Not long ago, I shared about rotten company (just click on Rotten if want to view the article) and there are at least 5 of them since then. Today's local news paper announced, “Sumatec Resource Bhd fell after being told by Bursa Malaysia to restore its finances or risk being delisted”. It share price down almost 50%, at the close was 13 cents only, all time low.
I foresee this counter will going to drop in next few days. Many people fail to realize the fact, they just speculate the counter and think it is very 'cheap'. I can tell, you will find tomorrow's price is even cheaper. Investment is similar to doing business, not just buy or sell share, at least you need to know what sort of company you are buying.
Today, if your friend ask you to join him open a restaurant, would you just simple give him the money, without asking any question? One must try to understand what's the return, is the restaurant can survive in next few years, the profit margin and try to find out others relating matter. Hence, investment should also base on business concept.
I noticed some of my clients trading into this company few months back, which I have also made know to them try not to invest in this type of company, but they did mention that they can cut loss if the company turn bad. Really, are you sure? Can you cut lost today at 50% of yesterday's price? Anyway, we all have freedom to choose, if want to trade (buy or sell) a profit company, or company not making any profit or not sure if making any profit, but selling at “cheap” price.