Comfort price fluctuating so rapidly 

Koon Yew Yin 14 May 2020

The price chart shows that the price shot up from about 80 sen to Rm 2.75 within 1 month, an increase of about 350%. On 20th April I posted my buy recommendation when it was selling at Rm 1.10 per share. You can read my article namely “Comfort should fly relatively faster” in i3investor.com forum under Comfort blog. I am so flabbergasted and happy to see so many commentators on i3investor thanking me for my buy recommendation.    

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Comfort price shot to limit up

Day before yesterday, the price shot up 30% to limit up to close at Rm 2.52. Yesterday it shot up to a high of Rm 2.75 and close at Rm 2.21 with nearly Rm 100 million shares changed hands. The price fluctuated so wildly. As a result, some clever day traders made money and some lost money. 

As I said the closing price was Rm 2.21 yesterday, currently after half day trading at 12.30 PM as I am writing this article, the price went up to Rm 2.41 and drop to a low of Rm 1.99 with 77 million shares changed hands. The price difference from the high of Rm 2.41 to the low of Rm 1.99 is 42 sen within such a short time. Some clever day   traders should be making a lot of money and some would be losing money within such a short time.  

My advice:

As many people are so confused by the wide price fluctuation and do not know how to react. I advise them to remember that statistics shows day traders cannot make much money on a long run. Only long-term investors can make more money. Patience is the key to successful investing. You can make more money by just waiting. 

Covid 19 is affecting every country’s economy around the world and most of the listed companies, with a few exceptions. Due to Covid 19 pandemic the demand for gloves exceeds supply. As a result, the glove price continues to rise and all glove manufacturers are making more and more profit which is being reflected on their share prices.   

I believe Comfort Gloves has the best profit growth prospect which is the most powerful catalyst to push up share price. From February it has added 6 production lines to its 49 original production lines. It is producing 430-450m pieces of gloves/month or 5.4 million gloves annually. The commencement of the new lines was timely as it helps to cater for both existing demand as well as the global surge in demand – arising from the unexpected outbreak of the COVID-19 pandemic. 

Since many scientists predicted that Covid 19 pandemic will continue for 1 or more years until a vaccine is approve by FDA of USA. Under the circumstances, Comfort share price can go up higher for a long time until the demand for gloves is reduced. 

I am obliged to inform you that I have used up all my funds to buy Comfort shares. If you decide to buy or sell Comfort shares, you are doing it at your own risk.       

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