invest/Trade ( Millionaire's Path)

TM-CI potential profit of 16% within a month!

2010-08-17T21:44:00.002+08:00

Telekom Malayisa (TM) is set to release its quarterly financial report very soon. I think it would be a fantastic result. Nevertheless, today TM breaks it resistance of RM3.43 to close at RM3.46 (intraday high RM3.49). I really expect the momentum to go on strong. Its trading volume also increase significantly.

There is a few TM call warrants listed on KLSE namely TM-CI, TM-CJ, TM-CK, TM-CL, TM-CM and TM-CN. I like TM-CI the most as it comes with a discount 3.18% and gearing of 5.24. It is going to mature very soon, its expiry date is 17/9/2010, this is a very good news to discounted call warrant. This means that TM-CI potential profit of 16% (3.18 x 5.24) is going to be released very soon. With current strong momentum of TM, I really think that TM-CI would be a very great trade. TM-CI has increased 22% the last 3 days.

Ok, good luck

GOon

TM may gain RM102m from Measat deal

2010-08-16T17:06:00.000+08:00

Telekom Malaysia (TM) stands to book an extraordinary gain of RM102 million if it has written down its investment in Measat Global Bhd to RM2.50/share.

In a note here today, ECM Libra Investment Research, it was believed that TM has written down its investment in Measat to around RM2.50 per share since 2003.

"The extraordinary gain will translate to about an additional three sen for financial year 2010 earnings per share," it said.

ECM Libra said the Measat share disposal would increase TM's bulging cash pile marginally.

It said with cash and bank balances of RM3.9 billion as at Mar 31, the sale proceeds from its 15 per cent equity stake in Measat, however, were unlikely to make significance difference to TM.

"Nonetheless, as TM's cash and bank balances continue to build up, it is increasingly become a question of when, and not whether TM will return excess cash to shareholders," it said.

The research house said press reports indicated that TM was unlikely to reject the offer as the promoters would have been inclined to have approached TM before that deal was announced to get their buy-in

US : "A Terribly Slow Pace of Job Growth": Private Sector Hiring Disappoints, Again

2010-08-07T02:14:00.002+08:00

"Tepid", "anemic", "desultory" and "punk" are among the adjectives being used to describe Friday's July jobs report.

At 131,000 the headline payroll loss was worse than expected. In addition, the tally for May and June was revised down by nearly 100,000, further evidence the U.S. economy cooled considerably after its first-quarter spurt.

"This remains a terribly slow pace of job growth," writes Dan Greenhaus, chief economic strategist at Miller Tabak.

The big disappointment was private sector hiring, which totaled 71,000 last month, weaker than anticipated. (As expected, government payrolls fell by 143,000 as temporary census workers were let go.)

"The private sector number is the most disturbing," Tig Gilliam, CEO of Adecco Group North America, says in the accompanying video. "It's great that we have a positive number but we're really not seeing an acceleration of private sector jobs, which is what we need to see fairly soon."

Year-to-date, the private sector had added about 630,000 jobs, far short of the level needed to replace the nearly 8 million jobs lost since the recession officially began in December 2007. The unemployment rate held steady at 9.5% while the "real" unemployment rate (U6) remained at 16.5%. With 14.6 million Americans out of work (44% for six months or longer), the unemployment rate being unchanged is not good news because it shows many Americans remain discouraged or are dropping out of the labor force -- and out of the official tally.

"We've got to expect that number to go up because we have so many potential workers sitting on the sidelines," Gilliam says. "As the job market gets better, more people will get active and engaged and that will have the effect of increasing the unemployment rate."

Gilliam notes temporary hiring continues to improve, which is traditionally a good leading indicator for future employment growth (and good for Adecco.) Both average hourly earnings and the average workweek rose in July, which are positive signs, but, overall, the U.S. employment picture remains grim.

Singapore and Malaysia Property Outlook

2010-08-03T21:26:00.000+08:00

Singapore
Price index for non-landed private homes up 2.6%. Latest flash estimates from the National University of Singapore show that its overall price index for non-landed private homes rose 2.6 per cent in May over the preceding month. Since the end of last year, the index has appreciated 8.6 per cent. The Singapore Residential Price Index (SRPI), compiled by the NUS Institute of Real Estate Studies, covers only completed properties.The sub-index for the central region, which covers a basket of properties in postal districts 1-4 and 9-11, grew 2.5 per cent in May over the preceding month, and 7.9 per cent year to date.The sub-index for non-Central region rose at a slightly faster clip, of 2.6 per cent month-on-month in May and 9.1 per cent year to date.

Developers' sales have slowed since May as Europe's economic crisis affected financial markets, causing home buyers to withdraw to the sidelines, even ahead of the June school holidays and World Cup season. The market is expected to enter a consolidation phase, marked by slower sales as developers try their best to maintain prices and potential buyers hold back their purchases, hoping for price cuts. Joseph Tan, executive director (residential) at the firm, forecasts that home prices are likely to remain firm despite his prediction that developers' new private homes sales will slow to about 2,000 units in Q3 from an estimated 4,000 units in Q2 and 4,380 units in Q1. 'Home prices are likely to stay stable given the positive outlook on the economy and strong boom in manufacturing and exports,' he added.

CBRE estimates that developers sold about 600-700 private homes in June, compared with 1,078 homes in May and 2,207 units in April. The developers are estimated to have sold 8,300 units in the first half of this year. They sold 14,688 new homes for the whole of last year. Despite the stronger increase in the central region, the flash estimate index for May for the location was still 3.7 per cent shy of the pre-financial crisis peak in November 2007. In contrast, for the non-central region, the latest index has already exceeded its respective January 2008 pre-crisis peak by 11.1 per cent. As a result, the overall SRPI flash estimate index for May is 5.5 per cent above its November 2007 high.

The Ministry of Trade and Industry (MTI) is offering 10 industrial plots for sale under the second-half 2010 industrial government land sales programme. The plots, with a total land area of 19.92 ha, comprise three sites on the confirmed list and seven on the reserve list.

