This is the latest stocks update from brother Bo. The new SAM table shows that the target price for SMPH was increased from 16 to 16.65 and its “buy below” price is adjusted to 14.48. This allows us space to buy shares of this company from its closing price of 13.8 per share last Friday.
From his message below, bother Bo discusses that in investing, there is always risk. I also believe that “not investing is more risky” because inflation eats our money and slowly evaporates in the bank. This is guaranteed year after year. In SAM, this risk is minimized by investing only in giant companies.
The other day, a very concerned friend talked to me, “Brother Bo, can I ask you something? It’s rather serious.”
“Sure,” I said.
“I’m really scared for you….”
“How come?” I asked.
“Aren’t you worried when you suggest to your members what companies to buy in the stock market?”
“Well, what if one of your recommendations turn out to be a flop? And your faithful followers lose their money. Then they’ll get angry at you and blame you for their losses. Because you’re a preacher and spiritual leader, won’t that affect your reputation?”
I smiled. “Thanks for your concern. I’ve thought about it a lot, actually. I’ve counted the cost.
I’ve long accepted the fact that in life, there’s always risk—no matter how small. Waking up in the morning is a risk. Walking out the door is a risk. Even inhaling oxygen is a risk. In this world, there is no such thing as zero risk. If a person won’t take risks, he’ll remain stagnant. We can’t erase risks but we can MINIMIZE them. And I minimize it by recommending only gigantic companies and never penny stocks. I also recommend that people invest in many gigantic companies—about 5 to 10—so that even if one fails, they’ll be okay. Finally, we don’t trade but invest, using an investment program called SAM or Strategic Averaging Method.”
“Fair enough,” my friend said. “So you’re betting your reputation that these stocks will grow?”
“My members’ welfare is more important than my reputation. I’m taking this risk because I want to help people build a retirement fund for their future. So that they grow old rich, not poor. I’ve long realized that if I don’t recommend specific stocksto my members, they won’t buy. They’ll freeze. And that will be a greater disaster—because people will grow old poor.”
“So you’re really convinced that your recommended stocks will go up in the next 20 years?”
“Yes, I do. But by your question, I realize that you still don’t get SAM. Here’s the fantastic thing about SAM… Even if the stocks don’t go up in the next 20 years, but just go bounce up and down—if my members invest EVERY MONTH during those 20 years—they’ll still earn.”
“Okay Bo. I get you. Where do I sign up for your TrulyRichClub?”
“Not so fast,” I grinned. “I have a very important question for you. Will you get angry at me if one of my recommended stocks turns out to be a flop?”
He laughed. “I guess there are things beyond your control…”
“Just like you, my TrulyRichClub members are intelligent people. They know that. They know I can’t guarantee that 100 percent of my recommendations will do spectacularly well in 20 years. But the chances are exceedingly high that MOST of my recommended stocks will make them wealthy.”
After talking with him, I realized I didn’t mention a very important point to him on why I believe our risks are small: In the last 12 months, only seven out of 47 national stock markets around the world have posted gains.
That’s how bad the global economy is. But out of those seven stock markets, the Philippine Stock Market is number 1.
We’re the best performing stock market in the world today. Can you believe that? The momentum is on our side. We’re experiencing a “high tide” here—and as you know—a high tide lifts all boats (great companies).
So keep investing, my friend.
May your dreams come true,