AIRASIA: Breaking of the triangle. Trend may continue

AIRASIA: Breaking out the triangle. TP 5.10. Long term play.

Disclaimer: Personal opinion of the author only. Trade at your own risk. Please read the disclaimer on the right.

Opening and selecting an online trading platform

Convenience, timeliness and low commission rates have made e-trading increasingly popular

A volatile stock market presents boundless opportunities but the speed a transaction is executed becomes much more important. When it comes to speed, those buying and selling shares through an online share-trading platform, referred to as e-trading, have an advantage over those who place their orders by calling their dealers or remisiers.

“In a volatile market where share prices move up and down very quickly, you will find it easier to access the stock market online, as opposed to calling your dealers. At times, phone lines can be busy,” says a spokesperson from CIMB Securities. “Besides the convenience and flexibility of placing an order at any time, even outside market hours, e-trading allows you to key in the buy or sell orders, make amendments or cancellations to undone transactions, and specify expiry dates on orders [known as good-till-date orders, which allows user to specify the number of days an order is valid].”

Online trading is also popular because of the low fees levied on transactions. On average, online platform providers charge a commission rate of 0.10% on the value of each contract, while for remisier or dealer transactions, the rate is 0.60% per contract. “Low fees translate into cost savings. And this can lead to higher profits,” says Tan Chee Siong, executive director of Jupiter Securities Sdn Bhd.

The actual amount charged differs among brokerages offering e-trading facilities but the cheapest provider may not always be the best choice. Here are factors to consider when picking an online stock-trading platform.

1) Cost and the required deposit

Most brokers do not charge a fee for the opening of an online share-trading account. “However, whenever you sign up for an online account, you are required to open a Central Depository System (CDS) account with the Bursa Central Depository, irrespective of whether you already have broking accounts with different broking houses,” says Tan. “Bursa Malaysia charges RM10 to open a CDS account but an increasing number of online broking houses are absorbing this fee.” Broking houses that are currently paying for this fee are ECM Libra Investment Bank, Jupiter Securities and Hong Leong Investment Bank (refer to table on next page).

Other costs that vary between trading accounts and brokers are dividend-handling fees and share-custodian fees, which apply to nominee stock-trading accounts.

Before executing trades, some brokers will require cash upfront while others will ask for a minimum deposit. Online share-trading platforms that require cash upfront usually do not permit trades that exceed the amount placed. For example; an upfront cash placement of RM10,000 in your online trading account allows you to trade up to RM10,000.

Asking for cash upfront before stocks are bought lowers the risk exposure of the broking house. This allows them to lower their brokerage rates, say Tan. Unutilised cash usually earns interest at a rate similar or slightly lower than fixed deposits.

According to CIMB Securities, some e-trading portals require a minimum deposit but this allows you to engage in margin trading. For example, a minimum deposit of RM1,000 allows you to acquire up to RM3,000 worth of shares. Some companies may allow the placement of share certificates as collateral but the amount of leverage received is lower. These facilities are better suited for investors with higher risk appetite and interested in margin trading.

Unfortunately, it can be costly for investors to trade in foreign shares even if they use the e-trading facilities of a local broker “Unless the foreign stock exchange does not charge contract stamp, investors who invest in foreign shares via a local broker are required to pay two contract stamps: one to the respective foreign exchange and the other to Bursa Malaysia. However, if you are transacting in a foreign exchange by opening a trading account with stockbrokers based in that country, you only need to pay for one contract stamp,” says Tan, adding that Bursa Malaysia allows local stockbrokers that offer online cross-border trading to charge the local prescribed brokerage rate or the foreign brokerage rate, whichever is higher.

2) Direct account vs nominee account

Online stock-broking platforms offer two types of trading accounts: direct and nominee. A nominee account appoints the stockbroker to hold the shares on behalf of the client. “Under a nominee account, the broking house would basically manage and inform you about corporate developments [on shares you are invested in] such as rights and bonus issues,” explains Tan. The major disadvantage of a nominee account is that you are not eligible to apply for initial public offerings (IPOs). A direct trading account offers this option. Those who prefer a direct account should check with the brokers on whether they offer this option.

