About dollar cost averaging, its basically spreading out your money that you want to invest into a period of time. So you will get more shares or units if the investment that you invest in goes down during that period of time. But what if the investment goes up? Wont you actually lose the shares that you would have got if you were to go in with a lump sum?

So arent the risk the same?

If i'm wrong please correct me cause i'm no expert.

This is how dollar cost averaging works. You set aside a fixed amount of money to be invested into the stock market every month. Let's say you are going to set aside RM1000 every month. So every month, regardless of the market condition (bullish or bearish), you keep on setting aside that RM1000 and put into the share market.

So when the market is down, with that RM1000, you can buy more shares. Why? Because the shares are now cheaper, so your RM1000 can buy more of the cheaper shares! So what happens if the market is high?

When it is high, the shares will be more expensive, so you will only be able to buy fewer shares.

So assuming that in the long term the KLSE is on an uptrend, your shares value will increase. Thus, your investment gets positive returns!

But I am not sure whether this works in Malaysia. First, we need to know whether the KLSE is on an uptrend in the long term. Anyone can clarify this to us? I don't have the data. Secondly, if the KLSE is really on an uptrend, we have to make sure that the average yearly increase is more than the return rates in other investment vehicles.

(Please correct me if I am wrong. I am still a learner...)

I'm From Pj Damansara jaya ss 24, if want u want to do a regular saving on investment you can give me a call, i can share with you more, then i can create a portfolio for you yah,
017-6727668



This post has been edited by vincecyc: Oct 25 2005, 11:45 AM

fell sorry for you, if you din't escape from the bear (down trend) of the market, it is very ovious that YOUR CONSULTANT Didn't do any things for your investment, want to know more give me a call, i can help you.

one and for all, if any one want to invest into oversea, you don't need a huge sum, RM1000 min, any one interested can call me to know more yah, happy to help you all, God bless you all.

Let me give the other side of the story.
I'm licensed to deal in shares,futures and unit trust and my experience can be considered as long, more than the age of majority of u.Im in my 50s.My background is in accounting .

No one know for sure when the market is going up or coming down,(else ,he will be a millionare long time go)so, no one can advise you precisely when to enter or exit the market.At the end of the day,you,as the investor yourself,hv to make the final decision,Your Dealer's Representive can only advise you and he could be wrong in his assessment.

Secondly,I must stress that in any profession,the interest of big clients are always better taken care of.So,if your volume is not big,you will still be entertained but don't expect to be served like a big customer.Sorry to say this but it's a fact of life!You should follow the market closely and ask for opinion from your Remisier.

And one advice from me,don't go for short term trading in the stock market,invest on a long term basis and I 've seen people making money in the stock market this way.

To make things clear,Remisier =Dealer's Representative,Future broker=FBR or Futures Broker's Representative.

I respect your opinion, thank you for it, when you say no one can know when the market down or when market is high, i agree on that.

yes, anyway what are you doing now?

I am really glad that someone like you is joining this thread. We need more experienced people like you! Please do post more often and share out your knowledge!

What is the long term trend of KLSE? Up, down or no changes?

If someone can tell you the long term trend of KLSE, most probably it's speculation..

Seriously, IMHO, no one could predict the trend in a market, they can analyze the trend of a certain stock whether it's bull or bear ... But not the trend for the whole KLSE market..

If this can easily be done, we wouldn't be seeing only ONE Warren Buffett now ...

No, you misunderstood me already. What I meant is the long term trend of KLSE from the available historical data. Perhaps from the year 1990 to today, what is the trend? Is it on an uptrend or downtrend.

According to the authors of "The Armchair Millionaires", the long term trend of the US stock market is always an uptrend. This is proven by the historical data available which spanned years back. So the author is implying that the stock market is a good vehicle for long term investment especially by using their method called "dollar cost averaging".

So now, what is the historical trend of KLSE? HAHA! That's a better way of questioning, I guess.

Oh ... Guess I misunderstood your question
---
About the trend in KLSE, I'm not sure about the details, but this is the story one of my ex finance lecturer told me...

She told me that the economy/share market of Malaysia is not that easy to predict as the economy/share market is heavily influenced by politics ... Is this true?

Haha! Personally I feel there's no politics involved directly in the share market. Note the word "directly".

Can politics influence the economy? Certainly yes! Politics directly determine the economic policies of a country which will influence the economy. Since the economy affects the share market, you can say that politics indirectly influence the share market (note the word "indirectly").

It's something like this...

Politics--->Economic policies---->Economy---->Share market

Also there are insider trading. Most of the stocks are priced even before the news break.

Hi,
Given that 30% or more of KLSE is owned by Government Linked Corporation or Government Linked Investment Corporations and Government is influenced by politic, you are clearly wrong in your assessment.

Dreamer

This post has been edited by dreamer101: Oct 26 2005, 11:30 AM

The KLSE operates like a huge casino with invisible movers and shakers.

TQ,TQ,I will be more than willing to share the little bit that I know with all the forumers.
As I came to this forum to seek help and knowledge on IT,I hv received unreserved helps from other forumers,I should also contribute my fairshare.

The problems with the Malaysian stock market at the moment are,IMHO,can be broadly categorised into internal and external,internally:

1.There's just too many stocks listed for a small country with population of 24million.The number of stocks listed is around 1000 now,New IPOs (initial public offerings) are coming on stream at the average rate of at least one per week.There's excess supply now.

2.Some listed companies are performing badly or r badly managed ,losing money everyday and their share price fall in tandem.investors get hurt and many just hold on hoping that the share price will recover only to be shocked later that the company get suspended,delisted,or some kind or capital reduction and cash call excercise that is not worth taking up.

3.Restructured companies get into financial difficulties not long after restructuring due to ,inter alia,bad or dishonest management,assets injected at inflated prices,application not properly vetted and approved by the authorities,and more seriously,fraud in the submmission.Small investors get hurt and loss confidence in the market.

3.IPOs are priced too high.Since the authority changed over to DBR(disclosure based regime)companies r free to fixed the IPO price ,thus,many investors loss money again.I feel that at this stage,Malaysians r not that sophisticated yet and r not ready for DBR.

4.Corporate governance is still lacking in many public listed companies.

5.Insufficient and inefficient enforcement against offenders,perceived selective persecution and political influence.

6.Some unseen forces supporting certain index linked stocks giving false impression
of the market .leading to erosion of investor's confidence.

7.Government policies on 30% bumi requirement,thus ,many well run,good quality, family owned companies hesitate to list.This requirement is also frown upon by foreigners.

Externally,

1.Other markets in Asia pacific is more attractive than klse.Foreign funds will pick the market that provide the highest return.

2.Flip flop of gov. policy,foreigners don't like this.

The abv r just my opinions,I welcome feedbacks and corrections from other forumers

BTW,Vincecyc,I am still in the industry but "semi retired",ie ,Ionly come in to the office to jaga the few good accounts.

lklatmy,
Thank you for contributing here. I hope you will be posting more often so that we can continuously learn from you, the experienced one.

Since you have years of experience, do you know what is the long term trend for KLSE from historical data? Is it on an uptrend?

Hi,
A quote.

True... I agree with you...

I have also read that book. According to the authors of "The Armchair Millionaire", the US share market has been on an uptrend in the long term since years years ago. So the trend will continue for the US share market, according to the authors. I really doubt the authors... But so far, his point is true...

This post has been edited by Chronox: Oct 26 2005, 07:04 PM