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 Q&A, General question on stock market

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plumberly
post Dec 31 2013, 10:39 AM

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QUOTE(Oracles99 @ Dec 30 2013, 10:13 PM)
When I started my working life ages ago in an audit firm, I used see my boss giving a qualified opinion if the accumulated losses of a company exceeded its share capital - the point that the company may not be able to continue as going concern. But today,on this issue, the auditors no longer issues a qualified opinion. They group it under "Emphasis of matter". Times have certainly changed.
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Thanks for the tip to keep an eye on "Emphasis of matter"!

Wish things are simpler than this. Say what you mean and mean what you say, rather than hiding in the bush. Ha.

Thanks again.
plumberly
post Jan 6 2014, 08:59 AM

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QUOTE(praceo_francium @ Jan 6 2014, 07:58 AM)
hi guys. i have a capital of rm20k. after register a cds account, what should i do?
how to pick a promising stock? how to avoid loss. is it what suggested by the banker reliable? and how can i increase my knowledge regarding stock market other than forumLYN. im just new here and now still have not finish study yet. i have no other commitment too. icon_question.gif
umw-og  a better choice perhaps?
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Try this:

AWARENESS
* read books (at least 10 books on shares)

KNOWLEDGE
* learn from the respected sifus here
* attend courses (online etc)
* start paying your tuition fee by investing in shares BUT start with small amount

SKILL
* learn from your failures and successes

MASTERY
* once you are here, teach me!


Cheerio.
plumberly
post Jan 6 2014, 11:12 AM

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QUOTE(river.sand @ Jan 6 2014, 10:42 AM)
I read fewer than 10 books  blush.gif
But if there is one book you must read, I recommend:

One up on Wall Street
by Peter Lynch
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Thanks.

That book is in my list to read but have never got around to read it. Will do so soon.

Cheerio.
plumberly
post Jan 8 2014, 09:02 AM

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QUOTE(river.sand @ Jan 7 2014, 09:02 AM)
What is the significance of ROE?

ROE = net profit/shareholders' equity

But shareholders' equity is not our invested capital. Why should we care?
Our invested capital is (price x number of shares), hence I can understand why PE is an important measure. But why ROE?
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My 3 cents here from my learning journey.

3 important core jobs of management:
* making profit, thus PTPM (either flat or increasing)
* able to make more $ from their retained profit, thus ROE (better than 15%)
* not taking too much debt, thus D/C (less than 33%).

Cheerio.
plumberly
post Jan 21 2014, 04:17 PM

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QUOTE(river.sand @ Jan 21 2014, 04:09 PM)
Back to the discussion of ROE, which I asked some time ago. I found some information which you may find useful  smile.gif
DuPont identity tells us that ROE is affected by three things:
- Operating efficiency, which is measured by profit margin
- Asset use efficiency, which is measured by total asset turnover
- Financial leverage, which is measured by the equity multiplier

ROE = Profit Margin (Profit/Sales) * Total Asset Turnover (Sales/Assets) * Equity Multiplier (Assets/Equity)

source

All firms should attempt to make ROE as high as possible over the long term. However, analysts should be aware that ROE can be high for the wrong reasons. For example, when ROE is high because the equity multiplier is high, this means that high returns are really coming from overuse of debt, which can spell trouble.
source

Furthermore, ROE can be manipulated with the following means:
- giving dividend generously, thereby reducing retained profit
- not re-evaluate properties, thereby lowering the equity value

So, high ROE is not necessarily good  sweat.gif
*
Noted and thanks.
plumberly
post Feb 11 2014, 03:16 PM

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Sources of company infor for study include:
a. company's investor relation
b. bursa M'sia
c. S & P
d. Value Line
e. Morning Star

I have tried c, d & e for M'sian companies, no success there.

Like to know:

1. Is there any local investment bank which provides online link to c or d or e? And for free?
2. Any local or regional companies similar to Value line or Morning star?
3. Where can I get ACE analyst consensus estimate data for M'sian companies?

Many thanks.
plumberly
post Feb 28 2014, 08:55 AM

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Hope you can help me with this.

Attached Image

(taken from The Star)

AA
How difference is this compared to private placement? Same thing?

BB
With this placement or PP, will existing shareholders see a dilution in their returns? I guess it depends on the performance of the extra fund.

CC
Existing shareholders will not have a say in :
* agreeing to the new fund? Approval in AGM?
* buying in the new fund?

DD
All KLSE listed companies can go for this fund raising activity?

