Sunday, 30 October 2011

My story -Typical know nothing to know a little thing investor

When I first started work in June 2008, I listen to my friend aka financial adviser and bought ILP because I just started work and I know that I need investments and protection but I was total noob in finance. (This ILP still haunt me today. Pls see: Best Bargain: Must buy: ILP)

Then I read up more and think that investing by myself is better. (Rich dad Poor Dad changed my mind. Previously, I hated anything to do with finance.) Hence, I bought unit trust in March 2009. I tried different kind of funds including method such as RSP.

I was lucky as March 2009 was market bottom and sold them in Oct 2009 for a bit of profit when I realised that I am actually feeding my profits as annual expense to the rich fund manager. Then I switched to stock.

In Oct 2009, I don't know anything about TA and FA. I listen to radio, see tv, see CNA market forum, see news etc and whacked my first stock golden agriculture at 0.45. In the next few days, the price drop to 0.42 and I felt worried and kan jiong. In the next few days it went back up to 0.46 and I sold it for low $xx profits as my emotion cannot take it.

Since then I started to buy and sell many stocks, but only dare to hold for a few days to few weeks because I do not have any plans or method. I have no confidence in my buy and easily panic as it is my hard earned money. In addition, I am easily influence by the media. The worst investment which I made during that period was blinding following BB Peter Lim, that mistake is still haunting my portfolio.

Since then till today I keep reading up books on FA and TA, learning all the methods which I could in stock investing. Somehow when I go through financial blogs, I discover LP's cbox and started to chat and learn from the people there.

I thought I had already learn many methods in investing such that it will make me a better investor. However, my performance is not good at all. I tend to buy and sell quite fast. I also tried forex but loss badly and read up on warrants but luckily did not tried that. I also wanted to try CFD, I got the account form but end up I never sign up.

Slowly slowly I realised that knowing the methods - TA and FA is not enough and in fact there is no holy grail in the methods. No matter how well verse you are in TA and FA, there is no way which you could predict the market movement.  Hence I started to give up listening to all these noises.

I learnt that I need to manage my portfolio well and do asset allocation. This directly and indirectly link to the emotion in my mind. I learnt and know that how much money I should and can put in each individual stock such that I will not panic when the market drop heavily. I learnt that I should and can only do average in but not average down. I learnt and know that when Mr Market is in panic, I should not panic. Instead, I should start whacking some good stocks slowly according to my asset allocation plan. When Mr Market too optimistic, I know I should start selling and should not have seller remorse.

Overall, now I know that I need to have a strategy. A carefully planned strategy such that I will have asset allocation according to my risk level and what I will do if market goes up and what I will do if market goes down. There is no point to predict market movement. The so called gurus also made so much mistakes, how can a layman like me do prediction? Nowaday, I started to buy slowly and sell slowly. Although it is hard, I force myself to stick to the rules which had planned.

However, I still have 2 past mistakes which is still haunting my portfolio. The school fees incurred in this process of learning is painful. Hopefully, Mr Market will give me a chance to repent.

I hope I am on the right track and I think my XIRR will tell me how I fare in future. All the best to me!

Lastly, thanks to all those had gave me guidance and I will continue to learn as much as I could so that I can improve! Thank you!

Thursday, 27 October 2011

So bullish on 27th Oct 2011?

Repenting or?

Are you repenting?


Wednesday, 26 October 2011

Food for thought: Why TA seems to work for many people?

It work because many believe in it.

Self fulfilling prophecy

Wednesday, 19 October 2011

why next time?

Long long ago there was a very lazy man, X. He wanted to spend the minimum amount of time in working and just work the bare minimum such that his boss had no reason to sack him. Typically, he worked from 9 to 5 everyday and went fishing or sit by the seasides to enjoy the beautiful scenery everyday after work. He just wanted a decent amount of pay such that he could pay off all of his necessary expenditure with little or no surplus every month.

