0.600 0.670 0.600 43.13M +5.83%
Jun 01, 2023 0.600 0.660 0.690 0.600 18.61M -7.69%
May 01, 2023 0.650 0.735 0.775 0.650 26.09M -11.56%
Apr 01, 2023 0.735 0.765 0.795 0.730 18.59M -3.92%
Mar 01, 2023 0.765 0.815 0.845 0.750 36.22M -6.13%
Feb 01, 2023 0.815 0.835 0.840 0.750 46.01M -1.81%
Jan 01, 2023 0.830 0.760 0.840 0.735 36.84M +9.21%
Highest:
0.925
Change %:
-28.289
1 week ago
The hero; Best Buy undervalued now
Malayan Flour Mills (MFM) is consistently profitable due to several key factors:
1. Integrated Business Model
MFM operates an integrated value chain that includes flour milling, livestock feed production, and poultry farming. This diversification helps spread risk and maintain stable income streams, even if one segment faces challenges.
2. Strong Market Position
MFM is one of Malaysia’s leading flour millers, benefiting from economies of scale, a well-established brand, and a loyal customer base. This gives it an edge in pricing and market penetration.
3. Essential Product Demand
Flour and related products are staples in diets, ensuring steady demand regardless of economic conditions. The company’s poultry operations also cater to a staple protein source, further boosting demand stability.
4. Cost Management and Efficiency
MFM’s long experience in the industry allows it to optimize production processes and manage costs effectively. Investments in modern technology also improve operational efficiency.
5. Strategic Partnerships
Collaborations and joint ventures, such as its partnership with Tyson Foods in the poultry segment, enhance MFM’s capabilities and market reach while sharing financial and operational risks.
6. Geographic Reach
MFM serves both local and international markets, providing revenue diversity. It can leverage currency fluctuations and demand shifts to its advantage.
7. Government Support and Policies
As a supplier of essential food products, MFM may benefit from favorable policies, subsidies, or protectionist measures, particularly during periods of high inflation or economic uncertainty.
8. Focus on Sustainability and Innovation
MFM has adapted to changing consumer preferences, such as demand for healthier and premium products, ensuring its products remain relevant and competitive.
These combined factors help MFM maintain profitability and a strong financial position, even in challenging market conditions.
1 week ago
Investing in Malayan Flour Mills Berhad (MFM) offers several potential advantages:
1. Attractive Valuation
• Price-to-Earnings (P/E) Ratio: MFM’s P/E ratio stands at a low level for the current fiscal year and is projected to be much higher for 2025, indicating the stock is attractively priced relative to its earnings. 
2. Dividend Yield
• High Dividend Expectations: MFM is recognized as one of the best yield companies, with high dividend expectations, appealing to income-focused investors. 
3. Positive Earnings Revisions
• Upward EPS Revisions: Analysts have significantly revised their earnings per share (EPS) expectations for MFM upwards over the past year, reflecting confidence in the company’s financial performance. 
4. Strategic Partnerships
• Collaboration with Tyson Foods: MFM’s partnership with Tyson Foods enhances its capabilities and market reach, potentially leading to improved operational efficiencies and profitability. 
5. Market Position
• Established Presence: As a leading flour miller in Malaysia, MFM benefits from economies of scale and a strong brand presence, contributing to its competitive advantage. 
Considerations
• ESG Score: According to Refinitiv, MFM’s Environmental, Social, and Governance (ESG) score is poor within its industry, which may be a concern for socially conscious investors. 
• Net Asset Value: The company appears to be poorly valued given its net asset value, suggesting potential overvaluation relative to its assets. 
In summary, MFM’s attractive valuation, high dividend yield, positive earnings revisions, strategic partnerships, and strong market position make it a compelling investment. However, investors should also consider the company’s ESG performance and asset valuation in their decision-making process.
1 week ago
here’s a step-by-step analysis and forecast for a strong uptrend in the next 30 days:
1. Price Action Analysis
Recent Downtrend: The price has declined from
0.760
0.760 (Oct 4) to
0.545
0.545 (Dec 9), indicating a correction phase.
Current Reversal Signs:
On Dec 6, the price reached a high of
0.565
0.565, suggesting resistance near this level.
The higher low at
0.545
0.545 (Dec 9) compared to previous lows signals potential bottoming out.
