Market Jargon

This is funny though :-

Market Jargon

Bull market :
a random market movement causing an investor to mistake himself for a financial genius.

Bear market :
a six- to eight-month period when the kids get no allowance, the wife gets no jewellery and the husband gets no sex.

Momentum investing :
the fine art of buying high and selling low.

Value investing :
the art of buying low and selling lower.

P/E ratio :
the percentage of investors wetting their pants as the market keeps crashing.

Broker :
poorer than you were last year.

Buy, buy :
a flight attendant making market recommendations as you step off the plane.

Standard and Poor (S&P):
your life in a nutshell. [that's me me me!!!]

Stock analyst :
idiot who just downgraded your stock.

Market correction :
the day after you buy stocks. [that's me me me too, Duh!!!]

Cash flow :
the movement your money makes as it disappears down the toilet.

Institutional investor :
past year investor who is now locked up in a nut house.

EBITDA : earnings before I tricked the dumb auditor.
EBIT : earnings before irregularities and tampering.
CEO : chief embezzlement officer.
CFO : chief fraud officer
EPS : eventual prison sentence.

Public Bank is Tops

Friday April 4, 2008
Public Bank is tops
PETALING JAYA: CIMB Equities Research has chosen Public Bank as its top pick among Malaysian banks, beating all its Malaysian peers on most operating aspects, including returns on equity (ROE), asset quality, loan growth and efficiency.
In a research note issued yesterday, it said Public Bank’s ROE was the highest in the sector and still improving. The bank also had the most compelling dividend yield, double-digit earnings growth, highest loan growth and superior asset quality, it added.
Other factors are the strong deposit franchise, greatest efficiency, new growth avenue in bancassurance, increased overseas contributions, and award-winning ability. The research house has raised financial years 2008 to 2010 net earnings by 1% to 4%, primarily for 26% to 38% cuts in loan loss provisioning.
In its dividend discount model (DDM), it raised the assumed dividend growth rate for the interim phase to 7.2% from 6.7%, resulting in a higher target price of RM14.60 compared with RM13.90 before, which is still pegged to a 10% discount to the DDM valuation.
“We continue to rate Public Bank an ‘outperform’, premised on the re-rating catalysts of continuing ROE improvement to one of the highest in Asia, a jump in FY08 dividend payment, stronger-than-expected contributions from Greater China, lower charge-off rates, and new growth avenue in bancassurance.
“Also, with a dividend yield of more than 9%, Public Bank has the best yield among the Malaysian banks,” it added.
CIMB Research said it considered Public Bank’s end-FY08 price/book value of 3.8 times to be reasonable, given its superior ROE and enticing dividend yield.
“In fact, we view its valuation as undemanding as its FY09 price/earnings of 12.7 times is below its five-year average of 14 times and does not fully reflect the improving ROE, dividend yield and asset quality,” it said.

Sold TENAGA

Sold my Tenaga at 7.40 for a small gain. Market looks very uncertain, reduce my holding to seek better opportunity.

Received Dividend from IOICORP, LONBISC & MNRB

Have just gotten my dividend payout of above counters. IOICORP interim 7sen, LONBISC first and final 5% and MNRB of 2nd dividend 5% respectively. Obviously, would expecting more payout in the near future. In the pipeline, BJTOTO, CARLSBG, GUINESS and MAYBULK are also declaring thier dividend payout as well. I particularly like MAYBULK's 30sen tax exempted, this translate to a 7% return of current price, is much higher comparing fixed deposit with mere 4%. The next in line which i expect a good dividend payout is PANAMY, PANAMY has a Nine-month net profit 40.825 million (increased 20.57%) would expect a 4th qtr result in end May and declaring its dividend in around end July. I guess it would be like final dividend of RM1 T.E which translate to a 9% return. Looks very much attractive, just got to wait patiently. Now you know why dividend play is such a boring waiting game, but the reward is slowly and surely. Till then happy trading.

KLCI Chart

MACD crossing, RSI turns up from oversold position and KLCI inching up.

Accept defeat and move on

A very nice article extracted from TheStar.

Accept defeat and move on
SUNDAY WITH T. SELVA
With the right attitude, even losing can make you a better person.
THERE will come a time in every individual’s life when things don’t go our way and this is the reality of life.
One of the most common occurrences is defeat, which comes in various situations in our daily and challenging undertakings and often causes anger, disappointment, depression, unhappiness and discomfort.
At the recent 12th general election, failure was more felt by a greater number of politicians than success and this had left many people with a disturbed mood, shame and pain.
I called two politicians whom I had interviewed during their campaign trail after their defeat was announced and they refused to answer my calls.
Another politician who I went to visit cursed and swore because he lost his seat and was forced to vacate his house hurriedly following the fall of the Selangor government.
A real man is one who can face up to his mistakes and learn something from them so that he never repeats them.
Here credit must be given to former Penang chief minister Tan Sri Dr Koh Tsu Koon who accepted his defeat and the downfall of the state government gracefully and passed on the baton respectfully.
He left with dignity and style and nothing commands respect more than a man who stands up to adversity because respect clears the way to power and success.
Many say this is easily said than done because it is difficult to accept or admit defeat.
One shouldn’t be afraid to acknowledge defeat because an individual who has the ability to stand up tall and admit that he’s wrong or that he’s been bettered in some way is admired and regarded as a gentleman.
This is because with the right attitude, even losing can make you a better person as the entire episode offers us an experience to learn from.
We spend our whole life building on a good character and this is not based on how we win every task we undertake but how we deal with losses and emerge stronger.
People with credible disposition do not fall following a failure but surface greater in the society.
Don’t dwell on your performance which wasn’t the best, instead recognise your defeat. Congratulate the winner and move on with positive thoughts to recover from your setback quickly.
Never hold grudges and take revenge because such thoughts are counterproductive and in fact they will affect your physique and aura.
Swallow your pride and ego and learn from your mistakes and turn your errors to your advantage.
Every loss should be played back in your head again and again to determine exactly why you lost.
This will keep you sharp and focused for the next time you face this particular adversary.
In a defeated situation you often ask why it was him and not you who came out on top. Did he have something that you didn’t?
There’s nothing wrong with admiring those who won and take stock of what it took to come out on top.
Another defeated politician I spoke to attributed his loss to the will of God and has turned to spirituality to heal his body, mind and soul.
Many people turn to the Almighty when in crisis, not realising that they should have done it before so that they have the divine guidance and grace in undertaking challenges in life.
The reality of life is there are super powers above us and all we have to do is give our best in all our undertakings and leave the rest to the unseen supremacy.
T. Selva, The Star’s Sunday Metro Editor, feels that every failure offers a chance to bounce back as a winner the next time.

Bought Tenaga (5347) at RM7.25

Bought Tenaga at RM7.25, not sure this is a right move. I am not a TA guy but i do refer to chart once in a while, to interpret Tenaga's chart now is definitely on the oversold position. This stock plunged to 7.20 from 8.50, is almost 1.30 drop since Monday, there maybe more down side looking at the uncertainty right now. With gross dividend of 5%, PE=7.64 and EPS=94 at current price looks very attractive to me and very near to 4 years support line at around RM6.80. These are the factors draw my interest to Tenaga but this purchase is right or wrong only time will time, judge yourself and execute it with your wisdom. In share trading definitely there is risk involved, one should calculate the risk over reward ratio then you will see the picture clearer, no definite or sure bid of up or down for any counter. Anything will happen, for now Tenaga is under tremendous selling force and may drift lower.........As usual, i must state that the above do not recommend a buy or sell call from me, your execution is of course totally at your own responsibility.

