Posted by Ricky Yeo > 2019-12-05 09:48 | Report Abuse

Yea I've no idea about short-term. Because I don't 'Assume everything else remains the same', everything else will NEVER remains the same.

Posted by Ricky Yeo > 2019-12-05 10:05 | Report Abuse

And one thing in investing is never do linear thinking:
PE price down -> Higher profit -> Buy stock
Steel price down -> Higher profit -> Buy stock

That is linear thinking. A better way is to think in feedback loop:
PE price down -> Everyone expect higher profit -> Priced into share price -> Watch out
PE price down -> Company is price taker -> potential price war (market share grab) -> cost savings passed to end buyers -> Profit might not go up (even drop) -> watch out
PE price down -> Everyone expect higher profit -> Threadmill effect -> Asymmetrical return -> Lower than expected profit increase can cause huge drop in price -> watchout

Posted by YiStock > 2019-12-05 10:17 | Report Abuse

Icon8888 will vomit blood

Posted by Icon8888 > 2019-12-05 10:20 | Report Abuse

Ricky Yeo distracted by too many jargons and concepts

Should have just focus on earning growth

That is the only thing that matters

Posted by Ricky Yeo > 2019-12-05 10:37 | Report Abuse

If you're playing short-term, market sentiment swings the price more than changes in earnings.
If you're playing long-term, a mix of ROC and earnings growth swings the price. But the baffling thing is, if one plays long-term, PE price is the least important thing to worry about.

Posted by yfchong > 2019-12-05 11:46 | Report Abuse

Ricky yeo are you going to give lecture.. I am keen to attend to get the mechanism.

Posted by cheoky > 2019-12-05 11:49 | Report Abuse

if short term can give 20%, why opt for long term 20%?

repeating and compounding is applicable in both case.

2 steps can reach rome why opt for 10steps to rome. that was my blind spot.

Posted by Investar2862 > 2019-12-05 12:53 | Report Abuse

Well said @cheoky

Posted by Choivo Capital > 2019-12-05 12:57 | Report Abuse

Basically,

what ricky is saying

Don't confuse investing with trading and trading with investing.

You can bullshit on the forums about how its a good investment, but you better not swallow your own bullshit.

If you do that, you turn a bad trade into a mediocre long term investment.

Really go holland then.

There is an advantage to long term investing vs short term trading. You can put far bigger sizes, you sleep better, you have time for a more enriching life (for me at least).

Posted by Icon8888 > 2019-12-05 13:03 | Report Abuse

Ricky read too many books

So do you

Both of you should seek counselling

Posted by chengcheekaan > 2019-12-05 14:45 | Report Abuse

provided you can always get 20% from short term. Congratz if you did.

Posted by tokohM > 2019-12-05 15:51 | Report Abuse

yistock, do you provide stock pick service?

Posted by Connie555 > 2019-12-05 15:55 | Report Abuse

Should seek publisher instead, nt counselling. i knew some guy, whr u 2 abang beradik kembar can jz contribute material without come out with single cents, provided ur content is good enough u get 5% cut for every book sold for all Popular outlet in malaysia. contact me if u wan uncle might lend u a helping hand

Posted by Ricky Yeo > 2019-12-05 16:36 | Report Abuse

@cheoky if driving at 200km/h can get you to your destination in an hour, why spend 2 hours driving at 100km/h?

So you obviously know if you do 200km/h every single trip, one day you won't get to your destination.

Similarly, if one can get 20% short term, then the question is not 'why opt for long term 20%', the question should be 'how much risk are you taking to get that short-term 20%?'

Most people can't answer this question, but that doesn't mean the risk isn't there. Do you want to increase return by 1x in exchange for an 1x increase in risk? The answer is a clear no because investing is non-ergodic.

