Author Archive

Posted on August 24, 2010 - by Createwealth8888

High Dividend Yield Stocks? – Part 8

Read older post on? High Dividend Yield Stocks? – Part 7

I believe all investors will love high dividend yield unless you are a day trader who don’t really need to care on dividend.

Imagine a high dividend yield bandwagon is rolling past you. A few people on the back of the wagon are partying and playing music of their lives and singing the song of high yield. You may be unable to resist the sweet sounds being played and run to join the party.

But, before you jump on the bandwagon, you may want to wonder a bit as there can be more than one way of looking at high yield; its associated risk of future dividend cut and impact to its stock price.

A. High Yield High Growth

I don’t think you can find it now in the current market. If you can find it, don’t tell anyone. Sell your car and mortgage your home and load it up! Just kidding. LOL (more…)

Posted on August 8, 2010 - by Createwealth8888

Understanding Stock Market Risks – Updated

You may often hear this – Investing in Stock Market is risky.

In fact, investment of any kind including setting up your own business by nature is risky, and can potentially cause you lose some or all your investing or initial capital.

Actually as a paid employee you also face similar risks of losing your job when you approach 40s or 50s. It is a well known fact that HR department update this list of employees in these age groups during annual budget exercise.

So what are the possible Stock Market Risks and how can we as retail investors mitigate these risks?

1. Price Volatility Risk

• Need to learn how to time your Entry and Exit points
• Buy in batches by Average In (different from Average Down)
• Sell in batches

2. Companies Risk

• Select top tier blue chips that are likely to be rescued by Temasek.
• Limit your exposure to any stock to less than 10%, and for bigger account size less than 5%
• Limit your exposure to any sector to less than 20%, and for bigger account size less than 10%.

Read more…

Posted on July 20, 2010 - by Createwealth8888

Help me! I am still losing money in my Investment Quadrant – Part 1

“Successful stock investing starts from stock analysis and continue from it.” – Createwealth8888

Some DIY retail stock investors are still not very clear between Stock Analysis and Stock Investing. Many are still stuck in the stage of Stock Analysis and didn’t really advance themselves into the stage of Stock Investing.

Knowledge, skills and mindset related to Stock Analysis and Stock Investing is different and require different approach.

Stock Analysis

Stock Analysis is about having a view on the market and/or a stock by either fundamental analysis or technical analysis or both.

Some may even throw in Hope Analysis in addition to FA and TA.

The end result of such analysis will be a trigger to buy or sell or hold decision on your stock or stocks in your portfolio.

Stock Investing

For retail stock investors, it is about using their limited investing capital to make net return to meet their investment goals over their investing life-cycle. Read more…

Posted on May 11, 2010 - by Createwealth8888

No safety net in trading futures, options or forex!!! – 2nd Revisit

No safety net in trading futures, options or forex!!! – Revisit

Win or lose. No Hold please!

If you dislike the ideas of losing your money then it is better for you to avoid forex, futures and options as such financial instruments are invented for the purpose of winning and losing.


You can’t really hold on to them as there will be time decay risks and incur additional financial costs for holding them overnight.

No Time to watch the market

If you don’t have plenty of time to watch the market, how could you afford the time and efforts to participate in such highly time sensitive and breaking news driven speculative adventures.

Know the differences … Gambling – investment – speculation and Are you investing or speculating? Read more…

Posted on April 27, 2010 - by Createwealth8888

Understanding Stock Market Risks – No 7 Risk

Understanding Stock Market Risks – No 6 Risk

This Great Bear of 2008 taught me there is another risk to think about:

7. Dilution Risk

Even if you only invest in blue chips that are strategically important to Singapore and the government will never allow them to fail. So there is very little risk of complete failure but you are still expose to the dilution risk i.e. your interests in your holding get diluted by these companies injecting more capitals to strengthen up their balance sheets by raising more capitals through private placement or right issues. Read more…

Posted on April 23, 2010 - by Createwealth8888

How to retire?

By Cheng Huang Leng

Four Pre-Conditions for Retirement

I retired in year 2000 at age 52. I am now 61, thus I can claim that I got more experience at retirement than most! I thought I should share my experience with mariners because I have seen too many friends and neighbours who became so bored that they have become a nuisance to their spouse and children and to others!

A few of them have solved the problem by going back to work. They were able to do so because they have a skill/expertise that is still in demand. The rest (and many are my neighbours) live aimlessly or are waiting to die – a very sad situation, indeed.

You can retire only when you fulfil these 4 pre-conditions:

1. Your children are financially independent (e.g. they got jobs),
2. You have zero liability (all your borrowings are paid up),
3. You have enough savings to support your lifestyle for the rest of your life,
AND most importantly,
4. You know what you would be doing during your retirement.

DO NOT retire till you meet ALL 4 Pre-Conditions. And of course you should not retire if you enjoy working and are getting paid for it!

The problem cases I know of are those who failed to meet Pre-Condition #4.

When asked, “What would you be doing during your retirement?” some replied, “I will travel/cruise and see the World”. They did that, some for 3 months and then ran out of ideas. The golfers replied, “I can golf every day.” Most could not because they are no longer fit to play well enough to enjoy the game. Those who could, need to overcome another hurdle – they need to the find the “kakis” to play with them.
(more…)

Posted on April 22, 2010 - by Createwealth8888

Portfolio Management – Rate of Returns

Portfolio Management – Diversification Is Your Friend – Part 2

What is your method for stock picking?

FA or TA or just buying on any major pullbacks or corrections?

What is your objective of coming into the stock market?

Having a positive returns over a long-term period

If your objective is to have a long-term (20 – 30 years) positive returns on your portfolio with re-investing all dividends and periodic adding of sizable capital, do you really need to do any serious FA or TA?

I don’t think so. Probably you just need to save enough money to buy some on major pullbacks and buy little more on major corrections and build up a well-diversified portfolio of dividend yielding stocks of at least 4-5%. Read more…

Posted on April 5, 2010 - by Createwealth8888

Q1 2010 Quarterly Performance Report

“However beautiful the strategy, you should occasionally look at the results.” – Winston Churchill

“What gets measured, gets managed.” – Peter Drucker

1. Year Goal Hit Rate

Year Goal Hit Rate improved by +4.8% from 14.4% in  Q1 2009 to 19.2% in Q1 2010.

(In 2003, I set some bullish progressive year goals from 2003 to 2011.
2010 Year Goal is 74.9% of 2009 Total Salary including all CPF contributions. Quite a big goal!)

2. Active Investing Performance

Since 1 Nov 08

1. ROC from 3.1% to 34.3% (I don’t use stop loss so no negative ROC. Never blindly use no stop loss)
2. Holding Days from 1 to 329 days (some sins committed in 2008 were cleaned up so longer days)
3. Mean ROC: 11.2%
4. Median ROC: 8.5%
5. STDev: 7.8%
6. Mean Holding Days: 60

Going forward, the days of high double digit ROC are likely to be over. I will be happy to get high single digit ROC. Read more…

Posted on March 29, 2010 - by Createwealth8888

5 Myths About ETFs – Part 3

5 Myths About ETFs – Part 2

Does STI ETF really give average market return?

I still think that STI ETF is just another beast in the stock market and its behavior is no different from any other beasts in the stock market – some are hares, some are tortoise, and some are dying and waiting to be buried.

If you look at the price volatility of STI ETF, it can be scary depending when you last bought it. Read more…

Posted on March 23, 2010 - by Createwealth8888

Buy And Hold – Is this the best use of limited capital? – Part 2

Buy And Hold – Is this the best use of limited capital?