Received PBBANK's Dividend

Today, i received Pbbank's dividend (50sen/1000units). With this it further reduce my average purchase price to approximately 1.50 each. Pbbank's dividend payout has been quite consistent and generous during these few years. I will do nothing with this counter except buying in more if it fall to a reasonable price (i hope so ha.ha i.e PE=8) but this is just fat hope, nevertheless, anything can happen because every dog has its day, of course Pbbank is a blue chip stock not as i described here....ha.ha...just kidding. As you can see buying dividend counters definitely benefit over the long period of time, no matter how market falls you sleep with pace with this kind of counter on hand. Till then, happy trading....

Sold GENTING at RM6.65

Market rebounded strongly today and again i dicided to dispose off my Genting at 6.65 for a quick contra gain. For sure, can't get the highest price as usual but this is sufficient for me as i'm a fast contented person. Opportunity is always there, we just need to wait for the right time, right place and right stock of cource. Hold your bullet, there maybe more excitement to come. Happy trading.

Bought in GENTING (3182) at 6.35

Have managed to purchase Genting at rm6.35 today. Looking at the current market sentiment (slump by 33points), is definitely not a good move to go in but as a longterm investor, this could be the opportunity to catch some of the quality stock. For sure no one can get the lowest price, if you think this is the right move and your instinct tell you so, by all mean, go ahead and execute it without regret. Here i am, additional Genting in my portfolio. Whoever holding cash now is king. Till then, happy trading.

Wealth Sharing Talk ??

Is this for real a true experience of someone how he manages or plans his financial or merely make out a story to lure investor for participating ???? but interesting to read though, does this reflect you in anyway ???

Wealth Sharing Talk

Alex (not his real name) graduated in 1993. He managed to get a job with a MNC two months upon graduation. When he got his first salary, he booked a RM80,000 car. Six months later, he purchased a house for RM270,000.00. In late 1995, he married his long time sweetheart Jenny (not her real name). He spent about RM 30,000 on his wedding.

Due to cash constraints, he spent his honeymoon at a neighboring country (Thailand) where he used his credit cards to cover the expenses, about RM10000 in total. The following year, he got a promotion and his salary increased to about RM4,000 (including claims). Up to now he was paying the minimum payment only on all his monthly credit card balances.

One day in a shopping mall, he was approached by a credit card sales person with a balance transfer offer. He was told that he could transfer all his balances to this bank and have a lower interest rate for a period of two years. On top of that he would be given a gold card of that particular bank. He took up the offer as he thought he could save on the interest charges.

In 1998, Alex and Jenny had a baby boy. Jenny was being seen by a specialist at a private hospital. They also decided that she would quit her RM1800 job to be a full time housewife. Alex paid close to RM10000 in total for the medical bills for the duration of the pregnancy and delivery (via a caesarean). Alex utilized his new gold credit card for this.

From now onwards, Alex’s expenditure was more than 90% of his salary. Hardly anything was left for savings. In 2002, Alex got a job offer which was paying him about RM6000. He took the offer. He had a daughter in the same year. Again, the medical cost was close to RM10000 which he paid by credit card.

In 2003 he enrolled his son in kindergarten which cost him RM250 monthly. The next year, Alex lost his job due to the company’s decision to downsize. He was caught unaware without any savings. He survived by utilizing all his credit cards to their maximum limits. He only found a job eight months later and was offered half of his last drawn salary!

Today, Alex earns RM3200 from his day job and teaches tuition at night seven days a week just to make ends meet, including paying back his credit cards outstanding balances (which are standing at about RM43,000). Lack of financial intelligence coupled with a failure to plan has transformed Alex from a bright graduate into a depressed, disillusioned and de-motivated father and husband.

Contra Gain on LIONDIV

This morning buy in Liondiv at a price of 1.40 and disposing them at 1.43 within the same day, making a quick contra intraday gain on this trade. Some how have been very lucky while dealing with this counter and it never fail me, maybe is pure luck and right timing as somebody claims. Market is drifting down since the beginning of the week, will there be a traditional rally before GE ? Even if it is, the rally won't be long, this act would probably just to make good impression to the "voters", so that many will deceive the wrong impression ?? Just can't predict how it going to be, no matter how during this juncture be cautious with what you trade unless you really know what you trade.........

Completely RISK-FREE Way to Buy Stocks

Interesting Article :-

Completely RISK-FREE Way to Buy Stocks
Let me prove it to you...
By Brian HuntEditor In Chief, S&A Investment Research
Dear Reader,
I want to show you a technique that should change the way you invest, for the rest of your life...
Done right, it's a way to buy stocks that eliminates all of the downside risk. Not some of the risk – all of the risk.
Using this simple technique, you can arrange your portfolio so it will be impossible for you to lose another penny, ever, in stocks. Even better, you’ll still get 100% of the gain.
In other words, if you buy a stock and it drops 50%, you shouldn’t lose a dime. And if it soars to 1,000%, you keep every penny.
It’s kind of like buying an insurance policy for your portfolio. But, it’s even better than that. Because, done right, this “insurance” won’t cost you a thing.
In short, you get a risk-free investment in common stocks – for free.
This is the perfect setup for long-term investors who are seeking capital gains, but can't afford to lose any money.
You can adopt this strategy, buy all of the most promising businesses you find, whether they're risky or not, and never worry, ever again, about losing a single penny.
How is this possible?
Let me explain...
Step 1: Collect the Cash
The key to this technique lies in dividends. This is where it all starts.
To correctly use this strategy – and ensure you don’t lose a single penny on your investment (while keeping 100% of the gain) – you first have to find high quality businesses paying a stable dividend.
Generally speaking, these are not hard to find.
I’m talking about the Coca-Colas of the world. The Microsofts. The Exxon-Mobils.
But there is a catch.
Not every stock – blue chip or otherwise – pays the kind of dividend we’re looking for. In order for this strategy to work, the dividend must cover the “cost” of the investment.
What’s your cost?
The risk you assume by making the trade. Namely, what you’ll lose if the stock goes south.
If you invest $1,000 in a stock, your “cost” in this case is anywhere from zero to $1,000, depending on when you get out. But, believe it or not, there are companies in the market right now that will cover this cost for you – in part with the dividends they pay.
So the first step is finding the right company with the right dividend.

IOI Corp earnings surge 52% in Q2

IOI Corp earnings surge 52% in Q2
By IZWAN IDRIS
PETALING JAYA: IOI Corp Bhd's net income surged 52% in the second quarter ended Dec 31, as soaring palm oil prices boosted profits from plantation and resource-based manufacturing businesses.
The three-month earnings swelled to a record RM581.2mil, or 9.71 sen per share, compared with RM382.6mil, or 6.25 sen per share, a year earlier.
Revenue jumped to RM3.46bil from RM2.26bil before.
IOI Corp released its latest quarterly results during the market's midday break, reflecting a growing trend among big corporations to announce vital corporate development to investors in a more effective manner.
“The stock is pricey at these levels, but the premium could be justified given its size, trading liquidity and probably because most people consider IOI Corp to be the best proxy for rising palm oil prices,'' a local fund manager said.
Last year, IOI Corp bought its first overseas plantation land in Indonesia and acquired a rival refinery in Johor. Last month, the company announced a plan to raise RM600mil in fresh capital to help fund further expansion.
IOI Corp shares closed 20 sen higher at RM8.15 yesterday on volume of 13.3 million.
The stock hit a record RM8.55 a month ago.
IOI Corp's six-month earnings jumped 62% to RM1.03bil against RM638mil a year earlier.
The company said its palm oil fetched RM2,572 a tonne during the six months, up from RM1,560 a tonne in the year before.
“Barring unforeseen circumstances, all business segments are expected to continue to perform well in FY08,'' it told Bursa Malaysia.
The crude palm oil (CPO) futures on Bursa Derivatives, the global benchmark, had risen 80% over the past one year amid fears the global edible oils market was in short supply to meet growing demand worldwide.
The CPO futures contract for April delivery jumped RM91 to RM3,451 a tonne yesterday, its highest closing price.
“We remain upbeat on CPO price prospects as supply deficits for other edible oils will encourage consumers to switch to palm oil,'' CIMB Investment Bank said in an update on the sector yesterday.
Shares in Kuala Lumpur Kepong Bhd (KLK), the third most valuable plantation stocks behind Sime Darby and IOI Corp, hit a record RM19.20 yesterday, up 60 sen.
KLK is due to announce its first quarter ended Dec 31 results on Feb 20.
In a separate statement, IOI Properties Bhd said it posted a net profit of RM91mil on sales of RM191mil for the second quarter. Its six-month net income surged to RM171mil on turnover of RM396.8mil.
The improved performance was attributed to “higher demand for residential properties”, it said.
IOI Properties proposed a gross interim dividend of 60 sen per share for the period.

