On Behalf of S-shares

Again i touch on the topic of S-shares.. many people just love to condemn them, they're dishonest, disgusting, disgraceful etc etc. Nick names... of course, are plenty.. S-shares = Sucker shares/Ass Shares/ Stupid shares. Many claimed them to be worse then the over heated tech stocks that traded in 1999-2000, others, just simply disregard them and run 360 degrees the other way. (Photo edited by Lawrence Law Wen Yong)

Of course, there are good reasons why these are happening to them.. names like FerroChina/Sino-Environment/China dye (Just to name a few) are synonymous with titles like "High receivables" "Going concern?" "Frauds" "Runaway" "Cheap China".

In my honest opinion, its because of these bad happenings-calling of name, shunning them, fleeing 360 degrees the other way, which is why S-shares presents great value to investors in Singapore. If an investor seeking huge gains, were to take time to analysis in detail and determine their comfort level of whats good "corporate governance" "Company's prospects" and "Company's balance sheet/PL sheets" properly to them and have the guts to invest in these beat down S-shares.. huge gains are of course more or less certain! I say these with confirmation because my "Cash-Rich Portfolio" have already risen to almost 80-120% within this one mth.

Yet im not trying to boast or anything, what im trying to say is, that some ppl will say "aiyo, ure lucky thats why.." well maybe i was lucky..but the main reason why i created my "cash-rich portfolio" was because i wanted to test out Graham's theory, and "S-shares likely the only ones to meet his strict requirements and presents these opportunities (probably once in a life time) to young investors like me!" I could also say that, "invest when fear is the greatest" could very well be applied in this notion where everyone simply hates/shuns these shares, presenting great upside to anyone who dares put their money into these shares.

And as a investor/recommend/support of these shares, i get people and friends, they expressing their concerns saying things like I'm taking too much risks ...that i need more experience..i will most probably get burned etc. In my honest opinion again, i think one of the personality of risky investors the one who chase after high flying stocks or blue chips too early relative to those who seek out those "good" companies that are heavily avoided and beaten down to a blup. For example, blue chip SIA trading at $11.20 per share in feb this year, from $11.20 dropped to $9.60 in late march 2009 while S-shares like China Hx dropped from $0.17 to $0.05. So.. if investor A buys 10 lots of SIA , he would have lost $16,000 while investor S would have lost $1200, relatively speaking. So this is the risk im talking about, because i have limited capital, i cannot stomach the lose of 16k, while losing 1.2k is alright to me. A stock such as a blue chip has most of the good news factored into the price already, Thefore, if things changes, there are lots of profits that people can take away, thus leaving holding investors to suffer on the downside.

And with regards to getting burned, yes to be honest.. i have already got burned, bought Sino-Fibre Tech at 0.60 (1.4k) played with warren ts (3k) and possible lose of another (5.6k) IPO, total lose amount to 9k. 9k is indeed alot, but its better to lose 9k now, then lose 900k in the future right? Whats important is, to analysis the reasons why i lose this amount, what can i do to prevent this from happening again, and what lessons have i learnt from here? And of course being young have its advantages! So i don't see whats wrong with taking more risk at a young age, or getting burned for that matter as long as mistake could be learnt not be repeated in my future years and if you think of it, getting burned in S-shares is sort of limited relative to getting burned by blue chips. With that, i urge all young investors to start investing.. not next mth or week or tml..start NOW!!! and if you can't afford Blue chips, there is always the all soo juicy S-shares sector to explore for hidden market Gems!!!

Additional Information

Investing in Gold stock to hedged against the downside of the market. Big Gold companies such as Barrick Gold Corporation (ABX), Newmont Mining (NEM) and Gold Corp (GG) are trading on the New york stock exchange. Advise to act on:

1) Buy only on serve correction $300-$450 per tonne

2) Buy if US dollar collapses in the future, deal to over supply and mounting debts (both trade and balance sheet)

Risker Gold Stocks Royal Gold (RGLD) and Almaden Minerals (AAU)