Posted by Ricky Yeo > 2019-12-05 16:42 | Report Abuse

I get 5% commission on Amazon and Bookdepository referral program. If I self-publish online, 100% profit is mine. So should I get 5% from Popular outlet? Welcome to 2019 uncle. Make it 2020

Posted by Outliar > 2019-12-05 16:48 | Report Abuse

I love Ricky Yeo

Posted by Connie555 > 2019-12-05 17:35 | Report Abuse

If what also according with what you say, economic no need run d Ricky, if like that why people still go and list their books over popular instead of amazan bookdepository? same thing goes to investment as well, why people still invest here, company here no moat no long term track record, PE high, ROC LOWWWW...could hv jz shifted oversea....niameh always talk talk talk, like a Tin Kosong...

Posted by probability > 2019-12-05 18:41 | Report Abuse

i also love Ricky Yeo.....

this shows humanity is doomed with all the knowledge and intelligence...

its like pets who are constantly provided with food ...until they continuously eat to their death due to obesity.....same thing can happen with knowledge...

the problem occurs when taste of food overtakes the need of energy....thirst of knowledge overtakes need of practical application..

.................

if M (making money) = function of (x, y, z,....etc)...and

y = function (p. q, r, s etc...)

each variable on the right side having an impact to y....and subsequently on M....

the program (the brain) overly spends energy on factoring and evaluating p, q, r, s.....till it neglects the sensitive-significant core factors x, y, z ...into its consideration...and also the factors itself change with time...its such a dynamic equation that..

to learn swimming...one need not calculate buoyancy law..bernoulli's principle , and stokes law ...they just need to jump into the pool and start kicking...

..................

i.e, ineffective & inefficient utilization of the limited brain power for the objective in hand..

Posted by probability > 2019-12-05 19:16 | Report Abuse

however, having such knowledge is definitely an advantage provided one knows when to use and not...

but that skills requires another 1000 page book to read - or just a good 'intuition'

Posted by Connie555 > 2019-12-05 19:38 | Report Abuse

When probablity talk about swimming...it reminds me that Ricky and Choivo is like the mum by the swimming pool. Why mum?

Well i rmb years bck where i went for Cold Eyes talk, he said he alwyas saw those woman (mum) at the swimming pool side telling the son (in the swimming pool) how to swim how to swim, while the woman herself only know theory nvr really learnt swimming before, if put her go swim she sure drown.

So as share market, it is so dynamic that no like u read all the books then u can perform like warren buffet. If read book can solve so many thing, we dont need driving instructor, why do we need driving instructor, we could hv jz throw those newbie some book and they can learn by themselve...

Posted by Up_down > 2019-12-05 19:47 | Report Abuse

Probability. Such technical knowledge is to serve either educator or real professional trader to build a complex algorithm through incorporating many conditions and modeling in predicting or trading shares. One day, our world would develop a quantum computer with AI ability in helping traders to trade shares automatically. Layman like us PER, Gearing and DY and growth rate are good enough to serve our purpose in trading shares now. lolz


Posted by probability > Dec 5, 2019 7:16 PM | Report Abuse

however, having such knowledge is definitely an advantage provided one knows when to use and not...

but that skills requires another 1000 page book to read - or just a good 'intuition'

Posted by popo92 > 2019-12-05 19:50 | Report Abuse

i strongly disagree with the knowledge part. You may read a lot of books but you gain a completely perspective than author. Time will tell who's correct, i am still objective in others value even now i think this sarawak professor do not have any business sense.

Posted by Icon8888 > 2019-12-05 21:06 | Report Abuse

I love Ricky Yeo too

I have a soft spot for academics

Posted by cheoky > 2019-12-05 23:30 | Report Abuse

From another perspective, you drive slowly, you can also get hit by incoming lorry. Pasir Gudang highway is filled with above examples. like APM?

maybe your practice of investing is focusing on the below scenario only, discounting above. resulting in miss opportunity also.

investing maybe can be said to be system building, trial and error. find the best return per time during investigation, how to respond upon encounter obstacle and unforeseen lose. that is a personal journey. such is my new perspective of investing.

your english level too high. need google what is ergodic... try involved more in market itself and learn more from market beside reading.





Ricky Yeo @cheoky if driving at 200km/h can get you to your destination in an hour, why spend 2 hours driving at 100km/h?

So you obviously know if you do 200km/h every single trip, one day you won't get to your destination.

Similarly, if one can get 20% short term, then the question is not 'why opt for long term 20%', the question should be 'how much risk are you taking to get that short-term 20%?'

