Author: Dr Wealth

Should I buy Silver Now?

Commodities have a good run in recent months and it is indeed time for a pull back. It is nice to see the silver price dropping about 10% from high of US$30+. For those who intend to buy silver or add position, is it a good time to enter? It is a question I asked myself. I first bought silver around US$21 and now waiting for a point to add position. Looking at the iShares Silver Trust (SLV), the price has went below the 50-day moving average, but still very far away from the 200-day moving average. In my...

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Humans are not rational

Economic theory bases on a fundamental principle that humans make rational choices. A rational choice to my understanding, is to make a logical decision that would make you better off than your current situation. There is a famous game – “Ultimatum Game”, which displays the irrationality of humans. There are many versions but I shall use a simplified example here to let you know the essence of the game: Imagine you and I are playing the game. A banker will pass you $100 and share it with me. You can offer any amount to me, for example, $1 for...

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Why is it so hard to sell losing stocks?

Do you sell stocks that show profits and hold stocks that are losses? Have you held onto losing stocks for a long time? Quietly hoping for the stock price to rebound to your purchase price? This is just a human cognitive bias. It is known as loss aversion, which means that you would get more depressed by losses than receiving more joy from winning the same amount. This is also one of the reasons why people are interested in capital guaranteed investments. They fear loss and are willing to take much less profits, some times lower than the inflation...

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The Art of Non-conformity by Chris Guillebeau

I have always been a fan of Chris Guillebeau’s ideas. He is one inspiring globe traveller who shares his philosophy of life and tries to wake people up from sleepwalking. He published this book after his successful blog and it is an easy and provocative read for most people. Below would be some highlights and summary of the book. The problem with conformity He mentioned that most of us behave like the five monkeys in a cage – it is a story of a sadistic monkey hater who caged five monkeys. “Enough food and water is available at the...

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Unconventional Success by David Swensen

David Swensen is the Chief Investment Officer at Yale University who takes charge of the Yale Endowment Fund. He has made an average return of 11.8% per annum over 10 years. I shall summarise his ideas from his book, “Unconventional Success: A Fundamental Approach to Personal Investment“. I could identify 3 main parts in the book and it should help you get a good idea on what his message is. Asset allocation is key to consistent profits It can be seen that his method is heavily centralised on Modern Portfolio Theory and his principal investment concept is that asset...

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Top 10 Favorites of BigFatPurse 2010

Recapping my posts from the year 2009, here are the most viewed ones by you. You may like to read if you have yet to, or you can read it all over again! 1) How to buy Singapore Government Bonds? – provides an overview of the ways to lend money to the Government! No 1 in 2009 and 2010! 2) Do not buy Critical Illness Insurance – As expected, this post drew rebuttals from the insurance agents. I do not blame them as they are passionate people believing in their products and want to help others. I am not against...

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Trading Report Card – Dec 10 and Year 2010

Dec 10 The stock market has a good run in the last few months of Dec 10. Those stocks that I traded in Oct and managed to ride the trend till Dec gave me the most profits. Kepland was the longest trade, held since Sep but it was not the best performing and it is also true that the blue chips were not doing well as compared to the mid and small caps stocks. Osim was the single winner in the portfolio and it really goes to show you do not need to be right all the time. I...

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Goals for 2011 – Part 2

After setting my first set of goals, I felt that I would like to achieve more. Hence, I decided to set 4 more goals here and round it to 10 goals for 2011!: #7 – I read 30 minutes everyday. Why? I learned a lot by reading books. I also get lots of inspiration from reading. It keeps me going and motivated. It also provide topics to share on this blog. Hence, I should develop a habit to read regularly. What is the person I need to be? I need to be disciplined. There will be times where I...

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Goals for 2011

It is coming to the end of 2010 and it is time for review as well as setting new goals for 2011. I will cover the review in a later post and now, I just want to focus on sharing how I set my 2011 goals. How I set my goals for 2011 Step 1: Specify minimally 50 measurable goals and phrase them as if I have already achieved them. I aimed for volume first because I want to make sure every area of my life is covered. All statements must be phrased in such a way that you...

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Give more and not less to be Rich

Yesterday we had a gathering with Dennis. He always share relentlessly as he believes that is how he can help most people – teaching us how to fish, instead of giving us the fish. He shared a life lesson and showed us that many of the common sayings converge to one principle, one of the law of successes. The law was mentioned by Napoleon Hill, who received the wisdom after interviewing successful people over 20 years. He urged us to “give the extra mile”. Have you heard of the saying from Christianity, “you reap what you sow”? Isn’t it...

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Do not buy corporate bonds

Everyone is familiar with Government Bonds and Treasury Bills. How about corporate bonds? A company needs cash and capital to run or expand the business. There are several ways for the company to raise money. It can borrow from the bank, getting listed, execute rights issues (if listed), take in private investments or issue corporate bonds. Out of these methods, the company will likely choose the least cost of borrowing. So if the company decided to issue bonds, it means that it is the cheapest the way to borrow. More often than not, corporate bonds will give out a...

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Read to Grow Rich for week 50 of 2010

Here are some interesting blog articles from local money bloggers this week: The problem about regular investments (RSP) by Adrian Khiat Top 5 Reasons Why You Should Invest in Singapore Property by Mr Propwise Why is it so difficult for Singaporeans to buy a reasonable priced home when its easy for foreigners? by Drizzt Is Property Truly Affordable? by Musicwhiz Value-for-Money in Financial Freedom by Panzer My War Room (4) by Createwealth8888 Porter’s Five Forces Series Part 1 – Threat of Entry by Musicwhiz And from international money bloggers this week:...

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Jim Rogers 3 Keys to Investing

Jim Rogers appeared in a Chinese talk show some time back (see video below – Thanks to Jimmy and Dennis). When asked what are the 3 keys to investing, he mentioned the following: #1 – Skeptical Be skeptical of what experts, analysts, journalists, reports, brokers, fund managers, financial advisers, professors, etc, say. He mentioned that 80% of the finance professionals underperform against the market averages. Hence, there is no point in listening to them. An investor must have an independent mind, not get swayed by comments and advice. You must believe in yourself, your research and investment method. You...

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Travel Investing – Philippines

Last week, I took a holiday in the Philippines. I spent 4 days on the famous white beach in Boracay and 2 days in metropolitan Manila. It is always interesting to observe the foreign country way of life and culture. I have thus pen my observations and thoughts in this post. Of course this blog is about investment, I shall focus the content on the economics and business of the country. Getting there – Cebu Pacific Air A good place to start is how did I get there? I took a budget airline, Cebu Pacific Air, to Manila. It...

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