Activity 1:Date: 4th January 2010

PURCHASE: MUMIAS SUGAR COMPANY


Average Purchase price: Ksh 6.90


NSE INDEX : 3189.55

RATIONALE OF PURCHASE:Anticipating above normal 1st half financial results in late Jan/early Feb.

@ Deal......advice taken.

Left just the bare minimum.I'll be doing the updates using percentages.

@stockmaster, thats BOLD. Benjamin Graham however warns us of the futility of short-time selectivity: 1. Human fallibility 2. The competition. Simply put, your expectations might miss the boat by a river OR even if you are right, tens of thousands of other investors are thinking and acting likewise! All the best and Keep us updated.

@stocksmaster, show of character - admirable - putting your money where your mouth is.

@ stockmaster

I learnt my lesson the hard way two years ago. Buying low and selling high is not easy and not a preserve for the weak.
Think about it, everyone knows about buying low and selling high but when a counter is low there's doubt and we're not so sure about it anymore, so we lose out. A good example was Safaricom, even below 3/- people were still dumping creating a negative impression so people could only see doom instead of the bargain.
Right now there are many counters on SALE! question is are you bold enough to take a chance on these particular counters? I don't think so.

I have adopted a method I read somewhere which has proven to be effective and has given me good returns. Buy into counters that have a record of good management, innovativeness and pay good dividend. Don't buy with the intention of selling but investing in a good company and you won't go wrong.

Right now I'm able to take the risk and I'm using my gains plus annual bonus to take advantage of good counters which are currently on SALE.

@2012, i have observed this market so closely at least for 3 years now and yes it is possible to buy low sell high. There are certain trends in the NSE that seem to work by my estimates 80% of the time meaning on average you can expect to score 3%-10%(on high liquidity counters. These trends are very specific to the NSE. You will almost always run a profit on these trends.

Stockmaster. I welcome your idea to share your moves, i was seriously thinking of setting up a "copy cat portfolio", to save my brain thinking. it's clear Mumias is undervalued based on returns and funny enough it just stays that way. I would be weary of your bet, i don't know how increased capital expenditure for their alcohol and power plants will reflect (on the mighty who ignore this counter) when results are read. I would take a long term position though on this one.