Below is a comment from anonymous reader (if you dont mind, next time log in with name and join as follower, at least I know in future you are my follower, I'm more willing to reply).....
Hi, Rei:
Been following your blog since Dec 2011 and I appreciate very much your sharing. Very new to the market and I am learning from your blog. Thanks.
Everybody says market going to crash this year, so why u still keep Coastal n others in vi? U can buy back later maybe @ cheaper price.
Hi Anonymous,
Well, actually everyone was yelling market going to have a big big crash in 2010, indeed there is a big correction 8% around May2010 lasted for 1 month. Then came 2011, there is a real crash ? where our KLCI drop by 16% lasted for 2.5 months, well, market recovered back again. Now came 2012, another big crash coming ??? Correction confirm will come but crash ? well I don't predict as I'm lousy in forecasting but there is still no clear technical signal yet. See many people can yell the bad things around, if nothing happens, he/she will keep quiet while those who do not believe will be profiting happily too busy too question his yelling earlier.
So, my question to you is should we predict ? I would say no. Ask yourself this question ?
1) Are you a true die hard investor or just a trader ?
2) Do Warren Buffet sell all his share during the 2008 crisis and wait till 2009 to buy back ?
For me, I can't be a die hard investor, not patience enough. I'm a hybrid, touch some on VI , some on MP.
1) For MP play, you won't worry about crash or no crash, as you have your tight stop loss to protect your portfolio.
2) To get rich/financial freedom through trading (TA), you need a lot time to monitor market, you need to learn a lot & experience a lot & ALWAYS IN actual market. But as an investor (VI), you need lesser time to monitor the market but you need to spend quite some time to study a company before jumping into it . Have you heard of a story regarding one uncle (ignorant or die hard investor ?) who bought 10,000 units of hublic Bank 20years back that cost him merely around RM10K+ for her wife as a fund for her retirement. Not only he did not sell those share during peak or when market starts to CRASH or have BIG CRASH, he keep on re-investing her dividend back to purchase more shares. And now, the shares total worth is about RM1 million which, she has RM50,000 as dividend every year as her retirement monthly expenses. Can you find this type of stocks again ? Yes, he just spend merely a capital of RM10k+, and now they are living on the dividends every year, financially free and still have around RM1 million as her wealth to pass down.
Anonymous : so why u still keep Coastal n others in vi? U can buy back later maybe @ cheaper price.
Rei : Why I still keep is related to these questions in my head.
a) Has market crash ?
b) Has Coastal fundamental change ?
c) Is Coastal giving dividend? yes, 3% same as FD. If sell, where should I park my money ??? In FD?
d) Is Coastal already selling at cheap price relative to others ? actually is selling at 41% below her intrinsic value of 4.65 when I first mention about her ?
e) If sell, when should I buy back ? In 2009, where market started bull run around March09, still a lot of people does not believe market has recovered & having a bull run instead they waited till Sept 2009 and some till 2010, that time those shares are back to the prices where they sell first at 2008, and they lost their dividend during that year.
f) I'm thinking to sell some to put the money in my pocket if Coastal reach 2.19, then later change strategy to momentum play.
Hope this answer your questions.