3) Service and support

An online stock-trading platform should serve and answer their clients’ enquiries. Training, support and talks are among the services offered. Its staff should be able to explain and educate clients about functions and benefits provided by the trading system. “One may choose a platform that comes with a lot of features, but you may not be able to make full use of it if there is lack of support,” says Tan. Check whether the stockbroker provides a help desk as this is your resource for technical queries and how-to questions. “Ask whether the broking house provides workshops or one-to-one training sessions. It is also important to ensure that they provide online or phone support or both to answer your queries,” says Katherine Yee, head of HLeBroking, Hong Leong Investment Bank Bhd.

4) Features and functionalities

The beauty of an e-trading platform is the amount of information that one can access. “E-trading allows investors to view online real-time share prices, manage their portfolio and use the Internet to settle trades. They also enjoy stock-specific information such as market depth, intra-day price movements, technical indicators and historical prices. This enables you to make more effective and intelligent decisions in your trading strategies,” says the CIMB Securities spokesperson.

Look for value-added, competitive features and functionalities. Research reports are also useful while traders should opt for systems that provide advanced charting tools. Stockbrokers may charge a fee for investors to view certain information on their e-trading system. “Some brokers charge a monthly subscription fee while others will waive the fee if you hit a certain trading amount. Others will offer all their content free. It is best to check with them before you decide to open an account,” says Tan.

“What you do not realise is that providers of electronic platforms that offer free services will often only offer tools with basic functionalities. This is similar to Apple’s iPad and iPhone, where the free applications only offer basic features while the fee-based ones have more in-depth and sophisticated features. Paid features and functionalities include advanced charting tools, mobile trading, research reports, SMS stock alerts and real-time price feed for cross-border exchanges,” says the CIMB Securities spokesperson.

5) Reliability

An investor should not miss a trade because of an unreliable system. An ideal trading platform provides low-latency trade execution. “If the system’s speed is slow, your order might be queuing at the back and you might not get to transact at the price that you want. This will put you at a disadvantage, especially in a hot market,” says Yee, adding that an efficient platform would require minimum effort from the user who wants to initiate a trade.

However, the speed of a trading system is not identifiable until an account is opened and orders are placed. “Before opening an account, you can check what users are saying about the speed of the e-trading system (word of mouth) or from reviews by users posted on online forums and blogs,” suggests Tan.

6) Convenience

Online share trading requires clients to deposit monies (within the settlement period of “trade date” plus three business days) into a trust account to pay for a trade. Likewise, proceeds from a sale will be deposited into the same account. Although it is possible to execute an interbank transfer, RM2 will be charged for each transfer between different banks and a limit is imposed on how much can be transferred in each transaction. Each interbank transaction also takes a few business days before the money is transferred. For convenience and cost-effectiveness, consider using e-trading systems that allow you to conduct online banking transactions with your preferred banks. It is also important to take note of any procedure that is required to update your trust account once you have transferred money. For example, you may need to provide the stockbroker with details of the banking transaction.

Source: www.theedgemalaysia.com

SIME (4197)

SIME is ready to move!!

With the CPO price going up like crazy for the past 2 months, people are expecting that sime will make lots of money! I give 3 months for this counter to reach RM13.20

Disclaimer: The above opinion is not an invitation to buy or sell. It serves as a blogging activity of my investing thoughts and ideas, this does not represent an investment advisory service as I charge no subscription or management fees (donations are welcomed though). The content on my Facebook's Note is provided as general information only and should not be taken as investment advice. All site content, shall not be construed as a recommendation to buy or sell any security or financial instrument. The ideas expressed are solely the opinions of the author. Any action that you take as a result of information, analysis, or commentary on this site is ultimately your responsibility. Consult your investment adviser before making any investment decisions.

ETITECH (0118)

There are some people that complaint i put a strategy only when the price already goes up....so now I'll write what strategy i will use to trade this counter based on today's price action.