EE
If you have shares in a company trying to raise new funds via this method, how do you decide whether to keep or sell the shares?

Thanks.

Cheerio.

plumberly
post Mar 1 2014, 07:12 AM

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QUOTE(gark @ Feb 28 2014, 05:03 PM)
So much questions..  tongue.gif

1. This fund raising is exactly the same PP only with different name.
2. It depend if the new acquisition will add or deduct value. New placement will have immediate dilution, but if the new asset can earn MORE than the dilution then it adds value. If it earns LESS than dilution then value is taken away.
3. 10% and less no need AGM or shareholder approval. loop hole.  rolleyes.gif The placement is on invitation basis, if you have premier banking you can contact your RM to arrange buy in. Usually the PP shares are sold at max 10% discount to market price.
4. Yes
5. Look at answer no 2
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Thanks Sifu Gark!

Sorry, a grade C student asking many questions. Ha.

Useful infor on (3).

Cheerio.
plumberly
post Mar 1 2014, 10:15 AM

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QUOTE(gark @ Mar 1 2014, 10:12 AM)
No sifu sifu ah....  tongue.gif

You are welcome.

Actually more important is item no 2
*
See, I should now downgrade myself to D grade student now! Ha.


plumberly
post Mar 1 2014, 10:39 AM

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QUOTE(gark @ Mar 1 2014, 10:27 AM)
So far I have seen you asked very technical question....

Have you actually started investing yet?

If yes, join us at the bursa trader's thread, so we can discuss on your stock selections.  laugh.gif
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This D grade student is trying to cover the basic first though I have ventured into shares back in the 2000's and with some successes (90% due to luck and 10% due to foresight. They say even a blind person can pick a winning stock during boom time!). Sold all my shares a year or two before the 2008/09 crash.

Now have prepared my top 9 list (growth & dividend portfolio) and waiting for a possible dip in the coming months/year.

Will join the thread once I am ready.

Cheerio.
plumberly
post Mar 3 2014, 10:31 AM

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QUOTE(Irresistible @ Mar 2 2014, 10:45 AM)
I hold a few stocks . The recent report is good, but stock price kept dropping ...

Should i sold off with little profit OR hold long term ? But, i felt market is not really good ....
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My 2 cents here.

It depends, among others:

(1) are the companies still fundamentally strong?

(2) what can you do with the money if you sell them now? Earn at FD 3 % or something higher?

(3) the economy outcome in the next 1-3 years.


My personal view:

(1) if the companies are not fundamentally strong now, find out why, sell them if I think they will stay in this pit for the next few years.

(2) if I can find another secured investment more 2 times better than the return from the companies, then I will sell them.

(3) my view is volatile economy with a crash. So sell them and grow the money elsewhere.


Mentors like Gark can give you a much better insight and direction.

All the best.


plumberly
post Apr 30 2014, 11:55 AM

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Attached Image
(taken from The Star)

Hope you can explain the 2nd paragraph. Don't understand it. hmm.gif

Thanks.
plumberly
post Apr 30 2014, 01:05 PM

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QUOTE(felixmask @ Apr 30 2014, 12:49 PM)
I use mine interpretation of MY Processor Brain to process
the company use the same dealer- buying and selling the company stock without paying a sen until , the dealer realize the amount so huge.

icon_rolleyes.gif

Disclamier- Know nuts of company
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Never thought of that! Thanks.

But what was the purpose beside paying the buy-sell fees?

To artificially generate some volume?

Cheerio.
plumberly
post May 24 2014, 03:30 PM

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Noted that JobStreet is now a Tier 2 company. Understand that SKILL Aust is buying Jobstreet. Don't understand why the "downgrade" from Tier 1 to Tier 2 just because of the purchase.

Thanks.
plumberly
post May 26 2014, 12:20 PM

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QUOTE(MNet @ May 25 2014, 02:02 AM)
JS no asset
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Maybe I understand the purchase wrongly. SKILL only bought the assets in JS and JS is now a shell building up its assets again?

QUOTE(SKY 1809 @ May 26 2014, 12:13 PM)
Don"t u think Eco World has better ranking than SP Setia in the eyes of the investors  laugh.gif

Even Apple without Jobs Steve is no more the same...............in the eyes of the investors ..
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Yes, agree that some companies are judged differently after some internal changes. I though moving from Tier 1 to Tier 2 is not based on our perception of the companies but company's characteristics as specified by the exchange board. No?

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