Hi guys
Last time when Sumatech was 50 sen Calvin warned about the danger of riding on sumatran tech tiger. Many paid little heed to Calvin and they said, "When Calvin say buy you must sell". And when Calvin called for a sell on sumatech you must buy"
And buy they did and chased sumatech to a high of 70 sen. Then?
Then sumatech turned into sudatrap and crashed bang, bang bang all the way down to only half sen. At best sometimes sudatrap trades at only one sen. So all who chased sumatech kena sudah trapped!!
Now we have a new fangled peril called GREATEC OR GREAT TRAP OR GREATER FOOL TRAP
WHAT IS THE GREATER FOOL THEORY (LOOK AT CALVIN PAST ARTICLE)
BY THE WAY, PEOPLE SAY CALVIN RECOMMENDED MANY STOCKS (BUT DO YOU KNOW THAT CALVIN ALSO WARNED AND WARNED ABOUT MANY CON MAN STOCKS ALSO.
THEY WERE TRANSMILE = TRANSFER YOUR SMILE TO CHEATING DIRECTOR
LIQUA = LI (YOU IN CANTONESE) QUA (DIE IN CANTONESE)
SAAG = SAGGING ALL THE WAY DOWN TO ZERO
SUMATECH = SUDATRAP
PATIMAS
AAX
XOX = DOUBLE SCISSORS CUT HEAD
VSOLAR = VERY SOLAR OR VERY STUPID
DOLOMITE = DYNAMITE THAT BLASTED SORCHAI TO PIECES
COMCORP = CON MAN CORP
SEACERA = SEE DIE LAH
SENDAI = SEND DIE
JAKS = JAWS
LIONIND ( JAWS 2)
DUFU OVER RM4.00 (DO FOOL)
ELSOFT (ALL SOFT SOFT NOW)
TEKSENG (BIG HEAD SENG) THIS SOLAR STOCK PUMPED TO OVER RM1.00 AND CALVIN GAVE WARNING.
"WAHAHAHA" OPPOSED CALVIN AND BOUGHT MORE TEKSENG AT RM1.00. HE EVEN AVERAGED DOWN A FALLING KNIFE (TEKSENG LATER CRASHED BY MORE THAN 70% AND "WAHAHAHA" DISAPPEARED)
IFCA (IF FALL C (DIE) ARGHH) IFCA GONE TRIPLE LIMIT DOWN FROM RM1.80 TO 25 SEN
SO MANY OTHERS CALVIN GAVE WARNING (WHERE IS STUPID 3iii & PHILIP (NEVER GIVE A WORD OF WARNING?)
AND NOW THIS UNPROVEN GREATEC OR GREATER FOOL TRAP
SEE THE FULL STORY
'THE GREATER FOOL THEORY By Dr Neoh Soon Kean (Excerpts from STOCK MARKET INVESTMENT), Calvin Tan comments
Author: calvintaneng | Publish date:
This is an excerpt from STOCK MARKET INVESTMENT In Malaysia And
Singapore by Dr Neoh Soon Kean, the Benjamin Graham of Malaysia. Year of
printing 1985
THE GREATER FOOL THEORY (Page 67 Last paragraph)
This is a theory that is usually very popular during the immature
phase of a stock market's development. More of the followers of this
theory are not aware that the trading system which they believe in goes
by this peculiar name. From the stock market's behaviour during the past
three booms, we can say that many Malaysians/Singaporeans appear to be
strong supporters of this theory. This theory was very popular in the US
during the 1920s but since then, it has fallen out of favour even
though pockets of true believers still appear from time to time.
In essence, believers of this theory hold that stock prices are
not dependent on anything tangible but rather dependent on the continual
appearance of more people who are willing to purchase the stocks at an
even higher price {these people are the so-called 'greater fools').