Bought CARLSBERG

Bought Carlsberg at 4.18 for 1000 units today. Total holding increased to 3,000 units for now. The impending dividend is going to announce someway around this month. Still very much in tact with dividend stocks. PM has just dissolved the parliament this afternoon and the market react negatively on the announcement as to what i've anticipated in my previous post. Many will sell off thier share as many think that is a safer move for the time being. I will foresee uncertainty on the KLSE market till the end of General Election. During this time is best to wait and see how the GE turn out before making an attempt again in KLSE. Till then happy trading....

Wishing All A Happy And Prosperous Chinese New Year 2008

Sold my LIONDIV again

Have sold all my LIONDIV at 1.61 this morning, another quick contra gain, thanks to DJ who rebounded strongly. The timing is just right for me on these two occurences recently. Try not to keep too long as the CNY and GE are both just right the conner. Would like to take this opportunity to wish all 'A PROSPEROUS And HAPPY CHINESE NEW YEAR'. See ya....

Bought Back LIONDIV

Bought back LIONDIV at 1.50 for 5000units, just can't resist the temptation after seeing the price drop below my target price at 1.57. Let see how it work out, obviously this stock is deviate from my focus on dividend stock. This is just could be short term attempt.

Sold RESORT

Tomorrow is Federal Territory Day and is a holiday for Kuala Lumpur and Labuan. Next week is CNY, wow...time flied. Everyone guessing GE is going to be announced after CNY, GE will be held in around March. How is our bources ? KLCI drifting lower and looks like trend is changing. I just sold 1000units of Resort at 3.86 this morning keeping 2000units that was purchased at a lower price for longterm. Looking and waiting KLCI to drift lower before entering into market again for a cheaper price hopefully. Anymore excitement after GE ?? is lifting currency control gonna stimulate KLSE ?? Sorry to tell that, can't predict the future, wait and see loh...

Received 15sen T.E from PANAMY

Just received 15sen tax exempted from PANAMY, i believed the next round of dividend is someway around July and probably is gonna be a good one as well, minimum 1.00 again ? just need to wait and see. Anyway, i still maintain 500units of this Panamy, thinking of buying back when it fall back to my buying target price around 10.70. Till then happay trading.

Sold LIONDIV

Bought LIONDIV on Tuesday for 5000 units at price of 1.57 and now (Thusday) have disposed all of it at a price of 1.70 for a quick contra gain. Not bad huh...thanks to the US rate cut or the DJ rebounce ?? Have you ever ask yourself how long will this going to sustain ? If you are speculator then it would be better for you to reduce your holding, sighting that the General Election is around the corner. Life after GE may seem weary.

Shares Swap

Looking at the current market, really heart sick. Whatever gain previously, has now turned almost zero gain. Take years to build your gains and take days to collapse it. Phew...whatever is it "don't catch the falling dagger" but everything seem to be very expensive before, now you feel dirst cheap. Hard to hide your temptation away, i'm eager to accumulate more quality stocks like Genting, Resort, Tenaga, Maybulk, Carlsbg and Cepat but instead finally, decided to dispose off half of my PANAMY at 11.10 for a swap of LIONDIV share at 1.57 for 5,000 units. Nonetheless, still stay very positive with the market for 1st quarter of year 2008, will try liquidate some and keeping majority of my stocks for very longterm as this is my focus which i'm still very much intact with "dividend stocks"......"if you are an investor, see this as normal cycle. Constant and increasing dividend is what we are looking at". Happy trading.

Received Dividend Again From BJTOTO

I have received dividend again from BJTOTO, this round is 41st & giving 8sen and noticed that the income tax rate has reduced further to 26% instead of 27% last year. This will bring down my total average purchase price of BJTOTO to $2.01 for batch 1 and $4.21 for batch 2 respectively. Overall average price will bring down to $2.56. Other than this, i managed to dispose IOICORP @ 8.15 and grab it back @ 7.90 for a contra gain of 25sen during this sell down, this retain my holding to IOICORP with a cheaper price instead. With this my average price is $5.72. Till then happy trading.

KLSE Top 10 Picks for Year 2008

The 10 picks are:

Sime Darby Bhd. This is the largest player in the must-have sector of plantations.
TA said Sime Darby was an excellent proxy to the plantation sector, given its fairly good sensitivity to the upstream plantation business, which is the most profitable part of the palm oil value chain. “We estimate a RM100 per tonne increase in crude palm oil (CPO) price would boost Sime Darby's earnings per share by 3%,” TA said, adding that any further earnings upgrade could stem from the group's successful extraction of merger synergy.

IOI Corp Bhd. IOI Corp is the second largest plantation counter by market capitalisation after Sime Darby. Half of its operating profit for the financial year ended June 30, 2007 was derived from the upstream plantation business.
“A key catalyst for upgrade in earnings forecast is potential acquisitions. The group has been on a merger and acquisition trail, acquiring land in Sarawak and Indonesia,” said TA.

British American Tobacco (M) Bhd. This stock is on the “buy” list of Citigroup. The consensus 6% to 8% contraction in market is too pessimistic, said Citigroup head of Malaysia research Wai Kee Choong. The counter could surprise from a hike in civil servants' pay.

Public Bank Bhd. In the banking sector, this stock is on the list of Citigroup, Aseambankers and TA.
TA said: “As capital ratios are expected to improve due to the adoption of Basel II (international banking guidelines on capital requirements) by early 2008 and no mandatory transfer of 25% annual earning to statutory reserves, the group will have some leeway to improve its capital management.”
The management has also given its guidance that the bank's risk-weighted capital ratio and capital adequacy ratio are expected to improve by 70- and 50-basis points, respectively.
Citigroup likes the counter for its strong growth in business loans and asset management business as well its dividend yield of 5% to 7%.

SapuraCrest Petroleum Bhd. At the current price, oil and gas services player SapuraCrest still has plenty of upside. While the share price has corrected some 41%, its fundamentals remain intact, said Citigroup. SapuraCrest's order book now stands at more than RM5bil.

Petra Perdana Bhd. This oil and gas sector play looks like good value at the current price.
TA's pick has outperformed earnings expectations in the recent results season due to a higher vessel utilisation of 85% and charter rates that are 10% to 15% higher as the company rolled over spot contracts that have expired.
“This is likely to be the order of the day with demand for vessels shooting up following greater exploration and production activities but hampered by tight supply,” said TA.
Future growth potential is bright, with 17 more new vessels coming on stream by 2010 and most of the vessels tailored for deepwater operations, said the research house.

PLUS Expressways Bhd. In the infrastructure sector, TA likes highway concessionaire PLUS, whose traffic volume could grow greatly with the government-driven domestic development in the next few years.
TA said traffic volume growth of 7% year-on-year to 10.9 billion passenger car units (PCU) for the 10 months to October 2007 “has been encouraging, so far”.
The group's future acquisition of the ELITE and Linkedua highways announced in June last year is also expected to benefit PLUS partly from advantageous pricing from friendly party and parent, UEM Group.