There was another man, Y who is same age as X.  However, he is totally opposite of X. He is a high flyer in a company, currently holding director position in a company. He spent enormous effort to work hard and work smart in office to please his boss. Typically, he worked from 8 and overtime till 11pm everyday. He want to work hard to get promotion and earn tons of money.

X and Y are secondary school friends and did not see each other often. 

One day, Y past by X when Y is on way to meet his client at 8pm while X is fishing by the seaside, enjoying his life.

Y: Hi X, why are you here again? I think I saw you many times around this time when I am rushing to meet my client.

X: I am fishing and I go fishing everyday after work. Sometimes I just sit by the seaside and enjoy the scenery.

Y: I heard that you are still doing that low paying job after so many years. Why aren't you striving hard to earn more instead of wasting your time fishing everyday? Don't you want to buy big cars, own big houses, with lots of cash and investments so that you can retire without any worry in future when you are old? Look at me, I worked so hard everyday, trying to earn a lot so that I can have lots of money. Next time, I can buy a house by the seaside and enjoy the beautiful scenery when I retire.

Guess what X reply?

X: Why wait till retire? I am already enjoying the seaside scenery everyday.

Monday, 3 October 2011

Could sell and buy back cheaper later

Very often, you would heard someone said "Could sell and buy back cheaper later".

Sometimes, someone may also said "If I should have sold it at at x price, and buy back at x-0.5 price. Then I would gain xxx instead of lose yyy."

However, this is all based on hindsight.

Irony is, how many times did the share went up further after you sold? How many times did the share crash after you decide to hold it and think it would go up further? How many times did share you bought drop more just after you just bought it?

If it is so easy to predict the up and down of the market, all of us would be billionaires and don't need to work right?

If you are so zhun, can you please predict and tell me when the market will crash and at which date will it rebound back?

If you are so zhun, can you please predict and tell me if the market will U-turn given the current bad economic conditions?

One classic advice:

Slowly buy, slowly sell. You can never sell at the exact top or buy at the exact bottom - always buy and sell in stages. (The top tick of a rally is the most expensive tick inthe market - fortunes have been lost hunting for it.)

Saturday, 1 October 2011

LMIR issue 1 for 1 right.

- 1-for-1 rights issue at S$0.31 per rights unit represents a discount of 42.6% to
the closing price of S$0.54 per unit
- Rights issue to raise gross proceeds of approximately S$337 million
- Proceeds raised to partially fund the acquisitions of Pluit Village in Jakarta
and Plaza Medan Fair in Medan, two strategically located quality retail assets
with attractive net property income yields
- Acquisitions enlarge LMIR Trust’s portfolio to 10 retail malls and 7 retail
spaces, valued at approximately S$1.46 billion

Pluit Village, a five-level retail mall located in Jakarta, Indonesia is to be acquired
from entities linked to the Sponsor of LMIR Trust, PT Lippo Karawaci Tbk,
for S$234 million1 and Plaza Medan Fair, a four-level retail mall
located in Medan, Indonesia, from Asiana Investment Limited, an unrelated third
party, for S$154 million1. The purchase considerations represent a 5.7% discount
to the average valuation for Pluit Village and a discount of 4.1% to the valuation
of Plaza Medan Fair.

To partially fund these acquisitions, the Manager has proposed a one-for-one
renounceable rights issue (“rights issue”) of 1,086,516,497 new units in LMIR
Trust at the issue price of S$0.31, representing a 42.6% discount to the closing
price of S$0.54 on September 30, 2011. This rights issue is expected to raise
gross proceeds of approximately S$337 million1. The balance of the purchase
consideration will be drawn from the S$150 million 30-month term loan (secured
on September 28, 2011) as well as internal cash.

388m - 337m = 51m. (51 m will comes from cash or the 150m loan facility drawn recently)

Current it has 110m cash + recently drawn out 200m on 28th sept (the 200m will be use to finance 125 debt + future acquisition).

Asset will grow to around 1.4b. gearing will be less than <10% now.

The problem now is: Are these 2 new properties good?