First, you need to stay wired in a lot of the time. You’d think this goes without saying, but most people keep track of the numbers and not the news – big mistake. Ensuring you know what businesses are performing admirably and which ones are tanking can mean you’ll then trade well in the stock market while taking fewer risks.

Second, know your market. Doesn’t matter whether you’re a stockbroker or a bullionvault.com trader – if you don’t know every single detail, every law and every guideline, looking things up or tripping over things you’ve missed can cost you time and money – both vital resources in the trading game. Falling out of sync with the way things work is a rookie mistake and can cost you and the company dearly.

Third, don’t lose sight of the important things in life – i.e. outside your office. Take the time to have weekends, spend time with those you love, eat well and sleep as much as you can afford to. An unhealthy, exhausted trader who’s miserable isn’t going to perform well, and if you’re not enjoying life, it’s harder to enjoy your job. So be careful with yourself and don’t make any extreme sacrifices if it will hurt you or anyone else.

One last tip – stay positive. Sometimes things will go well, and sometimes you’ll lose millions. It’s part and parcel of the trading game, and that ebb and flow comes naturally with attempting to turn lead into gold, figuratively speaking. Good luck, and enjoy your time in the market.

According to Ken Yong, the head of digital banking, they currently have 350,000 online customers of whom 40% of these customers use the Hong Leong Online Personal portal monthly while 20% are occasional users. He said that with the expected number of smartphone users in Malaysia to reach 9 million by the end of the year, the digital banking sector is set to increase as well.

HLB has since invested some RM5million into its IT (Information Technology) platform and with their latest offering, they are hoping to position the bank as one of the Top 3 internet banking providers in the country. Yvonne Chia who is the managing director of HLB group said that the newly launched Hong Leong Connect will be the platform convergence of its digital banking services which will involve adding the mobile banking platform to its current online banking system. HLB is the first bank to launch a transactional mobile banking applications across the Apple iPhone iOS, the Google Android OS and the Blackberry OS respectively.

The delivery of the new order will be around 5 years time (around 2016) and when that happens, analysts believe that they will be used to replace their current fleet. This will ensure that Air Asia will continue to be one of the youngest fleets around. In fact, if they do that, it will apart from ensuring that it is young, maintenance and efficiency could be well maintained and increased respectively. The new A320s have been known to be more fuel efficient (around 15%) and with the new fleet in place, Air Asia could further reduce their operating cost and if that is done, ticket prices could well be reduced as well. After all, that is the name of the game for Air Asia.

Meanwhile, the other consumer goods companies like Nestle, BAT, F&N too recorded higher profits. Nestle, the manufactures of Nescafe and Milo saw their net profit increase by 10% for the quarter ending March 31 for RM152.7 million while the same period last year, they recorded RM138.8million. MFM or Malayan Flour Mills also recorded profit for their 2010 financial year although they are wary of the challenges this year.

Top gainers in the Bursa also include financial companies like Hong Leong where the share closed at RM13.18 in end June, which is RM4.29 higher. A year ago, they recorded a close at RM13.38 which was RM4.18 higher. This was widely contributed to the recent news that Hong Leong was slated to take over EON Capital Berhad which increased investor’s confidence in the company’s shares.

Net profit for the financial year ending April 30 increase to RM63.01 million from last year of RM40.85 million. It also announced that despite the stronger recognition of progressed billings, unbilled sales are at RM550 million which is considered quite high. They have also earmarked projects worth RM1.2billion to be launched this year and that would include the Glomac Mutiara Damansara Residences.

The company will however continue to focus on projects for the Greater Kuala Lumpur and Klang Valley which comes with a variety of opportunities under the National Key Economic Areas under the Economic Transformation Programme. They are proposing that a 5 sen per share less 25% for the final gross dividend and that would bring the total dividend for the year to 9.5sen.

What Is a REIT?
A REIT trust company that accumulates a pool of money, through an initial public offering (IPO), which is then used to buy, develop, manage and sell assets in real estate. The IPO is identical to any other security offering with many of the same rules regarding prospectuses, reporting requirements and regulations; however, instead of purchasing stock in a single company, the owner of one REIT unit is buying a portion of a managed pool of real estate. This pool of real estate then generates income through renting, leasing and selling of property and distributes it directly to the REIT holder on a regular basis.

