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.

No Movement Means Movement

This week, the Monkeys are getting naughtier and not slowing down their mischievous activities. They pulled and pushed the Investment Jungle Lifeline. Monkey Subprime Crisis has been the leader of the pack for the past few weeks, pulling down the lifeline with new acrobatic moves. This week, Monkey Subprime Crisis found a new friend, Monkey Post-Election Effect. Being a very special specie, Monkey Post-Election Effect demonstrated its very first move in Malaysia and pulled the Investment Jungle Lifeline down by more than 10% in one day.

The Investment Jungle Lifeline has its life saving mechanism, knowing that Monkeys pulled and pushed both expected and unexpectedly. It rebounded on the second and third day after Monkey Post-Election Effect pulled it down. Eventually the swing ended at 1,194.84, representing a 10.2% drop from 1,330.61 as at the inception date of Hengdai Equity Fund IV.

In the chaotic happenings between the Monkeys and the Investment Jungle Lifeline, sat a Zen Monk. He is studying the Monkeys and the art of riding the Investment Jungle Lifeline. This week, he didn't move. And not moving at this juncture is the best strategy as no movement means movement.