My Trades and Opinion for Next Week

Sold BSDREIT RM1.36 2000 shares. The profit is RM120 - RM30 (Transaction Fee) = RM90. I will post the statement slip after I receive it.

I bought the shares for three months at RM1.30 to test my holding ability. I used to be an impatient trader which cost me a lots of money. I treat them as lesson fees. I don't want to repeat the same mistake. I treat it as a way similar to stop smoking. Bad habit is hard to change.

My target for BSDREIT is RM1.40 or RM140 of dividend as BSDREIT was giving out 7 cents of dividend in February 2009. 20 lots of BSDREIT will give RM140 of dividend. But I choose to sell it off before I take the dividend to strengthen my cash position. RM30 is my stadard way of calculating buy/sell round trip fee for trades below RM3000. I don't get into detailed calculation unless my capital grows above RM100k. My current trades are too small to deserve any accounting pratices.

My premature selling of this stock is due to the unfavorable market condition next week and it is very closed to my target. REIT stock won't go up a lot. The gain is just 3.5% (RM90/RM2600) but it is still 1.5% higher than FD rate in Malaysia.


My take for next week?

The visit of this blog is going downhill just like the stock market. I think everyone is busy grabbing the last distribution of red packet money from the stock market to buy new clothes, furnitures and get ready for major housekeeping.

As I skim through the blogs and forums, everyone is still very bullish. But they are just retail investors who won't have the ability to move the market much. In every stock market, the biggest market movers are the fund managers. If they are bullish, the market will go up. If they are bearish, the market will go down.

First we need to understand why the stock market retreated for the past few days.

Yes, it is the US President Obama's intention to regulate the banking system on Thursday and Warren Buffet's negative view on US economy on Wednesday. One is the most powerful man in the world and the other is the most influential investor in the world. They both make statements that are against the current bullish stock market environment.

How about my take? I think it is still bullish as there is no systemic problem with the economy. President Obama and Warren Buffet were doing the right thing: to cool down the overheated stock market. Such correction is very healthy in the long run.

I will buy some ETI TECH as it is selling at a big discount and the downside is very limited as Emirates' investor have significantly reduced their exposure to this company. I may buy back some BSDREIT it falls to RM1.33 or lower.

Other shares that I have in mind is Astro (for medium term, will sell after World Cup 2010 started), HLCAP (still investigating), E&O (if it falls bellow RM1.00 or lower), BOUSTEAD (if it drops a lot), SUNCITY (if ti drops a lot), PELIKAN (if it drops a lot).

With such market condition, I will keep 50% of cash.