Five of the 10 sites are new - a 4.65 ha plot at Yishun Street 23/Yishun Avenue 9 on the confirmed list and plots at Woodlands Avenue 12, Tuas View Square, Kaki Bukit Road 4 and Ang Mo Kio Street 62 on the reserve list. The rest are being rolled over from the H1 2010 reserve list.The government will sell all the plots on leases of 30, 45 or 60 years. Colliers International director (industrial) Tan Boon Leong noted that all three plots on the confirmed list are zoned Business 2 use. 'This will cater to strong demand for such sites as seen in the high number of bids for B2 land parcels last year.'

Singapore is the third most liveable city in the world, going by preliminary findings from a broad-based study commissioned by a think-tank here.The Centre for Liveable Cities (CLC) released initial results from its Global Liveable Cities Index (GLCI) at the World Cities Summit (WCS) yesterday. Of the 64 cities assessed, Geneva emerged tops and Zurich second. Copenhagen and Helsinki tied at fourth.Asia-Pacific cities which made it to the top 20 include Hong Kong (eighth), Melbourne (10th), Osaka (16th) and Tokyo (18th). CLC got the study going in 2008 to assess cities' liveability in five areas: economic vibrancy and competitiveness; environmental friendliness and sustainability; domestic security and stability; quality of life and diversity; and governance and leadership.GLCI is still a piece of work in progress, but CLC and some of the study's co-authors will present it at a WCS session today to gather feedback on its criteria and methodology. 'In terms of looking at liveability from a more holistic and balanced framework, I think there are probably very few, if any, such set of indicators that are around,' CLC director and National Environment Agency CEO Andrew Tan told the press yesterday. Across the five areas which the GLCI looked at, Singapore fared best in domestic security, coming in first. It scored fairly well in terms of governance, quality of life and economic vibrancy. But its showing in eco-friendliness was weakest, at 14th place.

Singapore is the 11th most expensive city in the world for expatriates, one place lower than its 10th position last year, says HR consultancy firm Mercer. But the city moved up a notch to fourth place among cities in Asia-Pacific - which for the first time has three cities in the top 10 list of the dearest places for expats.Tokyo remains the most expensive city in Asia-Pacific, with sister city Osaka second, and Hong Kong third. Singapore and Seoul round out the top five. Part of the reason Asian cities feature more prominently in the worldwide top 10 list is the rise in residential property prices in the region, said Mercer senior researcher Nathalie Constantin-Metral. 'At the end of 2009 and the beginning of 2010, residential property prices in many Asian countries rose as the economic environment began to stabilise and demand for good expat housing increased,' said Ms Constantin-Metral.

Kuala Lumpur, Malaysia
Moves by the Malaysian government to develop state land in and around the centre of Kuala Lumpur are being watched by property players amid concern that huge new projects could lead to an over-supply of office space. The state sites add up to more than 240 ha. And in a bid to trim the budget deficit, there has been talk of developing them to 'unlock value' and create a multiplier effect. One such site is a huge 162 ha plot at Sungei Besi - a 10-minute drive from the city centre - that is now the Royal Malaysian Air Force base. This has been earmarked for mixed development, with an Islamic financial centre at its core, once air force moves out. According to media reports, the federal government investment fund 1Malaysia Development and the Qatar Investment Authority are likely to be master planners for the project. Most property players are confident new supply over the next two years can be comfortably absorbed. But others are less certain, pointing to competition from new offices sprouting up in the greater Klang Valley, in areas such as Bangsar, Mont Kiara, Petaling Jaya and Sentral, among others. Unless the planners get it right, the government's projects could put additional pressure on rents post-2012. Yields would also suffer should foreign investors be slow in making Kuala Lumpur home and setting up shop.

Another Recession Due Circa 2012: Jim Rogers

2010-07-27T23:55:00.000+08:00

A new recession would be due around 2012 but central banks will not be able to throw cash at it anymore, Jim Rogers, chairman of Rogers Holdings, told CNBC Tuesday.

India's central bank raised its interest rate Tuesday, joining other monetary authorities such as the Canadian and Norwegian central banks in hiking rates to stem inflation.

"We do have inflation in the world… most central banks should resign," Rogers said.

There has always been a recession every four to six years in the US "since the beginning of time," and that would mean another one is due around 2012, according to Rogers, a hedge fund pioneer who started the Quantum Fund with George Soros in 1970.

"When the next one comes the world is going to be in worse shape because the world has shot all its bullets," he said.

"Is Mr. Bernanke going to print more money than he already has? No, the world would run out of trees," Rogers added.

The fact that second-quarter earnings have been better than expected does not necessarily mean that the recovery is stronger than anticipated, he said.

"I'm sure some of it is expectation management… but remember what the comparison is. We are talking about the second quarter of 2009, when we thought the world was coming to an end," Rogers said.

"Worry about next year, don't worry about the second quarter now. That's history," he added.

Rogers reiterated his view that the pan-European stress tests into the health of banks were just public relations and said he still owns the euro.

why 80% of investors lose money in stock market?

2010-07-07T01:14:00.000+08:00

I guess this is how most of the 80% investors/traders react to stock market. They buy high and sell low. Bravo!!!

In my humble opinion, one of the way to gain in stock market is to buy stocks when everyone is avoiding it and sell the stocks when everyone is fighting hard for it. It is really a simple strategy.

When people shout at you for buying stocks and you are a lonely investor----BUY signal.
When all uncles and aunties are putting their hard-earned money into stock market and coffee shops are filled with stock-market related chats------SELL signal

The right thing to do is to buy low and sell high. Does it sound easy? I don't know.

Calculate put warrants premium

2010-07-02T21:37:00.001+08:00

Above is the information I get from my online broker. As we can see that the premium for Axiata-ha is -2.71% (which is a discount of 2.71%). Besides, the exercise price is RM3.40, expiry date is 25/8/2010 and gearing is 10.35.

