The Advantage of Being Small

The Bull has pause. The investing environment for the region has suddenly change tune to bearish.

At time of this uncertain investing environment, it's advisable to re examine your own portfolio, reduce shares exposure & increase your cash holding. (Buy & hold for long term is BS created by Fund Managers)

The advantage of small/ retail investor is that you can easily exit from the market. you can RUN within few minutes. Stay sideline & wait for the Bull Return.

WAITING FOR A NEGATIVE NEWS

The KLCI has been rising fast for past 1 month.

Break record high almost daily for the past 1 week !

The 2nd & 3rd liner may have room to play catch-up with the index, but I believe the market is waiting for a negative news to make a meaningful correction.

it's time to have a rest & reduce the position.

Re examine your portfolio & prepare for the shake -up.

The BULL will be stronger to chart new high after the shake-up.
(Will Foreign Fund enter Malaysia after they profit taking from Indonesia ???)

SUPER BIG DEAL IN SUPER BIG PROJECT

Malaysia BN"S Govt will award SUPER BIG PROJECTS which will benefits some infrastructure companies.

The GEM OF THE MANY PROJECTS IS THE PRIME LAND IN KL. ( Sg Buloh & Sg besi land bank)

GUESS WHO WILL GET IT ! their stock will fly when the awards announce.

YEAR 2010/2011 WILL BE THE year of SUPER BIG DEAL. never in Malaysia History.

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DAP says UEM, MRT, YTL deals show NEM ‘nothing but rhetoric’

By Melissa Chi

Pua: In fact Gamuda has already told equity analysts that it is 80 per cent certain of being awarded the bulk of the project, and this would be because they are the only commercial party who have been in consultation with the Government as well as Pemandu to develop the entire plan for the project.

KUALA LUMPUR, Oct 6 — The DAP suggested today that the Najib administration’s commitment to open competition under the New Economic Model (NEM) was “nothing but rhetoric,” citing as examples of patronage the MRT project, the proposal by Asas Serba to take over highway concessions, Tan Sri Syed Mokhtar Al-Bukhary’s bid to buy UEM and YTL’s involvement in the high-speed rail link to Singapore.

“Should the government decide to proceed with any of the above projects or privatisation of assets without any form of open competition, it will not only reflect the fact that the NEM is nothing but rhetoric, but it has no sincerity in wanting to promote “dynamic and efficient markets” or isn’t serious about “tapping new sources of growth,” the Pakatan Rakyat (PR) party’s national publicity secretary Tony Pua said in a statement today.

The Malaysian Insider reported yesterday that state asset manager Khazanah Nasional Berhad is looking at tycoon Tan Sri Syed Mokhtar Al-Bukhary’s financial track record as it mulls his offer to buy the UEM Group Bhd, which runs the profitable Plus expressways concessionaire, for the amount of RM15.6 billion.

UEM has substantial stakes in 8 public listed companies, and is prized for its 38.5 per cent ownership of PLUS Expressways Bhd, 28.7 per cent of Time dotCom Bhd, 32.0 per cent of Faber Group Bhd and 77.1 per cent of UEM Land Bhd. It also owns the Penang Bridge Sdn Bhd as well as Cement Industries Malaysia Bhd. As at the end of 2009, the net assets of UEM Group Bhd amounted to RM12.3 billion.

The Malaysian Insider also reported on October 4 that Syed Mokhtar had asked the government to sell 1,200ha of Rubber Research Institute (RRI) land in Sungai Buloh and the police training centre in Jalan Semarak.

The government is now considering the award of Malaysia’s largest infrastructure project to date, that is the Greater KL Mass Rapid Transit (MRT) system which is expected to cost up to RM46 billion with a Gamuda Bhd and MMC Bhd joint venture being touted as the “winners” of the project.

“In fact Gamuda has already told equity analysts that it is 80 per cent certain of being awarded the bulk of the project, and this would be because they are the only commercial party who have been in consultation with the Government as well as Pemandu to develop the entire plan for the project. “Similarly, YTL Corporation Bhd is expected to “win” the project to develop the high-speed train service between Kuala Lumpur and Singapore due to its involvement with Pemandu at the “laboratory” stage of the ETP,” Pua said today.

