Gamuda Bhd long standing managing director came out to defend his recent move of reducing his stake in the company yesterday.
He promised investors that he would stay on for at least another 5 years while they groom a successor.
Lin also pointed that he was very surprised with market reaction to his recent stake reduction. He was quick to point out that the reason for selling his stakes was for "estate planning" and Gamuda is a people-dependent business, and they have 20-30 key members. He also remarked that there is never a good time to sell for a MD or a CEO without disturbing investors' sentiments.
In some ways, this press meet may have repaired things (a little bit) for Gamuda share price. He also conceded that his team should take the blame for how the information of the share sale was disseminated to the public. He said it gave the wrong impression that he was in it for only 18 months!
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Clients often asked: how do you play stocks in current market condition (if you cannot short it)?
At times like these, it is of limited use to feed people with fundamentals; fundamentals are designed for those who either never read the news; or are prepared to keep their shares in a vault and then dump the key. Certain analysts (and also prominent politicians) keep harping on how resilient our economy is and that we have oil and palm oil. We will be fine.
The trouble about the stock market is that a critical number of buyers need to see and believe the same way as them. If no one trust anyone, the only certain direction is down.
But there are a certain breed of investors who thrive on market volatility. They boast about timing the market right consistently. Truth is, no one can time the market right all the time (unless you practice the black art of front buying!). Not even Buffett and Soros got it right all the time. But what they have when others may not is the power to hold. During tough times, they just threw away the key, ignore market sentiment and wait.
There are also those who use trend analysis as guide. They stare constantly at those flickering numbers and lines just to find the "holy grail" price turning points such as overbought or oversold situations and price divergence points. Many trend users regard these as reliable instruments of timing the market. But unfortunately most of these models are based on historical data and retrospective. They are indeed masters of hindsight. They are not anticipatory.
So how?
Market sentiment is indeed king. Market catalysts (eg. improved earnings) alone would not move the price upward if the overall sentiment is poor.
Just like rushing for the Christmas bargain sales, don't join the queue at the end. And you don't always have to be first also. As long as the signs of a bargain are there, feel free to join the queue. At the moment, market sentiment is downright rotten. The queue is short and fleeting because the items are selling cheaper the very next day.
So the advice is to wait for the sentiment to improve.
So long as the US subprime mess is not cleared (more write-downs are expected), the market hasn't reached bottom yet.
He promised investors that he would stay on for at least another 5 years while they groom a successor.
Lin also pointed that he was very surprised with market reaction to his recent stake reduction. He was quick to point out that the reason for selling his stakes was for "estate planning" and Gamuda is a people-dependent business, and they have 20-30 key members. He also remarked that there is never a good time to sell for a MD or a CEO without disturbing investors' sentiments.
In some ways, this press meet may have repaired things (a little bit) for Gamuda share price. He also conceded that his team should take the blame for how the information of the share sale was disseminated to the public. He said it gave the wrong impression that he was in it for only 18 months!
----------------------------------------------
Clients often asked: how do you play stocks in current market condition (if you cannot short it)?
At times like these, it is of limited use to feed people with fundamentals; fundamentals are designed for those who either never read the news; or are prepared to keep their shares in a vault and then dump the key. Certain analysts (and also prominent politicians) keep harping on how resilient our economy is and that we have oil and palm oil. We will be fine.
The trouble about the stock market is that a critical number of buyers need to see and believe the same way as them. If no one trust anyone, the only certain direction is down.
But there are a certain breed of investors who thrive on market volatility. They boast about timing the market right consistently. Truth is, no one can time the market right all the time (unless you practice the black art of front buying!). Not even Buffett and Soros got it right all the time. But what they have when others may not is the power to hold. During tough times, they just threw away the key, ignore market sentiment and wait.
There are also those who use trend analysis as guide. They stare constantly at those flickering numbers and lines just to find the "holy grail" price turning points such as overbought or oversold situations and price divergence points. Many trend users regard these as reliable instruments of timing the market. But unfortunately most of these models are based on historical data and retrospective. They are indeed masters of hindsight. They are not anticipatory.
So how?
Market sentiment is indeed king. Market catalysts (eg. improved earnings) alone would not move the price upward if the overall sentiment is poor.
Just like rushing for the Christmas bargain sales, don't join the queue at the end. And you don't always have to be first also. As long as the signs of a bargain are there, feel free to join the queue. At the moment, market sentiment is downright rotten. The queue is short and fleeting because the items are selling cheaper the very next day.
So the advice is to wait for the sentiment to improve.
So long as the US subprime mess is not cleared (more write-downs are expected), the market hasn't reached bottom yet.
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