PSSST . . . want to make money out of a stock market that has already risen more than 100 per cent this year? Buying against the tide is something for investors in the United States and Britain - where the slogan, ''Buy at three and sell at four'', became a satirical by-word for virginal city slickers amassing huge fortunes on the London stock exchange - but the beauty of such simplicity is that it can be transplanted to other markets too.
Of course, buying up the laggards at the year-end is not a sure-fire way to make a quick killing on the market. But neither is buying Wheelock & Co, which has leapt 239.91 per cent this year already, nor the prohibitively expensive $46,000 price tag which is the minimum cost of a slab of HSBC Holdings these days.
The key to this technique is sticking with big-cap, big name companies. Investing in a small stock which has excelled itself in terms of losses is not wise: these losses may reflect fundamental or balance sheet problems.
Therefore, model portfolios used will stay with Hang Seng Index constituent stocks, although clearly a trawl among the second and third liners this year will pull up a choice set of serious league laggards.
Analysts are somewhat sceptical about such a broad brush method.
Nomura Research International manager Nichols Pang said: ''Unless there are significant changes in fundamentals, I don't think this technique is really useful. But, of course, in the short term, if the spread between the laggards and the leaders is big, then the laggard may eventually gain a bit on the leader a bit.
''But it does not mean that the price-earnings ratio should necessarily be the same.'' Slightly more positive, Crosby Securities head of research Archie Hart conceded it was ''a reasonable idea''.