Most people can't answer this question, but that doesn't mean the risk isn't there. Do you want to increase return by 1x in exchange for an 1x increase in risk? The answer is a clear no because investing is non-ergodic.

Posted by Ricky Yeo > 2019-12-06 06:40 | Report Abuse

Icon wrote "earning growth...is the only thing that matters"

Supposedly today I meet up with Icon to discuss his statement above. Failing to settle our disagreement (because Ricky is too academic and Icon's ears are oozing blood), we decided to race each other.

On the next day, you saw a few headlines news "Ricky ran 2km, Icon only 1km"; "Ricky beats Icon"; "Survival of the fittest: Ricky prevails" etc.

Now, if you think at a deeper level, those headlines tells you nothing. The distance me and Icon covered says little to nothing about how fit we are. Because no one asked "How long does it take for us to complete those distances?"

If I told you it took me 5 hours to do 2km (400 meter per hour) and 1 hour for Icon to do 1km (1km per hour), does that change your mind about who is fitter?

Similarly, one company can grow 20% and the other only 10%, does it tell you which is better? No. It is meaningless. The question comes down to "How much capital is required to achieve those growth rate?" If a company doesn't need any capital to achieve 10% growth while the other needs to reinvest 100% earnings to achieve 20% growth, which company is better?

And that is what ROC is all about. ROC is not jargon academic shit that Ricky invented. I can give you a dozen of stock all with the same growth rate and you won't have a clue which one is better.

Posted by Ricky Yeo > 2019-12-06 06:52 | Report Abuse

@probability I don't disagree that one needs to know how to use knowledge in order for it to be useful. It is like tools (hammer, screwdrivers, spanar, nuts, bolts etc) in a toolbox. If you use spanar to hammer nails, that's not very useful is it?

So having a wide knowledge is like having many tools in your toolbox, sure it doesn't guarantee you'll know how to use those tools correctly, which you can call wisdom or good intuition, but the risk of too little tools definitely outweighs the risk of having too many tools.

Posted by Investar2862 > 2019-12-06 07:20 | Report Abuse

Knowledge is important and always good to learn/acquired.

However, knowing and doing are poles apart...

In real life, experience in execution is most crucial for success - combining the knowledge, skills & experience...

There is a saying, that "too many cooks spoil the soup" - More doesn't mean better; "Simplicity is Power" - Less is More...

What matters most is the achievement of desired results/outcome - the appropriate approach you employ in that particular situation. They also say that there are many choices/options/routes to travel from destination "A" to "B".

The choice is yours!

Let's prosper together from our sharing...

Posted by Ricky Yeo > 2019-12-06 07:24 | Report Abuse

Uncle, of course many people still love to publish their books at Popular stores. "Look, my book is sold at Popular bookstores next to The Intelligent Investor by Ben Graham" versus "Look, my books are sold online.." which one is more convincing? Of course the one at bookstores.

Posted by Ricky Yeo > 2019-12-06 07:50 | Report Abuse

@cheoky You're right, investing is a trial and error. But you want to make sure your previous error doesn't stop you from having another trial. Which one has a higher probability of stopping you from having another trial, 200km/h all the time or drive slowly but get hit by lorry?

And for sure you should find your 'limit'. If you can do 20% short term without taking excessive risk, you should do it. Now if you ask me why don't I do it? Then I'll give you an academic answer: because I read enough from other investors' mistakes to not do it myself.

It is like not everyone that smokes develop lung cancer, but should I go test it myself, to see the 'limit' whether I'll end up getting cancer? Hey if I don't get cancer, I get all the upside: the pleasure derived from smoking. But should I really do it? No.

I have been learning from the market since 2012. Not bragging because that is a very short time. But I still prefer to learn from other people's experience (mistakes) through reading than learning by losing alot of my own money.

"Experience is what you get when you didn't get what you wanted" - Randy Pausch

You can do trial and error by yourself, one at a time, or you can read someone's experience of 30-40 years, condensed into 300 pages, finish that in a month, akin to doing 10,000 trial and error.