Volume Trend:
High trading volume on Dec 6 and Dec 4 compared to Dec 9 indicates accumulation, typically preceding an uptrend.
2. Key Technical Indicators
Support Level: The price has shown strong support around
0.540
0.540 to
0.545
0.545.
Resistance Levels:
Short-term resistance is at
0.560
0.560 to
0.565
0.565.
A breakout above
0.565
0.565 could lead to a rally toward
0.580
0.580 and beyond.
Volume Surge:
The increased volume during the recent lows indicates growing buyer interest, aligning with a possible trend reversal.
3. Forecast: Factors Supporting an Uptrend
Oversold Conditions: Prolonged downward momentum suggests the stock may be oversold and ripe for a rebound.
Volume-Based Signal: Higher volume on dips and steady support levels indicate accumulation by institutional investors.
Psychological Thresholds: A break above
0.565
0.565 could trigger more buying as it clears a psychological barrier.
Forecasted Price Levels (Next 30 Days)
Date Target Price Range Key Notes
15-20 Dec
0.560
−
0.580
0.560−0.580 Testing short-term resistance.
20-25 Dec
0.580
−
0.600
0.580−0.600 Breakout confirmed if volume sustains.
25 Dec-5 Jan
0.600
−
0.620
0.600−0.620 Steady upward momentum.
Recommendations
Watch for a breakout above
0.565
0.565 with volume as a key confirmation of an uptrend.
Monitor for pullbacks to
0.545
0.545, which could offer attractive entry points.
Track volume spikes, as they often precede price surges.
This analysis assumes no external shocks to the market. Continuous monitoring of market conditions is recommended.
1 week ago
Summary: Step-by-Step Analysis and Forecast for a Strong Uptrend
Recent Price Action
Downtrend: Price corrected from
0.760
0.760 (Oct 4) to
0.545
0.545 (Dec 9).
Reversal Signs: Higher lows at
0.545
0.545 (Dec 9) and resistance near
0.565
0.565 suggest bottoming out.
Volume Trend: Increased trading volume on Dec 4 and Dec 6 signals accumulation.
Technical Indicators
Support Level:
0.540
−
0.545
0.540−0.545 is solid support.
Resistance Levels:
0.560
−
0.565
0.560−0.565 is the short-term resistance; breaking it could push prices to
0.580
0.580.
Volume Surge: Recent volume spikes indicate buyer interest.
Uptrend Catalysts
Oversold Conditions: Prolonged decline suggests potential for a rebound.
Institutional Accumulation: Higher volume near lows supports trend reversal.
Psychological Barriers: A breakout above
0.565
0.565 could lead to stronger buying momentum.
Forecasted Price Levels
Dec 15–20:
0.560
−
0.580
0.560−0.580 – Testing resistance.
Dec 20–25:
0.580
−
0.600
0.580−0.600 – Breakout likely with sustained volume.
Dec 25–Jan 5:
0.600
−
0.620
0.600−0.620 – Momentum builds.
Recommendations
Buy Zone: Accumulate near
0.545
−
0.550
0.545−0.550.
Sell Zone: Take profits around
0.700
−
0.750
0.700−0.750.
Stop-Loss: Below
0.520
0.520 to limit downside risk.
This analysis assumes stable market conditions and no significant external disruptions.
1 week ago
Surge back 75sen-rm1++ due to:
1) flour price would fall afraid Ukraine wars ended as pushed by Trump
2) RM up a lot, cheaper for raw materials purchased
3) higher inflation next year: more people would eat more roti, other flour based products to contain hunger
1 week ago
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Save Print Back
3662 MFLOUR MALAYAN FLOUR MILLS BHD
Changes in Director's Interest (Section 219 of CA 2016)
Particulars of Director
Name : AINI BINTI IDERIS
NRIC/Passport No./Company No. : -
Nationality/Country of Incorporation : Malaysia
Address:
-
Descriptions (Class and Nominal Value):
Ordinary Share
Details of Changes
Date of Notice : 06/12/2024
Transactions:
No. Date Transaction Type No of Shares Price (RM)
1. 06/12/2024 Acquired 18,600 -
Circumstances by reason of which change has occurred:
Purchase of shares in open market by her child
Nature of Interest:
Deemed Interest
Consideration:
You are advised to read the entire contents of the announcement or attachment.
No of Shares Held After Changes:
Indirect/Deemed Interest : 52,600 shares (0.0040%)
Total : 52,600 shares
Remarks:
This announcement is dated 9 December 2024.
