Hi guys,

let share stock buying your stock buying strategy. I have no deal with stock market at the moment but i am interested to get involve in this field. Still in the process of registration with RHBinvest.

BTW, this is my idea:

Buy stock that price lower than RM0.20. Let say I buy at RM0.20/unit for 10000 units which is will cost me RM2000 + ~RM30 (for all those fees - online trade rm28) = RM2030

let say the stock that we bought is increasing by RM0.05 then we sell it .. RM0.25 x 10000units - RM30 (fees) = RM2470.00

So, our profit is RM440 for it which is +- 21% of our capital.

My point of view is buying <0.20/unit stock will get more return (%).

Am I correct? how about your guys? please share and comment about my idea .. tq ..

if your total cost is RM 2K, it should be 100,000 units, not 10,000 units.

and yes, you are making RM 400++ bucks if you were to buy at RM 0.20 and sell at RM 0.25

=============

as for stratergy, at the price of RM 0.20, i assume it is either a penny stock or most likely, a call warrant.

you ought to purchase in big volume (like you said, 100,000 units) in order to see the return.

Yes. High return % but it's also high in losses in the other point of view. My advice do to it diversify, don't put all your eggs in a busket.

aik .. 0.20 x 10000 = RM2k .. not 100000 .. if not, 20k for 100000 units .. ..

is it easy to increase 5 cents ( in a couple of days) for around 20 cents stock price tag? what is your opinion in this? ..

haha you can try and see. i used to buy 100,000 shares of call warrant, and hoping it to jump up just a mere 0.005 and i'd be very happy

guess what, the price went downwards, never come up until now

hoho .. that make me scare to buy cheap stock la .. .. i will go with rm1 price tag la .. smaller return in % but smaller risk .. .. come2 .. share your opinion ..

Please understand that it is the percentage of return that matters, not the stock price.

A return of 10% for a RM0.50 stock and a RM40.00 stock is the same.

Sorry to tell you that, wrong. On paper or theory, might be. Reality not.
For a stock of Rm0.20 to increase 5 cents (25%), it is not easy task, (except CWs that tight to the mothershare movement). You can see those Rm0.10 stock, hardly move Rm0.005 at all even traded 100K of volume.

If a stock is only traded (apart from CWs) at Rm0.20, it must have a reason why it is traded at low price. Good fundamental stock generally won't be traded at low price even after splittng.

Generally (although not a must, due to massive stock split or number of shares issued, different story etc) low price stocks (a few to ten cents one)mostly consists of poorly fundamental stocks.

Movement of a stock is related to % wise, not cents.

Just my 2 cents.

Try it out, then you will know.

This post has been edited by cherroy: Mar 28 2008, 02:16 PM

Very easy strategy as simple as:

"Buy Low Sell High" or
"Buy High Sell Higher"..

There are 2 rules of thumb: First, "Not lose your capital" and second please refer to rule No.1..

Anyway, price do affect the return.
If you buy cw at half cent, your return will be 100% or loss all or just break even(minus losses of broker charges).

Those half a cents CWs are worthless and near to expire, bare in mind,

RM0.05 is 25% out of RM0.20.

Buying a RM1 share and wait for it to go up 25% also the same as waiting for a RM0.20 share to go up.

You might think a RM0.20 share is more likely to go up 25% than a RM1 share, please do not think that way. A counter whether it is RM20 or RM0.20 has the same chance of going up, all depends on their fundamentals or people trying to 'goreng' it. It's just that RM0.20 shares are more affordable to retailers, that is why they would normally buy those when it is going up rather than the RM20 shares. And they will also normally be the ones who get burned when the prices start falling.

RM2000 + 20% is RM2400, but always remember RM2000 - 20% is RM1600.

Always remember to look both ways when crossing the road. The stock market shares are the same, it can go up and down so don't always look at the upside only or you'll get wtfpwned by the downside.

This post has been edited by skiddtrader: Mar 28 2008, 04:49 PM

everyone thought buying share is simple but what lie behind them is big amount of knowledge they need to acquire before trade real. start with blue chip first kid before attempt with high risk stocks, this is the best way gaining trading experience before getting yourself burn in the first place. Learn to walk first before you fly. This is no easy business, my colleague with more than 20 years experience also get himself burn, needless to mention you are just a greenhorn.

Well said.

Hope that more people will share their priceless experience here.

I am still learning, as a kid. Haha...

me too .. as a green kid .. .. just get my account ready for stock trading today but i have yet to start buying .. ..

still in the process of learning and understanding .. .

Seng_kiat, from your recent posts you seem to have this excitement to get into the market and make money. I know that excitement and I believe many have gone through it as well. But I have to caution you as much as I can to do your research and read as much as you can about the market before entering your first orders.

Don't worry about lost opportunities and don't fret on it. Don't let the excitement of earning money cloud your judgement. I would really recommend you try the CIMB virtual iTrade for practice first but that's up to you.

Good luck and don't stop learning. Don't survive on spoon-fed news and tips from the media or us, formulate your own ideas and interpretations.

thank you very much for your advices .. I really appreciate it .. i am new kid in this field and i must study and learn from the expert .. .. if you guys willing to share idea, tips, etc, feel free to post it for benefit all of us here .. ..

Don't look for tips, but learn what is the market about, fundamental of stocks etc.

Looking for tips is like wishing somebody to give you a fish, instead one should look how to fish.

Don't invest until you are familiar with and fully aware of the risk involved. It involves hard-earned money in stake, no play play

Welcome.

yeah cherroy is right. unless you have a gold mountain with unlimited of cash, different story

Word of advice. Don't ever play stock market with borrowed money. It will burn your backside if price drops like 10th March

Make sure you have cash in hand before going into the market. It is a wild wild west scenario there.

I started investing just before the GE. Out of excitement, I bought some stupid stocks which was cheap and also some blue chips. I am still stuck with some stocks which seems does not recover from the shock. Luckily I used my hard earned cash to buy it

In the meantime, I did make some decent amount of cash after that by carefully studying the market movement and playing contra (managed to recoup paper loss of my existing shares)

This post has been edited by dsugums: Mar 29 2008, 01:03 PM

u were jus like me when i 1st started tradin in stock market... too naive

y not open wit hong leong? they r using d same chart provider, jus dat hong leong is much cheaper.. min service charge is rm12 per transaction.. openin acc is FOC..