Saturday, 24 April 2010

Invest in one that grows!

This is where fundamental analysis comes into play. Investing in a stock (company) that grows is probably more important than one that gives out high % dividend (but does not earn much profit).

On the other hand, there's an article saying that companies that give good dividend yield are generally less volatile than those that don't because fund managers in times of bad market would rather sell off the shares of the company that give less dividend before the one that do if both trades at the same price.

See this article.

Now the difficulty lies in spotting the good 'chicken' to lay your golden eggs.

In choosing the golden chicken, here's some pointers picked up from What To Look for In Dividend Stocks for an Income Investing Portfolio:

- The company should have 3 consecutive years of positive margin.

- Companies that earn a profit can do one of three things: pay that profit out to shareholders, reinvest it in the business through expansion, debt reduction or share repurchases, or both. The company should pay out 50% or less of profit as dividend to use the rest in business growth.

Note that the percentage of net income that is paid out in the form of dividend is known as the dividend payout ratio. This ratio is important in projecting the growth of company because its inverse, the retention ratio, can help project a company’s growth.

- Dividend yield 3-6%. Dividends are dependent upon cash flow, not reported earnings.

- High ROE with little or no corporate debt.

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Friday, 23 April 2010

Pros and cons to singlehood

Pros:
1) FREEDOM
3) Money spent to yourself
4) No family burden

Con
1) Lonely on Vday --> envy of couples?
2) No cosy shoulders to lean on
3) No romantic surprises

Ok singlehood doesn't seemed that bad afterall... No matter which it is, most importantly is still to cherish what you have got at the moment and be happy. From the many failed marriage that I have heard and seen, it seemed that even when you are not single you may not necessary get that supporting shoulder and all that so-called romance.

I have a friend who once said that marriage is like an investment. That was a guy friend so he is speaking in terms of taking a wife. Maybe the modern generation are starting to manage relationship like an investment, so when it does not seem to be paying off then they would break-up / divorce. So when you have multiple relationships, it means 'portfolio diversification'? I think throwing in emotions is definitely not as easy as throwing in money... unless it is not true emotions you are investing.

At the end of the day it not about how well you get along with your other half but the mean of getting along with him/her. Of course both should also shares the same trust, passion, commitment and chemistry. Talking about relationship between opposite genders, John Gray's book have been very enlightening. A worthy read.

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Wednesday, 21 April 2010

Cash flow quadrant



I came across this quadrant from Wealth Buch's blog. The simplest being E, which is the one that I am in now. Hardest being B i think. S would be something like taking up a tuition job or being a hawker... I is what i aimed to be in my free time haha.

STI went below it's break point of 3000, probably due to the volcanic hit. MIIF just dropped below 0.50, if it dropped to 0.47 or less i will take in some lots. It is currently slightly below previous support lvl. Stoch at its lowest, RSI weak.

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Friday, 2 April 2010

Scrutinizing SG stock market

I have been lazy for the past year. Investing has always been on my mind but I am too lazy to get an account, and didn't bother to do any research nor studying... that is why I am lamenting every time I see a new peak in STI... I think I always 'man ren yi pai'. haiz.

Just started going into TA for the past few days. Wasn't as difficult as I thought. In fact it seemed quite interesting. Stoch, RSI, MFI, MA, Bollinger bands, SAR blah blah... tools that I never thought of using previously. I have been just stupidly looking at volume which is not that informative, it's just like looking at the tip of an iceberg. I still need to learn more about support and resistant and how to pin-point them.

I predict that current STI will continue to climb to hit above 3000. In '07 it almost hit 4000. Now it's still a time of fluctuations.

About parabolic SAR
The parabolic SAR is a fairly good tool for traders looking for a strategic method of gauging a stock's direction or for portioning a stop-loss order. This indicator proves to be extremely valuable in trending environments, but it can often lead to many false signals during periods of consolidation. This indicator is simple to implement into any strategy, but like all indicators, it is usually best if it is used in conjunction with other indicators to ensure that all information is being considered.

Another good tool for trending is Bollinger bands. It's said to tighten before a big move. Tight bands mean low volatility, vice versa. It also gives info on whether a stock is overbought or oversold (also seen with RSI) if plotted with a middle line of MAd20. However it does not predict the direction of movement.

Ref: Investopedia.com

What I am reading now:
Handbook for Stock Investors by Goh Kheng Chuan

Start of working life

Looking back at my 9 mths of training now seems like a flashback. There are times of pain (from long hours of standing and walking), stress (when we need to meet documents and project deadlines), joy (when my group won the project presentation and how i survived delivering it in the auditorium first time wearing a blazer), and last but not least the rapport built with my preceptors and fellow trainees.

Now that I have started work (been almost a year counting), it is very different. Like a load lifted off my shoulder, even though there are still small loads thrown to me along the way. Very much learning is dependent on self, nobody to push me at the back. Work everyday is very routine, except when i get rostered to work overtime elsewhere. Not too bad for now considering the current benefits and pay. I can foresee myself staying on and looking for opportunities to develop in the co for the next 2 years. My work scope may not be very much of my interest but it may be close if I trying viewing it in a different perspective.


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