Vard Holdings: Mr. Market is reacting calmly.

This is a short blog post on my observation that Mr. Market seems to be accepting the bad news regarding Vard Holdings' performance in 2Q 2013 rather calmly. Please refer to the comments section of my blog post on the company yesterday for discussion on its results.

Vard Holding's share price is at 84.5c, down 2.9% or 2.5c as of now. The decline is rather muted, I feel, to what is really a very bad quarterly report card. There seems to be quite a bit of support from buyers, actually. The news might refer to this as "bargain hunting".

It would seem as if Mr. Market feels that the current price level of the stock, for whatever reason, is a fair one at this point in time.

If Vard Holdings' share price should form a lower low, look out for a higher low in the MACD. I am not saying that it will happen but if it should happen, that could be a buy signal.

Related post:
Vard Holdings: Initiating coverage.

Interview with Matthew Seah (Part 2): Value Investing.

I prefer to have a more direct control over my money rather than letting a third party invest for me which usually results in subpar to market returns after fees are paid anyway.

So, although I invest in ETFs, I only invest in passive ETFs like S&P500 ETF and STI ETF where the returns are very similar to returns of the S&P500 and STI, respectively.

My investment approach when it comes to stocks is to pay attention to 3 Rs:

Right model
Right management
Right value

Investing in businesses which have all the 3 Rs has been very rewarding for me.

If you have guessed that I am a value investor, you are right.

Value Investing has been proven to be the best investing method, as can be seen with the phenomenal growth of Berkshire Hathaway, Warren Buffett's company.

Many people buy stocks after hearing good news about the stocks. They are just buying something which is selling at a higher price in the hope of selling it later at an even higher price, which doesn't make sense to me.




Value Investing is like shopping for stocks on sale. It would be more logical to buy stocks when they are at a discount and not when they have become pricier. This is about buying something at a price lower than its intrinsic value.

Another thing which is important to remember is to invest in companies which have some kind of competitive advantage over their peers. These companies tend to have a larger market share, and are more profitable in the long run. Therefore, they are likely to continue growing in years to come.

For someone who is new to investing, I would suggest being more cautious. What do I mean?

I tested some strategies through paper trading prior to real investing. When I started paper trading, I was more emotional and often closed my trades too early. Now, I hold on to my investments for a much longer period which has proven to be more profitable than short term trading.

Being stronger financially now also means that I am able to weather larger drawdowns to my investment portfolio without feeling too emotional. 

I will end by sharing this quotation:

"Your goal as an investor should simply be to purchase, at a rational price, a part interest in an easily-understandable business whose earnings are virtually certain to be materially higher five, ten and twenty years from now." Warren Buffett

Related posts:
1. Warren Buffett: The greatest money maker.
2. Getting started in investing and trading.
3. Interview with Matthew Seah (Part 1): Financial Freedom.