Monday, June 01, 2009

Risk-Return Assessment Of Market Leaders



No stock is always good or always bad. There is always the price which makes a good stock bad, and vice versa. The markets have charged head-on and prices have moved dramatically for some. I would like to rate them on a risk-reward ratio as trades going forward, on a 1-4 week view. They are ranked out of 10, the higher the number, the higher the risk over reward. What we should aim for is getting into low risk to reward, closer to 1 (below 5 is acceptable). Bear in mind, it has less to do with company outlook but rather more to do with price run up and the levels they are at now, compared to perceived upside and the downside risks. These are my views and not a scientific exposition filled with quantitative formulas, ... its unscientific, full of bias:

KNM at 0.96 (8.5)
Compugates at 0.075 (7)
Tebrau at 0.815 (6)
Scomi at 0.72 (5)
SAAG at 0.335 (4)
Sanichi at 0.10 (5.5)
UEM Land at 1.72 (9)
Mulpha at 0.54 (6.5)
Jaks at 0.82 (4)
Huaan at 0.465 (4)
IOI at 4.56 (2)
Mithril at 0.10 (4)
Resorts at 2.83 (5.5)
Axiata at 2.38 (8)
Equine at 0.59 (8.5)
Poh Huat at 0.65 (7)
TM at 2.68 (7)
CBS Tech at 0.49 (7)
D Bhd at 0.24 (3.5)
MRCB at 1.36 (4.5)
FRB at 1.06 (4)
ASB at 0.15 (5)
Kinsteel at 0.91 (4.5)
Iris at 0.19 (8)
Oilcorp at 0.47 (6)
Ramunia at 0.59 (4)
E&O at 0.79 (3.5)
Timecom at 0.38 (4.5)
Perisai at 0.62 (5)
Zelan at 1.00 (4)
Maybank at 5.30 (4)
AirAsia at 1.35 (3.5)
MK Land at 0.37 (5.5)


p/s photo: Tracey Ip Chui Chui

5 comments:

fuee said...

Glad that you mentioned your ratings full of bias, so as not to mislead others. A recap of your "quick trading note" at May 22: next entry level of 1008 - 1015. At the time i am writing this comment its 1062. Guess you are going the way of Mark Hulbert, a columnist in MW, almost all his readers recognize that when he says its bull, its bear, when he signals for a bottom, there will be rally. anyway, thanks for sharing, sincerely.

solomon said...

It is some sort of reality check for all, ya. Whether it is a green shoots or false dawn, I felt like Art Cashin the market is going to have a major healthy pullback of 10-15% very soon.

Like Dali said, the equities could have been repriced ahead of the fundamental at local front. I will take a bet and to miss the current rally and let the lucky one to earn theirs.

random said...

on a different topic, joanna wang will be at 1U central park 8:30 pm 5th june

easystar said...

Except of course that some stock are bad buys at any price (eg. some of the bank stocks that have now went down to zero)

lofan73 said...

hi bro,

whick stocks to look at for current scenario?