You are advised to read the entire contents of the announcement or attachment.
To read the entire contents of the announcement or attachment, please access
the Bursa website at http://www.bursamalaysia.com
Submitted By:
09/12/2024 07:00 AM
Ref Code: 202412093700082
1 week ago
Malayan Flour Mills Berhad (MFM) is projected to experience significant financial growth in 2025, with several key indicators reflecting this positive trend:
Revenue and Earnings Projections:
• Revenue Growth: MFM’s revenue is expected to reach approximately MYR 3.31 billion in 2025, marking a 5.08% increase from the previous year. 
• EBITDA and EBIT: The company’s EBITDA is forecasted to rise by 11.99% to MYR 252.2 million, while EBIT is anticipated to grow by 13.93% to MYR 194.2 million. 
• Net Income: A substantial increase of 31.81% is projected, bringing net income to MYR 131.6 million. 
Profitability Ratios:
• EBITDA Margin: Expected to improve to 7.63% in 2025, up from 5.27% in 2023. 
• Net Profit Margin: Projected to increase to 3.98% in 2025, compared to 1.01% in 2023. 
Valuation Metrics:
• Price-to-Earnings (P/E) Ratio: MFM’s P/E ratio is estimated at 4.48 for 2025, indicating an attractive valuation relative to earnings. 
Dividend Yield:
• Dividend Payout: The company is expected to offer a dividend yield of 4.96% in 2024, reflecting its commitment to shareholder returns. 
These projections suggest that MFM is on a robust growth trajectory for 2025, driven by increased revenue, improved profitability, and favorable valuation metrics. Investors may find the company’s financial outlook appealing, considering its strong performance indicators and commitment to shareholder value.
1 week ago
Strong buy call😎
Analysts' Consensus
SellConsensusBuy
Mean consensus
BUY
Number of Analysts
1
Last Close Price
0.5450MYR
Average target price
0.8750MYR
Spread / Average Target
+60.55%
High Price Target
0.8800MYR
Spread / Highest target
+61.47%
Low Price Target
0.8700MYR
Spread / Lowest Target
+59.63%
1 week ago
The success of flour manufacturing and related products in 2025 can be justified by several key trends and developments:
1. Increased Global Demand for Processed Foods
• The global rise in demand for bakery products, convenience foods, and snacks fuels the need for high-quality flour as a primary ingredient.
• Flour is a versatile input for various industries, including confectionery, fast food, and home cooking.
2. Growth in Emerging Markets
• Emerging markets, particularly in Asia, Africa, and the Middle East, are witnessing a growing middle class with increased purchasing power.
• Rising urbanization leads to a shift in dietary habits, with a preference for flour-based products like bread, noodles, and pasta.
3. Focus on Health and Specialty Flours
• Health-conscious consumers drive demand for specialty flours (e.g., gluten-free, whole grain, almond, and quinoa flour).
• Functional foods enriched with nutrients boost the need for innovative flour products catering to specific dietary requirements.
4. Stabilization of Wheat Prices
• After disruptions caused by global events, 2025 may see more stable wheat supply chains.
• Stable raw material costs can improve margins and support competitive pricing.
5. Technological Advancements in Flour Production
• Automation and advanced milling technologies improve efficiency, reduce waste, and ensure consistent product quality.
• Innovations enable the production of tailored flour types for specific applications.
6. Government Support and Investments
• Many countries prioritize food security and invest in agricultural and food processing infrastructure.
• Export subsidies and incentives further bolster the flour manufacturing sector.
7. E-commerce and Retail Growth
• Online grocery platforms and retail chains expand the reach of flour products to a wider audience.
• Flour manufacturers can leverage digital marketing to build direct connections with consumers.
8. Resilient Demand in B2B Markets
• Flour remains a critical input for food manufacturers, restaurants, and caterers, ensuring steady demand regardless of economic fluctuations.
• Long-term contracts with businesses provide predictable revenue streams.
Conclusion
Flour manufacturing and related products are positioned for growth in 2025 due to strong consumer demand, innovation in product offerings, and the stabilization of supply chains. These factors, combined with evolving market trends and technological advancements, ensure the sector’s resilience and profitability.