Strategy 1: Enter at current price @ 0.30

Stop: 0.255

TP: 0.335

Risk: 0.045

Reward: 0.035

Risk Reward Ratio: 1:0.77

This strategy is undesirable because it's RRR does not meet my criteria.

Strategy 2: Wait until it reach the resistance (0.335), and retrace back to 0.30. If it does not break, you can enter at 0.30, and place your stop slightly below (0.29, 0.285....depend on your tolerance)

Enter at current price @ 0.30

Stop: 0.28

TP: 0.335

Risk: 0.02

Reward: 0.03

Risk Reward Ratio: 1:1.5

Still did not meet my criteria, but then again, there is potential formation of inverted head and shoulder. so if u up for a little bit of gambling, then why not! haha.

Strategy 3: Wait until it breakup 0.335. The next TP is 0.39

Enter at 0.34

Stop: 0.32

TP: 0.39

Risk: 0.02

Reward: 0.05

Risk Reward Ratio: 2.5

The RRR is sufficient enough to take the risk.

The choice is yours.

Disclaimer: The above opinion is not an invitation to buy or sell. It serves as a blogging activity of my investing thoughts and ideas, this does not represent an investment advisory service as I charge no subscription or management fees (donations are welcomed though). The content on my Facebook's Note is provided as general information only and should not be taken as investment advice. All site content, shall not be construed as a recommendation to buy or sell any security or financial instrument. The ideas expressed are solely the opinions of the author. Any action that you take as a result of information, analysis, or commentary on this site is ultimately your responsibility. Consult your investment adviser before making any investment decisions.

Gadang Holdings Berhad (9261)

Gadang just won on LCCT projects. profit back inline in the last 2 qtrs. Next qtrly report announcement is due in late Jan 10. Why it is down on the good news ?

Research Highlights 7th December 2009

Top Story: LPI continue to leverage on fire insurance.
Due to increase in commercial buildings and improvement in property market, insurance in this particular segment will increase especially fire insurance. Gross premium growth are expected to be between 15% to 20%
Maintain Outperform with a fair value of RM14.59


Corporate Highlights

1. Gamuda’s 1QFY07/10results to disappoint
Gamuda’s peers in construction has recorded sub-par margin and RHB Research expect Gamuda to miss their expectation as well. Though Gamuda recorded profits of RM65million to RM70million, it is still lower than their expectation by 50%.
Maintain Underperform with Fair Value of between RM2.34 to RM2.12

2. Sunway secure pilling and structure works in Johor Bahru worth RM23.4million
With this contract, Sunway has managed to increase its outstanding orderbook by 1% to RM2.51billion. This will earn them a nice profit before tax of between RM1.2million to RM1.6million over contract period of 6 months ending May 2010.
Maintain Outperform with Fair Value of RM1.63


Technical Highlights

1. Daily Trading Strategy
A further drop to below 10-day moving average of 1,270 could trigger further selling and an immediate rebound from the 10-day moving average is needed to preserve the recent recovery efforts. Otherwise, the benchmark may drift lower towards the 40-day moving average of 1,261 and the 1,250 level. A mild rebound in Wall Street plus the potential of window dressing may contain any near-term downside risk.

2. Daily Technical Watch: Tan Chong’s potential retest of November high of RM2.70 and RM2.80 hurdle
- 10-day moving average of RM2.396
- 40-day moving average of RM2.323
- Immediate support at RM2.17; thereafter at RM1.82
- Immediate Resistance at RM2.43; thereafter at RM2.80 and RM3.36

3. Weekly Trading Idea: IOI’s potential bullish breakout from RM5.45
It is a bargain buy near the 10-day moving average of RM5.395 in anticipation of a breakout rally soon.
- Immediate Resistance at RM5.45; thereafter at RM6.40 and RM7.20
- Immediate Support at RM4.85; thereafter at RM3.88 and RM2.96
- Exit with stop loss triggered upon losing the 40-day moving average of RM5.308

Source: RHB Invest

INCKEN (2607)

Here's an extract from malaysiafinance.blogspot.com:

In the Annual Report dated Dec 2008, the Chairman stated: "Our planned sale of the Bangi land is still on track and we hope that it can be confirmed within the first half of 2009. Once this is concluded, we will then be able to focus on the expansion of our plantation sector either into Sabah, Sarawak, Indonesia or other ASEAN countries."

