Investors need proper training as this area requires a lot of subjective judgement and experiences.
ALL the famous investment gurus in the world, like Benjamin Graham and Warren Buffett, say that we should not try to time the stock market because we will not be able to predict its movement.
However, professional technical analysts believe that investors are able to time the market by looking into the historical price trends and trading volumes. They believe that the weakness in fundamental analysis is it is unable to provide the timing to buy or sell stocks.
Fundamental analysts are able to detect good quality stocks for long-term investments. However, they do not know when to accumulate or to dispose the stocks.
Technical analysts believe that a lot of good fundamental factors for certain stocks may have already been reflected in the stock prices. As a result, any investor who would like to purchase the stocks may not be able to make gains as the stock prices have already included the good fundamental factors.
Nevertheless, if investors know technical analysis, they may be able to discover the stocks much earlier than the others. A lot of time, these fundamental factors may not be made known to the public.
However, some investors, who are aware of these fundamental factors, may start accumulating the stocks. Technical analysts believe that these early actions can be detected by looking into charts.
Technical analysis is based on the interaction between the supply and demand for the stocks, which can be caused by the rational and irrational factors.
Technical analysts believe that prices move in trend and can persist for a long time until something happens to the stocks.
Even though technical analysts do not know all the factors that influence the buying or selling of all stocks, they believe that investors are able to know the actual shifts in the supply and demand of stocks by looking into their market price behaviour.
One of the advantages of technical analysis is that it is simple to use. Compared with the fundamental analysis, investors do not need to read financial statements before using technical analysis. Nevertheless, investors are still required to have adequate knowledge on how to interpret various types of charts.
Given that there are many types of charts, investors may get confused as some charts may indicate buying signals while others may indicate selling signals.
Sometimes, when there are too many investors using different types of charts, the effects may be neutralised between each other.
For market efficiency believers, they postulate that it is not possible make any gains by merely looking into stock prices and volumes because they believe that the stock market may have reflected all these factors. They label this phenomenon as weak-form of market efficiency.
In most academic researches on testing weak-form stock market efficiency (testing the market based on stock prices and volumes), they discovered that investors cannot consistently outperform the market.
Fundamental analysts believe that by merely looking into technical charts alone may sometimes cause investors buying into poor fundamental stocks.
However, technical analysts argue that these negative factors can also be detected using charts because poor fundamental stocks will normally face heavy selling by investors.
The technical charts will indicate when the stocks start facing selling pressures and investors need to sell the stocks once the charts indicate the selling signals.
Some investors believe that there may be self-fulfilling prophecy on technical analysis.
When many people are using the same technical chart on one company and the chart shows a buy on the stock, many investors will follow to buy the stocks. These may cause the stock prices to go up and reinforce the idea that the technical rules work.
We believe that investors need to know both fundamentals as well as technical analysis as these two methods can complement each other. Both methods have their strengths and weaknesses.
Sometimes we may want to use fundamentals to identify the stocks for purchase, then, use technical analysis to gauge when to buy the stocks; or we can use technical analysis to select stocks and use fundamentals to confirm the quality of the companies.
In conclusion, as technical analysis requires a lot of subjective judgement and experiences, we believe that investors need to have a proper training in this area. Interested investors are encouraged to read books related to this area to have better understanding.
Wednesday, July 1, 2009
Wednesday, May 6, 2009
We need to know who we are in order to do well in stock market investing
THE recent strong market rally caught many investors by surprise again.
Most investors, including some analysts, predicted earlier that it was just a bear market rally. They have been hoping the market will turn down again. Unfortunately, it has been moving up strong without looking back.
For investors who have not invested during the recent low in March 2009, they are getting very worried as they are not benefitting from the recent rally. They may even wonder whether they should jump in now in order not to miss the boat.
Another group of investors, who have managed to catch some stocks at cheap prices during the previous market low, are also facing the dilemma of whether to lock in their gains now or continue to hold on to their gains. Some even regretted selling their stocks too early last month.
We all know that it is very difficult, in fact impossible, to predict stock market movement. Most investment gurus will refuse to time the market.
Howard Kahn and Cary Cooper published a book titled “Stress in the Dealing Room” in 1993. According to their surveys done on 225 dealers, 73.8% of them suffered from fear of “misreading the market.” Most dealers have the same problem of acquiring and handling information.
We believe that in order to do well in stock investing, we need to know ourselves, especially in controlling our emotion on greed and fear.
Due to information overloading, our emotion is highly influenced by the news that we read. Each time we feel that the market is getting bullish and time to buy stock, the overall market will collapse the moment we enter.
On the other hand, the moment we fear that it will drop further and we have decided to cut losses, we will notice the market will recover after that. Most of the time, the prices of stocks that we sold were at the lowest of the recent fall.
