Historic rise

By Randell Tiongson on October 7th, 2010

The local stock market ended up in a historic high today at 4,245 points! Not only is our local index on a high, it’s on a rampage. The historic high was also achieved in a relatively short time.

Volume turn-over was about 4 Billion bucks which is pretty decent but not great. It indicates that many Pinoys are not as invested as they should be and I reckon that a big chunk of those invested are through off-shore funds. A good target for volume would maybe be 10B or more with the bulk being average Pinoy investors so that we can reap the economic impact of a very lively stock market.

While there’s much to celebrate, I wish to remind people that the stock market is really for long term investors and it should be consistent with their investment objectives and risk tolerance.

Further, diversification should always be practiced as this remains to be a really good tool for risk management. ¬†As I read somewhere, one should enter the stock market at the sound of alarms, and leave it at the sound of trumpets — or something to that effect.

Life is short, take some risk — calculated risks; but remain prudent. Happy investing!

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2 thoughts on “Historic rise”

  • there’s something wrong with your article. anything above 4bln is foreign funds. if you have noticed, the local investors are the one pushing the prices higher, not the foreign funds. the net foreign portfolio and net foreign buy/sell is still below the levels we have seen in 07. the record level prices we have seen is mostly foreign. so it’s just lately that we have seen foreigner coming in.

    you actually dont just look at the index. prior sessions rise is mostly PLDT (which comprises around 10-20% of the index). the telco has underperforming and just beginning to catch up. so if it goes past 3k, we would see index at 5k. its really a game of catching up.

    you’re right. investing is for the long run. and yes consistent with risk objectives and goals. but i don’t know how you define risk. risk is definitely not price volatility. risk is permanent loss of capital – which stems from 1) overpaying the stock 2) declining business values

  • @ Mr. Li, thanks for your comments — took note of it. The volume of the market indicates that few of us are invested in the equities market as compared to 30 day instruments where the volume is over a trillion. While I know the market is not for everyone, I feel that there should be more pinoys investing for long term growth. My 2 cents.

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Historic rise