Deputy Prime Minister Tan Sri Muhyiddin Yassin had also admitted that the Cabinet is mulling over the RM50 billion proposal by Asas Serba whom Pua claimed was linked to Tan Sri Halim Saad to take over all highway concessions in Malaysia.

Pua said the proposal should have been rejected outright for it was “completely without basis, merit and it was completely unsolicited”.

International Trade and Industry Minister Datuk Seri Mustapa Mohamed had said that getting a tender through direct negotiation is “unfair”, to Malaysian students at the University of Melbourne on October 2.

He said that only high-security projects involving the military and defence were exempted from open tender.

But the slew of government assets and projects being directly negotiated by the administration which were cited by Pua today appeared to contradict Mustapa’s assertion.

Mustapa had said in Melbourne that “open tender means more competition, greater transparency, no corruption. And that’s what the public wants. And we are listening to the public.”

Pua also pointed out that Prime Minister Datuk Seri Najib Razak had emphasised that “we can no longer tolerate practices that support the behaviour of rent-seeking and patronage.”

“The direct and opaque award of these contracts to these connected parties flies in the face of the Prime Minister’s call for ‘inclusiveness’ and to eradicate ‘rent-seeking and patronage’,” he said.

He urged the prime minister to ensure and reiterate in the upcoming 2011 budget announcement that “all government projects, large and small as well as all government owned assets which are to be privatised will be tendered openly and competitively instead of being awarded on a directly negotiated basis”.

Take Position to benefit from the SHIFT from West to East,

The continue weakness in US$ & the surge in Asian currency has again confirm the SHIFT OF FUND from The West to The East. Esp the Asian + 3.

An active investor should be able to notice this Megatrend & take position in advance to reap benefits from this SHIFT.

Diversify your fund to invest in this region is a must in order to get max returns for your investment. Singapore & HongKong market is the most important market in this region, Singapore is the financial centre in Asean & Hong Kong is a gateway to China. You must not miss this two in your investment diversification. Allocate atleast 30% of your fund into this market.

Back at home in Malaysia, The Govt have just announce it's Economic Transformation Programme (ETF), the development focus will be in Greater KL & Nusantara in Johor.

PROPERTY & INFRASTRUCTURES PLAYER WILL BE THE MAIN BENEFICIARY FROM THIS DEVELOPMENT.

I have take a position in UEMLAND, LIONIND, BSTEAD, TA GLOBAL & DNP.

THE COMPANIES THAT HAVE EXPANDED TO CHINA & THE REGION IS ANOTHER BENEFICIARY FROM THE SHIFT.

AIRASIA, PADINI, PARKSON ARE ALREADY IN THE RADAR SCREEN OF INSTITUTIONAL PLAYER.

While the smaller player like FACB, Salcon, need time to prove their achievement in China Story'
You will be rewarded if they succeeded in their venture in China.

THE PROPERTY MARKET IN ASIA HAS SURGE TO RECORD HIGH IN PASS ONE YEAR, THE FUNDS WILL DIVERT TO THE STOCK MARKET AGAIN & THE BULL WILL BE BACK & SURGE NEW HIGH !

INCREASE YOUR POSITION WHEN MARKET PULL BACK & LET THE PROFITS RUN.

MARGIN OF SAFETY & +VE CASH FLOW

I find it hard to pick a good undervalue stock now compare to months ago as the price ( most of the good stock ) has recovered from low and reach 12 months high.

We must make sure that our pick now must meet the 'Margin of Safety' investment pronciple :-

We must ensure that the market price of the stock is lower that it's NTA or it's intrinsic value or the fair value of it's assets.

AND

The company MUST :-

1. Low Debts
2. Cash Rish
3. The ability to have positive cash flow from it's business operation.
4. Profits making capability even during difficult time.

JIM ROGER- A GIFT TO MY CHILDREN

I have bought this book; JIM ROGER- A GIFT TO MY CHILDREN.( Chinese Version)

I started to read it at night to my son, age 7, I hope he can learn some valuable advise from this Investment Guru & also improve his Chinese.