Tenaga Nasional Bhd (TNB). TNB is the choice of Aseambankers and TA. At its current price level of around RM9.80, the stock has plenty of upside to the two brokerages' target prices.
Aseambankers said there could be a “reversion of 'old' bellwethers like TNB”. “We also foresee some resurgence, particularly for TNB, following a lacklustre year for the old 'TMT' bellwethers TNB, Malayan Banking Bhd and Telekom Malaysia Bhd,” it added.
TA said driving the demand growth is the general increase in economic activity, with an expected gross domestic product growth of 6.2% in 2008 and “spillover effect” from the commencement of big-ticket Ninth Malaysia Plan (9MP) projects.

RCE Capital Bhd. For mid-caps, RCE has the largest upside among Aseambankers' picks.
RCE, the brokerage said in a report, could be a “beneficiary of higher consumer spending from the recent civil service salary hike”.

Ann Joo Resources Bhd. This is Aseambankers' favourite counter in the building materials sector, which still has plenty of upside and is trading quite cheaply at the moment.
Ann Joo is an emerging integrated steel player that could benefit from sky-high steel prices. Aseambankers expects “titanic growth” for building materials plays.

Candlestick Patterns for Trading 3

Monthly Portfolio 31-December-2007

Goodbye 2007 and Welcome 2008 !!! My portfolio for the year 2007 !! No movement for my current holding. Have adjusted GUINESS purchase price after receiving 32 sen final dividend. Definitely will continue hunting for more value stock in this new year of 2008. I welcome all reader suggestions and provide me good dividend stock, particularly those stock that giving increasing dividend each year. Till then please find below and happy trading for year 2008 and make abundantly. May your resolutions come true......

Candlestick Patterns for Trading 2

Candlestick Patterns for Trading 1

Net Dividend Collected

Take a look of the net dividend that i collected thus far for my portfolio :-

Remisier Versus Online Trading

Wednesday December 19, 2007
Remisier versus online trading
In this article, we will look into whether we should buy shares online or use our existing remisier’s services to execute trade
COMMISSION rates for Internet trading and cash upfront transactions will be fully negotiable next year.
Although the full details on the actual implementation are not available yet, if the commission on Internet trading drops to a low of 0.15% (it may be even lower for some stockbroking firms), retailers may be tempted to execute the online transactions themselves without going through their remisiers.
Based on the existing structure, most retailers are paying a brokerage fee of about 0.6% per transaction. Assuming some stockbroking companies are willing to offer commission rates of 0.15% for Internet trading, there will be savings of 0.45% for retailers who trade online.
Nevertheless, we need to understand that transaction costs have two main components: explicit cost and implicit cost.
Explicit cost is the direct cost of trading, such as brokerage commission, stamp duties and clearing fees. Implicit costs are indirect trading costs like opportunity cost, market impact and missed trade costs.
Opportunity cost is the loss of opportunities due to the time retailers are required to spend on executing stock transactions instead of focusing on their main business or their work.
If you are working and have limited time to monitor the stock market, you may still need the remisier’s services to execute stock transactions.
I personally feel that it is really not productive to stay in front of the computer just to execute a few stock transactions. Sometimes, it can be quite time consuming getting the best price.
Any retailer who wants to trade online needs the necessary skills to be able to read market movements. He needs to know whether the current price is the best price to buy, or wait for a while because he may get a cheaper price later.
Market impact is the realised profit or loss reflecting the price movement of a share from the price decided on to the execution price.
Since remisiers follow market movements throughout the day, they should be able to read those movements better than we do.
They may not be able to get the best price in every trade but if they are able to save one or two bids lower than your intended purchase price, the cost saving can be quite substantial.
For example, your remisier is able to get one bid lower for you when you want to purchase a stock priced at RM1.50. You will save 1 sen over RM1.50, which is 0.67%.
Assuming your remisier is able to do that in eight out of 10 trades, the average cost saving will be 0.53% (8/10 x 0.67%).
This saving will still be greater than the commission of 0.45% that you would have saved through online trading.
Besides, you have not taken into consideration the time you could have saved and the opportunity loss on your current business if you spend too much time on share trading. The extra 0.45% that you pay is for your remisier’s skills.
As mentioned earlier, besides opportunity costs and market impact, there are other implicit trading costs, like missed trade costs.
Missed trade costs arise from the failure to execute a trade in a timely manner.
If you split a purchase of 20 lots of Stock A into two equal limit orders when the quote for Stock A is RM11.00 to RM11.10, the first order is executed at the buying price of RM11.00, after which the quotation moves up to RM11.10 to RM11.20.
The second order is placed and executed at RM11.10. You are paying an additional 10 sen (or 0.9%) for the remaining 10 lots.
Missed trade will cost you an additional 0.45% (0.5 x 0.9%) as 50% of your remaining stocks were traded at a price that was 0.9% higher.
A good remisier should be able to save you the above implicit costs. In this competitive business environment, remisiers need to continue upgrading their skills in order to give better services to their clients.

How Much is this affecting you with minimum $40 brokerage Fee Next Year?

Is imposing minimum brokerage of $40 create impact to KLSE or otherwise ?

Scenario 1 :- Buying penny stock…..
a) Purchase value 1,000 units @ $1 = 1000.00
b) Brokerage @ 0.42% = 4.20 but minimum is 40.00
c) Clearing Fee @ 0.03% = 0.30
d) Stamp Duty @ 1.00/1000 = 1.00
Total Purchase Cost = 1041.30

You need 9 sen to breakeven, coz, buy + sell will cost you about 82+…..

Compare to old calculation, total purchase cost for above scenario will cost you 1013.30

You need 3 sen to breakeven, your buy+sell is relatively much smaller, about 26+…..

Scenario 2 :- Buying Big Cap…..
a) Purchase value 1,000 units @ $10 = 10000.00
b) Brokerage @ 0.42% = 42.00
c) Clearing Fee @ 0.03% = 0.30
d) Stamp Duty @ 1.00/1000 = 10.00
Total Purchase Cost = 10055.00

You need 12 sen to breakeven, coz, buy + sell will cost you about 110+…..

No change with old calculation as the minimum brokerage ($40) is fully utilized.


So folk, in order to fully utilize your brokerage fee, government is encourage you to buy more instead. Will this affect small timers the most ?? Currently with 9 sen up we can afford to have a profit but with the introduction of minimum $40 charge this 9 sen in turn become your breakeven point unless of course if you can afford to buy in bulk then is a difference scenario. This is bad, imagine, the current lot size is 1 lot = 100 units, if someone thrown 100 units share to you out of the 10,000 units you queued. You will be suffering with minimum of 80+ charge with the mere 100units share that you acquired. I can see that there is no point of buying small on penny stock now because the gain is just too insignificant for one to expect and the gain may just well serve as a subsidy for the brokerage fee unless a jackpot was hit that the counter just rocket high. Thus, folk stay big from now onward, there isn’t much place for small anymore.

Monthly Portfolio 29-November-2007

Added GENTING, MNRB & more RESORT to my portfolio this month. As usual, nothing special to my portfolio except waiting for dividend patiently. Have adjusted YILAI purchase price after receiving 5sen of dividend. One thing to take note is that the trading volume is declining, does this indicate that the hot money is pulling out slowly ? If so how much will this affect KLCI this time round ? Will the "Synergy Drive" listing spur some excitement to KLSE ? I guess only time will tell.....lets wait see...tomorrow....

Dividend Yielding Stocks - PBBANK, PANAMY, MNRB, GUINNESS, BJTOTO & APOLLO

Listed below are some of the high dividend yielding stocks. These stocks have been consistantly paying good dividend without failed. Some DY is as high as 10% based on current price, one can just investing in this type of counter to profit the dividend and still much better off than putting the money in FD for a mere 3.7%.

