When to buy... When to sell...

Determining "when to buy and when to sell" is one of the most popular things that come up in every investor's mind. Logically, we could be filthy rich and extremely prosper if we were right all the time on the exit and the entry point of the market. Lots of methods and formulas were developed in order to determine the right timing for entering and exiting the market. In this blog, we share the Elliott wave principle as our tool in determining the time to buy or the time to sell. Our main reason is to give an insight to investors in Indonesia Stock Market about the possible happening in the market. Hopefully that this free material can help investor in making profit although it was not completed by an information on "what to buy".

In Seruling Capital, we also developed a pricing model that gives us an overview about this exit and entry point based on fundamental data of the company's stock. This pricing model provides information on entry and exit point for individual stock. We use a discounted earning as the backbone of out pricing model that combine with some form of optimization formula. This far, the result is satisfying as we were able to determine the price range of SMGR, for example. According to our model, we should buy SMGR at 1830 and sell it at 4200. In the reality, the pricing for SMGR was 1825 in October 2008 and 4275 in January 2009.

Well, since we cannot publish our pricing model, we can only suggest all investor should do their homework in determining the reasonable price for one stock according to its value. This value can be found through the financial data, business prospect and the corporate governance of the company. Just give some times every three months in evaluating company's performance and watch out the bearish trend at current.

Keep your risk rewarding. Play safe!!

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