Wednesday, September 25, 2013

Holistic investing

I am not sure if there is such a term call holistic investing. I believe such a concept is not new, but can't remember the actual term. Anyway:

When we talk about investing, many would think about stock selection, diversification, asset allocation etc. I think to be even more holistic, one should look at the profile of oneself too.

for example, if I hold a stable job, and I know I can set aside money every month or year for investment. My approach will be different from that someone that has a fix amount of money, or that we know our future income is going to drop or be volatile.

For me, I would not touch my CPF money for investment unless we are in a ultra bear market( more than 50% drop), those money will be like bond investment and is suit for the purpose of accumulation of fund for retirement. So I will not invest in bonds for the same of diversifying.

given the stability of my job, I dun need a very hugh war best, as my income for investment will increase every year. This is not to say we should be trigger happy, but perhaps I don't need a warchest as big as perhaps 50% of my investment income.

also, I have already have my insurance needs covered for me and my family, so I can invest with  a peace of mind

2 comments:

  1. Hi Mike,

    My CPF-OA and SRS money form my war chests 2 and 3 only to be utilised in the next bear market. :D

    Holistic investing is about diversifying across asset classes too. Not everyone can do this. For example, people talk about the permanent portfolio and also precious metals and properties. Oh, dear. I need to use some Tiger Balm liniment. Headache.

    I like to keep things simple. I am a lazy guy. :)

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  2. AK,
    Your comment made my blush. When I finished this post, and search for an image using "holistic investment", then I realised there is a book written on it. I am too lazy to change my blog then. Haha u are right, different asset classes and different geographies are important

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