In order to control our greed and fear, we need to ask ourselves whether the market has discounted the news that we have received.
For example, many analysts have been bullish lately, having the opinion that the worst may be over for the market based on the recent economic indicators which showed that the overall economy may have stopped contracting or is on its way to recovery.
Nevertheless, the recent strong market rally would have discounted this bullish news. In fact, we need to ask ourselves whether the current stock prices can be supported by the fundamentals for certain listed companies.
In our experience, in most cases, the moment we feel like buying stocks is the best time to sell them while the moment that we feel like selling them is in fact the best time to buy. We can apply this contrarian theory quite successfully in most periods.
Sometimes, if we are taking in too much contradicting information and, as a result, get confused over the market direction, we feel that the best strategy is to stay away from the market until we have a better and clearer picture of the overall market or the economic situation.
We should not be influenced by other opinions.
There are times that we need to follow our heart. Sometimes, our hearts try to warn us from taking hasty investment decisions. However, we refuse to follow our intuition but instead, choosing to get influenced by others or the information that we read and ending up making mistakes.
In conclusion, we need to maintain our concentration.
We should not be led by the market sentiments regardless whether it is on the way up or crashing down fast. We need to go back to the fundamental of economic situation and the companies’ performance and future prospects.
One way to minimise the feeling of regret is to stagger our purchase and selling. We will only know the peak when the market starts turning downwards and vice versa. Therefore, by staggering, we will have an averaging effect rather than taking a one-time hit, especially if it is at the wrong timing.
Most investors, including some analysts, predicted earlier that it was just a bear market rally. They have been hoping the market will turn down again. Unfortunately, it has been moving up strong without looking back.
For investors who have not invested during the recent low in March 2009, they are getting very worried as they are not benefitting from the recent rally. They may even wonder whether they should jump in now in order not to miss the boat.
Another group of investors, who have managed to catch some stocks at cheap prices during the previous market low, are also facing the dilemma of whether to lock in their gains now or continue to hold on to their gains. Some even regretted selling their stocks too early last month.
We all know that it is very difficult, in fact impossible, to predict stock market movement. Most investment gurus will refuse to time the market.
Howard Kahn and Cary Cooper published a book titled “Stress in the Dealing Room” in 1993. According to their surveys done on 225 dealers, 73.8% of them suffered from fear of “misreading the market.” Most dealers have the same problem of acquiring and handling information.
We believe that in order to do well in stock investing, we need to know ourselves, especially in controlling our emotion on greed and fear.
Due to information overloading, our emotion is highly influenced by the news that we read. Each time we feel that the market is getting bullish and time to buy stock, the overall market will collapse the moment we enter.
On the other hand, the moment we fear that it will drop further and we have decided to cut losses, we will notice the market will recover after that. Most of the time, the prices of stocks that we sold were at the lowest of the recent fall.
In order to control our greed and fear, we need to ask ourselves whether the market has discounted the news that we have received.
For example, many analysts have been bullish lately, having the opinion that the worst may be over for the market based on the recent economic indicators which showed that the overall economy may have stopped contracting or is on its way to recovery.
Nevertheless, the recent strong market rally would have discounted this bullish news. In fact, we need to ask ourselves whether the current stock prices can be supported by the fundamentals for certain listed companies.
In our experience, in most cases, the moment we feel like buying stocks is the best time to sell them while the moment that we feel like selling them is in fact the best time to buy. We can apply this contrarian theory quite successfully in most periods.
Sometimes, if we are taking in too much contradicting information and, as a result, get confused over the market direction, we feel that the best strategy is to stay away from the market until we have a better and clearer picture of the overall market or the economic situation.
We should not be influenced by other opinions.
There are times that we need to follow our heart. Sometimes, our hearts try to warn us from taking hasty investment decisions. However, we refuse to follow our intuition but instead, choosing to get influenced by others or the information that we read and ending up making mistakes.
In conclusion, we need to maintain our concentration.
We should not be led by the market sentiments regardless whether it is on the way up or crashing down fast. We need to go back to the fundamental of economic situation and the companies’ performance and future prospects.
One way to minimise the feeling of regret is to stagger our purchase and selling. We will only know the peak when the market starts turning downwards and vice versa. Therefore, by staggering, we will have an averaging effect rather than taking a one-time hit, especially if it is at the wrong timing.
Monday, March 2, 2009
America will overcome Country’s best days lie ahead, says Buffett --- Boleh Percaya Kah Ni?
