Looking on Shares Sustainability vs Companies Sustainability (Part 1)

While looking back at my post, I really forgot to stress that, company sustainability found in the corporate, ("BHD") some are projecting risk in their business while some has great prospective.

For me, sustainability income for a shareholder is important while sustainability in business for a corporate or company is also important.

For those regulars visiting my blog, I would introduce some crucial steps how to make shares investment a better you.

My 1st fundamental analysis : "Measure Your Profit"

a) choose my fluctuation on profit margin comparing company shares prices in

RM0.001 towards RM0.0011   (10%)
RM0.01 towards RM0.011  (10%)
RM0.10 towards RM0.11   (10%)
RM1.00 towards RM1.10   (10%)
RM10.00 towards RM11.00 (10%)
RM100.00 towards RM110.00 (10%)

For easy understanding, choose a product that would gives me a higher profit margin, as in this case RM0.001 would be easy to reach 10% so, not forgetting with the opposite -10%.

For an example,

selling an apple, with a profit margin 2%. Need to sell 10 apples to achieve 20%
selling an apple, with a profit margin 5%. Need to sell  4 apples to achieve 20%
selling an apple, with a profit margin 10%. Need to sell 2 apples to achieve 20%
selling an apple, with a profit margin 20%. Need to sell 1 apple to achieve 20%

once decided, choose the supplier that supplies the good quality apple.

For those in the business line, some are good at this, some are stuck with profit margin and some with different type of fruits.

While for those working people, their experience is limited by the experience of "profit". They choose to believe that as long as working 8 hours, the profit is there, salary equivalents to profit. As long as money put inside the shares, the shares would give profit within 8 hours.

Shares is not that an easy as that, or else no one choose to work at all.

Anyway, come back to reality, by getting yearly high and yearly low price in shares for Finance Industry, would give me a better idea, which is it might only give me 0% - 10% annually, which could be lower than Fixed Deposit if invested at the wrong price. An expensive shares would take a longer period to obtain the profit %.

Another side of the story is that, BUY a share vs TRADE a share would give me a even clearer picture. For example, if each shares give me 10% within a month, at the end of the year, it would project at least 100% profit.  In other words, the shares needed to be bought and sold at least 10 times within a year, would be a better view of trading.

Is there any cheap shares that have quality values and fundamentals? What qualities are we talking about and what kind of sustainability does a corporate need to have?

In my Part 2, I would review the following:-

Current Assets more than Fixed Assets -
 Current Ratio more than 1.50 -
 Net Profit before Tax   -
 Fast Cash Flow Positive  -
 Trade Receivables over Current Assets-
 Trade Payables over Current Liabilities    -
 Biggest Turnover (Stock)   -

Summary of Part 1

1. Expensive shares takes longer time to achieve expected profit %.
2. Trade the shares, buy and sell many times.
3. Get to know lowest price share.
4. Shares is not fast money.
5. Trading shares needs tools and skills. Learn it or lose it.


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