Monday, August 31, 2009

Trading Strategy - Dogs of the Dow

Dogs of the Dow Strategy

How this works is very simple. All you need to do is to rank the FTSE Bursa Malaysia top 30 largest companies according to (1) PE ratio from lowest to highest; and (2) Dividend yield from the highest to lowest. The aim is to select those companies with the highest dividend yield and lowest PE ratio. Here's the top 5 stocks for the lowest PE and the highest DY as at 28th August 2009.

Top 5 PE Stocks
Hong Leong Bank 9.60
RHB Capital 9.65
Berjaya Sports Toto 13.00
YTL Corp 13.14
AMMB Holdings 13.26

Top 5 Dividend Yield Stocks 8.51
Telekom Malaysia 8.33
Malayan Banking 7.99
Berjaya Sports Toto 6.76
UMW Holdings 6.00

Hence the best stock from this strategy is BToto as it appears twice on the lists. (For more info on BToto please visit this website: )

Different people will need to establish their own trading strategy according to their lifestyles, investment knowledge, debt obligation, and risk preferences. The above strategy is suitable for busy individuals who do not have much time to monitor their portfolio and yet they want a low risk portfolio with longer term perspective.

Saturday, August 29, 2009

Bookfest 2009 @ KLCC

Despite the H1N1, the event yesterday was a successful one. The audience was very responsive and we had a great time. Here are some pictures to share!

Sunday, August 23, 2009

Bestsellers List

Dear readers,

Thank you for your support.

I Love Stocks and Fear & Greed are both on the bestsellers lists of the MPH and POPULAR respectively for the month of August.

I hope these two books enhance your investment profits greatly. Always remember this: Knowledge is power! Invest in your knowledge now and profits will come naturally to you.

Happy investing,

Pauline Yong

Wednesday, August 12, 2009

Are you a rational investor?

Do investors always behave rationally? To answer the question, let's ask ourselves the following questions:

1. Do you have an investment plan?
Before we trade we all know that we should keep an investment plan to guide us through the process of trading. We are suppose to write down our investment objectives, investment horizon, and the entry and exit criteria for stocks. But most of us skip this important step and plunge ourselves into the trading world.

2. Do you do your own research?
Again, we read plenty of investment books that tell us we should always do the necessary number crunching to judge whether a particular stock is worth buying. But in reality, when we are in the midst of trading, somehow we became inertia and acted boldly, thinking that we know more than others. Or sometimes we acted impatiently, thinking that if we spend the time to do the research, the price could have shot up and we would have missed the boat! Hence, we ended up not doing the necessary research simply because we didn't want to miss the boat!

3. Can you stay calm?
Can you stay as calm as "See no evil, hear no evil, speak no evil"? Sounds exagerated? Not at all. In fact, this is exactly a true rational investor should behave! Everyday we are bombarded with plenty of information. Imagine if everyone is telling you the oil price will go higher and remain high, would you really believe so? Or suddenly, everyone is talking about how bad the economy is and the current financial crisis is going to turn into another "Great Depression", will you sell your stocks now? If we do not have cool heads, we are bound to be swayed by emotions and ended up buying at the peak and selling at the bottom.

So, if you said "yes" to the above three questions, congratulations, you're on your way to successfull trading.

Happy investing,
Pauline Yong