I sincerely apologize of no post update on last weekend, as I was on vacation for 3 days. Well, I should take my initiative to update it before I went on leave. Okay, this improvement will be done next time, I mean I'll try if time allows me to do so. ;)
I believe you have gain a lot of profits from the stock market, if you starting to invest since March 2009. We focus on Blue Chips and they are giving us good return every month. But, not for now anymore. have you notice what is happening now? Since 2 weeks back, you would see the top 10 volume companies are strange to you, or a very low share price company on the show. Why? It indicates the stock market has bullish until certain level that investors felt the fundamental companies share prices are already expensive. So they started to turn to invest in penny and PN17 stocks, perhaps for fast profit and lower cost per share.
KLCI index has been raised for more than 50% within 7 months, are you worry?
For your information, PN17 means Practice Note 17/2005 and is issued by Malaysia SEC, which indicates the company are in a financial distress situation.
Practice Note 17/2005 and is issued by Bursa Malaysia; relating to companies that are in financial distress. Companies that fall within the
definition of PN17 will need to submit their proposal to the Approving Authority to restructure and revive the company in order to maintain the listing status. Recently, some PN17 companies are successfully uplifted by SEC, and they managed to attract huge investors and make them the top volume of the trading day.
Oilcorp is being fried and rumors saying it will be uplifting from PN17 category soon. Will you buy it?
Are you one of the investors investing into them? What a joke! These companies share price are not supported by the fundamental elements at all, or I can say that they are not making enough money to support their share prices. Since the volatility is so huge, if you are late a little bit, you may making a great loss! But from the look at it, they can make you a very quick and easy profit within a day! If you are lucky, you can get 100% return within a day. No kidding.
Yes, with such a temptation and hot cake, I've followed the best practice of one of my mentors, "wherever there is fish, we will go there to fish!", while another mentor of mine adviced those PN17 stocks are devils, don't go for it.
Okay, temptation is an issue for me. I've invested into two of them twice, without knowing anything about them. Pretty daring huh! And guess what, my daring and decision did not bring me any profit, and I encountered minor loss by cut loss early. See, thing is just simple but not that straight forward, else everyone would have make money from stock market, no? I would say it's the timing problem, and I applied the best practice to the wrong companies. It gave me a very good lesson.
We talk about investment with passive income and risk control here, not gamble and fast money.
As there is no one can predict the right timing to enter and exit every time, for those who already earn money from these companies, you are just lucky by enter at the right timing. If you don't agree so, congratulations, you should be a millionaire or perhaps billionaire by now.
So, what now? Say bye-bye to penny and PN17 stocks, and wait for mid-term correction to buy good fundamental companies with discounted price (if there is any). Have a nice weekend, folks!