With a discount and the market is decreasing, axiata-ha looks like a good potential trade. The joy is varnished as soon as I try to double check the information especially the premium of axiata-ha.

The correct formula to calculate put warrants premium is as below.

The calculated axiata-ha premium is = [(0.075 x 5)+ 3.88 - 3.40 ] / 3.88 = 22%

The calculated axiata-ha preimum of 22% is very different from the premium I get from my online broker of -2.71%. It is really misleading.

I try to check the put warrant premium and information at Bursa Malaysia and CIMB Warrant website too. To my disappointment, Bursa Malaysia doesn't get the premium correct too. However, CIMB Warrant does a good job by calculating the premium correctly.

That's why we must always double check the information we get.

Ok, good luck.

GOon

Dow Jones Industrial forming head and shoulders pattern, part 2

2010-07-01T15:16:00.000+08:00

I wrote about "head and shoulders Pattern" on 21st and 23rd of June 2010. I was expecting this pattern to be formed. I was right. We can noticed clearly than it is actually formed in Dow Jones Industrial (DJI). For your information, the "head-and-shoulders" pattern is believed to be one of the most reliable trend-reversal patterns.

Basically, most of the investors/traders do their research based on the fundamental analysis and technical analysis. For technicians/chartists, it's gonna be downside bias for them. The head and shoulders pattern is definitely a real concern to them. For fundamentalist, things are not looking good either. US, Europe, Japan and China, all these economy power houses have been releasing lots of negative news.

As we can see from the chart above, there was a very short term rally from 8th to 18th June 2010. What makes me worry was the trading volume was not increasing as the rally was happening. I did not buy into the rally, in fact I was clearing my call warrants and started buying put warrants.

After 18th June 2010, when DJI was starting to decrease, the volume increased. The volume is increasing as DJI keeps moving down. If DJI fails to hold on to the support level of 9759, I really think we will see a major tanker in July 2010. This will not be an ordinary tanker! Some people might argue that we should buy whey they are trading near support and sell when they are trading near resistance. I am not objecting that, but this time round, I really think that DJI 9759 support is not going to hold on much longer. It is gonna to be broken.

Even though I trades in KLSE, sometimes I do my research based Dow Jones Industrial, S&P 500 and NASDAQ to determine the major trend of KLSE.

I am happy that I finally gains some new experiences in trading in KLSE. I start to buy put warrants. Before this, I never had the chance to do so as the uptrend was intact. The feeling is actually quite cute. Since I have bought put warrants, I am happy when the market drops while I used to be getting worry when the market drops.

For your information, most of the put warrants premiums are not correctly calculated by my online broker. I guess it is wise for us to double confirm the premiums before we trade on these put warrants.

Ok, good luck.

GOon

Read more on "Head and Shoulders Chart Pattern"
http://cathoon.blogspot.com/2010/06/head-and-shoulders-chart-pattern.html

"Dow Jones Industrial forming head and shoulders pattern"
http://cathoon.blogspot.com/2010/06/dow-jones-industrial-forming-head-and.html

“工作難致富”‧“炒錢族”投機賺錢

2010-06-25T01:35:00.000+08:00

（中國‧北京）從炒股炒樓到炒茶炒蒜，中國近年掀起各式各樣“炒風”，不少年輕人加入“炒錢族”行列。

一份最新的調查更顯示，近80%受訪者認為腳踏實地工作不如投機更易致富，近90%年輕人表示身邊有“炒錢族”。對於社會上湧現的“找快錢”觀念，有社會學家直言是打工收入微薄，財富分配不均造成，要改變現狀，就要“資產泡沫破滅，工人繼續罷工”。

由《中國青年報》社會調查中心於上週透過“題客調查網”所做的調查顯示，中國年輕人熱中成為 “炒錢族”投機賺錢。

調查訪問了11557人，其中30.6%的人承認自己是“炒錢族”，88.1%的人表示身邊存在“炒錢族”，更有76.8%的人認同踏實工作很難致富。而這萬多名受訪者中，“80後”佔59.3%，“70後”佔25.4%。

網上一些如“找工作難不如去炒股”、“工作40年不如炒房3年”等留言都說明，年輕人通過踏實工作很難致富，當長輩辛苦工作一輩子才積攢幾十萬元時，很多根本不踏實工作的人，僅靠炒樓炒股就成了百萬富翁。

少壯不炒股，老大徒傷悲”

“炒風”熾熱紛棄正職

一名於去年底放棄工作專職炒股的江蘇市民孫姚表示，“少壯不炒股，老大徒傷悲”這句話令他印象深刻，而自從成為“炒錢族”，他現在平均每月有上萬元人民幣進帳，一些過去曾反對他辭職炒股的親友，也開始嘗試業餘炒股。

對於“炒風”熾熱，中國人民大學教授周孝正說，中國先富起來的人基本都不是通過勤勞工作而來： “幹活的不掙錢，掙錢的不幹活，年輕人看到的就是這麼個社會，能不浮躁麼？”以珠三角為例，最低工資調高後仍僅每月1100元人民幣。周孝正說，貧富差距大，社會分配不公，要平息浮躁炒風，恐怕要“資產泡沫破掉，工人繼續罷工（討加薪），經濟崩盤重新洗牌，甚至改朝換代。”

Dow Jones Industrial forming head and shoulders pattern

2010-06-23T01:56:00.000+08:00

It is disappointing that rally over China's Yuan move fades as quickly as it began. In fact, Done Jones Industrial opened higher on Monday but closed mixed. I was expecting that rally would last a day or two. It looks to me that Done Jones Industrial (DJI) is forming a head and shoulders pattern. There is a significant resistance for DJI at 10700. The "head-and-shoulders" pattern is believed to be one of the most reliable trend-reversal patterns.

