SUPERMX (7106) SUPERMAX CORP BHD: Sellers are caught - Koon Yew Yin
The price chart below shows that the share price was Rm 7.50 on 29 June, 14 trading days ago. It shot up from Rm 7.50 to close at Rm 17.70 yesterday, an increase of Rm 10.20. Yesterday alone it shot up Rm 2.80 with an above average volume of 54 million shares traded. This is a clear sign that many rich investments have been buying aggressively. On 10 July Mr Sim, RHB Perak manager can confirm that I bought 995,500 Supermax shares at Rm 13.25. As a result, the share price has been shooting up like rocket. It is unwise to sell even at the last closing price of Rm 17.70 because it will continue to go up higher and higher until the Covid 19 pandemic is under control.
Many investors who sold earlier are disappointed that they cannot buy back at cheaper prices.
Due to Covid 19 pandemic, the demand for medical gloves far exceeds supply. As a result, glove makers can easily increase their selling price of their products as shown on the below selling price bar chart by Supermax. As I said before, the increased price is pure profit because it does not involve production cost.
Until the pandemic is under control, the demand for gloves will continue to exceed supply and all glove makers will continue to make more and more profit which are being reflected on their share prices. Many scientists predicted that the pandemic will not be under control for at least another year despite of the discovery of a vaccine which is being under human testing now.
As I said many a time, statistics shows that short term traders do not make much money. In fact, there are more losers than winners in the stock market. In the case of Supermax, investors should not sell their holdings because they don’t know whether the price will drop below their selling price.
If you look at the price chart carefully, you can see that just 5 trading days ago, the closing price was Rm 13.62. If you sold your holdings a few days ago, you should be terribly worried.
Common sense will tell you that the Covid 19 pandemic will not be under control for at least another 6 months and the demand for gloves will continue to exceed supply.
You can avoid stress and worry if you just buy and hold for a few months. You don’t need a crystal ball or consult a fortune teller to tell you that the price for Supermax and other glove stocks will continue to go up higher and higher until the pandemic is under control.
https://klse.i3investor.com/blogs/koonyewyinblog/2020-07-18-story-h1510605378-Supermax_Sellers_are_caught_Koon_Yew_Yin.jsp