Catalyst #1: Inch Kenneth has converted its 600-acre piece of plantation land in Bangi in 2007. This marks the successful conversion of its entire plantation land bank for mixed development purpose and brings the company one step closer to realising its land bank unlocking strategy. Its 350 acres of plantation land in Kajang had received the conversion approval back in 2001. The group expects to sell the 600-acre Bangi land for an estimated RM250-300m, which is equivalent to RM11.50 psf on the high end. Based on this price, the company could realise a windfall gain of RM144m as the land is carried in the company’s books at just RM6 psf. With 420m shares, the market cap at the share price of 0.44 = RM184.8m. People, the windfall gain is nearly 80% of the existing market cap!!!!!!!!!

Catalyst #2: The 350-acre land in Kajang has been earmarked for the development of a township project and will be Inch Kenneth’s maiden property development foray. Although the company’s lack of experience in property development is a cause for caution, it will be doing this with joint-venture partners on this front. Herein lies the key, the full name of the company is Inch Kenneth Kajang Rubber. Kajang... 10 years ago, nobody would bat an eyelid, today, 350-acre in Kajang means a lot. The estimated gross development value of the township is slated to be between RM1.2bn-RM1.5bn.

The sharp jump was probably due to certain "sale being done" and the launching of the property project. Despite the sharp jump, its still very very cheap no matter how you look at it. If you sit on a high NAV and your share price is at a deep discount, it will stay that way if nothing is done to unlock the values. Inch Kenneth is selling the land and launching the property project - what more do you want, if this is not unlocking, I don't know what is. Last known NAV is RM1.15, and that is being conservative. There is no need to mention much about its diversion into tourism, its a safe and small business for now. How I wish there was a rich backer for me to take over this company, there is so much value to unlock - if its there to be taken over, a new owner would easily pay up to 80-85 sen per share for control.

According to RHB Investment Bank, the 1997-1998 financial downturn was followed by active M&A activities. Remember banking mergers, and corporate restructuring of GLC such as Sime Darby and MRCB? Hence, we should expect that 2010 would be the year of M&A (history does repeat.). Below is the extract from RHB Invest report:

Bigger M&A wave is coming. We believe a bigger wave of M&A activity is coming. The four key sectors are:

o Property. We note that some property developers have begun to explore expansion plans in Malaysia and overseas. In Malaysia, we note Glomac’s purchase of development land in Selangor (43 acres in Sungei Buloh at RM4.80 psf and 7.62 acres in Pekan Kayu Ara at RM85-100 psf), and Mah Sing’s purchase of 12.91 acres in Bukit Jelutong, Shah Alam for RM37.79 psf. In China, SP Setia has a joint venture to develop 25 acres of land in the Zhejiang province, while Sunway City has a joint venture to develop 98.8 acres in Tianjin. More interestingly, all these acquisitions and joint ventures were announced over the last two months. As for the sellers, we note that in Nov, UEM Land proposed to sell 4.2 acres in Puteri Harbour, Nusajaya at RM145 psf, although we highlight that the land was sold to a Khazanah Nasional subsidiary Themed Attractions and Resorts for the development of an indoor theme park, retail centre and hotel. Due to the high capex requirement for infrastructure in Iskandar Malaysia, we expect these land sales and joint ventures with developers (including the earlier proposed jv with United Malayan Land) to continue.

Looking at Glomac and SP Setia balance sheet, you should be able to see that these companies have FCF of 0.10 and 0.13 per share, respectively. With a strong balance sheet, these two companies are ready to take out any smaller, highly geared, under managed companies, to replenish their land bank, and to expand.