KLCI was bullish on Monday responding to China's Yuan move. Now I am a bit concern about the current short term up trend of KLCI could be fading quickly too. In my humble opinion, it is a wise move for us to close part of our portfolio now. Right now, I think put warrant is really worth a look.

Ok, good luck

GOon

Read more on "Head and Shoulders Chart Pattern"

http://cathoon.blogspot.com/2010/06/head-and-shoulders-chart-pattern.html

Head and Shoulders Chart Pattern

2010-06-21T02:37:00.001+08:00

The head and shoulders pattern is generally regarded as a reversal pattern and it is most often seen in uptrends. It is also most reliable when found in an uptrend as well. Eventually, the market begins to slow down and the forces of supply and demand are generally considered in balance. Sellers come in at the highs (left shoulder) and the downside is probed (beginning neckline.) Buyers soon return to the market and ultimately push through to new highs (head.) However, the new highs are quickly turned back and the downside is tested again (continuing neckline.) Tentative buying re-emerges and the market rallies once more, but fails to take out the previous high. (This last top is considered the right shoulder.) Buying dries up and the market tests the downside yet again. Your trendline for this pattern should be drawn from the beginning neckline to the continuing neckline. (Volume has a greater importance in the head and shoulders pattern in comparison to other patterns. Volume generally follows the price higher on the left shoulder. However, the head is formed on diminished volume indicating the buyers aren't as aggressive as they once were. And on the last rallying attempt-the left shoulder-volume is even lighter than on the head, signaling that the buyers may have exhausted themselves.) New selling comes in and previous buyers get out. The pattern is complete when the market breaks the neckline. (Volume should increase on the breakout.)

A technical analysis term used to describe a chart formation in which a stock's price:

1. Rises to a peak and subsequently declines.
2. Then, the price rises above the former peak and again declines.
3. And finally, rises again, but not to the second peak, and declines once more.

The first and third peaks are shoulders, and the second peak forms the head.

The "head-and-shoulders" pattern is believed to be one of the most reliable trend-reversal patterns.

Sell In May and Go Away?

2010-06-17T10:41:00.001+08:00

I am a bit confused each time when i hear others talking about "sell in May and go away". I assume that they mean that the market will go down from May till October. Statistically, this is correct for most of the time that the market tends to be more bearish during this period. I think it has become a self-fulfilling prophecy.

There are a few Self-Fulfilling Prophecies such as:
• Sell in May and Go Away
• October Effect
• Santa Claus Rally
• January Barometer

If most of us know that the market tends to be more bearish during May-October period, why don't we trade Put Warrants/Put Options during this period? By doing this, we still could earn a handsome profit when the market goes down. So why should sell in May and go away? I guess most of us are still trapped in the traditional way of thinking that we could only make money if the market goes up.

Warrants and options are very good financial instruments when stock market major trend is clear. When the market is bullish, it is good to trade call warrants/options, and when the market is bearish, it is good to trade put warrants/options.

There are a few put warrants listed on KLSE. They are ridiculously expensive in term of their high premium.I don't think the market markers/issuers for these put warrants are sincere enough to develop our Malaysian warrant market. I guess this is the reason why many full-time traders that I know are not trading our at KLSE instead they choose to trade oversea stock markets.

Personally, I also preferred our oversea stock market put warrants/option, at least i don't have to pay 20%-100%++ of premium for a put warrant. Moreover, these put warrants (KLSE) are extremely low in liquidity.

GOon

Technical Levels—Not News— Become Main Driver of Markets

2010-06-16T03:24:00.001+08:00

Technical Levels—Not News— Become Main Driver of Markets

For KLSE, on the 30 minute chart, support is at 1294 and it is likely heading toward 1314. On the daily chart, KLCI has crossed above MA and it is likely to move toward 1324. I strongly do not expect it to hit a new high (above 1350) since it is just a technical rebound.

As much as Greece, the oil spill and the economy, the markets these days are moved by wild swings between technical levels that at times overshadow the underlying fundamentals.

"Technicals matter in this market," Pimco co-CEO Mohamed El-Erian proclaimed in a CNBC interview Tuesday, underscoring and perhaps understating just how much statistical measures of market behavior influence trading.

In particular, analysts have been watching support tests on the Standard & Poor's 500 around the 1040 level and top-side resistance near 1110 as an important gauge for whether the market can stay out of the recently breached correction territory and resume the aggressive bull-market run that preceded it.

"Since your valuations look good, people become more focused on technicals because now they're looking for another measure to gauge their risk," says Mike O'Rourke, chief market strategist at BTIG in New York. "They already know they're getting good valuations. You're looking for secondary indicators to key decisions off."

Of course, traders and shorter-term investors have always followed metrics like the 50- and 200-day moving averages—trend lines that track the market's movement over time intervals which are used to determine where it's headed next.

A close above a moving average for several consecutive trading days indicates a breakout higher, while breaching a low often means the opposite.

Such levels certainly can be driven by news events, but often became strong psychological barriers that trigger buying and selling independent of the headlines.

O'Rourke says he is watching the CBOE Volatility Index for clues. With the VIX holding below 30, he thinks the market could have an upward bias but will need help from economic indicators, in particular weekly jobless claims, which have stayed stubbornly high.

The market has bounced off a more than 13 percent correction-level downturn, with buyers stepping in whenever the S&P gets near the 1040 but hesitating when it approaches the 1110 barrier, which represents the 200-day moving average.

"From a macro basis, it's going to be a situation where you're stuck in this trading range, which is the technicals, unless something unforeseen happens," says Alan B. Lancz, president of Alan B. Lancz and Associates in Toledo, Ohio. "In that sense, it's going to take an awfully big piece of news to trump the technical levels right now."

In such an environment, the investment strategy is pretty straightforward, says Lancz: Sell into rallies and buy the dips until the market shows signs of a breakout.

"Get more defensive. Look at companies that haven't moved yet if you do have this trading-range type of market," he says. "You can buy more cyclical companies that have taken a beating—BP, energy—that can offer some opportunity for a bounce-back rally."

