Wednesday, March 19, 2008

Stock Sniffing

As Hengdai Equity Fund IV ("HDFIV") has made its maiden investment in Berjaya Sports Toto Berhad ("Bjtoto"), we will be sniffing the stock for its financial results, corporate developments and other announcements that may affect the underlying value of the company.

As long as the story still gels in nicely, we will keep the stock in our portfolio. On the other hand, if the share price drops due to "fear" in the market, we will sweep in more stocks. Sounds simple but it takes alot of courage to sweep in more stocks when the price drops. There is still a tendency to ponder on this question - Is there something bad happening in the company that causes the drop in the share price that I am not aware of? This fear in mind might delay or even stop the decision to sweep in more stocks, hence losing the opportunity to average down the cost per share before the share price recovers.

3 comments:

Hor ny Ang Moh said...

Hallo! U have to look at the Down Jone too! I think overall the mkt is going down! Remember the 10yrs cycle? Just my 2 cts!
Have a nice day!

Seane said...

Hi there ang moh... Thanks for your comment.

Yes, that's what majority investors are looking at - Dow Jones. Down Jones up, KLCI up. Down Jones down, KLCI down.

Can't really time the market if you ask me. Best is to be prepared by having cash ready and stay invested slightly (of course in selected stocks) to be able to reap some dividend (which is higher than FD)when times are bad.

I have a fund that has cashflow of about RM4k coming in every month, hence have holding power and ability to sweep cheap stocks when market is down.

JASON said...

TSVT is more of speculator than bizman

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