Therefore, I expect that Inch Kenneth will be a takeover subject in 2010. Even if it is not, the company is already starting to unlock its value. The recent quarter earning shows a positive EPS, and their EPS has been improving. Let see what will happen to this company.

Disclaimer: The above opinion is not an invitation to buy or sell. It serves as a blogging activity of my investing thoughts and ideas, this does not represent an investment advisory service as I charge no subscription or management fees (donations are welcomed though). The content on my Facebook's Note is provided as general information only and should not be taken as investment advice. All site content, shall not be construed as a recommendation to buy or sell any security or financial instrument. The ideas expressed are solely the opinions of the author. Any action that you take as a result of information, analysis, or commentary on this site is ultimately your responsibility. Consult your investment adviser before making any investment decisions.

source: malaysiafinance.blogspot.com
rhbinvest.com

Dubai's Panic

The panic in markets Thursday/ Friday caused by a 58 billion USD default in Dubai.

Most investors ignore the fact that the UAE has a sovereign wealth fund in excess of USD 1
trillion and the ruler of UAE is related to the ruler of Dubai. UAE also has 8 % of the world oil
reserves. This has no relation to the US and UK financial toxic assets/bailouts/ defaults etc
but the uniformed investors will panic and fear sell
their shares/golds/any other commodities (including currencies)

The Gulf states will stand shoulder to shoulder to help their brothers and they have the means
to do it. (not the Obama printing press)

Malaysian banks have a zero exposure to the Dubai default according to my research house.
Most of the exposure is to European, UK and US banks.

If the KLSE has a panic drop Monday you should step up and buy quality shares.
I myself will be monitoring my trading screen with my shopping lists (guess...hehe)



http://malaysiafinance.blogspot.com/2009/11/important-view-on-dubai-world-factor-in.html

ZHULIAN (5131)

Zhulian's Chart

Zhulian's QE

Zhulian's general info

-This counter has come down from 1.90, which based on last price, the PE should equate to 7+- (if you don't know what PE is, please do some reading)

-No gearing (according to their website, for 2008 financial period). No gearing means that the company has no debt, and they may be holding a lot of cash, which mean that if there are any opportunities coming down at their feet, they will probably take it up. furthermore, without debt, the company also will be more flexible in their course of business.

-Improve (and consistent) quater earning (see picture)

- High dividend yield = around 7%, which is much better than FD

-stable dividend payment = Indicates that business is going well, BoD are confident of future prospects, company is under control and bla bla bla...... Go read why dividend policy is important, as i'm too lazy to explain it here...haha

chartwise, hmm...i don't know why it is going down. maybe somebody just feel like taking his/her profits after the stock fly from 0.90+ in April to 1.90. That's more than 100% return in 7mths!

I'm expecting this counter to come down until 1.40 (too optimistic?! haha) before taking any action. but again, i'm flexible. if there is any reversal sign, i might take an action too. haha

source: www.rhbinvest.com
www.zhulian.com



Disclaimer: The above opinion is not an invitation to buy or sell. It serves as a blogging activity of my investing thoughts and ideas, this does not represent an investment advisory service as I charge no subscription or management fees (donations are welcomed though). The content on my Facebook's Note is provided as general information only and should not be taken as investment advice. All site content, shall not be construed as a recommendation to buy or sell any security or financial instrument. The ideas expressed are solely the opinions of the author. Any action that you take as a result of information, analysis, or commentary on this site is ultimately your responsibility. Consult your investment adviser before making any investment decisions.

DISCLAIMER!

Everything I wrote were views on stocks and sectors that I like, not an invitation to buy or sell. It serves as a blogging activity of my investing thoughts and ideas, this does not represent an investment advisory service as I charge no subscription or management fees (donations are welcomed though). The content on this site is provided as general information only and should not be taken as investment advice. All site content, shall not be construed as a recommendation to buy or sell any security or financial instrument. The ideas expressed are solely the opinions of the author. Any action that you take as a result of information, analysis, or commentary on this site is ultimately your responsibility. Consult your investment adviser before making any investment decisions.