PBBANK - Dividend Yielding 6%

PANAMY - Dividend Yielding 10%

MNRB - Dividend Yielding 9%

GUINESS - Dividend Yielding 8%

BJTOTO - Dividend Yielding 7%

APOLLO - DIvidend Yielding 8%

EKSONS & LHH

Alicafe, below is for you, hope it help. Obviously you can see LHH is on the uptrend and EKSONS is on the downtrend. There is saying "buy on support and sell at resistance" but is all depend whether the trend is up swing or down swing. Take your judge carefully. Determine the S&R is important as it will help you to execute your trades more accurately.

Disclaimer: The above don't recommend a Buy/Sell. Make your own judgement and be responsible to your own act.

Monthly Portfolio 29-October-2007

This month i have added 2 more stocks in my portfolio. The first one is PANAMY, i have been tempting to buy this stock since many months back and could not get the right time and right price. Eventually decided to settle with RM10.70 and reason buying this is simple, that is none other than "dividend" that i'm looking for. This company has been paying solid dividend for many years back till now and i like this so much as it suit my type. The second stock that i have been ventured in is IOICORP. I believe that there is still room for grow as the commodity prices for oil palm is kept pressing new record high like oil. Thus, plantation stocks in here to play.

Other than the above, i have adjusted the purchase price for BJTOTO, CARLSBG, MAYBULK and RESORTS after receiving dividend of 10 sen, 5 sen, 8 sen and 2.88 sen respectively. Please find below updated of my portfolio. Till then happy trading.

5077-MAYBULK MALAYSIAN BULK CARRIERS BHD

MALAYSIAN BULK CARRIERS BERHAD ("MBC or the Company")
Article Entitled: "Buoyant rates to lift MBC profit"
We refer to the query by Bursa Malaysia Securities Berhad vide its letter dated
6 September 2007, in relation to a news article appearing in The New Straits
Times, Biznews section, page 40 on Thursday, 6 September 2007 and in particular
the following statements:
"MALAYSIAN Bulk Carriers Berhad (MBC) ... said its net profit this year could
rise as much as 17 per cent...."
"... full-year profit could reach between RM360 million and RM365 million...."
In response to the above query, Mr Kuok Khoon Kuan did not give percentage nor
did he give any comparison between the 2006 and expected 2007 performance.
However, as quoted in the Financial Daily of 6th September 2007, Mr Kuok
disclosed that “There is no let up or signs that it (the shipping industry) is
going south-bound anytime soon. For the second half of 2007, the Baltic Dry
Index (“BDI”) has been going up, so there is no doubt that the performance will
be equally strong.”
Mr Kuok commented that in view of the strong drybulk market as indicated by the
BDI, if profit before tax (PBT) for first half 2007 was extrapolated, then the
full year PBT would be about RM360 million to RM365 million.
We wish to clarify that the quoted figures were not intended to refer to any
financial estimate, forecast or projection of our Group.

Public Bank set to sustain record

It plans to go big in China
By ELAINE ANG
PUBLIC Bank Bhd (PBB) has the distinction of being one of the most favoured banking stocks of the investment fraternity – churning out solid earnings each financial year and lining shareholders' pockets with fat dividends.
Its asset quality is the best in the industry with net non-performing loans ratio standing at 1.5% as at end-June. This has not compromised loans growth, which has been sustaining at double-digits for some years.
The bank's prudence has also stood it in good stead, as it was not affected by the US subprime crisis.
The banking group's excellent performance has been recognised industry-wide bagging it many awards throughout the years, enough to fill a trophy cabinet and more.

Tan Sri Teh Hong PiowSuch an outstanding track record raises the question of whether PBB's performance is sustainable in an increasingly competitive industry thus putting much pressure on the banking group to continue to perform.
Chairman and founder Tan Sri Teh Hong Piow is unfazed and is confident PBB would not disappoint its shareholders.
“We intend to sustain our track record of delivering financial performance, enhancing shareholder value and rewarding shareholders with strong dividend policy.
“This will be underpinned by continued adherence to good corporate governance and transparency.
“We also see ourselves as providing more cutting edge, innovative and superior products and services supported by a well-trained and motivated sales team,” he told StarBiz.
Teh's vision is for PBB to remain the premier bank – to be in the forefront of the Malaysian banking industry while expanding its regional presence particularly in the Asia-Pacific region.
“We believe in doing what we do best. Going forward, we will be driving our non-interest income by widening our suite of products and services. We intend to intensify our wealth management business,” he said.
One avenue is via Public Mutual Bhd. Presently, 22.6% of its fund is invested in the fast growing Asia-Pacific region, and 1.2% invested in Europe and the US.
Teh expects Public Mutual to make further inroads to increase its market share backed by its strong distribution network and excellent fund performance track record.
“We will continue to be on the lookout for synergistic opportunities. In this light, we will be forging strategic alliances with the best in their own industries.
“We are in the midst of finalising a tie-up with a global insurance company to customise bancassurance products as unique propositions to our customers,” he said.
As part of its plan to expand its regional presence, PBB has aggressively expanded its branch network since it acquired Asia Commercial Bank Ltd (ACB) in May last year.
ACB was subsequently renamed Public Bank (Hong Kong) Ltd.
The total number of branches has almost doubled to 24 from 13, with 22 branches in Hong Kong and two branches in Shenzhen, China.
“This expansion programme will be continued to enhance our market reach.
“We will also leverage on the existing 40 branches of Public Finance Ltd to cross-sell the bank’s products and services,” Teh said.
He added that PBB was also building its resources especially the sales force to aggressively penetrate the Chinese market to grow its loans.
This was particularly in retail lending with emphasis on consumer financing such as personal loans, motor vehicle financing and mortgage financing.
It will also focus on lending to middle market commercial businesses, particularly to small- and medium-sized enterprises.
Looking ahead, PBB will continue to strengthen its overseas operations in Indochina and look into the feasibility of providing a wider range of financial products.
This would be in in addition to the conventional loans and deposits.
Teh said Indochina was a relatively untapped market with good potential to develop the financial and insurance services.
CampuBank Lonpac, a joint venture between CampuBank, PBB and LPI Insurance Bhd commenced business operations on Aug 30 offering the full suite of general insurance products.
“We are very happy with the volume of business garnered so far in this short period of less than one month.
“Currently, there are no plans for any mergers and acquisitions.
“However, we are always open to financial-related business opportunities which have earnings sustainability and the potential to increase shareholder value,” Teh said.
As OSK Research banking analyst Chan Ken Yew puts it: “PBB is not a sexy stock. It is a bit boring like any low beta (risk) stock.
“It grows slowly but very steadily and investors like it as a dividend cum growth stock.
“I can comfortably say that the group should continue to sustain its performance for the next two to three years at least.
“Its aggressive expansion overseas in Hong Kong, China and Indochina should also help boost the group's future financials.”

Monthly Portfolio 29-September-2007

There isn't any movement on my portfolio, still holding my same old stocks. Has been quite lazy lately to post anything here. My focus has been diverted to Forex lately and still generating profit slowly & steadily. Below is my portfolio for the month of September, till then happy trading. Sayonara...