Advantages
When you buy a share of a REIT, you are essentially buying a physical asset with a long expected life span and potential for income through rent and property appreciation. This contrasts with common stocks where investors are buying the right to participate in the profitability of the company through ownership. When purchasing a REIT, one is not only taking a real stake in the ownership of property via increases and decreases in value, but one is also participating in the income generated by the property. This creates a bit of a safety net for investors as they will always have rights to the property underlying the trust while enjoying the benefits of their income.

Another advantage that this product provides to the average investor is the ability to invest in real estate without the normally associated large capital and labor requirements. Furthermore, as the funds of this trust are pooled together, a greater amount of diversification is generated as the trust companies are able to buy numerous properties and reduce the negative effects of problems with a single asset. Individual investors trying to mimic a REIT would need to buy and maintain a large number of investment properties, and this generally entails a substantial amount of time and money in an investment that is not easily liquidated. When buying a REIT, the capital investment is limited to the price of the unit, the amount of labor invested is constrained to the amount of research needed to make the right investment, and the shares are liquid on regular stock exchanges.

The final, and probably the most important, advantage that REITs provide is their requirement to distribute nearly 90% of their yearly taxable income, created by income producing real estate, to their shareholders. This amount is deductible on a corporate level and generally taxed at the personal level. So, unlike with dividends, there is only one level of taxation for the distributions paid to investors. This high rate of distribution means that the holder of a REIT is greatly participating in the profitability of management and property within the trust, unlike in common stock ownership where the corporation and its board decide whether or not excess cash is distributed to the shareholder. (Know the issues that affect a REIT. Read The Impact Of Interest Rates On Real Estate Investment Trusts.)

Picking the Right REIT
As with any investment, you should do your homework before deciding upon which REIT to purchase. There are some obvious signs you should look at before making the decision:

1. Management
It’s always important when buying into a trust or managed pool of assets to understand and know the track record of the managers and their team. Profitability and asset appreciation are closely associated to the manager’s ability to pick the right investments and decide upon the best strategies. When choosing what REIT to invest in, make sure you know the management team and their track record. Check to see how they are compensated. If it’s based upon performance, chances are that they are looking out for your best interests as well.

2. Diversification
REITs are trusts focused upon the ownership of property. As real estate markets fluctuate by location and property type, it’s crucial that the REIT you decide to buy is properly diversified. If the REIT is heavily invested in commercial real estate and there is a drop in occupancy rates, then you will experience major problems. Diversification also means the trust has sufficient access to capital to fund future growth initiatives and properly leverage itself for the increased returns.

3. Earnings
The final item that you should consider before buying into a specific REIT is its funds from operations and cash available for distribution. These numbers are important as they measure the overall performance of the REIT, which in turn translates to the money being transferred to investors. Be careful that you don’t use the regular income numbers generated by the REIT as they will include any property depreciation and thus alter the numbers. These numbers are only useful if you have already looked carefully at the other two signs, since it’s possible that the REIT may be experiencing anomalous returns due to real estate market conditions or management’s luck in picking investments. (For more, check out How To Assess A REIT.)

Conclusion
With so many different ways to invest your money, it’s important that any decision you make is well informed. This applies to stocks, bonds, mutual funds, REITs, or any other investment. Nevertheless, REITs have some interesting features that might make a good fit in your portfolio. Hopefully, this article has given you some insight into this unique type of security and expanded your investment opportunities.

Believe me; we can learn a lot from nature and from each other. Stock market is one of the places where all sorts of people are interacting to gain a piece of profit from this huge gold mine. However from statistics we know that only a small fraction of people are making money while others are losing their pants. Why is it so? The stock market is a place where the impatient will be punished severely. You see you cant coerce the stock market to do what you wish it to do. The market wont listen to you. So you are the one that have to do the listening.

How many times do you see that your stock portfolio skyrocket only after you sell for a small profits or even losses? How many times you cover your short when the market rally a bit during bear trend correction and then continues the downtrend plunge? How many times do we miss the nice market action even though we are right on our call on that particular stock just because we are not patient enough to wait for the market to run its course? I have and I believe that most if not all did go through this at some point of their investment or trading career.

Now, you asked, “Why is this happening to me?” Well, you got to know the stock market nature and behaviour. The stock market repeats the process of trending and correcting. Yes Trending and correcting all the time. During trending, the stock market moves in the prevailing direction and it is very obvious to all people. Even the blind knows that the market is trending when repeated news broadcasting that the market goes up so much or the market crash. Thats the general trend that we know. However, the market also spends some of its time in corrective mode to the prevailing trend. During market trend correction, things may not seem to be what it should be. At times you will question why the stock market rally even during recession or bad news. Sometimes it is just mind boggling to see the market goes south when everything looks wonderful. Well, patience is needed during this corrective move. You heard me saying “Wait” three times before the action word of NOW.

