Stock Market and the Usual Yo-Yo

Things have kind of cooled down at the stock market following the relatively good rally in early March. During that rally I saw my champion stock Pchem rising up to 7.58, acquired at the unit price of 5.04, the massive YO in the form of a rise would have made many investors off-loading their stock but not me. Is it a case of unexplained attachment or is it pure greed? ( I cringe when I type this word). My broker Charles also shook his head.

I was talking to a bank manager a few weeks back who said his friend working in the oil and gas company got 400K Pchem (IPO) shares through a loan and he offloaded them fast as the stock recovered slightly following its weak debut.The man regretted it by early March. He managed to repay his loan but he made a pittance. And just imagine he was overly relieved to be able to repay that loan!

My philosophy is if you were going to sweat over a loss in the short term, then you shouldn't enter the stock market. It is not for the faint-hearted and it is not for "chickens" who responded at the slightest negative news. Especially when you have selected a company to invest in based on its quality fundamentals. Because all stocks are subject to a Yo-Yo. You have to know the pattern of the trend, some people use the market charts data to make their move and this mix of fundamental and market charts data will actually determine actions on your stocks.

By the way, my principle is never to borrow to acquire stocks!

And so yours truly is waiting, don't know for what, and now witnessing the Pchem price falling to less than 7.00 as a YO sets in.. It is strange when the price is low, that is the time I get restless and itching to sell. Obviously not the characteristic of an intelligent risk-taker! So let us see whether the stock will climb back to its highest peak under this yo-yo environment. I believe it will.

This evening I heard that the US job data for April has shown a more than expected figure and US market sentiment is buoyant again ( another YO in  the making!) and the European stock markets also have gone north, so you can expect Malaysian stock market will open ( with a YO)  higher this coming Monday. I am not that sure what the impact of the death of Osama has on our Bursa but there was a positive sentiment in the Middle East market particularly Egypt. Others are still waiting for any possible response from some members of the  organisation the murdered Osama led. If there is then you can expect a YO.

I also notice my Sapcres and Dialog stocks are having the same swing along with the other stocks except those genuine non-speculative ones like the REITs and hmmm..... PICORP. When the international fund took flight just before CNY, almost all the desirable stocks took a beating but not PICORP... I almost smiled at myself as this stock, held for almost three years, doesn't suffer a Yo-Yo for the last two years. So still waiting patiently for it to recover from its prolonged YO... you never know.

And watch out for TM as its YO will come-a-calling  soon.