Thus, it neither matters what price one buys a stock nor that the
stock's price is ridiculously high by any normal standard of
measurement. Thus the believers of this school of thought hold the view
that whatever stock one buys can always be sold at a higher price
because there will always be greater fools than themselves. Thus, it is
fine to buy MUIB at $24.00 because there will be another person foolish
(or brave) enough to pay $26.00 for it. Believers of the greater fool
theory never for a minute think that the supply of fools will be
exhausted and that they may be the final purchaser before the crash.
During every stock market boom, there are usually a large number
of believers of the greater fool theory and some of them actually make a
lot of money on the way up. Some of them get out in time by finding
some greater fools to take over their hot potatoes in the nick of time
but many find that they themselves end up as the greatest fools because
there is no one else willing to bid up the price anymore. Needless to
say, the Greater Fool Theory is a much discredited one among academics
and most professionals. But it still finds many adherents. Why is this
so? Everyone is having too much fun, (that is, making so much money) on
the way up that they do not want to leave the market. George Goodman,
writing under the pen name of 'Adam Smith' has this wonderful parable to
explain how people are caught up in the web of the Greater Fool Theory
and do not know when to get out.
We are all at a wonderful ball where champagne sparkles
in every glass and soft laughter falls upon the summer air. We know, by
the rules, that at some moment, terrorists will burst in through the
terrace doors, killing many and scattering the survivors. Those who
leave early will be saved, but the ball is so splendid that no one wants
to leave while there is still time. Everyone wants to enjoy one more
dance and sip one more glass of champagne. So everyone kept asking:
"What time is it? What time is it?" We look around and find that all the
clocks have no hands.
This may be a surrealist's way of describing the stock
market but Goodman's parable has a great deal of truth in it. Of course,
we know that in every speculative boom of the past, the 'terrorists'
did come when most of the guests were still enjoying themselves at the
ball. As 'Adam Smith' implies, nobody knows when a speculative boom will
end but end it must for that is the rule. At every speculative boom,
not many of the small speculators escaped with their gains made on the
way up. Most of the smaller speculators known to me eventually lost all
their gains and much more than what has been gained.
Some even lost a large part of their original capital. Thus
on the next occassion when you happen to find yourselves at this type of
a ball, try to leave early. The problem is that once one is caught up
in the fun and games of the party, one is apt to lose touch with
reality. Chances are that believers of the Greater Fool Theory will hang
on to the bitter end, only to be slaughtered. It is better to miss a
few dances or a few glasses of champagne than lose one's life.
In concluding this section, an anecdote about Bernarde
Baruch, generally acknowledged to be the greatest stock traders of the
1920s is related. He was once asked how it was that he remained so rich
while many of his contemporaries had declared bankrupt. This was his
splendid answer: 'I always sold too early.'
Calvin comments:
This greater fool theory could be applied to stocks like IFCA, Sumatech, VSolar, XOX & others
I have people telling me I missed IFCA on the way up. Calvin
does not go gambling in casino Greater Fool Type of Stocks. And how
they missed a fortune on the way up due to my warnings. And how they
finally lost all their 'profits and all their capitals' for overstaying.
Now I am not here to tell you how to punt or gamble. I am here to warn
of a Greater Fool Stock.
All will have to be responsible for your own actions in investment.
LATEST ADDITION TO GREATER FOOL STOCKS ARE HENGYUAN
See the Pump & Dump of Hengyuan
HENGYUAN REFINING COMPANY BERHAD (4324)
Chart Period:
The Greatest Fool who chased Hengyuan from Rm17 to Rm19 will be stuck up there for a very long time.
The Opportunistic Fools who bought the Falling Knives of Henguan from Rm15 down to Rm10 are also stuck in limbo!!
Now the Greater Fool Stock is Jaks
See
JAKS RESOURCES BERHAD [S] (4723)
Chart Period:
The Greatest Fools who chased Jaks near Rm1.80 will be hung up there for a very long time
Now in progress are Many Opportunistic Fools who bought the falling
knives of Jaks from Rm1.50 to Rm1.00 will also be caught & stuck in
limbo later when price of Jaks return back to its true level
So take care
Calvin Tan Research