In a detailed analysis of the S&P's pressure points, Bank of America Merrill Lynch's Mary Ann Bartels predicts the range "could break to the upside" past 1110 on its way to the next resistance level of 1150.

However, she notes a break below 1044 would bring a test of 950 to 1,000 into play and probably would take the bullish forecast of 1300 by year's end off the table.

"It seems the market is finally in a position to react to oversold conditions in the short-term indicators," writes Bartels, the firm's technical research analyst.

A separate analysis from Standard & Poor's points out that the 13.7 percent correction decline that bottomed out on June 7 is right on the nose with the average of the previous 17 completed corrections since 1945.

While investors shouldn't be too quick to assume the correction is over—the averages have since left correction territory—Sam Stovall, S&P chief investment strategist, said the market "now may be ready to rally" even though gyrations likely are not finished.

Stovall identified 13 "sub-industries" that could benefit from a breakout, among them auto parts and equipment; office electronics; diversified financial services; apparel, accessories and luxury goods; and technology distributors.

"The decline for the S&P 500 was amazingly dead-on with historical average," Stovall said in a note to clients. "Yet these earlier sell-offs took an average of four months to bottom out, and a similar length of time to get back to breakeven. This recent decline took less than half that time to materialize, so we will likely have more ups and downs to endure before all is said and done."

BLASH trading approach

2010-06-15T01:21:00.000+08:00

        There is a story about a speculator whose desire to be a winner was intensified by each successive failure. He tried fundamental analysis, chart analysis, computerized trading systems, and even a number of esoteric techniques ranging from wave counting to astrology. Although each of these approaches seemed to work well on paper, once he started to place actual trades based on these methods an odd thing happened: His short positions inevitably seemed to be followed by towering bull markets, and steady uptrends had an uncanny tendency to reverse course after he went long. After years of frustration, he finally gave up in exasperation.

        It was at this point that he heard of a famous guru who lived on a remote mountain in the Himalayas and who answered the questions of all pilgrims who sought him out. The trader boarded a plane to Nepal, hired guides, and set out on a two-month trek. Finally, completely exhausted, he reached the famous guru.

        "Oh Wise One," he said, "I am a frustrated man. For many years I have sought the key to successful trading, but everything I have tried has failed. What is secret?"

        The guru paused for only a moment, and, staring at his visitor intently, answered, "BLASH." He said no more.

        "BLASH?" The trader returned home. He did not understand the answer. It filled his mind every waking moment, but he could not fathom its meaning. He repeated the story to many, until finally one listener interpreted the guru's response.

        "It's quite simple," he said. "Buy low and sell high."

        The guru;s message is apt to disappoint readers seeking the key to trading wisdom. BLASH does not satisfy our concept of an insight, because it appears to be a matter of common sense. However, if, as Voltaire suggested, "Common sense is not so common," neither is it obvious. For example, consider the following question: What are the trading implications of a market reaching new highs: The "commonsense" BLASH theory would unambiguously indicate the subsequent trading activity should be confined to the short side.

        Very likely, a large percentage of speculators would be comfortable with this interpretation. Perhaps the appeal of the BLASH approach is tied to the desire of most traders to demonstrate their brilliance. After all, any fool can buy the market after a long uptrend, but it takes genius to fade the trend and pick a top. In any case, few trading responses are as instinctive as the bias toward buying when prices are low and selling when prices are high.

        As a result, many speculators have a strong predilection toward favoring the short side when a market trades at new high levels. There is only one thing wrong with this approach: it doesn't work. Why? Because market's ability to reach and sustain new highs is usually evidence of powerful underlying forces that often push prices much higher. Common sense? Certainly. But note that the trading implications are exactly opposite to those of the "commonsense" BLASH approach.

        The point of all of this is that many of our commonsense instincts about market behavior are wrong. Chart analysis provides a means of acquiring common sense in trading- a goal far more elusive than it sounds. For example, if prior to beginning trading an individual exhaustively researched historical price charts to determine the consequences of market reaching new highs, he or she would have a strong advantage in avoiding one of the common pitfalls that await the novice trader. Similarly, other market truths can be gleaned through a careful study of historical price patterns.

        It must be acknowledged, however, that the usefulness of charts as an indicator of future price direction is a fiercely contested subject.

        Fundamental and technical analysis are important to successful trading.,

Good luck.

GOon

Axiata-cc deeply undervalue with potential profit of 19%.

2010-06-14T02:59:00.001+08:00

Currently, there are a few call warrants that i think are really worth a look and Axiata-cc is certainly one of them.

Axiata had just released a strong quarterly financial report on 27th May 2010. Axiata and Digi signed a memorandum of understanding (MoU) to explore long-term network and infrastructure collaboration in Malaysia. These are good news to Axiata and I expect more good news to come.

There are a few Axiata call warrants listed on KLSE and among them i like Axiata-cc the most. Currently, Axiata-cc comes with a discount of 4.5%, gearing 4.16 and expiry date 5/8/2010. It is currently trading at RM0.185. It means that Axiata-cc should up 19% or RM0.035 to finish up the discount and the fair value should be RM0.22.

Axiata-cc is an European styled call warrant therefore we can't exercise it now. In my humble opinion, when a call warrant is in discount territory the nearer it is to its expiry date the better it is.

Ok, good luck.

GOon
Read more: 'Axiata, DiGi network sharing to cut costs' http://www.btimes.com.my/Current_News/BTIMES/articles/20100611110005/Article/#ixzz0ql9ZDtyB

Axiata posts strong Q1 results
http://www.btimes.com.my/Current_News/BTIMES/articles/20100527203340/Article/

erroneous trades caused US Stocks to fall nearly 10 pct

2010-05-07T10:43:00.001+08:00

A computerized selloff possibly caused by a simple typographical error triggered one of the most turbulent days in Wall Street history Thursday and sent the Dow Jones industrials to a loss of almost 1,000 points, nearly a tenth of their value, in less than half an hour. It was the biggest drop ever during a trading day.

