Philippine Stock Market Research

OPM, not the Music but What is Most Sacred to Stock Advisors

June 16, 2011

The PSEi has been seesawing at 4,100 to 4,300 since last April 2011.  Greece’s Ten-Year Note is almost 18%.  The Chinese are intensifying presence in the Spratly Islands.  There is fish-kill, e-coli in German cucumbers and the quality of meat down south is poor.  So for your secure investments in stocks, our recommendations are

Stock Advisors get all these negative news and uncertainties every day.  We have them most of the time in our articles also.  It’s not that we like reporting bad news, but it’s our job to digest them and to show investors the right path with their hard-earned money.  Stock Advisors range from stock-brokers, traders and analysts.  They have to make sense out of all the news, data and information and take action on their own funds and most importantly, OPM.  This is the most sacred job and responsibility of Stock Advisors.  There are around 130 stock brokerage houses in the PSE.  Around 20 of them have research teams, while the rest have nada.  Everyday, all these houses and their traders and analysts (if they have any) give BUY, HOLD, SELL stock recommendations to investors.  Investors, of course, want the best returns for their hard-earned money, and stocks are more exciting than bonds and time deposits.  The main question though is do investors really get superior returns from stocks??  Really, just ask around in parties, when you hang out with your friends… parents’ day even.  Stocks may be appealing but they also scare away investors.  We’ve all heard about what happened to investors’ hard-earned money from the mining stocks of the 90s and the horror story of the two letters, BW.  These are what probably drives the real estate market nowadays.  Land and condo units give more security and returns to investors’ hard-earned money.

Like Stock Advisors, Investors should also have a sacred responsibility.  This is of choosing their Stock Advisors.  They just shouldn’t be ones recommended by friends or ones you see in the news.  In our daily routine here, when we Stock-Pick and Recommend, we have Criteria and Acid-Tests; and if stocks pass them, then they give a high degree of providing our Main Goal.  Our Main Goal here is to Seek Out High-Growth and Resilient Stock Securities.  Yes, stocks are supposed to be securities not gambles.  So if you’re an investor, have this recommended test in picking your Stock Advisor.  (1)  Check their background, history, clientele.  Houses have retail (small to high-networth) and institutional (banks, financial institutions) clients.  (2)  Do they have Research and what Investment Method do they use?  What are their stock picks, and why were they picked?  Be wary if they just or mainly use technical analysis or charting.  The Philippine market is too small to be manipulated with chart formations.  This is what we discovered in 1Q10 thereby totally dropping this method and giving 101% faith in the proven and effective method of value-investing.  (3)  Lastly, ask them what OPM is.  I’m sure you’ll know what to do if they answer the Apo Hiking Society, Parokya ni Edgar or Sarah Geronimo.

Disclaimer

The Philippine Stock Market Research report is solely for information. It should not be constituted as an offer for solicitation for the purchase or sale of securities mentioned. The information herein has been obtained from sources believed to be reliable. Whilst every effort has been made to ensure accuracy, we do not guarantee the accuracy or completeness of the report. All opinions and estimates expressed herein constitute our judgment as of this date made on a reasonable basis and are subject to change without notice. No liability can be expected for any loss arising from the use of this report or its contents. As this is general information, it does not have regard to the specific investment objectives, financial situation and the particular needs of any specific person who may obtain this report.