Saturday, 18 November 2017

What is keeping you going in your work?

    1. Money?

    2. Sense of Purpose (aka 使命感)?

    For pondering.






    [I made an update to my previous post on Money Management for your reading pleasure.]

    Sunday, 12 November 2017

    Money Management plus Method - I

    My general guide for assets allocation in equity relative to STI:

    ST index Tier% Equity holding %
    above 3600 90 <10 td="">
    3400 85 15
    3200 80 20
    3000 75 25
    2800 70 30
    2600 60 40
    2400 50 50
    2200 40 60
    2000 30 70
    1800 20 80
    below1600 10

    (We can use in conjunction with TA rather than blindly catching falling knife.)

    -----------------------

    Methods of Asset Allocation:

    1. Strategic asset allocation calls for setting target allocations and then periodically rebalancing the portfolio back to those targets as investment returns skew the original asset allocation percentages. The concept is akin to a "buy and hold" strategy, rather than an active trading approach.
    2. Tactical asset allocation (TAA) is a dynamic investment strategy that actively adjusts a portfolio's asset allocation. The goal of a TAA strategy is to improve the risk-adjusted returns of passive management investing. 
    There are more, if you are interested... read more here https://www.investopedia.com/articles/stocks/07/allocate_assets.asp
    or get your hands on 'The little book that saves your assets' by David M. Darst.

    ***

    Book review: High returns from Low risk

    Image result for high returns from low risk


    Learning points from this book:
    • In the long-run (the author used data of US traded stocks over 86 years), low-volatility stocks are shown to give a higher return.
    • Comparing portfolios of varying volatility - as volatility increased from 13% to about 20%, compounded return increased. As the volatility increased further beyond 25%, compounded return declined.
    • How to select the right low-volatility stocks? Look at
      • Beta less than 1
      • the stock's income yield and
      • momentum (price trend)
    • People who underreact to news when it comes in gradually run the risk of being 'boiled' (boiling frog syndrome).
    • The selection of low-volatility stocks can be applied to other investment vehicles as well e.g bonds. 
    • Hold if the above three points still hold true while reviewing your portfolio.

    ***

    A fairly simple to read book, with simple concepts and no 'cheem' investment theories. The back chapters talked about some zen which I fell asleep reading.

    Thursday, 19 October 2017

    C52 Comfort Delgro - downtrend continues

    Start of downtrend

    Still no sign of reversal...



    Speaking those who buy-and-hold versus those who chased the market. 
    Who's the winner?


    Ah... the good ol' days.


    *Disclaimer: I have no vested interest in C52 currently.

    Wednesday, 18 October 2017

    Richdad's cashflow game

    My friend introduced me to the richdad's cashflow game which can be played online for free (click here to play). I think it's a great beginner learning tool to introduce kids (or anyone else lacking in financial literacy) to grasp certain concepts of cash-flow and investing.


    Takeaways from the game


    1. Clear your debts first

    2. You don't have to act on every opportunity

    3. Calculate the yield % on investments that give passive income before investing

    4. Investing needs both elements of skill and luck

    5. Buy low, sell high (patience, patience... duh)

    6. More money = more investment opportunities = higher returns

    7. Life likes to throw you the unexpected when you least expect it

    8. Even if you have achieved financial freedom, you might not necessarily get to achieve your dream

    ***
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