A Personal Finance Blog for Malaysian: Invest in Bursa Malaysia

Sunday, September 19, 2010

Invest in Bursa Malaysia

What do you invest in Bursa Malaysia?

Mainly equity (or Share) in listed company and become a "very very small shareholder" in a "very very big company".

As a shareholder, you will be entitled to attend the annual general meeting held once a year and some door gift or refreshment.

As a shareholder, you will be entitled to share the profit of the company via dividend payout.

As a shareholder, you may have gain on capital of your investment due to "higher demand" for the shares, and therefore, driving up the "Price" of the shares.

Will you gain from the Bursa Malaysia (i.e. the Stock Market)?

I believe understanding the financial statement and diligent analysis is more important than luck in order to WIN in stock market.

Basically there are few types of investing styles, which one is yours?

  • Portfolio investors
  • Index investors
  • Venture capitalist investors
  • Technical investors
  • Growth investors
  • Value investors
There are millionaires making their fortune from each and every styles above, nothing is absolute right or wrong! It is just which style suits you.

I choose Value Investing for a few good reasons:-
- I am not professional investor, no time to do investment every day every hour
- I have limited fund (so can not be index investor, portfolio investor or venture capitalist investor)
- I am scare of losing big money (so can't be technical investor)
- I have limited information (timely and accurately)(luckily I have found www.equitiestracker.com which can compensate me for a small amount of subscription fee)

What is Value Investing?
  • It focus on Value and Business, not the movement of price.
  • It is based on believes that markets are inefficient, prices often does not reflect value correctly.
  • Basis for buying is buy when you believe the asset will increase in value over time or when Price is less than 2/3 of its Intrinsic Value.
  • Basis for selling is when Price is over and above Intrinsic Value. No such thing as cut loss.
  • It is mean for long term (good for those below 50)
Price is what you pay; Value is what you get.