After yesterday's announcement of being awarded the desalination plant in Tuas, Hyflux shares shoot up by more than 10% of closing price of $1.83 on Friday. If you have followed my blog, I hope you have bought the shares then.
However, you did not miss the boat. It's just that you will not be buying this share at a 10% to 15% discount. You can actually say that you will earn 20 cents per share lesser. Hyflux is still a good company for long term investment.
Lessons to be learned here.
1. We do not invest blindly. We do our homework before buying or selling the shares.
2. It is always good to grow our war chest with cash so that when there is an opportunity to buy, we have the money to buy. The opportunity does not come very often. News of Libya crisis has caused the price to drop more than 20%. This is the opportunity that I am talking about.
3. Knowing the value and growth prospect of the company is very important. It can help us buy an undervalued company anytime, or sell them when it becomes overvalued.
4. Do not hesitate, strike when the price is right.