The Dow recovered two-thirds of the loss before the closing bell, but that was still the biggest point loss since February of last year. The lightning-fast plummet temporarily knocked normally stable stocks such as Procter & Gamble to a tiny fraction of their former value and sent chills down investors' spines.

"Today ... caused me to fall out of my chair at one point. It felt like we lost control," said Jack Ablin, chief investment officer at Harris Private Bank in Chicago.

No one was sure what happened, other than automated orders were activated by erroneous trades. One possibilility being investigated was that a trader accidentally placed an order to sell $16 billion, instead of $16 million, worth of futures, and that was enough to trigger sell orders across the market.

No one was taking blame, either. The New York Stock Exchange said there was no problem with the Big Board's systems, and all the markets were on a conference call with the Securities and Exchange Commission.

Nasdaq issued a statement two hours after the market closed saying it was canceling trades that were executed between 2:40 p.m. and 3 p.m. that it called clearly erroneous. It did not, however, mention a cause of the plunge.

The NYSE also said it would cancel some trades on its electronic platform.

There were reports that the sudden drop was caused by a trader who mistyped an order to sell a large block of stock. The drop in that stock's price was enough to trigger "sell" orders across the market.

The SEC issued a statement saying regulators are reviewing what happened and "working with the exchanges to take appropriate steps to protect investors."

Whatever started the selloff, automated computer trading intensified the losses. The selling only led to more selling as prices plummeted and traders tried to limit their losses.

"I think the machines just took over. There's not a lot of human interaction," said Charlie Smith, chief investment officer at Fort Pitt Capital Group. "We've known that automated trading can run away from you, and I think that's what we saw happen today."

The market was already wobbly because of fears that Greece's debt crisis will undermine the economic recovery. Traders watched television coverage of protests in the streets of Athens, and the Dow was down 200 when the selloff began less than two hours before the closing bell.

At 2:20 p.m. EDT, the Dow was at 10,460, a loss of 400 points.

It then tumbled 600 points in seven minutes to its low of the day of 9,869, a drop of 9.2 percent.

On the floor of the New York Stock Exchange, stone-faced traders huddled around electronic boards and televisions, silently watching and waiting. Traders' screens were flashing numbers non-stop, with losses shown in solid blocks of red numbers.

Then the market bounced back, about as quickly as it fell. By 3:09 p.m., the Dow had regained 700 points. It then fluctuated sharply until the close. The trading day ended with the Dow down 347.80, or 3.2 percent, at 10,520.

The Dow has lost 631 points, or 5.7 percent, since Tuesday amid worries about Greece. That is the largest three-day percentage drop since March 2009, when the stock market was nearing its bottom following the financial meltdown.

At its lowest Thursday, the Dow was down 998.50 points in its largest point drop ever, eclipsing the 780.87 lost during the course of trading on Oct. 15, 2008, during the height of the financial crisis. The Dow closed that day down 733.08, the biggest closing loss it has ever suffered.

The impact of Thursday's gyrations on some stocks was breathtaking, if brief. Stock in the consulting firm Accenture fell to 4 cents after closing at $42.17 on Wednesday. It recovered to close at $41.09, down just over $1.

Procter & Gamble, generally a stable stock, dropped as much as $23, almost 37 percent, and rallied to close down only $1.41.

Many professional investors and traders use computer program trading to buy and sell orders for large blocks of stocks. The programs use mathematical models that are designed to give a trader the best possible price on shares.

The programs are often set up in advance and allow computers to react instantly to moves in the market. When a stock index drops by a big amount, for example, computers can unleash a torrent of sell orders across the market. They move so fast that prices, and in turn indexes, can plunge at the fast pace seen Thursday.

Even if there were technical issues, concerns about the world economy are running high.

The stock market has had periodic bouts of anxiety about the European economies during the past few months. They have intensified over the past week even as Greece appeared to be moving closer to getting a bailout package from some of its neighbors.

"The market is now realizing that Greece is going to go through a depression over the next couple of years," said Peter Boockvar, equity strategist at Miller Tabak. "Europe is a major trading partner of ours, and this threatens the entire global growth story."

The Standard & Poor's 500 index, the index most closely watched by market pros, fell 37.75, or 3.2 percent, to 1,128.15. The Nasdaq composite index lost 82.65, or 3.4 percent, and closed at 2,319.64.

At the market's lows, all three indexes were showing losses for the year. The Dow now shows a gain of 0.9 percent for 2010, while the S&P is up 1.2 percent and the Nasdaq is up 2.2 percent.

At the close, losses were so widespread that just 173 stocks rose on the NYSE, compared to 3,008 that fell. The major indexes were all down more than 3 percent.

Meanwhile, interest rates on Treasurys soared as traders sought the safety of U.S. government debt. The yield on the benchmark 10-year note, which moves opposite its price, fell to 3.4 percent from late Wednesday's 3.54 percent.

SEC accuses Goldman Sachs of civil fraud

2010-04-17T00:00:00.002+08:00

The government has accused Goldman Sachs & Co. of defrauding investors by failing to disclose conflicts of interest in mortgage investments it sold as the housing market was faltering.

The Securities and Exchange Commission announced Friday civil fraud charges against the Wall Street powerhouse and one of its vice presidents. The agency alleges Goldman failed to disclose that one of its clients helped create -- and then bet against -- subprime mortgage securities that Goldman sold to investors.

Investors in the mortgage securities are alleged to have lost more than $1 billion, the SEC noted.

The Goldman client implicated in the fraud is one of the world's largest hedge funds, Paulson & Co., which paid Goldman roughly $15 million for structuring the deals in 2007.

Goldman Sachs shares fell more than 10 percent after the SEC announcement.

The civil lawsuit filed by the SEC in federal court in Manhattan was the government's most significant legal action related to the mortgage meltdown that ignited the financial crisis and helped plunge the country into recession.