1 week ago
The flour and related products manufacturing sector in Malaysia is poised for significant growth in 2025, driven by several key factors:
1. Rising Demand for Convenience Foods:
Malaysian consumers are increasingly seeking convenient food options, leading to a higher demand for flour-based products such as bread, pastries, and ready-to-eat items. This trend is expected to boost the flour manufacturing industry. 
2. Growing Health and Nutrition Awareness:
There is a heightened awareness among consumers about health and nutrition, prompting a shift towards healthier flour alternatives and fortified products. Manufacturers are responding by introducing innovative offerings to meet this demand, thereby expanding the market. 
3. Increasing Income Levels:
Rising income levels in Malaysia are enabling consumers to spend more on diverse and premium flour-based products, further driving market growth. 
4. Population Growth and Changing Dietary Habits:
Malaysia’s growing population and evolving dietary preferences are leading to increased consumption of flour and related products, providing a robust market for manufacturers. 
5. Expansion of the Bread and Bakery Products Market:
The bread and bakery products segment in Malaysia is projected to grow by 5.59% from 2024 to 2029, reaching a market volume of USD 10.20 billion by 2029. This expansion indicates a strong demand for flour-based products, benefiting manufacturers. 
6. Positive Economic Outlook:
The Malaysian economy is expected to continue its growth trajectory, with the industrial sector, including manufacturing, playing a significant role. The manufacturing sector is anticipated to grow by 3.9%, providing a favorable environment for flour manufacturers. 
In summary, the convergence of consumer trends, economic growth, and demographic changes is set to create a conducive environment for flour and related products manufacturers in Malaysia to thrive in 2025.
1 week ago
Out perform hehe huat yay
Malayan Flour Mills Berhad (MFM) indeed has the potential for significant upside if the right conditions are met. Here's a closer look at what might be driving this sentiment and what could support its continued growth:
Reasons for Optimism in Malayan Flour Mills (MFM):
Strategic Partnerships and Expansion:
MFM's joint ventures, especially in the poultry integration business, have positioned it as a major player in Malaysia's food industry.
Diversification into higher-margin products and segments, like value-added poultry products, boosts profitability potential.
Rising Demand for Food Security:
As food security becomes a priority in Southeast Asia, companies like MFM that contribute to the supply chain are likely to see increased demand.
Government policies promoting local food production could also act as a catalyst.
Cost Rationalization and Efficiency Gains:
Efforts to optimize costs through technology upgrades and operational efficiency may lead to better margins.
Declining raw material costs (like wheat) could improve the bottom line.
Export Opportunities:
MFM is well-positioned to benefit from export growth, particularly to nearby ASEAN markets, where demand for both flour and processed poultry is rising.
Stock Market Momentum:
Recent price movements suggest strong accumulation, which could precede a significant breakout. If institutional investors are involved, the upside could be extraordinary.
Forecasting Potential Upside:
Short-term Target: If MFM sustains its bullish momentum, the stock could test historical highs within the next 3-6 months.
Mid-term Target: Further expansion into export markets or strategic partnerships could push the stock higher, potentially into the RM1.50–RM2.00 range (depending on market conditions and earnings growth).
Catalysts to Watch:
Quarterly Results: Improved earnings due to better margins or higher sales volumes.
Market Sentiment: Any positive announcements regarding partnerships or government incentives could push the stock higher.
Global Commodity Prices: Favorable trends in wheat and feed costs could reduce input costs significantly.
1 week ago
Super extra outperform, huatlah hehe
Patterns in Historical Data (Dec 2022 - Dec 2024)
Volatility Insights:
The data demonstrates periods of high volatility, especially in 2024. For example:
Nov 2024: A sharp decline (-18.32%) following a peak in Oct 2024.
Jun 2024: A significant uptick (+14.00%) due to increased investor activity and strong price support.
Recent Trends (2024):
Strong Recovery Potential: After the downtrend in late 2024, a bottoming pattern at 0.535-0.555 shows signs of consolidation.
Support Levels: Established around 0.535, with resistance zones at 0.655 and 0.775 indicating upside potential.
Volume Patterns:
Higher volumes coincide with major price movements (e.g., Jun 2024 and Nov 2024). Sustained volume increases suggest growing investor interest and accumulation phases.
Bull Run Drivers
Several catalysts can fuel a super bull trend for this stock:
Sector Growth:
If this is part of a high-growth industry like consumer discretionary or tech, improving economic conditions could enhance demand.
