While I was browsing through web, I noticed that one of the hottest topic for this weekend is Cosco and Yangzhijiang. There is nothing wrong with the companies, they are doing great. The problem is with the share price.
It is a strange behaviour we have observed again and again. When the stock is down and out, investor switch off, don't want to look at the stock and price again. But, when the stock price keep going up, you see people jump in hastily. The greater it climb, the more people get sucked in.
Now, listen to your heart. Take your calculator out and punch in the number. Look at the current earning forecast vs forward PE. Look at the current market condition. Is it wise to jump in at this juncture? It might be better to take profit instead.
Sunday, 21 October 2007
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