Wisdom from a wise man.

Nice to Hear, Talk is Sweet, Another MLM SCAM

My friend told me there is one (maybe more than one) FOREX trading company using Multi Level Marketing (MLM) scheme to promote FOREX TRADING.

This is getting popular in Penang, Malaysia.

They organise seminars, classes to recruit member, you just need to open trading accounts & place your money in that trading accounts, the forex trading programme will trade for you.

They claim this Forex trading programme will make you gain from forex trade, esp trading Euro in USD.

You will get commission if you recruited a new member, you also earned commission from your down line trades.
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THIS IS ANOTHER MLM SCAM (SAME LIKE SWISSCASH),
THEY SHOW YOU RESULTS FROM INTERNET FOREX TRADING, GAIN IS SO EASY !
BUT THE SCREEN THAT YOU ARE WATCHING, IS IT REAL ?

OR IT IS JUST A SHOW ? A PRE-PROGRAMME RESULTS !
SO LONG AS THE NEW MONEY (FROM MEMBERS)
CONTINUE TO POUR IN, YOUR GAIN WILL CONTINUE TO GROW.

GREED WILL MAKE YOU BELIEVE IT'S REAL, COS YOU ARE SO DESIRE TO MAKE MONEY, ESP EASY MONEY THAT COME TO YOU WITHOUT PUTTING IN ANY EFFORT.

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Common sense prevail !

• Forex movement is most complex, affected by many factors, known & unknown one, even the most experience forex dealer will not guarantee you gain.

• A computer programme is just a tools, if it really can make you gain, the organiser will never go to organise seminars & seminars (work so hard) to attract your money, they will instead enjoy live in holidays while the computer making money for them.

• We have seen many MLM scam, it repeat over & over again, using different name/subject ( Cafe, Unit Trust, Farm, Feng Shui, Gold Bar, Forex etc) to attract members to inject fund into their game plan.

• Money make money is real, but not this MLM scam, it has to be Prosper through Investing in proper method. usually value appreciate in longer term.
  

P/S: Jim Roger said in his Book, A gift to my Children : Common Sense is not that common.

80% were Professionals : Swisscash Victims !!!!!

80% were professionals !

THIS IS NOT JUST GREED! NOT THAT SIMPLE !

OUR EDUCATION SYSTEM MUST INCLUDE FINANCIAL PLANNING SUBJECTS, WE CAN'T JUST PRODUCING ENGINEERS, DOCTORS, LAWYERS WITHOUT FINANCIAL KNOWLEDGE.
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SC: Swisscash victims to get back part of their money

KUALA LUMPUR: Investors in the Swisscash Internet-based investment scam will now be able to get back part of their money following a consent judgment the Securities Commission (SC) entered into with two of the defendants in the case for a sum of RM31mil.

The SC said in a press release that the Swisscash scam involved an estimated total amount of US$83mil, which was what the Kuala Lumpur High Court ordered Albert Lee Kee Sien, Kelvin Choo Mun Hoe and Dynamic Revolution Sdn Bhd to pay in a judgment on Sept 25 last year.

According to SC chairman Tan Sri Zarinah Anwar, the SC entered into a consent judgement with Lee and Amir Hassan for the settlement sum.

She said the settlement was the largest ever in the history of the prosecution of such scams, which affected thousands of investors globally and prompted cross-border investigations involving seven other jurisdictions.

The previous largest settlement amount under the SC’s jurisdiction was RM2mil for insider trading in Padiberas Nasional Bhd, which was also distributed to affected investors.

“This is a milestone payout which is made possible following a consent judgment entered into with two of the Swisscash defendants,” Zarinah said, adding that the restitution would be based on a court-sanctioned distribution plan.

She told a media briefing yesterday that investors in illegal schemes could not expect regulators to get their money back for them as a matter of course. “Swisscash is an exception, in this case the recovery was only made possible not just by extremely painstaking efforts on our part but also by the close cooperation and support that we’ve been receiving from our counterparts in the various countries,” Zarinah said.

