Mr Market for KLSE

If Equity Market is an individual, then Mr.KLSE must be a very low EQ & emotional person. You can see him depressed & down when mood is no good. But he will be very excited when his mood is good. His emotion will change very fast. Up & down! Some time it's so scary to watch when he is down.

Compare to others Mr. Market, like Mr. Dow Jone, Mr Straight time, or Mr. Hang Seng. Their EQ is certainly better than Mr. KLSE, They are more mature than us, Mr KLSE act like a kids.

There are reasons why Mr. KLSE never grow up and still behave like a kid:-

1)The retailer are more on short term and lack of investing knowledge.

2)Most of the foreign funds in Malaysia is for short term play, most of them are short term hot money.

3)Most of the local institutional fund are open ended fund, their buy or sell decision is highly affected by their moody retail investor. for eg. KLSE only has one closed ended fund ie I-Capital.

Once you have understand the behaviour or character of Mr. Market (KLSE), you should know 'buy & hold' is not the best strategy for Equity investment in Malaysia.

I believe 'Value Investing' and 'Cut & buy back' when Mr.Market is depressed.