Malas dah nak copy tp sesiapa yg interested nak baca just click here
Thursday, February 26, 2009
How long should investors hold their stock investments?
here is some tips by the expertise just click here
Friday, February 6, 2009
Pastikan dahulu kesahihan status halal di kopitiam
KOPITIAM atau kedai kopi yang menyediakan roti bakar berserta nasi lemak dan kuih-muih semakin popular di kalangan sesetengah penduduk Islam negara ini. Perniagaan yang dipelopori oleh masyarakat Cina ini dikatakan wujud di Tanah Melayu sejak 1938 lagi. Sehingga kini pelbagai jenama kopitiam muncul bagaikan cendawan tumbuh selepas hujan, berikutan permintaan menggalakkan.
Sebagai individu Muslim, persoalan yang perlu diteliti sebelum sesuatu makanan atau minuman dimasukkan ke mulut ialah adalah ia halal di sisi syariat?
Kelihatannya dewasa ini tidak ramai yang mengambil berat persoalan itu. Mungkin yang penting bagi mereka ialah apa yang dimakan menepati selera dan mengenyangkan perut.
Namun jika ditinjau kaitan makanan dengan syariat, isunya bukan sekadar makanan dan minuman yang menyelerakan tetapi ia boleh menjadi penyebab seseorang dihumban ke neraka. Rasullulah SAW pernah bersabda yang bermaksud: Setiap daging yang tumbuh daripada yang haram maka neraka adalah tempat yang layak baginya.
Lebih daripada itu umat Islam diseru agar sentiasa memelihara diri dan keluarga daripada terjerumus ke dalam neraka. Sebagai mana firman Allah SWT yang bermaksud: "Wahai orang yang beriman! Peliharalah diri kamu dan keluarga kamu daripada neraka yang bahan-bahan bakarnya ialah manusia dan batu (berhala);
Neraka itu dijaga dan dikawal oleh malaikat-malaikat yang keras kasar (layanannya); mereka tidak menderhaka kepada Allah dalam segala yang diperintahkan-Nya kepada mereka, dan mereka pula tetap melakukan segala yang diperintahkan. (Surah al-Tahrim ; ayat 6)
Tindakan sesetengah pengusaha kopitiam menggaji pekerja Islam di premis mereka, adalah suatu usaha yang patut dipuji tetapi ia belum menjamin aspek halal yang dituntut dalam Islam. Mereka seharusnya lebih prihatin dengan keperluan umat Islam untuk mendapatkan makanan halal lagi suci.
Bermula daripada kopi yang disajikan sehinggalah kepada aspek kebersihan pinggan mangkuk perlu selari dengan kehendak syariat. Begitu juga barangan seperti mee, daging salai, rempah-ratus dan lain-lain yang diimport daripada negara luar seperti Taiwan, Hong Kong dan China yang turut diragui sama ada halal ataupun tidak.
Lebih membimbangkan lagi apabila logo 'Halal' Jabatan Kemajuan Islam Malaysia (Jakim) tiruan digunakan dengan meluas semata-mata untuk melariskan barangan dan mengelabui mata pengguna Islam yang tidak prihatin.
Pengusaha kopitiam seharusnya mendapatkan pengiktirafan sijil halal daripada Jakim mahupun Majlis Agama Islam Negeri, sebagai usaha menarik lebih ramai pelanggan Islam ke premis mereka. Langkah ini perlu dipertimbangkan dengan serius memandangkan di sesetengah kopitiam, 70 peratus pengunjung adalah penganut Islam.
Orang Islam pula perlu lebih sensitif terhadap isu halal kerana ia boleh memberi kesan kepada peribadi dan keimanan seseorang.
Kajian oleh majalah The Halal Journal berkaitan kesedaran masyarakat Islam terhadap produk halal di beberapa negara Eropah, Asia Barat dan Asia Tenggara yang berakhir pada 2007 menunjukkan, 94 hingga 98 peratus responden bersetuju untuk membeli hanya produk berasaskan daging yang halal.
Sementara itu, hanya 40 hingga 64 peratus responden bersetuju makanan yang telah siap diproses seperti roti dan lain-lain mestilah berstatus halal.
Statistik ini jelas menunjukkan, kesedaran umat Islam terhadap produk makanan halal yang telah diproses masih ditahap sederhana. Sehubungan itu, pihak yang bertanggungjawab seperti Jakim dan Persatuan Pengguna Islam Malaysia melipatgandakan lagi usaha mempromosi produk halal kepada seluruh masyarakat Islam agar kewajipan umat Islam mendapatkan makanan yang halal dapat dipenuhi.
Selain itu, ia juga berupaya membangkitkan sensitiviti umat Islam untuk lebih prihatin mencari yang halal sahaja.
Pihak berwajib juga diharap dapat memperbanyakkan lagi aktiviti penguatkuasaan ke atas logo halal agar pihak yang tidak bertanggungjawab dibawa ke pengadilan.
Kita tidak mahu ada pihak yang mengambil kesempatan meraih keuntungan lumayan daripada trend lepak di kopitiam tanpa mengambil kira sensitiviti masyarakat Islam.