She said investors would have to show sufficient documentary proof of their principal investment and must not have been involved as recruiters in the scam. Investors who profited from their initial investment and still made claims would have their profits deducted from the claim sum while other criteria for consideration included whether investors heed the warnings by authorities before investing.

Zarinah said the first batch of restitution payments would be made early next year following approval from the court. She said 80% of the investors were male professionals and the profile was “not so typical of this kind of scam”.

She said to-date, there were 3,000 complaints filed against the scam.

OOH ! U HAVE NOTHING TO TAX AH ?

The Malaysia Govt has announce in Budget 2010 last month to implement 5% property gain tax on ALL property gain effective 1.1.2010.

This is not RPGT that impose tax on property sales for property disposal within 5 year of purchases, to control property speculation.

This new 5% tax will impose on ALL property sales, irrespective of how long you own the property, even you have dispose 20,30, 0r 100 years of old property.

AND the gain is straight forward selling price less purchase price. No deduction of bank interest, no adjustment on inflation rate.

THIS TAX IS NOT FAIR TO LONG TERM PROPERTY OWNER AND TOTALLY UNACCEPTABLE.

Why do not bring back the RPGT that tax on property gain from short term property speculators ?

This speculator grasp a huge gain from property speculation within short period of time, they 'GORENG' up the property price in the expense of the average home buyer.

The speculator should be the subject of this Property Gain Tax, not the normal average HOME owner.

MY GUESS ON WHY THE GOVT ULTIMATELY IMPOSE SUCH A SILLY TAX ON ALL PROPERTY OWNER :-

1) The Govt is actually thinking of bring back the RPGP in 2010 as the Govt need new tax to increase the Govt's revenue.

2) BUT this plan was facing resistance from Property Developer, because if RPGT is imposed, then all property developer will find it difficult to sell their properties, their BIZ will be affected badly. esp. when the economy has not recovered from the financial crisis.

3) The Govt has no choice, they can't confronting this 'Property BIG Boss', & the govt is in dire need to find some extra income, therefore the Govt has finally come up with this SILLY Tax:-

Tax 5% only, a small % tax on gain, from ALL property sales. Don't care whether it s new or old property, speculator or home owner, fair or not fair.

High End Properties in Penang - Imagine the SUPPLY 3 years from now

The prices for High End properties in Penang has reach record high level, with most of them selling above 1.0 mil a unit for landed property or even Condo.

The newly launch from Mah Sing will be price 3 - 4 million per unit, after this we will see IJM, Queensbay & E&O launching their HIgh End properties that selling above 1 mil for link house, & multi millions for semi D & Villa.

For those who wish to speculate in Properties, before you cheer for this record high property price, please sit down & try to imagine the supply of this HIGH END properties in 3 years time from now, when the the projects completed in year 2012-2013.

Will the price sustainable or what is the chances of properties price continue to surge if:-

1. The economy growth remained low at 3 -4 %
2. The average Malaysian monthly income level remained depressed at low level of 2000-5000 monthly
3. Over supply of High End properties by greedy developers.
4. Every new projects only have less than 50% occupancy when completed.
   

IT TELL YOU ALL : VALUE INVESTING

What is 'Value Investing' & How Value Investing can make us success in Investing & make us wealthy ?

This 2 articles from 冷眼 has tell us ALL ABOUT IT. .

IT'S SIMPLE YET DIFFICULT.

Get Rich Quick Scheme

Lately i have been told by a few friends about some business opportunity, one of it is a business of sheep farm for milk, the other one is CAFE business.

They all have the same business structure:-

1. Ask you to invest in the business, few thousands for a membership.


2. They will pay you very high dividend every months. they claim it is a very profitable Biz.


3. You entitle to recruit/introduce member, the more member you introduce, the higher money you will get.


4. The company main focus is to get more members to joint them, the actual cash flow is coming from the membership fees, not the income from running the Biz.

STUDYING THE ABOVE FACTORS, IT IS NOT DIFFICULT TO GET A CONCLUSION:-

THIS IS A GET RICH QUICK SCHEME!

