Wednesday, October 8, 2014

Quite interesting times

Should one catch a falling knife? I would not especially when we have seen that the knife is already been held high up. In recent times, useless stocks have reached all time high. The usual lesson is that if one is to hold on to those stocks, be afraid as we would never be comfortable with those companies. It may be a one time wonder. Good stocks would however pick itself up. I have seen that in old old stocks like Genting, BAT, Nestle etc. and they would reach all time high again and again.

Not for those useless ones as chances are some of these companies financials are tweaked to accommodate the good times. When it is bad times, no point for these companies to show good results right?

Good companies however would not need to tweak their accounts. They will perform and pick themselves up usually (not always). Anyway, the market has only been down for few days. I am not sure whether how far more it will deteriorate.

Globally, stocks are not performing as well with some fear that China and Europe will be slowing down again. As mentioned, commodities are taking a hit and that may impact our country as well being one country that is quite dependant on petroleum related and other types of agri products. Things are not well it seems now.

It should be interesting to see what Bank Negara and government will do if the fall is continuing... 

13 comments:

Unknown said...

I'm fully invested since 2010. So, i don't have the option to ponder on when/what stocks to buy. Anyway, every correction over the past 5 years, had been a buying opportunity. And in fact, every Malaysian stock mart crashes, had been a golden buying opportunity for many fundamentally sound counters!

AdCool said...

Felicity, at this period of time, what type of counters should we focus on? Consumer, food and health?

What's your thought?

felicity said...

All of the above if you can find companies that have their own strengths, moat.

In times of uncertainties, one can take their time

Betronist said...

Market corrected substantially but, in my view, there aren't many "extremely" undervalued stocks yet. The market rallied so much in the last 12 months and I guess the long-term investors like Kevin Wong wouldn't be worrying too much (still sitting at decent gains I guess).

But I do see a handful of VERY cheap stocks now that I might want to accumulate slowly and gain 50% once they eventually recover. The recovery won't come so soon though.

Unknown said...

Hi Fung C.F.,
I see that you are one of those investors/speculators, waiting to enter or re-enter mart again...but only at cheaper levels than now. If there are many more others market timers/outsmarters and old & new money, waiting to pour their...into stocks...this can only mean good news for already fully invested investors!
Hope your patience pays and reward you back handsomely!

Best wishes,
Kevin

felicity said...

It will be a consolidation - look at US market and everywhere else

Betronist said...

Kevin, I'm not sure what made u think that I'm a speculator, but I am actually a long term investor like u.

But being an value investor, I never dare to get myself fully invested all the time. To me, that's the riskiest thing to do in investing because that leaves no room for new opportunities. It might sound like market timing for u but that's risk management for me.

In the current bear situation, I wouldn't mind selling my holdings if I found a good stock selling at 5x P/E (there are a handful of such bargains out there right now! maybe more coming). No point holding on some brilliant 12x P/E stocks (which bought at 5-7x P/E previously) if such opportunities come.

I hope my views make a little bit sense to you. This is a great opportunity to buy stocks!

felicity said...

Hi FUng

Care to share some of these 5x PEs stocks. I do not seem to have found any unless those one time wonder or based on some extraordinary performances specifically for the year...

Unknown said...

Some may also call me a speculator, because i re-balance my portfolio far too often. I'm not too concern of others definition...so long as my humble portfolio is doing well...they can even call me a lucky punter, for all i care.
After all, aren't we all in stock markets solely to make money?!

I would like to be known as a ethical investor though.
But in the end, i will leave it to others...

Betronist said...

Felice, I'm not comfortable mentioning names publicly. Sent you an email just now. Thanks. :)

Disciple said...

NAIM is undervalued with good fundamental and potential !

goh said...

http://www.klsescreener.com/v2/. Have u tried this? It will help u screen counters which meet certain criteria. Then off course u need to validate each if they are some one hit wonders.

goh said...

Fung,

If you don't, would u pm me too if u have vet any counters under pe5 which aren't one hit wonders.

Goks