Dry-bulk shipping rates reach new highs

By C. S. TAN
PETALING JAYA: The Baltic Dry Index (BDI) crossed the psychological 8,000-point level, closing at a new high of 8,090 on Wednesday.
With the latest surge in the index, the BDI, which measures commodity shipping costs of various routes and ship sizes, has averaged 6,950 so far in the current quarter, 16% higher than the average 5,983 in the second quarter this year.
The average in the current quarter is 93% higher than the average 3,593 in the corresponding quarter last year.
A Bloomberg report quoted China Cosco Holdings Co chairman Wei Jiafu as saying yesterday that shipping rates for dry-bulk cargo, such as iron ore and coal, would continue to rise as China's economy would see robust growth for the next 20 years.
In another report, Bloomberg quoted China Ocean Shipping (Group) Co deputy director of research and development Yang Shicheng as saying that China would import 390 million tonnes of iron ore this year, 11% more than last year.
That would hold freight rates at record highs, he said, adding that iron ore would remain the key driver of freight rates, having replaced grain since the start of the century.
AmResearch said in an update report yesterday that dry-bulk charter rates set all-time highs again last week, with average Capesize spot charter rates ending the week at close to US$125,000 a day, while the average Panamax spot charter rates finished at over US$62,000 a day.
Capesize refers to ships that are too large to pass through the Suez Canal and Panama Canal, and which have to go around the Cape of Good Hope or Cape Horn. Panamax refers to ships that are too big to go through Panama Canal.
AmResearch cited a media report that an aluminium smelter would be put up in Sarawak by a joint venture between Rio Tinto and Cahya Mata Sarawak Bhd.
“We view this news as positive to our bulk universe, both for the long haul (Maybulk) and feeder services (Hubline).
“Hubline will have first mover advantage due to its stronghold in resource-rich Sarawak, and with the expected delivery of two handysize vessels by 2009, Hubline will be running a total of 26 bulk vessels,” AmResearch said.
Handysize is the most widely used type of dry-bulk vessel and are between 15,000 and 50,000 tonnes deadweight in size.

Monthly Portfolio 28-August-2007

This month (August 2007), KLSE market took a tumble on concerns of US Subprime mortgage tussle. However the KLCI meltdown recover from a 17% drop to a 9% drop as at yesterday closed. Would this bumpy ride continues....? I would say it certainly depend very much on US Dow Jones, it seem like DJ creating a tank for Asian Markets. When DJ is up, Asian Market would follow and vice versa. The dust has not settled as yet.

This month i bought in JAKS for a quick hit and run at 0.90 sen, luckily was able to dispose at 0.93 sen for a small gain. It was never my policy to buy this type of stock but just can't resist the temptation to join others for a quick punt. Other than this i also received a 25% dividend on PBBANK and have adjusted the purchase price accordingly. My portfolio's profit shrunk from 66% to 60%, a 6% reduction compare to last month. Will certainly take a closer look at the market since September is a budget month, traditionally some tide would be expected especially some of the tobacco & beverage counters. Till then happy trading.

Public Bank not exposed to US subprime mortgage market

KUALA LUMPUR: THE Public Bank group has no exposure to the US subprime mortgage market and expects this year to be another year of strong performance, said chairman Tan Sri Teh Hong Piow.
"The Public Bank group's overall operations, including its Labuan Offshore Bank and overseas operations in Hong Kong and China, Indochina and Sri Lanka have absolutely no exposure to the US subprime mortgage market segment whether directly or indirectly in its investment portfolio," he said in a statement.
The unit trust funds managed by Public Mutual also do not have any direct or indirect investment in the US subprime mortgage market.
Teh expects the group's loans growth to be sustained at the annualised rate of 17% as achieved in the first half of the year.
"The group's customer deposits continue to grow strongly. Asset quality is expected to remain strong.
"Currently, the group's net non-performing loan ratio is only 1.5% – the lowest in the banking industry in Malaysia.
"With its healthy loan to deposit ratio of 75%, the group is very liquid," he said.

Monthly Portfolio 28-July-2007

KLSE market has a sell-down yesterday following the US market plunge overnight. KLCI dropped 26.12 points & settled at 1355.28 points. More selling would be expected next week. I am staying out of the market for the time being and might pick some quality stocks if i see some light at the end of the tunnel. Meanwhile my portfolio increase slightly despite of the sell-down yesterday compare to last month. However, may foresee greater impact after next week. Being longterm, i'm not worry much on the sell-down in-fact it create opportunity for me to get some quality stocks which is relatively high now. Till then happy trading.

Resorts World begins share-buyback

Saturday July 21, 2007
Resorts World begins share-buyback
By KATHY FONG
PETALING JAYA: Resorts World Bhd kick-started its capital management plan with the commencement of its share-buyback scheme yesterday.
This came after the group had in a surprise move sold a 14% stake in loss-making Star Cruises Ltd last Friday for RM1.16bil cash.
Resorts World announced to Bursa Malaysia it bought back nine million shares at an average price of about RM4.15 a share, costing it RM37.36mil. The stock closed at RM4.22 yesterday, up 32 sen.
This is the first time that Resorts World has bought back its own shares.
Genting Bhd’s head of strategic investments and corporate affairs Justin Leong said: “As Resorts World’s largest shareholder, we are pleased that Resorts World has finally embarked on its capital management programme.
“We see this as a positive step towards enhancing value for all shareholders.”
In the past, there was criticism that Resorts World’s capital management was not efficient enough, given its large idle cash reserves.
Resort World’s cash pile is nearly RM2bil now and is expected to balloon to RM4bil by year-end.

Monthly Portfolio 30-June-2007

This month my biggest gain is from BJTOTO after the share breaching the $5 psychological barrier. BJTOTO has reported its 4th Qtr result with a decrease of 18% profit and declared 7.5sen dividend for this qtr. Would likely to hold for a while for Bjtoto and monitor how the price move before taking any action to it. I have adjusted RESORT & YILAI purchase price after receiving dividend of 3sen & 8sen respectively. Below is my latest portfolio & there isn't any movement for this month as my focus has diverted to newly discover financial investment that is "Forex" trading at the moment...hehe...yeah..got new toy to play. I'm about 12% in profit right now for this new gizmo not bad huh...!! errr....till then Happy trading....

Trendlines for Novice

Part 2

To find major support and resistance levels, one way is to draw trendlines on chart. It is always possible to find the direction of a particular stock is headed by connecting more than 2 points price tops and bottoms on a chart.

Below appears to be going down in price for EKSONS after connecting the tops price like so. Oscillators like MACD and RSI show down signal :-

Below appears to be going up in price for MAYBULK after connecting the price bottoms as follows. MACD seem crossing showing buy signal and RSI is above the 50% strength level. MAYBULK seems very interesting trading at this price, probably an upside is to be formed in the later stage.

Why did i say so for MAYBULK, it is because if you buy on or near the line, when/if the line breaks, you will get out very near where you got in. Not only that, you will have a clear set of reasons why to get out. That is, you will know that the trend has broken down and that the situation that caused you to enter the trade has changed. Base on current market and the trendline, i would recommend a buy for MAYBULK on current state.

Till then happy trading.

How to define Support & Resistance on Stock for New Traders - Novice

PART 1

Have you ever seen a zig-zag chart before ? The price of a stock in KLSE market works in similar fashion in between the support and resistance.

SUPPORT - is where the buying at a price lever is strong enough to cause a reverse in a downtrend.
RESISTANCE - is where the selling at a price lever is strong enough to cause a reserve of an uptrend.

Most of the traders look for support levels when they wish to buy and they similarly look for resistance lever when they wish to sell.

Trading Stocks Is A Long Haul Thing

When you ask around among the circle of your friends how successful is their stocks trading, it can be pretty depressing. Only probably about 5% of my friends are making any money. With so many trading stocks, why is this?

1. Mentality is wrong. One would probably think that this is the area where they can get Rich Quick by trading stocks and how easy and profitable it is to trade with so many brokers giving abundant informative recommendation of stocks. Well, it is easy to actually trade, but difficult to trade well. Many people will just start trading without knowing what they are doing. A good course of study on the company and how they fare with their competitors with each other, what is the earning, is this company fundamentally strong, TA & blah blah blah is a must before you start any live trading. You must be educated in stocks to trade profitably. You can't just go on gut feeling. Stocks trading should be done for the long haul.

