Early this year, i have heard many people complaint about losing money by investing so call fundamental good stock. Claim that fundamental investing is not applicable. 

What really happened it here is that people don't realize stock market is getting much more sophisticated compare to those olden day.

In stock market there is 4 cycle which people need to understand

In this case, i will take GPACKET as case study.

As you can see from the chart.

Phase 1 : Down Trend

Will a person invest during down trend? Obviously the ordinary people will answer it "NO". But there is some one will adopt opposite way of investment. There is famous quote in the investment world from a famous guru Warren Buffett.

Warren Buffett once said that as an investor, it is wise to be “Fearful when others are greedy and greedy when others are fearful.” 

Conclusion: Value Investing for super long-term as long fundamental factor remain unchanged, people will buy into such stock. But why is it people still losing money even adopt such method. It is very simple, the answer is you don't have a deep pocket to average down and diversify your portfolio.

Phase 2 : Accumulation

When come to accumulation stage? The question people normally asking when will it rebound. There is no definite answer for when will a counter rebound. Let the market tell you instead you asking around the broker, analyst or friends. They are just normal human being like you and me. The only thing different between you and them is that you are having a job for your own and spare cash to invest but those people are taking this as their job. Will a technical analyst giving a buy call during a consolidation stage? The answer is "NO". Why, because all the broking firm survive base on the "brokerage" generated by traders or investor. So, you won't be getting too much detail on the potential upside accumulation stock from analyst neither brokers till it start to show sign of moving upward. So, you need to do your own study or solicit information from other sources. People who normally buy in during sideway are those people who has done your study deep enough. They are patient enough to wait year after year for the stock to move. 

Conclusion: Fundamental research by private research house, boutique fund manager will invest at the early stage when no one identify such GEM. Boutique fund manager such as Creador Fund. If ordinary person who have limited cash, advisable not to adopt such strategy due to time value money. What people say is that a dollar today is worth more than a dollar tomorrow. In another word, currency keep on depreciate over the time due to inflation. 20 Years ago, you could have own a landed property at Petaling Jaya with the price range from 300-400k, but now it cost you more than a million to own a landed property.

More information can be obtain by clicking this linkage http://creador.com/our-approach/

Phase 3 : Uptrend

Those smart investor who has bought at low and accumulation across a period of time. When there is some good news appear and that is the right timing to push the stock price higher. When this so called 'GOOD NEWS" came out, meaning it start to enter the radar of the retail traders eyesight and people start looking at the counter. So, it further boost the momentum for further upside base on technical interpretation base on chart. 

But the funny thing is normally when price go up, retail trader enter and aim big profit. On the other side, those "BIG PLAYER" only aim small percentage profit it because their position is heavy. Have you ever heard those unit trust manager generate hundred percent return? It will never happened in life. It only happened to those boutique fund manager which have full discretionary to invest or trade at their own risk appetite compare to unit trust manager which regulated by the fund itself base on the term and condition.

Let me get you a video showing that "BIG PLAYER" sell during the start of the uptrend. Listen carefully, is start of the uptrend. not the end of the uptrend. Have you heard of Robert Kwok, Malaysian Richest Men.

Here is a little bit of his history.

Click on below linkage to understand him better. Do fast forward to watch the video from 15.00 minutes to 21 minutes.

https://www.youtube.com/watch?v=8nGcqaCQbPk

So, those who invest multi million dollar fund size. They adopt contrarian strategy. Meaning when you buy, you expect it to lose money and keep on losing. When you sell, you expect it go up higher and higher. It sound funny, it very simple. It is because the position they are holding is heavy and this wont allow them to sell at the peak. So, people who always sell at the peak is good, but can you always sell at the top? Do you want consistent profit or huge profit? I can't answer this question for you. It is up to you to find out your investment path.

Conclusion: Never ever aim to sell at the highest price. It is wrong approach. Most of the time people who having such mentality end up losing money unless this is super bull market. At this moment, Year 2019 i don't foreseen there will be any super bull for Bursa Market. It will be a volatile market which present threat and opportunity.

Phase 4 : Correction

If you are into this stage, you are facing a situation which is should I cut lost, should i average down. I can't help you much when you into such situation. My advise is that everyone need to pay a fees into Bursa Market to learn through painful way. So, is either you equip yourself with the relevant knowledge, or you can attend courses to be a better trader.

Conclusion: Try not to average down, focus on other stock which able to generate profit then use the profit to par down the losses which you are holding and reduce the positions for the lost making counter.

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