Price Earning / PE Ratio - the thin line

PE ratio is a very common key financial ratio used in stock analysis. However, one need to be cautious of the value itself. Sometimes, forward PE ratio is reported rather than the current PE ratio. PE ratio is simply EPS/NTA, whereas forward PE is projected EPS / NTA , where the projected EPS is not something that has yet to happen. Forward PE is always used to give the investor the impression that the PE will be cheaper in future than it is currently.

USA market a very huge market

Last friday OSK foreign stock investment talk is very nice. The speaker who came all the way from US told us that he was gonna teach us how to fish in the US market rather than just gave us a few stock to choose from. I think he has successfully done just that. I have gain some thoughts that i have never thought of, especially on how to select what to buy from the US market that has over 7000 stocks listed. I also like that he is able to use data and chart to answer the many questions that the seminar attendees posted to him.

One thing that should excite everybody to start thinking to invest in US market is that, it is huge, and using a 20 years technical chart one can see that we are clearly in recovering phase, and haven't got a bull run yet. From other data, one can also see that institutional investor are moving away from china to go to market like USA and Russia. Just based on this i think we should invest in US over long term.

winner of RHB stock challenge to attend OSK seminar at Penang

My idol Yew Tatt, a winner of RHB stock investment challenge (http://rhbinvest.com/page/site/public/english/StockChallenge.html), will attend the OSK foreign market investment seminar at Penang wawasan open university this friday evening. OSK investment seminar is always pretty good

Yew Tatt wins RHB stock challenge

Congratulations to my friend Yew Tatt for winning this. Geng!

http://rhbinvest.com/page/site/public/english/StockChallenge.html

Top 10 Players

No.	User ID	Location
1	asimo	Wilayah Persekutuan
2	AngKS	Pulau Pinang
3	yew tatt	Pulau Pinang
4	reenaypl	Perak
5	ENSY	Melaka
6	Stallend	Negeri Sembilan
7	ena85	Pulau Pinang
8	Wong Sing Kay	Johor
9	jason0226	Wilayah Persekutuan
10	chong8922	Johor

Top 10 Players rankings for Grand Winners (1 – 31 March 2010)

sticky downward

i've always enjoyed reading P.Gunasegaram's column since his days in the Edge, although it seems to me now in the star, his words are not as 'sharp' as his the Edge day.

Sticky downward is the phenomenm he recited on saturday. An example he gave is the fresh milk that he buys. As milk price is dominated in US dollar, when US dollar is strong or price of raw material up, the business people increase the price of fresh milk. But when raw material price drop or as Malaysia ringgit strengthen, like right now, the milk price is not going down as fast, or not going down at all. Milk price is one thing that i can feel the diminshing buying power of Ringgit. When i was in university, i loves to consume 1 litre of goodday fresh milk per day. At that time, it was selling at around RM2.99. Nowaday, it easily fetch a RM6.45 price tag, an increase of over 100%. surprisingly, during rare occassion, it is sold at discount at RM4.99. How come such huge different? A 'sticky downward' theory can explain it. The business owner simply having a very high margin, and hike up the price to maintain their margin when price of raw material goes up, but after that keep maintaining the price on an elevated level. Another example related to this is that while goodday is selling at RM6.45, dutch lady fresh milk, most of time, is sold at RM4.99. Is it the raw material price of goodday is so much higher? Since both of them source their milk locally, i don't see why the price of raw material is the answer to this.

My babies are consuming dutch lady frisolac. Again, since less than 2 years ago, price has increase almost by RM15 for frisolac 1. that is almost 40% price increase. Despite that currently RM is very strong, frisolac's price is still high upon the sky.

i have never buy stock based on this sticky downward theory. However, it is interesting to see if i should buy into a company that has such business occurance. Let's buy into Dutch Lady!

Zhulian is up 6.99%

Zhulian is top gainer today, surging to 2.45 or 6.99%. good, since this is the last counter that i targeted and it is up. My wife has bought into it recently

dividend is good, growth seems at least stable if not marvelous.

OSK foreign market seminar at penang 23 April

Busy lately, so didn't post much. Anyhow.
There will be a seminar organize by OSK Investment Bank

Friday, 23 April 2010
Wawasan Open University
Lecture Theatre 1, Level 5,
54 Jalan Sultan Ahmad Shah,
10500 Penang

Agenda:
5.45pm Registration & Dinner

Welcome Remarks

Precious Metals Trading
- Ms.Mandy Lam
Managing Director – Business Development
OSK Futures Hong Kong Limited

Hong Kong Stock Market Outlook
- Mr.Tan Swee Koon
Research Analyst
OSK Securities Hong Kong Limited
Singapore Stock Market Outlook
- Mr. Leng Seng Choon
Co-Head of Research
DMG & Partners Securities Pte Limited

US Stock Market Outlook
- Mr.Tony Petrilli
CEO, ViewTrade Holdings USA
Q & A Session