Let me give you some example of this in our nature. In the world of wilderness, you often times see that the lion lies in wait for the prey. What is the beast waiting for? It is waiting for the right moment to pounce on the prey that gives the most probabilities of capturing it. The same goes for safari hunters. Every shot counts and they have to be sure before pulling the trigger. Again, that is patience speaking. Do you go for fishing? I often time compare fishing with the stock market action. It is like a mirror that you can see clearly of the market behaviour. Well, I am not a professional angler but I do know some fundamentals of it. The technique used also depends on the fishing location just like the many different choice of investment vehicles that requires different specialized techniques. However the fundamental principle remains the same. Lets take pond-fishing as an example. When you see some movement on your rod, you just dont strike. It might be some small fishes nibbling your bait. It requires patience to do nothing at this point of time. When you see big movement only then you know that it is the call to strike. As Warren Buffett said, “The stock market is a no-called-strike game. You dont have to swing at everythingyou can wait for your pitch. The problem when youre a money manager is that your fans keep yelling, Swing, you bum!” Here is another saying of Warren Buffet, “The Stock Market is designed to transfer money from the Active to the Patient.”

Here are the 3 things that you can do right now to improve patience in your investing and trading business.
1.Every time you feel the urge to sell off your investment holding because the stock prices have risen, take a deep breath and ask yourself “Has the business fundamentals changed? Has the initial reasons for the investment changed? Is there a better future for this company? Does the microeconomics and macroeconomics outlook changed? What is my initial capital commitment period?” If above answers are the same when you made the investment initially then be patient and stay put.

2.Every time you feel like calling your broker to place a trading order, pause for a moment and ask yourself “Is there a trade setup? Any trading signal triggered? Has the trend corrective pattern completed? Has the support or resistance line breached? Has the primary and intermediate trend reversed? Any stop loss triggered? What is my holding period?” Above questions will trigger us to think logically on our trading decisions.

3.Finally ask yourself this very important question, “Do I have any confirmation for the investment idea or trading signal?” Confirmation plays a very important part to ensure that we are on the right track. This is the safety line to ensure that we are making decision based on logical facts and not assumptions. As the saying goes, “Better be right than be sorry.”
Do the above 3 things often and you will see that patience is building in you. Most of the time inactivity in investment and trading is beneficial and even profitable decision. Make it a habit to stay put on your decision when you know that you are right on track. Let this sink into your mindset.

But is putting all your money into the stock market inadvisable for everyone?

For a tiny minority of investors, a 100%-stock portfolio may make sense.

You are one of them if you:

* have set aside enough cash to support your family for at least one year

* will be investing steadily for at least 20 years to come

* survived the bear market that began in 2000

* did not sell stocks during the bear market that began in 2000

* bought more stocks during the bear market that began in 2000

* have read Chapter 8 of The Intelligent Investor and implemented a formal plan to control your own investing behaviour.

Unless you can honestly pass all these tests, you have no business putting all your money in stocks.

Anyone who panicked in the last bear market is going to panic in the next one – and will regret having no cushion of cash and bonds.

Growing like Wild Fire : The structured warrant markets in Asia underwent a huge metamorphosis in 2006. The success was partly attributed to the buoyant regional stock market, and partly to the growing familiarity of the momentum instrument. With a furious bullish undertone, turnover in warrant trading now accounts for nearly 30% of Hong Kong’s total turnover compared with just 7-9% a few years ago. In Singapore, it contributes to 5-10% of total daily turnover. In Korea, where structured warrants are known as equity-linked warrants (ELWs), the turnover now comprises 10% of overall market turnover since inception in December 2005.

Such appetite to consume volatility is evident in Malaysia, despite its slow growth momentum since the new guidelines from the Securities Commission (SC) came into effect in May 2003. Bursa Malaysia shifted gear in the second half of 2006 – we saw CIMB accelerated its warrants issuance program, while AMMB and OSK Securities followed in tandem. Still, the warrant market over here is relatively small and inactive – from 12 call warrants at the end of 2005 to 35 currently.

So what is to be expected in 2007?

