Before discuss the topic first of all let us discuss what stock picks is
Stock pick – When an analyst utilizes a systematic form of analysis for concluding that a specific stock which will make good investment. Thus it should be added to her/his portfolio is called as active management. The position may be long or short which will depend upon the outlook of investors for the particular stock’s price.
Stock picking – It is very difficult procedure due to it has not a perfect way for determining a price of stocks in the future. There are some observing factors in which an investor can be able to get a better sense of stock prices in future. When an investor uses any forecasting technique then it should include a margin of error in the calculations as forecasting is not an exact science.
Team of investors is utilizing by a stock picking which can pick stocks for investment. Exchange Traded Fund (ETF), active management, and mutual funds or separate accounts can use top-down or bottom-up strategy to pick stocks. Generally company offers a high conviction fund that includes a few stocks in which aninvestor picked for their best performance bets in future. High conviction funds hold 20 to 40 stocks which is so less in number than the average actively manage fund and certainly a less number than a fund which tracks an index.
Stock picking can be dissimilar as compared with the passive management in which neither teams nor group of investors picks individual stocks. The analyst buy a passively controlled mutual fund or Exchange Traded Fund will be automatically be invested in the underlying basket of stocks which mutual fund or ETF invests. Usually baskets of these stocks are based on an index such as the S&P 500 Index.
There are some KLSE stock picks of 2020 which are discussed below –
- MBM Resources Berhad – This Company is engaged with the business of Motor Trading with the dealership and distribution of several foreign transports and automotive manufacturing. It is quite undervalued stock with good future prospects.
- GDB Holdings Bhd – Primarily the company is involved in the provision of services of construction, mixed development projects and focusing on commercial. It offers an attractive dividend yield of 6.78 percent. There has also been considerable growth in the benefit or net profit of the company between the year 2014 and 2018.
- AmanahRaya REIT – It is a good KLSE stock picks when users looking or searching for an investment with a diversified property portfolio and high dividend yield. The stock provides return of investment o about 17.29 percent with a dividend yield of 10.51 percent. In the past years, the operating profit of the company has also shown improvements.
- Poh Huat Resources Holdings Berhad – The manufacturing office of the company and furniture in home which is a leading brand in exporting of furniture in Southeast Asia. The country exports furniture to several foreign countries such as India, Southeast Asia, America, and the United Kingdom. Good growth of this company due to the trade war between United States and China. The importers of United States may turn away from the products of China which presents better future opportunities for the company and the company also provides a dividend yield about 4.43% and is predictable to grow in the future years.
- Focus Lumber Berhad – It is engaged in the sale and the manufacturing of the veneer, laminated lumber and plywood and has a subsidiary which is engaged in the sale and generation of electricity. The company has a dividend yield of about 10.51 percent and the net profit has considerably improved in the earlier years. But Investor should take nearly 45 percent of the company’s revenue from a single consumer. Import Co and Ihlo Sales and the remaining revenue are derived from the US market.
It is important to note that the stock market moves in cycles from low to high. Now several stocks are reasonably under rate but it can gain momentum and reach a certain good price providing good returns in KLSE Market. Now it is important for investors that closely watch the stock market before investing and then decide to invest in the stock market.