Monday, October 26, 2015

"Unknown"

I remember my friend making this remark many years ago.

"..I believe that the best stocks are those that nobody has written about it..."

At that point, I was looking at Colex and it was trading between 0.150 to 0.155.

That night, I went home and checked if anyone had talk about Colex and I found none, at least nothing recent that point.

The next day, I told my friend that Colex seems to be such a stock. Thus, he got it the next day (I miss it cause I wanted to get it at a lower price..lower than my friend).

Source: Yahoo Finance

Now Colex is at 0.310 and I regretted it badly.

Thus, this emphasize on the point that "Unknown" stocks are not bad stocks. They are just not popular enough for people to talk about it. In value investing, it can also be deem as a ugly stock that nobody want to touch or noone cares. But eventually it will be pick up by value investors.

It should also be noted that we should not invest solely based on the stock is an "Unknown". We should still look at its business model and financials.

Colex is not the only unknown I have encountered. Many others have since also rise in their stock prices.

In short, what is not popular may not be a bad stock, what is popular may not be a good stock.

8 comments:

  1. This comment has been removed by the author.

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  2. Replies
    1. Haha... hmm..it's still be an unknown to me without your prompting. But I must say there are still some significant risk involved. So the amount invested is limited.

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    2. I follow one famous blogger... bu 要 hai wo!!!!

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    3. I follow one famous blogger... bu 要 hai wo!!!!

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    4. This comment has been removed by a blog administrator.

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    5. Haha... don't worry. I believe there are still many other unknown for other to choose.

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  3. Hi all, just an update as I have a friend asking me why I didn't explain on why I wanted to buy Colex.

    This is because the main thing about the article is telling people not to be afraid of the unknown. Colex is just an example and the justification to buy then is no longer relevant.

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