2. Trading for the wrong reasons. Once, i ask my friend, for what is the reason you trade stocks since you are not in the positive all this while. He told me, at least there is a thrill in my daily live and most importantly "is for the fun of it". Yes, there is a high associated with making a huge profit from one trade, then you are all in positive. However, do not treat stocks trading like a day at the race track. You should not trade for the excitement of trading. Not to mention that there is a lot of time to be spent just waiting for the correct trade to come along. Also, don't start stocks trading because you think it only requires a few minutes a day to make money. Even if you are scalping the market (making small quick trades), it takes time for those trades to develop and mature. One should sharpen their saw before start trading and with only one reason, that is "Winning".

Happy trading.

Congratulations to our PM

Would like to take this opportunity to offer my sincere congratulations to our PM and soon-to-be first lady for their coming marriage. All the best and may God bless you.

Modern Zen

Interesting...........Look at item number 18...

Monthly Portfolio 26-May-2007

KLCI stood at 1339.08 yesterday, many have felt that KLCI now is at tail end and hard to find a new breath after sustaining the bull for almost a year. This is mostly the perception from many each time i get their comment, will the KLCI end right here and make a south turn ?? What would you think ??

This month, there isn't any trading in my portfolio. I have adjusted the purchase price for CARLSBG and GUINESS accordingly after receiving 32sen and 13sen of dividend respectively. Other than that, I have added a 500 free units of MAYBULK shares after the "ex" of the bonus issue of 4:1. Please find my portfolio below & till then happy trading.

Whose fault is it ??

Just want to share this, i find it funny. Interestingly, when i happen to have a lunch chat with my friend recently, he told me that he just got a small windfall while placing an online order of a penny stock. To his surprise and disbelief that when he checks the matched order, it was 10 cents below his ordered price, which means, a 40 cents stocks which was placed and it matched at 30 cents. The price jumps back to 41 cents right after that where he quickly sold it for a quick intra-day profit. I wonder is a computer glitch or human error ??? Walau er.... This kind of thing also can happened ????

Magnum may unveil big special dividend

KUALA LUMPUR: Magnum Corp Bhd is finally set to proceed with its long-expected capital management plan as it may soon announce a bumper payment to shareholders.
A source said the company, subject to board approval at a meeting on Tuesday, could announce a special dividend of between 60 and 70 sen a share.
The board may give the go-ahead for the numbers forecast operator (NFO) to distribute its vast cash pile of more than RM700mil.
Last year, Magnum raised its dividend to 14 sen a share from 10 sen. The return of cash will benefit shareholders and none more greatly than Multi-Purpose Holdings Bhd (MPHB), which owns 51% of Magnum.
The cash from Magnum may help MPHB pare down debt but the source said MPHB also had a good story to tell.
MPHB, the source said, was set to announce a record profit for its first quarter ended March 31, thanks to Magnum's strong NFO business and a robust stockbroking business owing to the bull run on Bursa Malaysia.
MPHB announced a pre-tax profit of RM86.4mil and a net profit of RM60.5mil, or 6.3 sen a share, for its fourth quarter.

Which high cap stock will replace Maxis on KLCI?

Below was extracted from The Star for you reading pleasure :-

PETALING JAYA: The Kuala Lumpur Composite Index (KLCI) is going to miss some significant members with Maxis Communications Bhd on its way out of Bursa Malaysia alongside Island & Peninsular Bhd (I&P) and Malakoff Bhd, which are also being taken private by their respective owners.

The three companies have a combined capitalisation of close to RM50bil, representing almost 7% of the benchmark's total market capitalisation (market cap) based on yesterday's closing prices.

Maxis closed RM2.30 higher at RM15.30 while I&P and Malakoff were unchanged at RM2.33 and RM10.30 respectively.

Earlier this week, business tycoon T. Ananda Krishnan made a 20% premium offer of RM15.60 per share to take full control of Maxis.

Last week, Permodalan Nasional Bhd announced plans to take I&P private by buying the remaining shares it does not own for RM2.35 each.

Malakoff, on the other hand, will be delisted at the end of this month on completion of the sale of its assets to parent MMC Corp Bhd.

A fund manager noted that the liquidity in these counters would have to be distributed elsewhere. “It means more money will be going into other index-linked counters,” he said.

While the funds could move to new entrants to the benchmark index, there were not many blue chips that were not already part of the KLCI, the fund manager added.

Bursa Malaysia chief executive officer Datuk Yusli Mohamed Yusoff said in an e-mail reply to StarBiz that the exchange would implement “a standard process'' to replace any index-linked stocks that had been de-listed.

“The number of index constituents in the KLCI is fixed at 100. The weightage of each constituent is distributed by way of market cap, with bigger companies assuming higher weightage,” he added.

A head of research at a local brokerage said: “Ultimately it depends on how Bursa wants to replace the companies. The new entrants don't have to be of similar size to those that are being dropped.''

He said based on sectors, YTL Power Bhd could represent the power industry and Green Packet Bhd the telecommunication sector.

Other potential candidates were Nestle (M) Bhd, Dutch Lady Milk Industries Bhd and JT International Bhd, the research head said.

“Liquidity and free float could be an issue. But there are stocks on the KLCI currently which are low in liquidity.

“Market capitalisation is probably one of the biggest single factors,'' added Pong Teng Siew, head of research at MIMB Investment Bank.

Monthly Portfolio 28-April-2007

There is a lot of movement in my portfolio this month. Firstly, i have adjusted the buying price accordingly after receiving the dividend from BJTOTO and MAYBULK. I have added 2000 units of LONBISC for a price of 1.68 and 1.64 respectively. Thus, making my total holding of LONBISC to 4000 units for an average price of 1.68, the reason for increasing the number is simple - "long term & good dividend payout". If you follow my previous posts closely, you will know that i'm one that favour on dividend stocks, that is my style. I always believe that dividend stocks are defensive stocks, irrespective whether the market goes up or down, i have a peace of mind holding on to my stocks unless some drastic or unexpected thing that tarnish the company image happened like terribly bad financial result, company being wind down due to poor governance, a catastrophic that causes the company's core business no longer a niche market and etc...

Secondly, i also bought in 2000 units of RESORT for an average price of 3.40 and 5000 units of YILAI at 1.23. These are my biggest buying spree so far for this month. Below is my latest portfolio, till then, "Happy trading".

Good Article - What triggers a downfall in the market?

