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First it was Jim Rogers now latest one is Leopard Fund. Unlike retail investors Professional fund managers do not invest on rumors & emotions. They study the market take their time to select best stocks with higher growth potential.
What are the basic things professional fund manager looks before invested in an individual company?
Ø The valuation. (Price earnings ratio, Net asset value, Price to book value).
Ø The reputation of the Director Board of that particular company.
Ø The liquidity. (Big funds will not invest in illiquid family owned companies.)
2010 will be best year for Colombo Stock Market. More & more International funds are preparing to invest in Sri Lankan equity market.
So now I am talking to retail investors. What are the stocks we should buy & hold to sell when Big Funds start to invest? Don’t think short term; look for six to twelve months investment. In short term there will be ups & downs but if you invest in a good company for medium to long term you will defiantly rewarded with more return.
Look at the Colombo Dockyard. It was at Rs 67.00 on May 2009, now it is trading around Rs 187.00. Sampath Bank was trading at Rs 80.00 level six months ago now trading at Rs 180.00.
Foreign Investor’s favorite stocks.
Ø John Keells Holdings Plc.
Ø Commercial Bank of Ceylon Plc.
Ø Development Finance Corporation of Ceylon. (DFCC).
Ø National Development Bank. (NDB).
Ø Chevron Lubricant Lanka Plc.
Ø Aitken Spence Plc.
Ø Hayleys Plc.
Ø Distilleries Company of Sri Lanka Plc. (Rs 6 Billion due from Sri Lanka government on disposal of Sri Lanka Insurance Corporation.)
All above stocks are Blue Chips but if you study carefully you will find good midcap stocks too. Do your home work & invest wisely.No tags for this post.