Saturday, January 05, 2013

My 1st Reaction as Stock Market Newbie #2

By end of 1996, both of my stock did increase in price especially TANCO, reaching RM4. Unbelievable! MULPHA only increase to RM1.5x. My dad advised me to sell, since I already earn the profit. But I did not listens, as I am believing that if I keep holding for more years, my price will slowly keep moving up as well, RM6, RM7 or RM10! He did not force me, so this is my decision. My RM15K now turn RM28K in a year. That is 86% more money from my saving! A lot better than putting in banks. Bank interest rate at that time, I think is 6%-9% if I not mistaken.

The ugly yet to come! By early 1997, both my stock start going down and down days by days, weeks by weeks and months past. I am seeing my saving going down, yet I still don't want to sell my holding as I expecting it to move up again! At the end of 1997, all of my RM28K turns RM5.5K (500% drop!). The worse is from TANCO, I can't believe it drop from RM4 to 50cts. Unbelievable! This really opened up my eyes. Really regret that I did not sell earlier when I have chance to do so, but instead choose to hope that it will rise again to level of 1996.

What happen to the market? Why the market behaving like this? I am asking myself. Dad told me, our country was hit by financial crisis. All shares price plunge to the lowest. A lot of major newspaper headlines talk about this crisis. At that time I do not know what financial crisis is all about and its impact to the economy. Just know that, there are many businesses struggling for survival and some close down and people have to ride thru the hard days ahead. My salary was deducted 10% every month due to this crisis. I am considered lucky as I still got my employment!

My shares got stuck now. My dad said just leave it, it will recover once the financial crisis over. I have no choice, so I just leave it since I am putting as my long term investment. I console myself that shares price can recover overtime. Actually my dad's stocks majority also got stuck and did not even make it to sell out! We both really got burned up in 1997/1998. 

Since then, I have negative perception on the stock market and I told myself to stop looking at the stock market and forget about it!

To be continue...

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Alex Chan said... hindsight you should be buying during the crisis.BAT was selling at 13.

You might be many time richer today

BullTrader said... are right! if crisis come this time...I will be the buyer... last time just fresh as newbie don't know much... :-)

primepeng said...

you don't have a clue how to sell and misuse the patience