Recently I saw Stockmanmy, a regular commentator on i3investor used this term “sialang” in share investing. The term means you use all your available fund to buy a stock to maximise profit. I must say that this is a good method if you know how to do it.
Every super investor has the 3 most important qualities, namely knowledge, decisive and bravery. As soon as he finds a good stock, he decides and bets with all his available funds.
I wish to take this opportunity to elaborate on this so that readers can learn a new technique of making more money from the stock market.
Our brain has 3 basic function, one is auto function which controls our blood flow, breathing and reflex action. The second is emotional function such as fear, ego, shame, shy, humility etc and the third is logical thinking.
In the stock market, most investors cannot control their emotion to think logically. Even a company like JAKS or Eversendai which is beginning to show increasing profit in compliance with my share selection golden rule, many investors dare not buy it because of fear.
Professional chartists also would not buy these 2 stocks because the prices are just beginning to move up. That is why they are not recommending these 2 stocks. They will only recommend buy when the prices have move above the 70 day moving average.
Smart day traders would buy and sell when the share price has gone up for 1 or 2 weeks. The problem is that they will not buy back if the price continues to rise. They cannot overcome their emotional problem of shame to buy back the same share at prices higher that the prices they sold.
In fact, when the price continues to go higher, super investors would borrow more money on margin to buy and sialang.
As humility is not one of my strong points, I wish to take this opportunity to boast that I was the 2nd largest shareholders of VS Industry, Latitude Tree and Lii Hen, all of which had gone up a few hundred percent within 3 years.
In VS Industry’s 2015 annual report, you can see that I owned 102 million shares. After the price has gone up more than 550%, I sold VS to buy Lii Hen.
Although Lii Hen continues to report increasing profit, I sold some to buy JAKS and Eversendai since it has already gone up more than 800%. You can see from the company announcements that I sold in blocks of a few million shares each time to fund managers.
Currently I am the second largest shareholder of Eversendai and I am the largest shareholder of JAKS. I strongly believe these 2 stocks will continue to go up higher. That is why, a few fund managers have been asking me to sell a few million JAKS shares to them. I believe they will soon start to buy JAKS when the company reports more profit from its power plant in Vietnam.
You can read my previous posting under the title “Why I bought into JAKS?”