We have seen from the last three chapters how manic the stock markets of the world can be and that the Malaysia/Singapore market is particularly so.’ Worse than being merely manic, the Malaysia/ Singapore market is very unpredictable—it can collapse in the midst of prosperity just as it can zoom upwards in the midst of recession. As if such problems are not enough, the Malaysia/Singapore market can be characterized by being one which is subjected to manipulations. The small investors can lose a very large percentage of their capital if they invest blindly.
On the other hand, if the small investors can pick correct stocks at the correct time , they can make a great deal of money . Good stock selection and timing works well in any stock market, whether it is American, British or Malaysian. However, as we shall see later in this book, good stock selection usually requires careful and meticulous work. Some of the masters of the art take more time while others take less but they all have to work at it consistently. The amount of work they need to put in would depend on how gifted they are. If one is as gifted as Lord Keynes, half an hour a day suffices while even the great Warren Buffet (generally regarded as the greatest stockpicker of this generation) works on it on a full-time basis.
To be certain, readers are very interested in buying shares as an investment. However, many of you do not have the time or inclination to spend a few hours on it every day. Even if you have the time and inclination, Some of you may not have the necessary training to read company or economic reports and understand what has been written. It would be much easier for many of us if we can just pick up newspapers or magazines and follow their advice and recommendations. Nowadays, stock market investment has become a very popular topic. Almost all newspapers have a columnist or two writing on business or stock market affairs.
In addition, there are business magazines like Malaysian Business or Shang Hai which also carry regular features on the stock market and individual companies. In this section of the book, an attempt is made to analyse the record of the professionals of the field as well as other writers with regard to their recommendations and comments on stock investment. Last Chapter takes a look at the views and recommendations of local experts regarding the economy and the stock market just before and after the three previous stock market crashes (1981, 1984 and 1987). Next Chapter casts its net wider and examines the record of stock market professionals in the US. Next Chapter will explains why these experts are so prone to making serious errors of judgement. At the end of this analysis, we may be able to draw some interesting conclusions regarding the usefulness of relying upon professional advice.