Planting the Seeds: Expect to see further relaxation of the listing requirement. The current placement methodology (new issues need to be placed to 100 holders, or 50 holders each subscribing to a minimum value of MYR100,000) is a barrier to expand the warrant market. Hong Kong and Singapore have abandoned such pre-placement regulations in 2001 and 2004 respectively, and have since replaced it by the “warrant supermarket” approach ¨C where issuers can list all sorts of warrants and “shelf” them for public consumption. Risk management takes effect not until the warrants are consumed in the secondary market. The result is a heavy influx of warrant launches. Listing fees were lowered and made competitive as an effect (not a cause) of the huge supply of issuance.

Such supply-driven dimension has serious connotations in fuelling the popularity of structured warrants. Currently, there are 20 and 13 issuers in Hong Kong and Singapore respectively, although only a handful accounts for market dominance. They compete to issue or roll-over new warrants with relevant strike levels as the market trended upwards throughout 2006. As it stands, there are 550 structured warrants listed on SGX, compared to 35 on Bursa Malaysia (note that both SGX and SC revised guidelines in 2003). The other implication is that the breadth of the issuers and the warrant issues will inevitably translate to the depth and market making efficiency on the warrant market.

Keeping it Fair, Tight and Liquid: Prior to the current market making system, daily prices of structured warrants were based strictly on forces of supply and demand. There was simply no guarantee of ample liquidity on a day-to-day basis. Nonetheless, the existing market making system has not eradicated the legacy of doubt and suspicion. Recent examples were the quotations of two call warrants – Resorts-CA and Genting-CA, which traded in opposite directions to their respective underlying stocks. Issuers’ goodwill is thus eroding fast.

The challenge for Bursa Malaysia is to induce inter-warrant competition from foreign issuers running on a global platform to improve the overall market making efficiency. Reputational risks will increase with more issuers competing on a selective group of stocks. Any inconsistency in pricing from volatility manipulation or failure to maintain a tight bid-offer spread will be fast acknowledged by the demand side. While the appetite to consume volatility can become more than manageable on the delta- and gamma-hedging fronts for some issuers, a more competitive supply side will evolve in the hedging front and collectively adopt less defensive market-making techniques.

Teach and Reap : Bursa Malaysia, the issuers, and the distributing brokers are obviously anxious to keep the local warrant market moving, and thus need investors to understand structured warrants, trade skilfully and profit from it. In Hong Kong and Singapore, warrant issuers actively provide data on warrants indicators and conduct (sometimes joint) product seminars on warrant trading. Websites with tools and simulators of prices based on different pricing parameters are clearly lacking here.

Final Thoughts: There is definitely more scope for growth in the structured warrant market in Malaysia. As the above-mentioned changes are foreseen, so would the trading mentality evolved. The typical buy-and-hold warrant trading strategy will only succeed with efficient market makers from a breadth of issuers. High delta in-the-money warrants will be replaced and rolled over fast with relevant strike levels, and issuers need not resort to defensive market making tactics (e.g. widening the spreads) and rapid implied volatility adjustments. Else, investors and traders will adopt a shorter holding period for structured warrants upon closer scrutiny of the various market-making mechanisms employed by the issuers. In markets like Singapore and Hong Kong, about 90-95% of total turnover on structured warrants were contributed by day-trades on average. This is a natural evolution after 3-4 years of product adoption. The Malaysian warrant market cannot afford to undergo this chicken-and-egg syndrome at such infancy stage, where overwhelming participation from the day-traders prevails over the actual retail clients.

In the next issue, we will discuss the basics of structured warrants.

One thing that every investor should take note of is that no investment is a guaranteed deal. As with the earlier explanation, the IPO market returned to normal after the tech bubble burst. This means that investors can no longer expect the huge amount of gains which at that time amounted in double or triple digit gains by simply flipping the stock of the early tech IPO days. This does not mean that there is no longer money to be made from the IPO market; it just means that the focus has simply changed from making a quick profit to strategizing with a long term outlook. Investors currently are more inclined to look carefully at long term stocks then trying to capitalize on a stock’s initial bounce.

So finding a good IPO may be more difficult than realized even though you have a long term plan. This is due to the fact that many IPO markets out there are loaded with many unique risks that are different if compared to the usual stocks that have been trading for some quite some time already. However, this should not deter you from taking a chance in the IPO market; just keep these simple tips in mind when you are in the market looking around.