Ooi Kok Hwa is a licensed investment adviser and managing partner of MRR Consulting and he writes on 'Personal Investing'.
AS a result of China's higher-than-expected economic growth of 11.1% and fear of possible further interest rate hikes in China, regional markets, including Malaysia, fell sharply last Thursday.
This was the second time after Chinese New Year (CNY) that a drop in Chinese stock prices rattled the markets across Asia.
According to Lee In Ho in his study on Market Crashes and Informational Avalanches, there are four stages in a market crash. They are boom, euphoria, trigger and panic.
Under the boom stage, the market will normally have a main theme that excites everyone about stocks.
In Malaysia, several positive measures under the Ninth Ma- laysia Plan got investors excited about the construction and property sectors. At this stage, this is seldom a bubble as companies continue showing good corporate results. A bubble will be created at the euphoria stage. The unjustified extrapolation of future earnings and the revision of higher target prices by research analysts can cause overconfidence in companies’ future performance.
A bubble will start to take shape when the general public reacts to this overconfidence. An irrational exuberance will occur when market prices and expectations about future values are far beyond the fundamentals of the companies.
However, no one will know when the rise will stop. A market will resume its upward trend until something triggers the downfall.
Usually, the stock prices get higher and steeper just before the market crash.
At the trigger stage, private information will reach a threshold that triggers other traders to alter their behaviour. At this critical situation, when almost everyone is at irrational exuberance, any event can trigger the market to tumble.
In January 1994, our stock market put the blame on former finance minister Tun Daim Zainuddin for saying that he had sold all his shares because prices had reached dangerous levels.
Until now, nobody can really understand the main reason behind the sharp plunge on the Shanghai Index right after the CNY.
According to some fund managers in China, the selling was mainly due to investors panicking when they noticed that their friends were selling stocks.
A famous researcher in behavioural finance, Robert Shiller, conducted a survey by asking institutional and individual investors what was in their mind during the stock market crash in 1987. One conclusion he drew was that the crash was due to people reacting to each other with heightened attention and emotion.
Investors seemed to follow what other investors were doing. As a result of action and reaction, a feedback loop was created when everyone had a simultaneous reaction to common stimuli.
A market crash is described as a process that corrects a public belief that is inconsistent with the current distribution of private information. The severity of a crash will depend on whether the market is filled by “new generation” investors or experienced traders.
“New generation” investors do not know anything about the stock market but are greedy and want to get quick money from it. A market will not crash if it has experienced traders who know how to control risk and when to cut losses.
However, if a market is filled by “new generation” investors with no holding power and do not know when is the right time to sell a stock, any sharp drop in prices could result in panic selling. At this panic stage, the fear of further drops could cause big fall in prices.
When will the stock market crash again?
My usual answer for this question is the stock market will not crash as long as you continue to worry about when it will crash. The market will crash at the time when you least expect it to happen. Investors should remember that the market always performs beyond your expectations.
We should not be too worried about when the market will crash. Instead, we should consistently review our portfolio and sell those stocks whose prices have gone beyond their intrinsic value.

Famous Quote

Reveals the high dividend yielding stocks

Below is the compiled list of all high dividend yielding stocks. Those in light green are my preference at the moment. Take a look you may find your preferred stocks here. Bear in mind that these companies might not pay the same amount of dividend as they used to be, is very much depend on the company performance & result that lead them for consistent dividend payout.

Public Bank (1295, RM 9.25) first-quarter net profit up 23%

1st Qtr Net profit = 476million

Estimated annualise EPS = 56sen

Maintain target price = RM9.80

More companies raising dividend

Hey, check this out:-

By YEOW POOI LING (Source : The Star 12 April 2007)
PETALING JAYA: High dividend yield stocks will provide support amid lingering concerns of market correction or weakening in the US economy.
OSK Investment Bank head of research Kenny Yee said dividend stocks helped “mitigate volatility in the portfolio” as they were more stable in terms of share price movement.
He noted that more and more companies were raising their dividend to reward shareholders.
“Companies realise that paying good dividends helps boost the share price as well as increase efficiency in capital management,” he said, adding that it also improved return on equity.
For example, Public Bank Bhd declared a total dividend of 60 sen per share for the year ended Dec 31, 2006. Since the dividend’s ex-date on March 16, the share price has appreciated 5.7% to RM9.20 yesterday, giving a total return of RM1.10 per share or total shareholders’ return of 12.6%.
Meanwhile, MIMB Investment Bank head of research Pong Teng Siew said during a market rally, investors tended to look for capital gain, hence stocks with attractive dividend yield only attracted “a certain type of investors.”

He said taking a defensive approach during a bull run might result in the loss of opportunity to make capital gains due to the low volatility of high dividend yielding stocks.
“Usually in a bull run like now, investors buy for capital gain and not for stable income because they do not want to risk under-performing the market,” Pong added.
Companies that had a stable recurring income would be able to sustain paying out high dividends, he said, citing examples like Chemical Co of Malaysia Bhd, Bintulu Port Holdings Bhd and Highlands & Lowlands Bhd.

Monthly Portfolio 30-March-2007

This month, I have disposed 2000 units of MAYBULK at a price of $3.52 and reducing my current holding to 2000 units. My act to do so is in fact to buy back the same units at a lower price and hopefully make some different out of it but i must admit i make a mistake here, my deed cost me a price where not only i won't be able to buy back, i may missed out the dividend and the impending bonus issue later on. I have bought 2000 units of LONBISC at $1.70 in my portfolio, high dividend payout (8%-9%) is part of my reason of buying this stock, further more the down side for LONBISC is low. Being a long term player, one should hold their stocks as long as he/she want, because over time we will tend to benefit from it. Another counter which is under my greate interest is AXREIT. This counter provide high dividend/income distribution of about 7%-8% each year, which indeed, i find it very attractive and it fall under my cup of tea where my focus is on high yielding generating stocks. Velo's blog has more detail writeup on this counter. Would consider buying AXREIT if price fall below $1.70. I have just received a dividend payout from PBBANK recently and it was a good dividend payout in fact where $400 per 1000 units was given out to its shareholder. I have adjusted the buying price for PBBANK in my portfolio accordingly (refer to below). Until then happy trading.

KLCI - 23rd March 2007

KLCI inched higher to close at 1235.65. KLCI is definitely on the up trend and the momentum seem to have strengthen for the past week and the next level will be testing 1250 point and i believe that the KLCI is likely to break this level. Advise to hang on to your stocks for a little bit longer.

BJTOTO (1562, RM4.72) Something Fishy ?

Interestingly & particularly, this counter has drawn my attention lately due to the active share buyback from the company. See below chart:-

With the active shares buyback the price has inched further and even breakout from the price that I set for at $4.74 today. Hence, the upside possibility is high if nothing suspicious arouse. The next level that the price may head to is $4.90. RSI +, MACD crossed over & price are heading north, thus, at this moment would recommend a trading buy on this counter.

KLCI - 16th March 2007

KLCI closed 1182.2 point on 16/3/2007 and the volume continues to slide. In the near term KLCI need to breakout from the 1215 level to surge higher else it will be very much on a consolidation stage.

KLCI - 9th March 2007

KLCI rebounded and is testing its psycological level at 1200 points, once it surpass this level the next level will be testing at 1217. Will this rebounce sustain ? Transaction volume is in a declining stage as shown in the above chart, does this means a sign of exiting by the investors ? Will history repeat itself of year 93-94 ? Looks very similar. Be careful folks, if possible try reducing your holdings. At this moment just wait and see whether the upside prevail and bringing back the confidence level to the market.

Portfolio 04-March-2007

Obviously, with the down fall, my portfolio shrunk as compare to previous month. However, i have added 1000 units of BJTOTO in my portfolio but i must reckon that i got it on the high side. Will accumulate further if price fall further, this will certainly apply to my other stocks as well. Being a long term player, one should not bother much on the correction as this create opportunity for us to grab more quality stocks in our portfolio. I foresee KLCI will drop further next week, am now standing by to grab more stocks in case it fall to my level of price. Once again may the best price be yours. Happy trading.

KLCI - 3th March 2007

KLCI closed 1164.68 on Friday 2/3/2007. The down turn of KLCI started on Monday 26/2/2007 and have been consecutively down for the rest of the days.

26/2/2007 -- 1272.87 (-10.6)

27/2/2007 -- 1237.08 (-35.79)

28/2/2007 -- 1196.45 (-40.63)

1/3/2007 -- 1180.91 (-15.54)

2/3/2007 -- 1164.68 (-16.23)

Needless to say, no matter how good was your recommendations are. It all turn out to be otherwise, that's no doubt about it. The question is will the KLCI find it footing and recover next week?? I am negetive to it. However this create chance for us to grab some quality stocks which we may have missed out earlier. The market have been bullish since last July 2006, it is time for a dip though this may have been affected by the overall worldwide market down turn. In every situation there is an opportunity, so find it and seize it. May the best price be yours.