28 September 2011

Time to start accumulating stocks slowly

Based on my experience, some of the stocks in the stock market has reached its lowest point this year. While we cannot deny the stock price is moving south, I believe that it is time to start accumulating good company with more reasonable price. There are three strategies now:

  1. Buy into High Dividend Yield Stock. The cheaper the price is, the higher the dividend yield is. Please make sure the company can distribute dividend in consistent manner. 
  2. Buy into Undervalued Stock. To determine whether the company is undervalue, you could judge it current PE with historical PE or other market variable indicator such as P/NTA, P/CF, P/S and P/B etc.
  3. Buy into Growth Stock. To determine whether the company is a growth stock, you can check whether the PEG ratio is low, CAGR is high, industry is a growing industry, having a good management etc.

3 comments:

  1. Hi, I wonder u still keep your mahsing? I read from invest talk, many still waiting for bear 3rd phase where it will have much more impact on the price. I just wonder whether is time to keep cash better.

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  2. Hi Mr loso,

    Actually I would like to switch mah sing to Chip Eng Seng, but unfortunately mah Sing drop from 2.80 to 1.50 and I changed my mind to start accumulating Mah Sing. In fact, I started accumulating MAh Sing since year 2005, means that i started it's investment when the price was about 50 cents ++. So, if you are buying a good business, it is very silly to sell it just because of the reason the price is dropping. I would hold it until I find another better investment opportunities in Singapore. :) now I am holding about 66lots and plan to accumulate till 100lots. If I success to do so, means that I will be able to reach dividend income of five figures. :)

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