A Goldman Sachs spokesman didn't immediately return a call seeking comment.

The agency also charged a Goldman vice president, Fabrice Tourre, 31, who it said was principally responsible for devising the deal and marketing the securities.

The SEC is seeking unspecified fines and restitution from Goldman Sachs and Tourre.

"The product was new and complex, but the deception and conflicts are old and simple," SEC Enforcement Director Robert Khuzami said in a statement.

"Goldman wrongly permitted a client that was betting against the mortgage market to heavily influence which mortgage securities to include in an investment portfolio, while telling other investors that the securities were selected by an independent, objective third party."

In my humble opinion, I think the current rally has lasted too longer even though it is supported well by its fundamental. With Goldman Saches being charged with fraud over its handling of subprime mortgages, it would serve well as a reason to take some profit out of the stock market. It could be a long winding road for Goldman Saches and traders would be following closely this Goldman Saches case.

On Friday, General Electric (GE), Bank of America (BAC), Google, Advanced Micro Devices, Mattel and Gannett release better-than-expected quarterly financial reports but yet the market can't manage to keep its rally. Traders are profit-taking and running away.

Ok, good luck.

GOon

GE earned 21 cents a share, compared to analysts' estimates of earnings of 17 cents a share

2010-04-16T19:05:00.002+08:00

For the recent period, the conglomerate /quotes/comstock/13*!ge/quotes/nls/ge (GE 19.89, +0.39, +2.00%) said earnings fell 32% to $1.87 billion, or 17 cents a share, as revenue fell 5% to $36.61 billion.

From continuing operations, the industrial bellwether said it earned 21 cents a share, compared to FactSet-compiled estimates of earnings of 17 cents a share on revenue of $37.3 billion.

GE, a component of the Dow Jones Industrial Average, said it may evaluate additional restructuring that will improve earnings power going forward.

"We saw encouraging economic signs, including increases in airline passenger miles and freight loadings, declines in receivables delinquencies, and growth in local advertising markets," said Chairman and CEO Jeff Immelt in a statement. He expects earnings and dividends to grow in 2011 and beyond.

GE's stock has climbed more than 66% in the last year after reaching a near 20-year low last March following the credit crisis.

In the first quarter, GE said its financial arm, GE Capital, saw its profit drop 41% to $607 million as revenue fell 10%. Immelt said he was "very encouraged" by the performance as losses and delinquencies declined.

PUBLIC BANK achieves 24% GROWTH IN PRE-TAX PROFIT

2010-04-15T13:15:00.002+08:00

PUBLIC BANK ACHIEVES 24% GROWTH IN PRE-TAX PROFIT AND 4.4% DOMESTIC LOAN GROWTH IN FIRST QUARTER OF 2010.

Public Bank Group achieved a commendable start to 2010 with a pre-tax profit of RM923 million for the first quarter of 2010, representing a 24% growth from the corresponding period in 2009. Over the same period, the Group recorded a net profit of RM685 million, 16% higher as compared to RM589 million for the corresponding period in 2009. The Group’s domestic loan base grew strongly by 4.4% in the first quarter of 2010. With the continued pursuit of prudent credit policies and effective credit monitoring, the Group continues to sustain its strong asset quality with its gross impaired loans ratio maintained at below 1%.

The Public Bank Group's results translate into an earnings per share of 19.7 sen for the first quarter of 2010 and an annualised net return on equity of 25.3%.

Highlights of the Public Bank Group's Performance:

• Pre-tax profit of the Group grew by 24% to RM923 million in the first quarter of 2010 as compared to RM745 million in the previous corresponding quarter.

• Net profit attributable to shareholders grew by 16% to RM685 million in the current quarter as compared to RM589 million in the previous corresponding quarter.

• Annualised net return on equity for the first quarter of 2010 stood at 25.3%.

• Earnings per share for the first quarter of 2010 of 19.7 sen was 13% higher as compared to 17.4 sen in the first quarter of 2009.

• Cost-to-income ratio remains efficient at 35.7%.

• Total assets increased to RM219 billion as at the end of March 2010.

• Total loans and advances of the Group grew by RM4.8 billion or 3.5% in thefirst quarter of 2010 to reach RM142.4 billion as at the end of March 2010, driven by the strong domestic loan growth of 4.4% for the first quarter.

• The Group’s total customer deposits increased by 2.8% in the first quarter of 2010 to reach RM175.6 billion as at the end of March 2010. The Group's domestic customer deposits grew at a stronger 3.8%, against the backdrop of a contraction of the domestic industry’s customers deposit of 1.3% for the first two
months of 2010.

• The gross impaired loans ratio of the Group remained below 1% as at the end of March 2010, as compared to the banking industry's gross impaired loans ratio of 3.4% as at the end of February 2010.

• The Group's loan loss coverage of 172.3% continues to be the highest and most prudent in the Malaysian banking industry.

• The core capital ratio and risk-weighted capital ratio of the Group remain healthy at 9.6% and 13.7% respectively as at the end of March 2010.

"Barring unforeseen circumstances, the Group is expected to continue to recordsatisfactory performance for the rest of 2010", Tan Sri Dato’ Sri Dr. Teh Hong Piow (Chairman Of Public Bank)said.

There are a few public bank call warrants listed on KLSE, namely Pbbank-cj, Pbbank-cl and Pbbank-cm. Out of these 3 call warrants, Pbbank-cl is my favourite and closely followed by Pbbank-cj. Both Pbbank-cj and Pbbank-cl are in discount territory. I prefer Pbbank-cl more because of its higher gearing of 5.6.

I did share my views on Public Bank and Pbbank-cl on my 1st April 2010 post. Since then, Pbbank-cl has jumped 26% and I expect this trade to continue provide me with more handsome profit.

