How do you plan to grow your nest egg ?? :)
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When I started investing, I knew how to pick stocks base on fundamentals and had no problem using all my available CPF funds for stock investment especially in depress times. Prior to this foray, I had been reading many books from successful investors and traders using different styles. With my FA knowledge and ability to manage my emotions, I was ready for Mr. Market.
Still many mistakes were made by me throughout my journey. I had my fair share of losses but these were not significant as back then, I had learnt to take minor losses before it turned bad. In short, I knew how to cut losses even at an earlier stage. On such occassions, the problems were not on timing but rather my assesment of ‘value’ was wrong!
To many traders and investors, their biggedt mistakes are due to wrong bets thus resulting in heavy losses. In my situation, it was fairlure to ride the winners due to:
1. Failure to understand that buying must be on the way up and selling on the way down.
2. Impatience-unable to sit tight.
3. Lack of self confidence due to inexperience
4. Poor technical analysis skills
5. Failure to understand the term "Institution Patronage"
My two biggest investing errors cab be summarised as follows:
1. GES International- An established contract mgfr.
On the day of its listing, I bought 100 lots at approx $0.31 as I was of
the opinion that at this price there was value to be found. My conviction
was further strengthen by the fact that our economy was just recovering and the general market was poised to move up. Not long after, NTUC Income came in as a substancial investor having bought from the open market at mean price of low 30plus cents. Following that, I liquaidated my position at small profits. To my surprise, the stock passed par and traded all the way above $3 driven by many instituition players.
2. HTL International- An established furniture Mgf
In 1999, after the Asian financial crisis, I had noticed this co its market cap was approx $48million. The co was then profitable with turnover in excess of $150million and nett profit of $7million. Dividends payout was 0.7cents/shr. The only setback was the co was experiencing negative cash flow as a results of fast expansion. I bought 70 lots using CPF funds and traded in and out with minor profits. Approx two years had past, the co was more transparent and occassionally gave shareholders update on their business thru SGX masnet. Immediately, I was on alert and started to accumulate up to 200 lots at price of $0.30 using CPF. Due to its success in Europe, the co started to expan its mgfr operations inChina as such, more funds were needed but the co did not ask for a right issue. Out came an instituitional investor, Morgan Stangley(if I recall correctly). the latter was willing to provide a loan of $20million in exchange for shares at 30plus cents. I still traded in and out and excited the stock at below $0.60. Eventually, the share price shot up to approx $1.4 before share split.
In all, I had left hundreds of thousands on the table due to my sheer ignorance. I knew how to pick stocks and was exactly right on the timing but the results were not impressive.
I began to learn and today, I am a wiser investor. -
minnie2004:
I also holding on to good-yielding stocks for my passive income. I don't really go for high-yield stocks as the dividend might not be sustainable.I adopt a more passive strategy with a majority of holdings in high-yield stocks, with some paper gold and commodity ETFs as a hedge for a hyper-inflation scenario.
Some of my criteria of good-yield stock are having a history of about 4% dividend yield & payout ratio of 40% to 60%.minnie2004:
Reits are also one of my favorite investment vehicles too. Imagine I am owning part of the properties (e.g those retail malls) without worry about liquidity and maintenance. Although one will argue that we can use leverage when buying propertiesReits are one of my favorite investment vehicles, although their yields are not as attractive as before. To me it's a hassel-free alternative to buying and managing physical properties. Also, we get to buy properties at a discount as many of them are still selling at a decent discount to NAV
But I am rather selective on this. I constantly looking out for their gearing ratio as this is one of the red flag if we are unaware. One thing I don't like is that some REITS will keep raising capital through private placement or asking money from uniholders for new acquisitions. Our holdings might be diluted. -
INNOVATE:
1. Failure to understand that buying must be on the way up and selling on the way down.
One must not forget that the long term is inevitable. It is regression to the mean all over again. -
i believe alot of people who invest in stocks dont look at long term and neglect the power of dollar cost averaging…
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Kingster
Your statement makes sense.
Easily more than 80% of players are traders than investors. Vast majority of traders fail to recognise that the road to be a successful one requires proper education/training in the areas of finance, economics, humanities, technical analysis and psychology. IN all, their standard must be like pro inorder to compete effectively. Mny times their opposites are highly trained including ther likes from ivy league, oxbridge and other top unis with seasoned mentors after their graduation.
For retail investors, the highest chance of a comfortable retirement is still thru equities. However, must be properly trained to survive in the market. -
INNOVATE:
Those Big Boys (institutional players) are the market. They graduated from the Ivy League, have IQ higher than anyone of us here, have access to information faster than us, have better tools where retailer investors don't have. What is the chances of beating them?Kingster
Your statement makes sense.
Easily more than 80% of players are traders than investors. Vast majority of traders fail to recognise that the road to be a successful one requires proper education/training in the areas of finance, economics, humanities, technical analysis and psychology. IN all, their standard must be like pro inorder to compete effectively. Mny times their opposites are highly trained including ther likes from ivy league, oxbridge and other top unis with seasoned mentors after their graduation.
For retail investors, the highest chance of a comfortable retirement is still thru equities. However, must be properly trained to survive in the market.
Maybe investing in index might be a better choice. Just ride the market with them -
daddy2007:
ya index is an \"easier\" way to invest but then, investing in STI will have to be more patient compared to other indexes like HSI and Nikkei.
Those Big Boys (institutional players) are the market. They graduated from the Ivy League, have IQ higher than anyone of us here, have access to information faster than us, have better tools where retailer investors don't have. What is the chances of beating them?INNOVATE:
Kingster
Your statement makes sense.
Easily more than 80% of players are traders than investors. Vast majority of traders fail to recognise that the road to be a successful one requires proper education/training in the areas of finance, economics, humanities, technical analysis and psychology. IN all, their standard must be like pro inorder to compete effectively. Mny times their opposites are highly trained including ther likes from ivy league, oxbridge and other top unis with seasoned mentors after their graduation.
For retail investors, the highest chance of a comfortable retirement is still thru equities. However, must be properly trained to survive in the market.
Maybe investing in index might be a better choice. Just ride the market with them -
kingster:
Should be ok if you have a 10-15 years horizon. Plus you get dividends of 2-3% yield annually.
ya index is an \"easier\" way to invest but then, investing in STI will have to be more patient compared to other indexes like HSI and Nikkei.
But personally I don't like passive investment. If one invest in STI from 1999 till 2010, the annualised return is 0%
One of the lessons that I learnt from the 2008/2009 crisis is to blend passive investment with active management. Know when to cut lost -
daddy2007:
Yes I agree with that. With the boom and bust cycles getting shorter and more erratic, a buy-and-hold strategy may not be so useful. It is better to adopt a buy-and-manage attitudes towards equity during these times. That means parents have to be more financial literate these days.
One of the lessons that I learnt from the 2008/2009 crisis is to blend passive investment with active management. Know when to cut lost
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ParentingChildren:
That means parents have to be more financial literate these days.
ya... glad that MoneySENSE Singapore is doing a good job for promoting awareness in this area
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