Noble Group stock advanced 2.2% to close the trading session of 5 Jun 2015 at $0.71. This advancement came after Noble Group stock has retreated continuously in stock price since early May 2015. The stock reached a low closing price of $0.695 on 4 Jun 2015 and reports I read mentioned that ever since Noble Group stock broke below its $0.825 level, the stock price has attracted “shortists” to “short” the stock to levels which the markets are seeing.
Personally, I am not vested in Noble Group stock though readers can recall that Noble Group was the first stock which I have bought and which has given me then a very impressive profit margin. Throughout my investing journey, I have also profited from Noble Group stock by trading in the stock and earning the trading profits. However after some time, I mean even before the release of reports by Muddy Waters and Iceberg Research, I have stopped being interested in Noble Group. And the subsequent movement of Noble Group stock price as well as the reports have proven me right in not keeping the stock as if I have done so, I would be “sitting on quite a large unrealized stock losses”.
So what is it which has stopped me from being interested in Noble Group stock? Well, to answer this question, I think I must first give my own take why I have earlier bought this stock and which I believe may be the reasons why some retail investors are interested in this stock. The main reason for the interest in Noble Group stock, is, as I believe due to the “pedigree label” of Noble Group being a blue-chip stock as it is one of the constituents of our STI, the benchmark for Singapore stocks markets. With its trading price being generally quite low as compared to its other STI counterparts and coupled with the fact that this stock has a high liquidity and often high price movement be it up or down, many investors may like to invest or to be more exact trade in the stock for like what I say, the “blue-chip” title gives the feeling that this stock is “safe investment” while the high “beta” of Noble Group stock gives investors the feeling that this stock can be a good trading play as well. Some more, Noble Group stock gives some dividends, albeit a little. Hence, combine all the aforementioned factors, Noble Group stock may be seem as a safe trading dividends stock.
Now, as to why I am no longer interested in Noble Group stock, well simply it is because I do not really understand fully the business of Noble Group, I mean in details. Having read through the annual reports of Noble Group stock, I think the reports are too complex for me to understand. Warren Buffet has also mentioned that one must invest in a business that one can fully understand.
Don’t get me wrong, this blog post is not mean to discourage you from investing or trading in Noble Group stock, the above is just my sharing. At its current low price, Noble Group stock may still head north in stock price, bought by its supporters or the stock could still be sold further south.
As for me, I am currently looking at the many other fundamentally good dividend Singapore stocks trading at such attractive valuation with easily-understood business models.
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