We continue with the journey, but today I'll post more stocks.
2nd quarter of 2015, newbit bought Inari Ametron at RM3.3X.
The buyer seller was about RM3.38. He told me he will key-in good-till-date to buy RM3.50 for two weeks. I was curious and asked him why market price was RM3.38 but want to buy at RM3.50. Then he realised he made a mistake, and joked that he must be drunk.
Is it quite common that remisiers, dealers or clients made mistakes. Bursa has implemented dynamic limit in which I think is wonderful. It helps reduces mistakes in addition to price marking. Many brokers also have some sort of system controls to help reducing mistakes, but at the same time it causes some inconveniences. We must understand that brokers want to help us, and should not be screaming at remisiers or brokers if some of the controls have affected our genuine trades.
Coming back to Inari shares, in the end he bought at RM3.3x, the PE ratio was not cheap but not too high and with reasonable growth. So he bought it.
After 6 months, it went up to RM4.7x, up more than 40% from purchase price. Then there is a bonus issue of 1 for every 4. So his cost is about RM2.6x.
Now the Inari stock price has dropped 25% from RM3.7x after bonus to now slightly more than RM3.00.
Lessons? Please be careful when you key in your order.
Should he have sold when it was up 40%? Talk is easy, because now we knew it has dropped back to RM3.00. When it up 10%, should he sell? 20%? Nobody know the 40% is the highest.
At that time there was no adverse reports from analysts, so he decided to keep. He is for long term, there will not be any active buying and selling.
Currently his Inari is up more than 10%, plus dividend also not so bad.
GUH.
Then after few months he bought GUH. It was RM1.60 when he first saw it, but it dropped to RM1.0x. Lazy to find out what price he bought it, I think is RM1.0x.
Now GUH stock price is about RM0.90, dropped more than 10%. Made from Inari but lose on GUH. Only gain from dividend.
GUH he sometimes receives business news that GUH got projects. Always got good news. But it did not translate into an increase of GUH share price.
Lessons learned? Project does not equal to good stock buy. It is the PE ratio and growth that are more important.
Caring.
Not sure have I posted he sold Caring stock and made 90% or 100%? Can't remember. This Newbie he then sold his Caring stock.
Reasons for selling?
1)PE ratio was very high after share price increase, close to 30
2)lack growth from analysts reports
3)dividend yield low because share price high.
4)almost all analyst recommend sell.
I think I have posted so will not write more. Nobody remember why he sold half on the first selling. Maybe he que there only done half or maybe he threw to buyer only done half. After a few weeks he was quite curious why he still have Caring shares, then he sold the balance.
Good profit. Almost 100% I think. Congrats.
Then Newbie bought Mitrajaya stock.
Mitrajaya share price he bought was RM1.1x if I'm not mistaken. With current Mitra stock price of RM1.27, made 10% profit already.
That's all for now.
Almost cover all, I think the next post I will be able to cover all the the historical transactions.
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http://politemarket.blogspot.my/2016/04/inari-guh-mitrajaya-caring-stocks.html