Posted by Ricky Yeo > 2019-12-06 10:18 | Report Abuse

Uncle again, no one ever said reading books can solve anything. But should one stop reading because reading can't solve everything? No. It is like rich doesn't solve all your problem, should you stay poor?

Each has its own way. If you find a great way to learn something, then stick to what works. For investing, success lies in making accurate analysis, and psychology plays a big part of it. That is why reading is the best way for me to learn about psychological side of decision making and thinking. Should I personally experience FOMO (fear of missing out) by turning my mind into a cocaine brain because everyone told me that is more practical and less academic?

Li Ka-Shing said "When you buy the books, read them carefully and learn the lessons and strategies that are being taught in the book." He incorporate what he reads with what he experienced in his business, that is the only way to do it. When Munger said "You’d be amazed at how much Warren reads – at how much I read. My children laugh at me. They think I’m a book with a couple of legs sticking out.", they are doing the same thing, incorporating what they read with what they experienced at running Berkshire. And when Bill Gates carries a tote bag full of books almost everywhere he goes, he is doing the same thing, learning from others and related that to Microsoft and his foundation. I am doing nothing less different from them. Although I won't be as good as them, but all I am trying to do is to make good decisions and reduce blind spots. That is all there is.

Posted by chengcheekaan > 2019-12-06 11:39 | Report Abuse

I think as long as can make money, who bloody cares what method to use? So, instead of writing so long, why not just post your actual portfolio profit? that save all the writings.

Posted by probability > 2019-12-06 12:13 | Report Abuse

Cocaine brain? love it..

im trying to get hooked for a while so that i can understand it better

a brain that understands a cocaine brain may very well be the ultimate investor....(especially for capital below 10 million)

getting hooked on cocaine and getting hooked on books is no different

there are millions of investors who are as hooked into reading like Li-kashing , Munger and Buffet ....who are losers in stock market....as much a the cocaine brains who lost.

stop quoting this successful guys' traits as a causal factor


conclusion:
..........

bookworm and cocaine brain...lets not discriminate between these two in a bias manner

.

Posted by probability > 2019-12-06 12:43 | Report Abuse

no amount of reading can equip me to sense the emotions market have with every revelations of new information to the market...if i myself do not have these emotions..testosterone..adrenaline rush...and dopamine outburst...

..

i shall treasure these hormones like my gods

Posted by Ricky Yeo > 2019-12-06 12:47 | Report Abuse

You have my permission to try probability. You're spot on on cocaine brain. That's why the market is full of patsy.

I think you got it wrong on the other point. Sure there are probably many investors that love reading books but are losers in the stock market. But the habit of reading is unlikely to be the causal factor of their losses.

Which one has higher correlation: reading lead to success versus reading lead to losses in market? Your name is probability, you should know this. Maybe you don't.

Posted by probability > 2019-12-06 12:49 | Report Abuse

just like i treasure the emerging information...and form a concept (fundamental) of its probable implications on the company's valuation

Posted by probability > Dec 6, 2019 12:43 PM | Report Abuse X

no amount of reading can equip me to sense the emotions market have with every revelations of new information to the market...if i myself do not have these emotions..testosterone..adrenaline rush...and dopamine outburst...

..

i shall treasure these hormones like my gods

Posted by Ricky Yeo > 2019-12-06 12:50 | Report Abuse

That's why we are a different species. If you treasure those hormones, because your life is lack of excitement, great for you. = )

Posted by Icon8888 > 2019-12-06 12:50 | Report Abuse

Why Ricky so free nowadays can reply so many questions ?

Oh I know, it is now school holidays ....

Posted by probability > 2019-12-06 12:54 | Report Abuse

if the correlation data shows a minor advantage of the readers...does it matter?

as there is a lot of time invested for readings and researching..it does not come for free

anyway Ricky...there is nothing right and wrong strategy..all your fundamental valuations are highly appreciated...in fact its highly needed in i3...

but its often felt you overlook on the obvious - more influential information (which matters more) - i think thats what everyone is trying to stress

and i really dont like quotes from successful people's trait - thats pure bullshit

Posted by Ricky Yeo > Dec 6, 2019 12:47 PM | Report Abuse

You have my permission to try probability. You're spot on on cocaine brain. That's why the market is full of patsy.

