Why buy when the market (whether property or stock or even gold) is sky high? Oh… because when it’s sky high, everyone is bullish, so the prices sure can go higher. When it’s quiet, surely the prices will not move much, so it’s wasting time and money to buy and then wait. We do not even know how long to wait! Familiar with most of us? Actually it’s a familiar situation all over the world. No one buys means no one buys. Everyone buys means it must be a great time to buy.
Speculators focus on fast money. Move in quickly, come out quickly with a bag of money (profits). A quiet market has no such traits. Some personal finance people meanwhile continue to focus on how to save extra money here and there but if we look at the fact that we will be living way longer, then we must realise that savings alone is not enough! Anyway, here’s one latest update about the stock market of Malaysia; BURSA. Please look at the many important points the article has highlighted okay.
Article in themalaysianreserve.com The article said that Malaysia is Asia’s worst-performing stock market and prices are getting lower by the day. However, there were not many buyers and these two are major reasons why people were not buying; political risks and weak earnings outlook.
Michiel van Voorst, chief investment officer for Asian equities at UBP Asset Management Asia Ltd said, “Local stocks have fallen substantially “but valuation without a catalyst is not enough. The profit cycle needs to improve on an incremental basis.” Within 2019, global funds have pulled out more than USD2 billion (RM8.3 billion) from Malaysian stocks.
Beyond just political risks and lower earnings outlook, the business sentiment was affected after the government announced the stopping of several large infrastructure projects. As at currently, current price-to-book valuation of 1.5 times is near its lowest since 2009 and this is also at a discount of the 10-year average. Please do read the Article in themalaysianreserve.com
A good friend gave a few recommendations on some potential stocks to buy and hold. I do not hold any of these stocks currently. Inari (manufacturing), Genting Malaysia (conglomerate) and S P Setia (property developer). By the way, he also said that the market is very volatile. So, only buy if we have extra cash in hand yeah. Do not borrow to buy because these are not recommendations.
What is certain is this. If a business continues to do well, the only opportunity to buy their stocks is when the market is bad and their valuations are down. Then again, it’s so uninteresting, right? Haha. Look around and we will see many businesses continue to do well. If they are listed, it’s a very good time to take a look and buy a few thousand units perhaps. Happy understanding that when times are slow, we act faster.
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