Previous post regarding Public Bank:
http://cathoon.blogspot.com/2010/04/public-bank-on-track-to-meet-strong.html
http://cathoon.blogspot.com/2010/04/public-bank-set-to-jump.html
http://cathoon.blogspot.com/2010/04/cimb-research-reaffirms-overweight-on.html

Public Bank on track to meet strong profit targets

2010-04-15T12:40:00.000+08:00

OSK Research says Public Bank is on track to meet its strong profit targets and upgraded it from Neutral to Buy as the bank is set to announce its first quarter earnings on Thursday, April 15.

It said on Thursday that after an upward earnings revision, it is raising its target price for Public Bank from RM11.80 to RM13.00.

“Our new TP assumes a ROE of 26.0%, a long-term growth of 4.0% and 9.3% cost of equity. The current share price implies a relatively conservative 22% ROE vs management’s 3-year target of 30%,” it said.

OSK Research sees its performance remaining firmly on the uptrend, and largely on course to deliver 2%-3% quarter-on-quarter earnings growth, although the 1Q period is typically a weaker quarter.

The relatively strong results are likely to be underpinned by: 1) an uptrend in net interest margins from repricing of mortgages and higher HP rates, 2) quarter-on-quarter growth in wealth management fee income on the back of higher management fees from its unit trust business, 3) a 2%-3% quarter-on-quarter expansion in gross loan base, and 4) continued downtrend in loan loss provisions.

Previous post regarding Public Bank:
http://cathoon.blogspot.com/2010/04/public-bank-set-to-jump.html
http://cathoon.blogspot.com/2010/04/cimb-research-reaffirms-overweight-on.html

IJM secures Rm246.7m contracts in Sarawak

2010-04-14T23:04:00.000+08:00

IJM Corp Bhd has secured two contracts in Sarawak valued at RM246.7 million.

It said on Wednesday, April 14 its unit IJM Construction Sdn Bhd had received two letters of acceptance of tender for the Sarawak Public Works Department.

The contracts were for two access roads to be build in Kapit, Sarawak. The first package involved earthwork, construction of three minor bridges, culverts, drains and pavement works for 20km of road for RM125.2 million.

The second package involved earthworks, rock excavation, construction of two minor bridges, culverts, drains and pavement works for 10.5km of road for RM121.5 million. Construction period for both packages is 24 months.

I still prefer IJM-WB. It is still come with a discount of around 2-3%, and gearing around 3.6. In fact, IJM-WB is one of the most discount warrant listed on KLSE. With more good news pouring in, IJM-WB should be able to maintain its upward momentum.

GOon

Good luck.

I WILL ALWAYS LOVE YOU

2010-04-09T04:52:00.001+08:00

IJM: Buy, target price RM5.50

2010-04-09T03:39:00.000+08:00

MAYBANK Investment Bank upgraded builder and property firm IJM Corp Bhd (3336) to a "buy" with a target price of RM5.50, saying near-term newsflow on potential awards could intensify in the months leading to the announcement of the 10th Malaysia Plan.

"Positive order flow momentum could trigger a further re-rating of the stock in our view," it said in a report yesterday.

It noted that IJM has also been aggressively bidding for contracts in India. The firm's recent lacklustre order flow in India was due to a deliberate decision by its management to cut back on tenders amid an environment of high operating costs, it said.

"(But) with the recent normalisation of building material prices and borrowing costs, we believe management will resume normal bidding for Indian jobs," it said in a report yesterday.
It noted that the outlook for the non-construction divisions remained positive also.

It forecast the construction division to only account for 12 per cent of IJM's 2011 earnings. It believes the property and building materials divisions would remain as the firm's main earnings contributors, accounting for 31 per cent and 30 per cent earnings respectively.

In Peninsular Malaysia, IJM is looking to tender for packages in major infrastructure projects such as the Pahang Selangor Water Transfer Project, the Low Cost Carrier Terminal project and the Klang Valley Light Rail extension, it said.

Previous posts regarding IJM:
http://cathoon.blogspot.com/2010/03/ijm-wb-up-14.html
http://cathoon.blogspot.com/2010/03/ijm-unit-wins-rm600mil-job.html
http://cathoon.blogspot.com/2009/01/ijm.html

Outperform Rating On General Electric Company (GE)

2010-04-09T03:21:00.000+08:00

Bernstein Research Maintains Outperform Rating On General Electric Company (GE)

Analysts Steven E. Winoker and David Abrameto at Bernstein Research have released an update on General Electric Company (NYSE: GE).

GE will report its first-quarter earnings on April 16. Analysts expect the company to report EPS of $0.17 in its first-quarter. Industrial gross margin is expected to be at 25%-26%, while operating margin is expected to be at 10%-11%. Analysts expect GE to report consolidated revenue of $36.7 billion in the quarter.

Analysts at Bernstein Research have maintained their Outperform rating and $20 price target for General Electric Company.

The GE call warrant listed on KLSE, GE-C1, has jumped around 50% since February 2010. With GE-C1's discount status (discount around 3%) and positive rating of GE, GE-C1 would be considered as a good yet safe trading bet. Even if GE were to move side way, GE-C1 should provide us with a profit of 10% (3% discount x 3.3 gearing). Currently, GE-C1 is priced at RM0.145. The fair value would be RM0.16 if GE is to move side way.

Ok, good luck.

GOon

IJM Corp price estimate lifted to RM5.50

2010-04-08T13:52:00.000+08:00

IJM Corp, a Malaysian builder and property group, was raised to “buy” from “hold” at Maybank Investment Bank Bhd to reflect the prospects of building contracts in the country and India in the coming months.

The share price estimate was increased to RM5.50 from RM4.50 in Kuala Lumpur trading, Maybank said in a report today.

Previous posts regarding IJM:
http://cathoon.blogspot.com/2010/03/ijm-wb-up-14.html
http://cathoon.blogspot.com/2010/03/ijm-unit-wins-rm600mil-job.html
http://cathoon.blogspot.com/2009/01/ijm.html