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02-12-2010 12:04 PM #1
Senior Member- Ngày tham gia
- Jan 2010
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Local investors eye low-price shares, foreigners gaze blue chips
As the stock market shows no sign of recovery, local investors tend to buy stocks with high liquidity and low share price, while foreign players preferred blue chips, financial experts said.
Stock analysts say there are three main investment strategies for individual investors in the current slumping market.
Investors should buy shares in blue chips with healthy earning results for long-term or invest in essential-product makers, such as electricity, medicine, steel, which have large capitals and carry low risk of being bankrupt.
Otherwise, they can also become speculators, who try to cash in the market’s fluctuation. A director of a Ho Chi Minh City-based brokerage, who asked to be anonymous, said most of individual investors chose the last strategy. These investors prefer to buy shares with the price of VND10,000-15,000, which are considered having strong defensiveness in the difficult time, he added.
“They can achieve a reasonable profit rate of 3-5 percent as share prices of those stocks rise slightly VND200-500. They believe stocks with share prices clinging on the face value of VND10,000 for couple months hardly decline more,” the director said.
“For example, trading volume of air conditioner maker REE (REE) and Sacombank (STB) with share price of around VND14,000 remained among the market’s most active shares even when the market tumbled. Investors keep buying these stocks because they easily exchange hands.”
Foreign investors meanwhile were net buyers, pumping into blue chips including dairy firm Vinamilk (VNM) and brokerage SSI (SSI). Foreign player hesitated to pour more money into the market as they wait for share prices to fall further, analysts said.
“Share price of a certain share is low as its price-to-earnings (P/E) ratio of a certain share plunged from 12 to 5. However, the stock market in Vietnam relies on official and unofficial information,” a broker at a HCMC-based brokerage said.
The Ho Chi Minh Stock Exchange edged down on Wednesday as investors took profits from the previous six rising days. The benchmark VN-Index shed 0.37 percent, or 1.66 points, to close at 449.93 points. The gauge of 270 companies and five mutual funds declined 13 percent this year.
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