Sunday, January 29, 2012

Trading a Business?

Have you ever think of “Trading as a Business”? The idea of this book is quite good, a successful businesses generate more cash than it consumes, so do the trading.

Chinese say, In every crisis, there's an opportunity! However, the very first thing is having a trading plan – the strategies to make money, minimize the risk and increase profit! “No one plan to fail, but fail to Plan!”

Always start with small amount, practice make perfect. Don't afraid to make mistake, as every mistake will give new experience. The experience gain will enhance in your future plan. Most important is admit the mistake done, if you buy a stock, but the share price go down, cut lost first! Stop investing if you are in doubt where's the direction now! Don't let the mistake become bigger! I like the quote from Warren Buffet, “There's only 2 rules to make money in stock market, first, never lose your money. Second, never forget the first rules.

Trading is not speculating or gamble! Never listen to news, rumors or tips, do your own analysis. Many people don't know when to buy, as they don't understand trading is probability! Gambling always lose because the probability is not at your side.

Deal with your own psychological difficulties, learn to control greed and fear. Daily movement of price and volatility of the stock market is the fact, if you can not take it, this type of investment may not be right for you.

Trading is not mean get rich quick scheme! Trading is not making easy money as well! It's a serious business with proper planning. If you start with $1,000, every year only need to make 4 trade which earn 25%, you will become millionaire after 10 years!

Last, build up your investment knowledge with latest equipment or technology to improve your trading skill, building wealth and securing your capital!

Monday, January 23, 2012

Happy Dragon Year 2010

Wishing you a fabulous New Year full of Great Achievement and Experiences!

Wednesday, January 11, 2012

Plantation Stock

I like the Palm Oil farm, it's the gift from Mother Nature - the resource which can grow and sell with high price. It can make into cooking oil, margarine and various oleochemicals. Malaysia having the world's largest plantation company - SIME Darby, which produce 5% of global production. Beside, there are many others small to medium size plantation company listed at Bursa as well.

A friend ask, "Do you buy Plantation Shares?" I say, "Yes"
Then he ask again, "Do you plan to sell it, as it's almost at the high price now?", I say, "No, because I plan to keep it for long term."

Yes, the world's economy may not stable right now, many news from Europe, especially about the financial crisis. But, who care... let say, today you own a Plantation Company that produce very good income for you, do you sell the farm today because worry about tomorrow's news?

You can check the Palm Oil's price at this web:
We do not know Market will up or down tomorrow, so just forget about it.
I don't know if tomorrow Palm Oil's price will up or not... but i know, if I own a good plantation, with hard working and honest farmers, the future's earning will increase and making profit.

As long as you don't pay too high to own it, the Stock Market's pricing fluctuation is an advantage for us.
Some figure:
1. Production cost for CPO is about RM1,500 per ton. Average CPO price for the past 2 years was above RM3,000, this is ample of profit margin!
2. It take 3 years for palm oil tree to bear fruit and will continue for the rest of 13 years.
3. Don't forget after 16 years, the land's price will increase as well, then the owner can decide if want to replant or develop the land for other purpose.

Monday, January 2, 2012

Malaysia REIT report – Dec 2011

The portfolio generate gross cash dividend of RM5,434.83 for the past 6 months. The total gross dividend for the year is RM10,646, this imply the total return of 10.6% p.a., or 9.6% net after deducted tax against our initiate investment of RM100k. This is equal to receive extra cash of RM800+ every month without doing anything, which make us sleep well at night even market crash tomorrow. 

We purchase from the market the new Pavilion REIT (Pavreit) with our cash in hand when it was listed in Bursa last month. As of year end closing, we have cash of RM3,554.16 after including the cash dividend and deducted the cost pay for Pavreit.

Currently, the value of our portfolio worth RM161,161.66, if we were to sell our holding base on today's market price. (initiate investment of RM100,000 Jun 2009) However, we do not have any intention to sell our portfolio in near future.

In next few months, we expect Amfirst and Hektar going to give Right Issue, we will adjust our portfolio base on market condition and decide if going to subscribe the Right Issue or not.
The purpose of this report is show how to build consistent investment return (we are not expect frequently buy and sell from this portfolio) and at the same time keep track of our REIT investment portfolio and return.