The Problem of Active Monitoring…

While I should be thinking how to introduce myself and the format of my blog, I feel like taking this opportunity to vent my stupidity and highlight the problem of actively monitoring the stock market…

Actively monitoring the stock market always result in narrow-mindedness and short-sightedness. You tend to get very fearful when the stock drop a few cents and get extremely excited when the stock go up by few cents. The problem is in such a short window, the stocks tend fluctuate up and down, as though it has no direction. I allow myself to enter into the irrationality of the market until I deviated from my target exit price and goal of purchasing the stock.

To cut the story short, two weeks ago I bought into Benalec at reasonable price of RM1.445 (I was looking to enter at RM1.42 actually, but when kiasu-ness kicks in, I start to feel a bit kan-cheong and bought in too early) and set a target price of RM1.55 based on the chart. I knew Benalec is a strong fundamental companies which is trading at undervalue valuation. I wish could explain why Benalec is a good fundamental company but I think this is a wrong forum. Anyway… the stock price has been hovering in the value band (the band between upper and lower band) for quite some time, so I thought it is a good opportunity for me to buy now and hold until it hit my target price.

But in that two weeks, Benalec price don’t seem to move. Deep in my heart, I feel like this is a lost of opportunity especially other stocks which I was monitoring were moving up. Just FYI, I put all my money into that single stock. Please do not advice me diversification. I think diversification is for those that do not know what they getting into. Anyway, continuing… because I put all my money into one stock and seeing other stocks within my radar were moving up, I feel a little regret (lost of opportunity)and deep in me, I was contemplating to take small profit and put the money into better yielding stock… I was eyeing MBSB-OR, that time.

So when Benalec starts to move up a little bit, I decided to SELL at RM1.47 and lock in RM200 profit. Then I bought 10,000 units of MBSB-OR. After 1 – 2 trading days Benalec was trading between RM1.44-RM1.48 and I thought I made a good decision. But sadly, today Benalec went up to RM1.55 and close at RM1.53. Instead of making RM200, I could have made close to RM2000 in just two weeks. What a waste….

The lesson here, don’t over-monitoring. Whatever that is excessive is never good, anyway. All I am hoping now is MBSB plus its warrant will give me good profit. I was hoping to make at least RM2000-3000 once the mother share and the warrant are listed in the market. We will see… I could have done it just by holding on to Benalec without taking any risk.

I should stop whining. Lesson learnt..

I still think RM1.55 is a good profit taking point. If it does break RM1.55, the RM1.6o will be the next resistance and take profit. Then go back in again at RM1.44 or better. That’s my gut feeling…This is a good trading stock, while waiting for its fundamental to unveiled.