Tuesday 16 January 2018

Actually I don't like Bonus Issue & Share Split


Before we start,
let's have a book at these two conversations below:
FIRST.

 FRIEND : "Oh! We didn't meet for few years already, how are you?"
ME : "Well, so far so good, how about you?"
FRIEND : "Still the same~ Oh yeah! I saw you lost a lot of money at shares, is okay, this meal I treat!"
ME : "Lost money? Me?"
FRIEND : "Aiks.... still remember few years ago when you just started to invest, you told me you bought AEON shares at around RM5 right?"
ME : "Yeah."
FRIEND : "I checked the share price just now, it is now around RM1.70, so you must be losing a lot of money."
ME : "No.... I sold some at around RM3.60 and the rest at around RM2.70~"
FRIEND : "Aiks.....still lost money, never mind I treat you !"
ME : "........................^^;;;;"

 *After I bought AEON last time, it went through process of 1:1 Bonus Issue then 1:1 Share Split.
SECOND.
FRIEND : "Yo bro! Not bad, you earned so much at shares market!"
ME : "Nah..... my capital is not big enough, didn't earn a lot also."
FRIEND : "But still... you earned the most from NESTLE right? Last year only around RM70, now already more than RM100, so scary!"
ME : "Yeah, but I earned the most from AEONCR though."
FRIEND : "Wow bro! You earned too much money until crazy already?"
ME : "Huh?"
FRIEND : "AEONCR was around RM14 at the start of year 2017, now is around RM13, sure lose money right! I treat you this meal, after that you go hospital check your brain ya~"
ME : "............................^^;;;;;"

 *AEONCR last year went through 2:1 Bonus Issue.
I created the conversations above out from thin air,
is not real,
but I do hope I have those kind of friend LOL.

 Anyway,
if you didn't understand the important point of those two conversations,
that means you might be not so clear about Bonus Issue and Share Split,
I strongly recommend you to study about Bonus Issue and Share Split before you start investing.

 Well.....
A lot of people like Bonus Issue and Share Split.
You can go to AGM if you don't believe,
I can guarantee you that every year there must be at least one shareholder asking/suggesting Bonus Issue to the management.

 Or you can see the share price of a company that announced Bonus Issue,
the price will definitely rises!

 Well.....
Everyone love things with low price~

 Few years ago,
less people wanted to buy a share which was quoted at above RM40,
but after 1:10 Share Split,
everyone crazily buying it even it was above RM5~

 Another example is AEON,
at the price of RM16,
AEON went through process of Bonus Issue and Share Split to become Rm4 per share,
someone who I am very closed with quickly bought it at around RM4.

 Looking at the share price now which is around RM1.70 for AEON,
luckily that fella didn't buy a lot.....

 Personally,
I am not very fond of Bonus Issue and Share Split,
this is because it will not only affect the share price,
and is hard to explain about the change of share price.

 For example,
I told someone that I bought LPI at around RM16 during year 2014,
now year 2018 the share price is around RM18,
feel like didn't earn a lot,
but actually LPI went through 2:1 Bonus Issue between the years mentioned.
If not, LPI now will not be priced at around RM18,
but should be priced at around RM27!!

 The problem is...........
most people only thought that LPI last time was around RM16, and now is around RM18,
so they feel like LPI didn't rise much,
not worthy to invest.

 No wonder a lot of people don't like long term investment,
this is because they thought can only earn around RM2 if they hold LPI for this few years,
but holding LPI from year 2014 around RM16 until now year 2018 around RM18,
I at least earned RM10.

 Recently people all talked about NESTLE because it just break through share price RM100,
but actually if not because of Bonus Issue and Share Split,
I think many other companies also will be priced at above RM100~

 One more reason I am not fond of these company activities is because it is not convenient for me to check the financial result of a company,
I sometimes accidentally took the higher EPS before Bonus Issue to compare with the lower share price after Bonus Issue,
so I was very happy because I thought that I found an undervalued company to invest,
then I did some deep research only found out the truth................
It not only wasted my energy, but also my time...............

 Of course,
this is just my personal opinion,
you do not need to follow me to dislike Bonus Issue or Share Split~

 Investment is about doing own thinking, making own decision.

 Thanks for reading.




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