The prospectus is very important when you are considering in the IPO market. Investors should not put all their faith into the prospectus but they however should not skip reading it. The prospectus may not be the latest best seller, and it is undoubtedly a dry read, but you should keep in mind that the prospectus provides useful information such as the how they will use the money that was raised from the IPO as well as the company’s opportunities and risks. So if the prospectus states for example that the company will be using the money to buy equity from founders or private investors, or they will be using it to repay loans, then you should consider twice before making that investments. This is because it is a bad sign that shows the company us unable to repay its loans without first issuing stocks. What you should look out for in a prospectus is when the company is going to use the money to conduct research, expanding into new markets or marketing. So do not be fooled when the company over promises because when they under deliver they will lose out in the market place. As an investor you should read the projected accounting figures thoroughly especially when the prospectus is stating an overly optimistic future earnings outlook. Prospectuses of the company’s going public that you are interested in can be obtained from you stock broker.

You may not be one of the large crowds; instead you actually do research in what you are to investing in. But unfortunately getting information about companies that are about to go public can be a bit tough. This is because unlike most publicly traded companies, analysts do not focus that much attention on private companies and attempts to pierce the corporate armor is not that prominent. You can gain information from the prospectus that they produce, but you should also remember that the prospectus is written by them and not by an unbiased third party. So the best way is to utilize the power of the Internet; find as much as you can possibly can about the company, including its finance, overall industry health, competitors, press releases and that sort. The information might not be enough but remember at this stage any information about the company will be a crucial factor in determining whether or not you want to invest in that particular IPO. You may never know what your research might lead you to; for example you stumble upon the fact that the company’s prospects are not what it seems to be and not investing in it would actually seem like a better idea.

Wait for the lock-up period to end before considering anything else. The lock-up period is basically a legal binding contract ranging from three to 24 months between that of the insiders and underwriters of a company that prohibits them from selling any shares of their stocks for the specified amount of time. An example of such an occurrence would be from Jim Cramer known from the CNBC program ‘Kudlow and Cramer’ as well as from TheStreet.com (TSCM). TSCM, at the height of their stock price was worth millions of dollars, however Cramer who is experienced knew that the stock price would plunge and overpriced. But the incident occurred during the lock-up period, so even if Cramer wanted to sell his stocks he was forbidden in the legal aspect to do so. Only after the specified period has lapsed was he able to sell. It is a good strategy to wait until the insiders are free to sell their part of the shares; this is because if they still hold onto their stocks even after the lock-up period has expired, this means that there might be chance that the company has a sustainable and bright future. When the company is in the lock-up period it is impossible to tell whether the insiders would in fact be happy to take the spot price of the stock or not. So before you start considering about the investments of the companies, let the market run its course. Even as the specified period has lapsed, a good company will still be a good company, not to mention a worthy investment.

Another useful tip is to choose a company that has strong stock brokers. This does not mean the big investment banks will never bring companies that do not have potential public, but usually when quality companies go public they will be associated with quality brokerages. One thing that you should take note of though is to be careful with smaller brokerage firms as they may be willing to underwrite with just about any company to get themselves on the map. Bigger companies have their reputation to protect so they can be pickier when it comes to the companies that they choose to underwrite. This does not mean you should completely disregard smaller firms because due to the size of the firm, their client base are also smaller and this will make it easier for you to purchase pre-IPO shares. This however, does not happen in larger firms and they will also prohibit you from buying that particular IPO as your first investment. They are usually reserved for investors who are established; long standing customers that often have high net worth.

Being cautious should be an attribute that should be cultivated especially when you are dealing in the IPO market. This is because as mentioned earlier due to the lack of information in the IPO market, a lot of uncertainty surrounds it. So approaching an IPO with skepticism is actually a good thing and the level of skepticism should increase even further when it is recommended by a stock broker. This shows that most money managers and institutions have passed on the underwriter’s attempt to sell the stocks. And when that happens, it is usually the individual investors who are left to pick up the slack. When there are an unusually high number of these stocks then something is definitely amiss especially when the stock broker is pushing it strongly. Unless you are a valued customer that deals a tremendous amount with the firm you would not get the chance of purchasing these particular stocks. When companies go public and the stock brokers deem those IPO stocks to be worthy then it is most likely they will save it for favored clients to purchase.
So when you are venturing into the world of IPO investments make sure that you are well informed and a little bit of skepticism would not hurt either. You should not avoid IPO share altogether but it will take experience and a certain amount of skills for you to find the right company that will reward you handsomely.