Oleh MOHD. ALI MUHAMAD DON
Pensyarah Kanan
Pusat Pemikiran dan Kefahaman Islam
UiTM Kampus Bandaraya, Johor Bahru.
Sebagai individu Muslim, persoalan yang perlu diteliti sebelum sesuatu makanan atau minuman dimasukkan ke mulut ialah adalah ia halal di sisi syariat?
Kelihatannya dewasa ini tidak ramai yang mengambil berat persoalan itu. Mungkin yang penting bagi mereka ialah apa yang dimakan menepati selera dan mengenyangkan perut.
Namun jika ditinjau kaitan makanan dengan syariat, isunya bukan sekadar makanan dan minuman yang menyelerakan tetapi ia boleh menjadi penyebab seseorang dihumban ke neraka. Rasullulah SAW pernah bersabda yang bermaksud: Setiap daging yang tumbuh daripada yang haram maka neraka adalah tempat yang layak baginya.
Lebih daripada itu umat Islam diseru agar sentiasa memelihara diri dan keluarga daripada terjerumus ke dalam neraka. Sebagai mana firman Allah SWT yang bermaksud: "Wahai orang yang beriman! Peliharalah diri kamu dan keluarga kamu daripada neraka yang bahan-bahan bakarnya ialah manusia dan batu (berhala);
Neraka itu dijaga dan dikawal oleh malaikat-malaikat yang keras kasar (layanannya); mereka tidak menderhaka kepada Allah dalam segala yang diperintahkan-Nya kepada mereka, dan mereka pula tetap melakukan segala yang diperintahkan. (Surah al-Tahrim ; ayat 6)
Tindakan sesetengah pengusaha kopitiam menggaji pekerja Islam di premis mereka, adalah suatu usaha yang patut dipuji tetapi ia belum menjamin aspek halal yang dituntut dalam Islam. Mereka seharusnya lebih prihatin dengan keperluan umat Islam untuk mendapatkan makanan halal lagi suci.
Bermula daripada kopi yang disajikan sehinggalah kepada aspek kebersihan pinggan mangkuk perlu selari dengan kehendak syariat. Begitu juga barangan seperti mee, daging salai, rempah-ratus dan lain-lain yang diimport daripada negara luar seperti Taiwan, Hong Kong dan China yang turut diragui sama ada halal ataupun tidak.
Lebih membimbangkan lagi apabila logo 'Halal' Jabatan Kemajuan Islam Malaysia (Jakim) tiruan digunakan dengan meluas semata-mata untuk melariskan barangan dan mengelabui mata pengguna Islam yang tidak prihatin.
Pengusaha kopitiam seharusnya mendapatkan pengiktirafan sijil halal daripada Jakim mahupun Majlis Agama Islam Negeri, sebagai usaha menarik lebih ramai pelanggan Islam ke premis mereka. Langkah ini perlu dipertimbangkan dengan serius memandangkan di sesetengah kopitiam, 70 peratus pengunjung adalah penganut Islam.
Orang Islam pula perlu lebih sensitif terhadap isu halal kerana ia boleh memberi kesan kepada peribadi dan keimanan seseorang.
Kajian oleh majalah The Halal Journal berkaitan kesedaran masyarakat Islam terhadap produk halal di beberapa negara Eropah, Asia Barat dan Asia Tenggara yang berakhir pada 2007 menunjukkan, 94 hingga 98 peratus responden bersetuju untuk membeli hanya produk berasaskan daging yang halal.
Sementara itu, hanya 40 hingga 64 peratus responden bersetuju makanan yang telah siap diproses seperti roti dan lain-lain mestilah berstatus halal.
Statistik ini jelas menunjukkan, kesedaran umat Islam terhadap produk makanan halal yang telah diproses masih ditahap sederhana. Sehubungan itu, pihak yang bertanggungjawab seperti Jakim dan Persatuan Pengguna Islam Malaysia melipatgandakan lagi usaha mempromosi produk halal kepada seluruh masyarakat Islam agar kewajipan umat Islam mendapatkan makanan yang halal dapat dipenuhi.
Selain itu, ia juga berupaya membangkitkan sensitiviti umat Islam untuk lebih prihatin mencari yang halal sahaja.
Pihak berwajib juga diharap dapat memperbanyakkan lagi aktiviti penguatkuasaan ke atas logo halal agar pihak yang tidak bertanggungjawab dibawa ke pengadilan.
Kita tidak mahu ada pihak yang mengambil kesempatan meraih keuntungan lumayan daripada trend lepak di kopitiam tanpa mengambil kira sensitiviti masyarakat Islam.
Oleh MOHD. ALI MUHAMAD DON
Pensyarah Kanan
Pusat Pemikiran dan Kefahaman Islam
UiTM Kampus Bandaraya, Johor Bahru.
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