Author: Growing your tree of prosperity

The Twin Arrogances in Investing.

Initially I wanted to just provide a personal update today, but tragedy has befallen my mother’s side of the family and, over the next few days I will be hanging out with my my dad while my mum goes to Johor to pay her last respects to her youngest brother. The other thing is that Kyith of Investment Moats wrote a really objective article on leverage that you can find here. I strongly recommend that you read it to get under the hood of how most leverage strategies work. I this the article is sufficiently well-written such that a public...

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Life Narratives

It is only when you start becoming a trainer when you start to realise the importance of narratives.  A good narrative is where my biggest disadvantage lies. I don’t have a good Cinderella story – it is public knowledge that I grew up on landed property. Unlike many motivational gurus and some financial advisors who want to rely on sob story to churn sales, I never had to experience my home electricity being cut off and neither was I forced to dumpster dive when I was a kid because my dad gambled away all my bursaries. The lack of a...

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The Model Thinker #14 : Local Interaction Models

Today’s installation is so abstract that I will just describe two local interaction models. First the Local Majority Model : –> 1 2 3 4 C 5 6 7 8 Each cell in a two-dimensional square can be in two states : White or Black. In each period, one cell is chosen. If a cell is chosen it will adopt a new state if five or more of its neighbours are in that state, otherwise it maintains it current state. If we allow this Local Majority Model to run over a canvas of Black and White Squares, we will...

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What does it take to be Marriage Material in Singapore ?

I think it is about time we update some figures on what it takes to be marriage material in Singapore. According to evolutionary psychologist David Buss, women across multiple cultures value economic resources, earnings potential and ambition much more than men when selecting their mates. This is why the world is full of examples of rich and powerful old men marrying younger trophy wives but you can hardly find examples of rich, wealthy women marrying athletic and young men. In fact, evolutionary psychologists are specific enough to say that women desire men to be in the top 70% percentile...

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If you invest with an aim to “Shake Leg” one day, you will never become a Millionaire.

One of the interesting facet of my work as a trainer is that my work is, at best loosely, coupled with the Dr Wealth Marketing team. This means that I can only at best influence how that team markets my course. Consequently, I do not have the power to dictate what the marketing team does.  if you think about it, this makes a lot of sense given that I know very little about marketing to other people and the Dr Wealth team are pros at what they do. Naturally, member of the Marketing team read this blog to determine...

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The Model Thinker #13 : Path Dependency

Path dependency happens when current events interfere with future events. There are two extreme models of path dependency. Imagine you have an urn full of white and black balls and you get to draw one at random from the urn. If, after drawing a ball, you get to add two balls of the same colour drawn back into the urn before you draw again, you end up with the Polya process. The Polya process models the situation where anything can happen. After drawing 1000 balls, the probability that the urn contains 40% white balls is the same as the...

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Letter to Batch 4 of Early Retirement Masterclass

I just concluded two days of investment training and as part of a custom, I will share my final letter to my students here. As you can see, there are a fun folks in this particular batch of students : –> Dear Students of Batch 4, It’s been a great honour and privilege to be able to conduct a 2-Day Early Retirement Workshop for you. Compared to other batches, this class was highly interactive and very fun to teach. Dr Wealth staff was still traumatised after one of the ways suggested by the class to increase sideline income included...

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The Model Thinker #12 : Random Walks

The simplest form of the random walk is a function that has an equal probability of being +1 or -1. The expected outcome of this function is zero and the standard deviation is the square root of the number of periods. A simple random walk in one dimension has two important properties. The first property is that it is recurrent. Over time, it crosses zero infinitely often. The second property is that it is unbounded – it can exceed any positive or negative threshold. Our stock markets can be considered to be nearly normal (or Gaussian) random walks with...

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The End of an Era

Today actually marks the end of an era. Beginning tomorrow 1st April 2019, Tictail, the platform where I sell my books, will shutting down for good. It is also time for me to permanently end the sale of my books from this blog. Until very recently, I’d always struggled with the selling of my books. My distributor MarketAsia changed hands and I could no longer find a home for my physical copies, so I had to load them in my parent’s home and wait for the occasional sale to get them to my tiny fanbase. It was such a...

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What problem is Financial Independence supposed to solve ?

I thought it might be a good time to summarise everything I know about The Problem that becoming financial independence is supposed to solve. If no one works on coming up with a proper definition of the problem, financial independence is just like blockchain technology, a solution looking for a problem. Here is what I know about the problem so far : a) Emergence of the gig economy The emergence of the gig economy is a new thing that folks in my generation did not have to contend with. Graduates from the ITE/Poly/University tracks will face an economy that...

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The Model Thinker #11 : Entropy : Modelling Uncertainty

Data falls into four categories. Data could be in equilibrium. A person’s height is in equilibrium, as is the stock price for one counter at market close today. Data can be cyclic. Revenues for the semiconductor firm is generally cyclical because there are ups and downs. Data can be random like the distribution of stock prices on the SGX. Finally, data can be complex. If my daughter chooses stocks, it may not be completely random and, my daughter being a 7 year old, possibly may not be based on a fixed pattern as well. Equilibrium and randomness can be...

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BBFA The RPG – From Keyboard Warrior to Marriage Material !

We all have to begin somewhere in life. I have spent a large part of my younger life as a BBFA so I know that BBFAs have a strong affinity with the Financial Independence Movement. Once of the core strengths of the BBFA is that they are not constrained by society’s judgement on their approach towards financial planning. This gives them the freedom to work towards building a pile of Fuck You Money without society making them feel bad for doing it. One very effective way to achieve your financial goals is by gamification, so I decided to imagine...

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Gaming Analogy for the FIRE movement.

There are many interesting parallels between the FIRE community and Board gamers. As it turns out Tabletop Gaming magazine talks about different attitude towards tabletop gameplay last month which can be applied to the FIRE movement. In tabletop gameplay, players can be arranged around a 2×2 matrix. On one axis is respect for the rules and, on another axis, respect for goals. This creates four categories of different “players” that can be found in the board-gaming world our society today. Let’s look at each category one by one. 1) Conventional Player / Believer in the Singapore Dream. The conventional...

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The Model Thinker #10 : Broadcast, Diffusion and Contagion.

What does it mean when it was written in The Economist that a group of whiz kids hired by Barclays Bank modelled the cryptocurrency craze as a disease and concluded that the bull market in 2017 is not ever occur again ? After reading this chapter, I suspect that the they used models of broadcast, diffusion and contagion to model the behaviour of cryptocurrency investors – specifically this thing called the SIR Model. If I am right, then cryptocurrency investments reach fever pitch based on the following variables : P(contact) = Probability that a non-crypto investor gets exposed to...

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Pursuing FIRE while in a relationship.

There is one question that I am not good at answering : How does one pursue FIRE while in a relationship with someone else? The first problem is that finance experts are generally not relationship experts, you should treat all relationship advice from financial experts with a pinch of salt. ( Of course, I freely dispense relationship advice because I want to keep readers entertained. ) The second problem is that financial experts who solve these problems within their own marriage can only describe their solution based on one data point. This kind of wisdom is not empirical at...

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