Yes after this past 2 days of selling off while the market is very bullish, I have hit the 2nd investment target. 3 more targets left, 20k, 25k, 30k and beyond. Like to keep a beyond target cos calculating $30k annual income, seems to be a bit low.
I have been keeping track of my expenses so far. Each month, if practice even more thrift eg eat at home more instead of going out, without insurance payments etc, can lower to $1k, extreme thrift. But that is not a good standard of living. Then easily each year more than $17k. So $30k can at most keep for 2 years of living. Hmm... why is Singapore such an expensive place to live in? Think Msia can last even longer but that is another story...
_____________________________________________
Currently in my SG cash portfolio, which I have been actively trading compared to Msia cash portfolio - more medium term, CPF portfolio - long term. I am left with stocks from only 3 counters. Previously I have up to a max of over 9 counters. Been selling off to lock in gains.
Yar I sold off my Capital Land shares, when share prices bounced up after XD today. Though it has closed higher than my selling price in the morning, I have netted gains plus dividend. Think that is good enough for an 8 day old investment, the returns if annualize could be much higher than my current 18% returns. I do wished I had more time to buy more shares when it started felling about 2 weeks back. This strong rebound caught many off-guard. Havent finished buying back those that had fallen before the action begins. But this scenario compared to the previous, where I ran out of capital when the market fell even lower, is more pleasant. It just meant waiting at the side-lines. I am not completely out of the market but I am looking for more opportunities to buy now.
_____________________________________________
Yesterday, in the wee hours of the night, I was reading the Money Management Chapter of the TA book. It mentioned some basic rules which can be modified depending on risk appettite. I shall mention a few interesting points.
The first is a rule that only 50% of investment funds to be invested. The other 50% is for contigency or even further falls (or my I-ran-out-of-capital-when-everything-is-so-cheap dilemma) Yar that I learnt the hard way. I found through actual investment that I am a actually a moderate-to-high risk taker. As I've mentioned, I take calculated risk. Hence for further investment, I shall set that amount to about 60-65% invested. 30-35% reserve.
The second is that a maximum of 15% of the funds actually invested is in a market/counter. Eg Capital Land. Why? Cos if it was losing money, you still have other counters. Something about the idea of diversification.
The third point relates to the 2nd point about diversification. It mentions that funds invested shouldnt try to spread beyond 4-6 counters. The reason given was that the Volume effect is not achieved if spread too thinly over too many counters unless with deep capital levels. As mentioned, as long as the counters are in DIFFERENT MARKETS, then diversification is more or less achieved. On this point, I beg to differ. In my portfolio, in fact there are many counters in Property. I did write earlier that my investment philosophy is about the Property, the value of commercial land, retail land, residential developer, hotels etc. So this directs that search of good counters in this area. Hence my stock selection are somewhat in the same property areas. They diff in the type of property dealt with and also the position in the supply chain of property.
The 4th point is the age old financial maxim "Let profits run and cut the losses". This is seriously easier said than done. Those who have actually invested knows that when prices are going up, one would keep asking whether its the right time to sell or not? What if tom, prices head even higher, should I wait? Some would also ask it I should buy into this rising market and then reap higher prices? Then when prices are falling, one would keep asking, whether its the right time to buy? Or wait for tomorrow which may be lower? Or should I sell off my losing position and cut losses? Seriously I really dont know, its very very subjective and depends on your investment target for that stock, your perspective of the market, your risk appettite.
The last and most important "Learn to be comfortable being in the minority. If you are right on the market, many people will disagree with you". THIS has so much profound meaning. Because the mass market is usually wrong, that is why not the average person gains in the market. So if the mass is bullish eg buying, a smart investor would be bearish and adopt an opposite strategy eg sell. There is another whole school of thought about this contary strategy called Contarians. I just go the way which can nett me gains.
And "Try to ignore conventional wisdom ie dont take anything said in the media too seriously". SOOOO very true indeed. Cos if the mass listens to the media, whom analysts makes predictions and recommendations, and they follow, yet not everyone is millionaire, it just means that, that information is flawed.
I have asked my Dad regarding analyst, cos he had invested in the stock market for 20 years, I told him how many predicted STI and Dow to fall even below the historic low hit this year. But now market showing strength, does that mean such talks should be completely ignored? He advised that one would have to sieve through the analysis and find the good analysts and follow those. Okay, so far I have none.
Havent exactly been reading the newspapers or analyst's report. My current strategy is still more based on Price monitoring upgraded with MA, reading of Annual reports, SGX announcements etc.
_____________________________________________
Its not yet mid-May, I shall continue to look out for opportunities cos my captial are being 'released' back from all these sales. Left with few counters. PLUS that PENNY-STOCK-STRATEGY failed cos that penny stock price also flew higher. Signz there goes my short-term multiplier gamble.
As I continue to monitor the stock market, at the back is my mind is this target of "earning next year's income so that I can rest with a peace of mind". Its only just the start of May, I am on track. Hope for more UPS and DOWNS so that can benefit from the cycles.
Happy Happy HB =)
No comments:
Post a Comment