Economic Recovery:
Macroeconomic stability, higher disposable incomes, and sector-specific reforms are likely to benefit the stock.
Technical Analysis:
Breakout Potential: A decisive move above 0.655 (October's closing price) could trigger a sharp rally.
Psychological Levels: 0.775 (July 2024 peak) and 0.855-0.925 (Q2 2024 highs) are potential bullish targets.
Projected Super Bull Run Timeline
Short-Term (1-3 Months):
Expect sideways movement with attempts to break resistance at 0.655. Support at 0.535 should hold.
Mid-Term (3-6 Months):
Gradual accumulation could lead to a rally towards 0.775. A breakout here may trigger further momentum buying.
Long-Term (6-12 Months):
If the market dynamics remain favorable, a run towards 0.925 and beyond is plausible. Strong fundamentals and external catalysts will be crucial.
1 week ago
Super extra outperform call, diba hehe
Summary of Key Levels and Forecast
Timeline Target Range (RM) Key Catalyst
Short-Term 0.655-0.775 Consolidation, economic data, volume uptick
Mid-Term 0.775-0.855 Sector growth, macro recovery
Long-Term 0.925-1.000+ Bullish sentiment, earnings growth
1 week ago
Buy hari ni, dividen masuk on Dec 30 bulan ni, kenapa tak kutip hehe
MFLOUR - Notice of Book Closure
MFLOUR - Notice of Book Closure
ILC-04122024-00007
Second Interim Single Tier Dividend of 1.5 sen per ordinary share Kindly be
advised of the following : 1) The above Company's securities will be traded
and quoted "Ex - Dividend? as from: 17 Dec 2024 2) The last date of lodgment :
18 Dec 2024 3) Date Payable : 30 Dec 2024
MANAGER, REF. DATA MANAGEMENT
You are advised to read the entire contents of the announcement or attachment.
To read the entire contents of the announcement or attachment, please access
the Bursa website at http://www.bursamalaysia.com
04/12/2024 07:00 AM
Ref Code: 202412045100004
1 week ago
Most Asian stocks jumped on Tuesday with Chinese shares rallying on optimism around more stimulus measures from the world’s second largest economy, while the Reserve Bank of Australia held interest rates steady, as expected.
1 week ago
syer mflour, sangat berbaloi, kecairan takda masalah, dividen pun ada.. cun betul hehe
1 week ago
The principle "buy when others are fearful" is grounded in behavioral finance and value investing. Here's a detailed explanation:
### **1. Market Fear and Opportunity**
- **What it Means**: Fear in the market often arises from economic downturns, geopolitical events, or unexpected company-specific news. This fear leads to panic selling, driving down prices.
- **Opportunity**: During such times, assets often become undervalued relative to their intrinsic worth, presenting opportunities for investors who are willing to take calculated risks.
### **2. Contrarian Approach**
- **Going Against the Crowd**: Most investors tend to follow the herd, selling when others sell and buying when others buy. A contrarian investor does the opposite, recognizing that panic-driven sell-offs can create bargains.
- **Historical Evidence**: Many successful investors have built wealth by purchasing assets during crises (e.g., Warren Buffett during the 2008 financial crisis).
### **3. Long-Term Perspective**
- **Intrinsic Value**: The focus is on the intrinsic value of an asset, which may not align with its current market price during fearful times.
- **Recovery Potential**: Over time, markets tend to recover, and fundamentally strong investments typically regain or surpass their previous value.
### **4. Importance of Research**
- **Not All Drops Are Opportunities**: Not every price decline indicates a good investment. Thorough research is necessary to determine whether the downturn is due to temporary factors or permanent damage.
- **Focus on Fundamentals**: Look at a company's financial health, competitive advantage, and long-term prospects.
### **5. Managing Risk**
- **Avoid Overleveraging**: Ensure you don’t overcommit financially, as markets can remain irrational longer than expected.
- **Diversify**: Spread investments across sectors or regions to minimize risk.
### **6. Psychological Strength**
- **Emotional Discipline**: Fearful markets can test your resolve. Successful investing requires ignoring negative noise and staying committed to a well-thought-out strategy.
- **Patience**: Recovery may take time, so a long-term horizon is critical.
In essence, this strategy is about leveraging market inefficiencies caused by fear, buying quality investments at a discount, and holding until the value is realized over time.
1 week ago
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