Thursday, July 16, 2015

Random thoughts: A reality check

I am a believer that i cannot time the market. I still believe in that. 

My portfolio is now half of what it used to be. And my bonuses has gone into boasting my emergency fund.

Strange just last December I am busy using my EY bonuses to buy various counters.

I took a hard look at myself and realized that since I only have "significant" savings  during my bonuses months, I should be really prudent in my use of ammo. 

Just 6 months ago, I wanted very much to increase my portfolio size and increase cash flow from my portfolio (dividends$

Now, I just wanted a warchest for a plain 5-10 % correction and a insurance for a simple 20% bear. 

It is also easier now. When some counters (yangzijiang and singapore shipping ) do perform better after I sold them, I realize that discomfort is very much easier to bear as compare to the very nagging question of how much higher can market go? 

I did ask my wife to start buying M1 and Ascendas hospitality recently. I am private wealth manager now. Unlike LP who really manage the money. I offer my mouth, advice only, and it will be followed. But my commission is only a treat of a good meal when profit taking materialized lol. Glad I had 2-3 such meals so far LOL.

I crave for savings more than dividends now.

Also, while I am still prospecting for companies, very often, I will come
To this question, compare with A or B that I am looking at... Er... Then I cannot bring myself to dig deeper. 

Also, I have come to terms that my analysis of companies is rather short sighted. 

I look at the AR, surf the net and try to project their earnings base on their business, while I have more hits than misses, I realized these projections usually cannot go further than 2-3 years and there are just too much missing info.  

Products demand changes and market cyclicals will tilt the earning power, I figure out I am better off just looking at track records of management and buy at the low or in general market low sentiments rather than predict what is the killer product. 

I might still try my hands on some fairly valued counters or activate my "wealth  manager" status to nimble. But I have to be patient and wait for a better price. 

If size matters, my human capital is really my job, not my portfolio.


  1. Hi SI,

    I agree. I realised a while ago that my expertise and passion is in my job, not the stock market. By putting 100% into my job, I can get back 100% returns, but the same can't be said for the stock market. I may put in 100%, but may only get back 20 or 30% because I'm not as good as I think I am. Hence, my strategy is to put more into my work, save more - these are the things that I can control. Then once I have a size, I just need to whack some real safe counter, or even STI, during the bear market and hope for the best.

    That keeps things a lot a lot simpler for me.

    1. Hi LP,

      I can't say I put in 100% and I get back 100% in my job. There is no high correlation between time, effort and money in the short run.

      In the longer run, the promotion which I wanted so badly just 2 years ago turn up to be a energy sapping for me...

      Respect for all my seniors who have been doing it for years...

      But PSLE coming, kinda of worried for my kids. Really good people, but might not have the "strength" to last the whole paper.

      The parts are all get better, the vocab., the compre, etc, put them together, they see Stars...

      Hope I have enough time to condition them

  2. Hi SI n LP

    True is true that hard work gets rewarded. U work hard get promoted then pay goes up. But work gets more. Stress perhaps more too.
    100% into job gets 100% returns.
    but qn is how long can this last? Another 10yrs 20yrs.
    what happens after that?
    I gone thru this process too.
    Used to work 18hr days when i 15yrs ago. Work equals get money.
    but i asked myself i want to do this for the next 20yrs? (I was 25 then), or rather can i tahan this breakneck work pace for the next 20yrs.
    I decided that surely there must be a way.
    but they are risky arent they?
    If hard earned money ended up risked..n gone how?
    In a long process which took me the next 5yrs..of dual working n discovering how this investm thingy works..
    the simple conclusion baffles me..

    Look at dividend history. Keep on adding. Rebalance portfolio regularly.

    Slow is fast. Fast is slow.


    1. Hi Paul,

      I agree with investing as we work.

      Investing is really boring ...

      If we work investing to provide a passive income so that we need not work at a rather early age, we must really decide on a lifestyle that allow size to build up.

      That is the crux of matter rather than method. Ak is successful as much due to his frugality rather as his investment acumen. For employee like us. It is a path that is simple but tougher than learning to invest

  3. Hi Paul,

    Fully agree...there'll be a point in time that even if we want to work, we also can't. There's why this work process is just a start. You need to break from it and invest the savings. But have you seen many young people who just wanted nothing but passive income? They do not have the capital yet but all they dream of is to work less and get more passive income. Not necessarily bad, but I think to have passive income, you really need to spend the first part of the cycle earning your capital. There's where work comes in. Can't skip this step, unless you have strong mountain behind you ;)

    1. Paul,

      The problem of slogging it out is as we "age" we are not as energetic and fast as before.

  4. Hi sillyinvestor,

    When people start reading financial blogs or even start writing financial blogs, they all want to become like AK. Receiving $10,000 of passive income every month. But almost everybody forgets that he spent the best of 10 or even 20 years accumulating that stash slowly.

    When we are starting out, investing is at best an interesting "part-time" job.

    1. Hi 15HWW,

      AK is a good example for those who similar circumstances with him or able to get to be frugal.

      Frugality is the strongest virtue, and investment simply is the by product of this.

      Without frugality and hard work for the first 10-20 years. We cannot achieve what he acheive ...

      I do understand it is not easy to frugal when after a week of tough slogging ... I always give in to craving of food...

      Like that say, u only know what u are make of when in hot water. I cannot chase the last dollar to save every single cent, and hence have to accept I will take longer to reach lesser.

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