EVERYONE THAT JOINT THEM IS HOPING TO EARN A FORTUNE IN SHORT TIME, THEY ALWAYS BELIEVE THAT THEY WILL NOT BE THE ONE WHO LOSE MONEY.

THEY WILL TRY TO BRING IN MORE NEW MEMBERS SO THAT THEY WILL GET RICH QUICK, THOUGH THE MEMBER THEY BRINGING IN MAY BECOME THE VICTIM LATER.

A SCHEME LIKE THIS WILL NOT LAST LONG.

WHY SACRIFICE YOUR RELATIVES & FRIENDS FOR OWN BENEFITS ?

(PICTURE: GEORGETOWN, PENANG ISLAND)

FD Depositers- What You Can Do To Max You Money

When the economy has hit the bottom & start to recover,

When the interest rate has reach the bottom & still at the bottom,

The risky assets will now become not so risky & appear to be rewarding,

The FD is not safe anymore if the assets price rebuke the trend & turn upward. You will only getting a negative real return on your FD.

You have the following choices:-

1. Buy shares, if you know how to pick a good under value stock.
2. Buy 1 Malaysia Fund, if you know nothing about shares, and dare not to take risk. This is safe because it's fixed price fund at RM1.00, you will never lose & stand a better chance to earn returns higher than FD rate.
3. Do nothing, remained 100% in FD & get negative real returns on your hard earned money. (Picture : Queensbay, Penang )
   

A Big Mistake IF Committed High Debts at Young Age

Financial Planning must start at young age if you want to achieve financial freedom earlier.

When young, the priority should be learn Investing, save more & Invest.

No financial planning is bad, but if you committed high liabilities at young age, this is worse than no planning.

IF you have just started working & earn a salary that barely enough to cover your monthly expenses, you are making a BIG mistake if incurred big DEBTS by buying a new cars & a house with minimum downpayments at young age.

You will end up incurred a huge liabilities owing to Banks, on top of daily expenses, you have to pay monthly installment & interest from your salary. Nothing left after all this expenses, means no saving for YEARS untill you finally settle your bank loans.( this will take you many years to settle, unless you are so capable that your promotions & increment beat the average salary earner)

It is advisable to avoid to purchase BIG ITEM like new car or house at young age, use the limited financial resources (salary) to save as much as possible, learn investing, invest your saving to earn extra income.

This investment income will be your second source of income, your employment salary is the major one. At some point of time, your investment income will grow & final overtake your salary as the major source of income.

Then this is time you can start to invest in House or purchse a better car without affecting your saving & personal wealth.

Income Vs Assets

Reading a book, the author stated that:-

We have already enter a century of 'not depending on income (salary)to earn, but earn base on ASSETS'

How TRUE!!

Those invest in PROPERTY & EQUITY will see their wealth grow faster in shorter time span.

THE FIVE LIONS

After 1997/8 financial crisis, The huge debts Lion Group went tro a series of restructuring and their assets regroup under this 5 lions in KLSE :-

1. Amsteel Corp Bhd


2. Lion Diversified(cum Parkson)


3. Lion Industries


4. Lion Corp


5. Lion FIB

In 2007, Amsteel Corp has been put under PN17, then delisted in KLSE.

Now we only have 4 Lions left in KLSE. (plus 1 Parkson) under Lion Group.

Lately when market stage a rebound from bottom, all 2nd/3rd liner has started very big jump from their price, including all this 3 Lions, ie LionCorp, LionDiv & LionInd.

All 3 are involve in STEEL INDUSTRIES, but NOT ALL are the same qualities in term of financial strength & biz performance.

Out of these 3 Lions, Lion Corp is the weakest one, it's burden with large debts, high cost of operations, low NTA, bad cash flow (or worse, negative cash flow) and still facing high risk of being INSOLVENT.

It's due to the above -ve factors that I never touch LionCorp. ( In contrast, I always like LionInd & Liondiv)

NOW WE SAW LIONCOR HAS JUMP UP IN PRICE WITH ACTIVE VOLUME (from low of 0.155 IN 12/3/09 to Thur closing of 0.395 in 30/4/09).

