My counters updated 25 Nov 2017

Good morning everyone.

After investing in the stock markets for more than 20 years but I realise that I don't earn much for the past 2 decades.

My findings: -
1. Focus too much on blue chip counters with no growth or low growth.
2. Trade too many times. I have calculated for the year of 2017. My stock broker earns more money than I. He loves to receive my calls because he can collect money for me from commission.
3. Too diversify.

From September 2017 onwards, I have sold the following counters and have decided to focus on few top guns.

1. I have sold: -
a. VS - Sold All
b. SKPResources - Sold All
c. Uchitech - Sold All
d. Pentamaster - Sold All
e. Vitrox - Sold All
f. Gkent - Sold All
g. Masteel - Sold All
h. Southern Steel- Sold All
i. Superlon - Sold All

I focus on the following counters now:
1. Top Glove
2. Hartalega
3. Kossan
4. Aeon Credit
6. Padini
7. Haio
8. Nestle
9. Digi - If it keeps dropping until Dividend Yield reaches 8%. Currently, I wont' buy even though it drops substantially. The counter has no growth, the only way that we can earn money is through high dividend. It is not attractive yet.

How much can you make for Top Glove since inception?

I have bought top gloves for years. Last year I decided to sell it.
After the announcement of the third quarter result, I started to top it up again.

I have found out the following: -
If you bought 1 lot on public listed at RM 2.70, how much will you get now?
**For simplicity, I do not include dividends received.

1,000 shares @ 2.70

FY 2002: 3 for 10
1,000 shares --> 1,3000 shares

FY 2003: 2 for 5
1,300 shares -->1,820 shares

FY 2005: split
1820 --> 3,640

FY 2007: 2 for 5
3,640 -->5,096 shares

FY 2010: 1 for 1
5,096 -->10,192

FY 2016: 1 for 1
10,192 -->20,384

@6.90 on 10 Nov 2017
How much do you have now?
20,384 * 6.90 = 140,649.60

Percentage earned = 140,649.60 - 2,700 / 2,700 = 51 times.

That's fabulous!!
You have earned 51 times + free dividend for twelve years.

Invest in stock is fun.

If you bought 10 lots at RM27,000
You have 1.4064 mil. now.


Between 11 September and 15 September, I have invested / held the following counters:

1. 500 shares of superlon@2.86 (increase 1 cent from the inception of 2.85)
2. 500 shares of penta master@ 4.64 (decrease 16 cents from the inception of 4.80)
3. 300 shares of Hai-o @4.57 (increase 19 cents from the inception of 4.38)
4. 300 shares of Padini @4.37 (decrease 21 cents from the inception of 4.58)
5. 500 shares of VS @2.60 (increase 15 cents from the inception of 2.45)
6. 1000 shares of SSteel @2.30 and 1000 shares of SSteel @ 2.39 (Note: Average price is 2.345) = New investment is RM 4,690
7. 1000 shares of Masteel @.1.55 = New Investment RM 1550

Investment carried forward = 7258
Total Investment for the week = 6240
Amount spent: 19,738.

**Please refer to last week's portfolio for verification
**Please take note that I won't calculate realised gain until I have made a sell. In other words, I am in the second week of updating my ideal portfolio. No sales has been triggered, so no realised gain has been recorded.
**The above is my ideal counters. I may own or may not own the above-mentioned counters.
**The writer does not bear any unfovourable consequences if the investors follow the writer's  portfolio to purchase the above counters.
**I am buying stocks as my hobby.

Avoid the following stocks

Through my investment career, I have found out the following. -
winning in the stock is about probability.
You should not invest in the following counters because the chances of winning is lower than 10 percent..
l. Lost making companies. 
2. The latest quarter's growth rate is lower than 20 percent.
For example
a. Oceancash drops from 78 cents to 70 cents with net profit growth is negative 17 percent.
b. Johotin drops from 1.52 to 1.36 with net profit growth is negative 26 percent.
C. willow drops from 1.52 to 1.20 with net profit growth is negative14 percent.

3. Inconsistent profit.
For example
a. Solution. Even though net profit increases for more than 150% for the recent quarter but the net profit for the previous quarter was at the negative territory. 
b. AAX. Net profit drops 90 percent in the previous quarter. In the current quarter, net profit increases 4500 percent but the share price drops from 0.40 to 0.39.

4. Low trading volume companies.
a. Fareast
b. Toyoink 

5. companies that issue right.
a. Eversendai
b. Aeon Credit. After the announcement of right issues, the share prices drops dramatically but it crawls back slowly. 

6. Never get into any counters with share price that is lower than R.M. l unless you are cold eye or you have the insider information.

7. Never buy blue chips because
you can't earn huge amount of money.

8. Bear in mind that stock market
is not like buying items with discounts, You should never accumulate dropping stocks or the more you buy, the more you lose.

My Approach - Fundamental Analysis

Before I purchase any stocks, I will go through a few procedures:

Step 1: I will eliminate the following counters:

1. All lost making companies. No matter how good analysts say, you must not touch the counter.

2. All companies with a growth rate of less than 20%.
I have analyzed for years. Less than 10% of the companies with growth rate of 20% or lower outperform the market in a quarter.
** Super growth companies must have growth rate of 40% and above or the share price drops dramatically.
E.g 1. IQGroup. Net profit reduces 60%. Stock price drops around Rm 4.80++ to current (around RM 3.30). It is so scary.
E.g. 2. Magni - Net profit reduces 17%. Stock price drops RM 7.30 to RM 6.20.
It is extremely scary.
E.g. Tunepro. Net profit drops 50.90% but the analysts keep saying good buy. At the end, the share price drops from around RM 1.70 to RM 1.20.