Skip to main content

I just lost $4785

Ouch! It is really very painful to lose so much money. It has probably happened 1 or 2 times before. But those times I just shoved it under the rag and try to forget it.

This time, I am forcing myself to write it down and hope that I will learn from it and never let it happen again!

It was on Indoagri. I first got into this stock in April 2013. The stock has fallen from a high of $3 from in January 2011. I thought the stock would due for a rebound at $1.115. Then I average down at $0.88.

Then I completely forgot about the stock until I looked at it again in January 2016 when it is at $0.44. I had been busy raising my born from Oct 2013 to around Jan 2016.

Then in Nov 2016, I once again averaged down at $0.52 cents. Again hoping that it will recover to $1.




Looking back, I am obviously an idiot. I had no idea this was a commodity stock. It had shot up to $3 because of the commodity bull cycle (Read Jim Roger's Hot Commodities to learn more). I thought if it can trade up to $3, it's probably a good stock and should recover to that price level at some day. Just like how DBS, Capitaland had after the Great Financial Crash. I was planning to hold the stock for the longterm just like I had for CapitaLand.

So why did I finally decide to cut loss?
1. I learn that now crude palm oil is in a bear cycle. It was suppose to start recovering (which was why I bought more at $0.52). But to be fair, Wilmar and Bumitama is doing relatively better.

2. Comparing among other palm oil stocks, I see that Indoagri is the weakest among all. Hence, even if CPO prices recover, it will likely be a laggard compared to Wilmar and Bumitama.

3. With some technical analysis in hand, I am such an idiot for "hoping" that price will recover to $1 even after averaging down at $0.52. It might take forever. Because the previous low will tend to be the new resistance. And it will probably take a bull market in CPO to drive prices back up.

4. No one know when the CPO bull will come back. I have already waited very long. And if the next CPO bull comes back, I want to ride on a stronger player (Wilmar or Bumitama), instead of a laggard like Indoagri.

It is very painful to cut loss like this. As I am in constant fear that it will turn around and rebound to 44cents or more. But I am more afraid of losing more money.

Unlike GME, where there was a chance for a quick rebound from the Holiday sales figure. I do not see any immediate light for Indoagri. Hence I decide to proceed and cut-loss.

But I shall try to keep an eye on this pain inflicting stock, in case it mount a quick turnaround.

And I am going to lay-off buying anything for a couple of days. Just to let my emotions settle.

Comments

Post a Comment

Popular posts from this blog

Analysis of ComfortDelgro - Update 2

Based on the 3rd Quarter FY17 results, net profit decreased by ~ 8% Q-o-Q to 3.7cents.  Including the 0.04 special dividends of CabCharge Australia, 9MFY17 EPS is now 11.2cents. So if we estimate EPS of 3cents for 4QFY17, FY17 EPS will be 14.2 cents. This is just slightly lower than FY16 EPS of 14.72cents. Give 4QFY16 EPS of 3.3cents, if we assume another 8% loss, we will get about 3 cents for 4QFY17. But the final number may be potentially slightly higher cos of the new Downtown Line 3 that started operations in October. So we have about 2 months of income there.  At 14.2 cents, at PE of 13x (undervalue based on historical PE range), price should be about $1.846.  If all things remain, which means the one or more of the followings: Grab stagnated at pulling market share, higher revenue from bus and trains, and no exceptional gains,  we could expect future EPS to be about 0.9*14.72= 13.25 to 14.2-04=13.8.  Taking the lower conservativ...
Post a Comment
Read more

Review of my history with Genting Singapore

Can't quite remember when I first bought Genting Singapore stocks. I remember subscribing for their rights so I must have owned it before 10 September 2009. And my records with my broker showed that I have traded the shares a couple of times in 2011 and 2013 and seemed to have made some decent profits. The hokkien has a saying "blind chicken peck the worms". I must have been a blind chicken from 2011 to 2013. My records showed that I was quite a trader then and actually did pretty okay! It could be age (getting older) or simply because now that I do not have a fixed regular income to offset any trading loss, I have become a lot more risk adverse. Hence I was quite surprised to see my trading history! The more I think about it, the more I believe this is a result of not having a fixed income from a job. Sigh. I have learned a hard lesson in that, maybe someday I will write a post on how it is important to appreciate a good paying job and just ignore whatever politics o...
Post a Comment
Read more

My Experiences with Bear Markets, Market Corrections and Panics

Even though I know that bear markets, market correction and panic are some the best times to buy stocks, I realized each time that it has happened, I have failed to maximize my opportunities.  Take for instance the GFC in 2008. I did one good thing by buying DBS at the low of $5+. And we did well on that after it issued a 2 for 1 rights call. I did not do any FA or TA on DBS, I just knew that it's a core economic function of Singapore, there is no way the government will let DBS fail. The mistake I made was selling it off too early after it hit $16+. Had I kept it all the way now, the returns would be a lot greater if I added in the dividends received. At that point, I did not understand of beauty of dividends in boosting your overall returns.  On looking back, what was worse was that I did not empty my war chest to capitalize on the GFC. I was certainly not financial savvy at all. In fact, I was sort of freaked out by the 50% or more crash in the prices of the stock ...
Post a Comment
Read more