I think you got it wrong on the other point. Sure there are probably many investors that love reading books but are losers in the stock market. But the habit of reading is unlikely to be the causal factor of their losses.

Which one has higher correlation: reading lead to success versus reading lead to losses in market? Your name is probability, you should know this. Maybe you don't.

Posted by probability > 2019-12-06 12:58 | Report Abuse

you didnt get the point...i treasure amygdala's response to worries too...anxiety...serotonin loss..etc

its a tool

Posted by Ricky Yeo > Dec 6, 2019 12:50 PM | Report Abuse

That's why we are a different species. If you treasure those hormones, because your life is lack of excitement, great for you. = )

Posted by Connie555 > 2019-12-06 13:48 | Report Abuse

Remind me of someone....i can name u blablabla which is cheaper than blablabla.

As a layman, logically we jz want to make profit, dont tell me all the bullshit that you invest is bcz of cheap roc blablabla...yes to a point fundamental is important but not to excessive i would say....figure is widely available, anyone with good accounting knowledge can calculate the same ROC, yet they cant make money. what they lack of? i would say mindset.....and the if share price doesnt move for 5years oledi and u still sticked with it bcz of cheap u are wasting hr time...

look at insas look at plenitute....academian should explain why share price never move...they are cheap....way cheaper than tguan alot...why tguan move insas remain stagnant? like kc always say insas holding alot mark to market securities and very liquid, share price should reflect the right value of insas....

Ass Ass Lee is still seeking for answers...maybe academian can help him abit...

________________________________________________________________


I can give you a dozen of stock all with the same growth rate and you won't have a clue which one is better.

Posted by Connie555 > 2019-12-06 13:49 | Report Abuse

*too excessive

Posted by Ncm88 > 2019-12-06 13:56 | Report Abuse

Double top 3.58 wait for retracement

Posted by popo92 > 2019-12-06 14:34 | Report Abuse

a masterpiece that was written by professor sarawak after his academic studies.... very confident indeed.. https://klse.i3investor.com/blogs/JTYeo/102021.jsp

Posted by chl1989 > 2019-12-06 14:55 | Report Abuse

out of 100 investors, only one appreciates roic, the rest dont. if they dont value, they wont buy, then share price how to go up?
u must know what it takes for the share price to go up. it is earning growth.

Posted by chl1989 > 2019-12-06 14:56 | Report Abuse

n most importantly, we make money from share price, not their roic

Posted by chl1989 > 2019-12-06 14:57 | Report Abuse

ncm88, not just double top. but double btm at 3.3 also. haha

Posted by Ricky Yeo > 2019-12-06 16:06 | Report Abuse

@popo92 what a strategy, when all fails, digging up failed investment as a way to discredit things people has to say. That tells you alot about how you treat others isn't it. Here are my list of failed investment: Favco, Flbhd, Tropicana, Tunepro. I like to see your worse online behavior. You're getting close to uncle Connie. Ad hominem. When one has nothing substantial to talk.

Posted by Ricky Yeo > 2019-12-06 16:28 | Report Abuse

@chl1989 Sure. Where do you suppose earning growth comes from? Does it come out from thin air? Enlighten me.

Posted by Ricky Yeo > 2019-12-06 16:29 | Report Abuse

Uncle, I'm not forcing any way for you to listen to me, do I? I want to share what I believe is true, I don't profess everything I said is right, and certainly just because I read doesn't make me superior. But I definitely didn't put a gun on your head to listen to me did I? Why are you so worked up.

Posted by Ricky Yeo > 2019-12-06 16:35 | Report Abuse

@Icon whether I am on school holiday, hard labor, retirement, what does that have to do with investing discussion? Is it because everyone is doing linear thinking here: student -> naive -> don't listen to his nonsense.

If my running analogy is too jargon, let me know, happy to explain in another way. If you disagree with my running analogy, I like to hear something better from you. Or you can't have something better to discuss so you resort to school holiday to demean someone? That's why I enjoy learning psychology.