IS THIS VALUE AN ILLUSSIONS !

DO WE BUY STOCK ONLY FOR BELIEVING IT'S PRICE WILL JUMP ?

(Picture: Khoo Kongsi, Georgetown, Penang)

ASW UNIT FINISHED IN JUST 4 HRS FOR RM980MIL

From the overwhelming response for ASW units to snap up in just 4 hours, many have queuing for hours but got nothing at the end, this show the people has lots of saving, in banking system as FD & other saving accounts earning almost Zero interest. They just got exited when ASW can offer 5%-6% rate of return.

ASW is only Good for those have excess fund, other than invested in stock, properties etc, they still have more fund that idle in banking accounts that can be used to invest in ASW that is save & earn higher returns than normal FD.

But this may not be 'Good Idea' for those who has limited saving, esp so if this investment is your only investment that you barely have.

A rate of returns of 6% will not help to to improve your personal finance, because it's real rate of returns is not enough for U to offset the increased cost of living. (the inflation may easily exceeded 5%)

If you have limited fund, the best investment that can really help U to improve your wealth is 'Investing In STOCK'

• Earning 20-30% per year is not difficult in Stock if the investment sum is small.


• What U need to do now is TO LEARN VALUE INVESTING, & EQUIP YOURSELF WITH MORE FQ.


• SUGGEST U TO READ malaysiafinance.blogspot.com, & samgang.blogspot.com, as a starting point in learning Investing.
  
  (Picture: Georgetown, Penang)

Change of Sentiment

sentiment
Not long ago, investor / trader were searching reasons to SELL, seems end of the world is approaching.

Now, people are confused ! Full of Fear & Greed.

Sooner, they will looking 'REASONS' to BUY.
ANY NEWS WILL BE 'GOOD' NEWS.

BUY! BUY! BUY!

(Picture: Georgetown, Penang)

Decoupe, 2nd liner from Blue Chips

Lets PARTYING, who care whether the World is in Doom & Groom !

The KLSE 2nd liner has decoupe from the Blue Chips/CI.

Blue Chips can not rise without the returns of Foreign Fund, whereas 2nd liner can continue its road to recovery, thanks to the liquidity in the market/system.( with or without Foreign Fund)

The following factors help the 2nd liner to outshine the Blue chips Boy:-

1. The stock price has drop drastically in the past 8 months. Some even drop as must as 90% from it's top.


2. The banking systems in Malaysia has lots of liquidity in the sideline looking to invest for better returns.


3. Interest rate in banking system has fallen to very low level. And most likely to drop further.


4. 2nd liner has small capital & easier to move the share price.


5. Malaysian has not suffered serious loses in this latest crash, it's time to partying again. All syndicates are coming out now after months of inactivity's.

Off course we can join this Party to get some pocket money, But please remember to AVOID the following :-

1. PN17


2. -VE NTA


3. ILLIQUID & LOW VOLUME COUNTER


4. DO NOT CHASE HIGHER


5. NO CONTRA PLAY


6. DO NOT BORROW


7. DON'T TOUCH THE STOCK THAT U DO NOT UNDERSTAND

WHY INVEST IN SHARES ? JUST AN ILLUSION ?

For small shareholders, why invest in shares ? Is shares value an illusion ?

(for retail investor) Try to imagine:-

• U bought a shares at a certain price, what can U get from it if U hold it & never sell. (other than Dividend, if any)
  
• Even IF the company earn millions, what can U get if it never distribute Dividend.
• If no buyer to buy at higher price, U can't get good price to sell even it's a GREAT company
• Is shares market just a money game ? Buyer chasing up price, Seller pushing down price.
• It is just an illusion IF U don't sell at high & not buying at Low ! ?

OR

IT IS REAL 'INVESTING' ONLY WHEN THE COMPANY YOU BOUGHT IS GROWING IN EARNING & DO DISTRIBUTE DIVIDEND EVERY YEAR. & DIVIDEND GET GROWING TOO