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Basic intro to stocks 2013 11 08

Date post:03-Sep-2014
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philippine stocks
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  • You become partowner of Corporation Shares of Stock are pieces of the corporate pie. When you buy a share of stock, you become: ONE OF THE OWNERS OF the COMPANY. So far: OWNERS BOARD MANAGEMENT WORKERS Customer
  • Mr. Prudent Investor
  • Lucky Guy
  • Mr. Media Man
  • You can be one of the owners Ms. Long-Term Investor
  • You can be one of the owners Ms. Long-Term Investor
  • You can be one of the owners Ms. Long-Term Investor
  • Start a Company ASSUME: Ten founders chip in: One million each. Ten million Pesos = Ten million Shares ONE million ONE million ONE million ONE million ONE million ONE million, ONE million each
  • One hundred shares: Market Value: rises over time = 100 PESOS Par Value Constant 1 peso
  • Market Value: Land TITLES rises Just like real estate Original Cost: One peso per square meter
  • Market Value rises... when many Customers The Company: shareholders
  • Cash Dividends Shares of Stock BUY Capital Gains You become a Winner
  • Meralco 390 Capital GAIN: 70% a year for 5 years. 262 P60 in 2008 20 300 / 60 = 5x
  • Cash Dividends Cash DIV AEV = 4% AP = 4% GLO = 5% MER = 3% RLC = 3% Semirara = 4.5% TEL = 8% URC = 4.5% Price ANS 1/5 = 20% ! = Yield Cash incentive
  • Cash Div, 1 -------------------Share price, 5
  • 1.00 / 5.00 = 20%
  • CHINA Bank 12 / 57 = 21%
  • PhiL WEB In 2011: 916m Capital GAIN 59% a year, for the past three years Net profit in 2008: 292m I cannot put up my own Lottery. But I can be partowner of one.
  • Union Bank Capital GAIN 61% a year, for the past three years Net profit in 2008: 13bn In 2011: 18bn
  • D M Consunji DMCI. 30 years in construction firm, on retirement lump sum P1m *One peso per share, at start 18 *SOLD at Six pesos Share price: One Peso Gosh, 61 47
  • Dizon Mines Exports Copper & Gold 6 P100K from uncle.. U, expert on Economy, on Business. IF Price of Copper & Gold Will Sales UP ? IF SALES go WILL Profits UP IF Profits UP 55 15 WILL Share Price go UP
  • Aunties Portfolio: Value Shares P1 million of ABC 100 sh P1 million of DEF 500 sh P1 million of GHI 600 sh
  • Choose Three of these Stocks Imagine, that you had invested in THREE stocks, some years ago. Write down the names of the three stocks. AYALA LAND ABOITIZ POWER ABOITIZ EQUITY VENTURES BELLE CORP ICTSI JG SUMMIT JOLLIBEE .. MERALCO METROBANK ... PLDT UNIVERSAL ROBINA 1. ............... ? ? ? 2. ............... 3. ...............
  • Ayala LAND Malls, Build-andSell, Offices 10 Next: A Pwr 35 x 3.5
  • Aboitiz Power 37 Generate Electricity Next: A E V 10 x 3.7
  • Aboitiz Equity Ventures Electricity, Banking 56 2008 Profit 4.3bn Next: BELLE 10 x 5.6
  • Belle Corp. 6.5 Next: ICTSI x 4.3 1.5
  • ICTSI Next: JG Summit 94 24 x 3.9
  • JG Summit Cebu Pacific AIR Robinsons Land Summit Media 5 Next: JFC 47 x 9.4
  • Jollibee F.C. Next: MER 141 55 x 2.5
  • Meralco Next: MBT 395 200 x 1.98
  • Metrobank Next: TEL 134 48 x 2.8
  • Next: URC PLDT 3190 2600 x 1.23
  • URC 20 130 x 6.5
  • What if Portfolio Belle + Meralco + Aboitiz Equity V P1 million of BEL x 4.3 = 4,300,000 P1 million of MER x 1.98 = 1,980,000 P1 million of AEV x 5.6 = 5,600,000 TOTAL, three-years investment = 11,880,000
  • You may Calculate: Jollibee + JG Summit + PLDT P1 million of JFC x 2.5 = 2,500,000 P1 million of JGS x 9.4 = 9,400,000 P1 million of PLDT x 1.23 = 1,230,000 TOTAL, three-years investment = 13,130,000
  • Why do prices move up, or down
  • Who wants to buy Who wants to sell
  • Toyota CAR Buyer I want to buy that car, for : 700K I bid... Sellers 900K 900K 900K 900K I ask...
  • House for Sale Buyers 7m 6m 5m 4m I bid... Seller I want to sell this house for ... 5 million I ask...
  • Buyers & Sellers fight over the price. volume BID Who wants to buy 5,000 10,000 60,000 10 8 6 LATEST TRADE: 12 ASK volume Who wants to sell 12 14 16 3,000 15,000 100,000
  • You may post any price. You may jump the queue Ask for a LOWER selling PRICE of 10 BID HIGH at 12 volume BID INSERT 5,000 10 10,000 8 Who wants to buy 60,000 1.06 LATEST TRADE: 12 ASK volume INSERT 12 3,000 14 15,000 1.16wants to sell 100,000 Who
  • Seller can PLACE 5 orders, to capture all the BIDS volume 5,000 10,000 60,000 29,000 30,000 BID 10 8 6 4 2 LATEST TRADE: 12 ASK volume 12 14 16 18 20 200,000 15,000 100,000 100,000 100,000 12 02
  • BUYER can place 4 separate orders, to capture all the ASK volume BID 315,000 10,000 60,000 10 8 6 LATEST TRADE 18 10 10 18 16 14 12 15,000 100,000 100,000 100,000 ASK volume 18
  • You can SEE All the BUYERS & SELLERS Buyers Today: BID Sellers Today: ASK
  • Buyers Today: which Brokers Sellers Today: which Brokers
  • When can you execute trades? till When can you ENTER an online ORDER? AFTER HOURS ! ANY TIME NEXT DAY It gets implemented by 930am
  • Yesterday: 20 Computer: matches buy orders withsell orders Whats the mood of the market, today?
  • What IF: More Sellers Less Buyers
  • FEW Sellers What IF: There are More BUYERS
  • Investing in Equities Investing versus Trading
  • Bonds SAME Amount at the start +/- 1 +/- 1 +/- 1 Money +/- 1 +/- 1 +/- 1 Cash 5 4 3 2 1 0 Money Over TIME 18 16 14 12 10 8 6 4 2 0 In Three Years
  • 200 THINK Stocks KEEP COOL WAIT WAIT Money BUY ! Over TIME 170 160 150 140 130 120 110 100 90 80 70 60 50 40 30 20 10 0 In Three Years
  • Disciplined, Patient Decide to invest, then... Make a plan. Stick to it. Buy NOW Buy Now WIN You get the average 54
  • 3,000 1. Persistent, Disciplined BUY BUY Way, Better BUY 200 100 BUY Years and years Investing
  • 2. Patient, Long-term THINK WAIT WAIT BUY Years and years Investing
  • 3. How to buy stocks, like an expert: style of impatient shortterm maximization SELL BUY SELL SELL BUY SELL BUY SELL BUY BUY BUY Trading
  • Do research, before buying. Check the sales, profits, of the listed company
  • Get the news first, ahead of the rest Check the economic forecast, the outlook for industry, the flow of money. Check the Price Hist
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