Archive for the ‘Featured’ Category

Posted on March 11, 2010 - by Alvin

Your investment capital looks like this

Everyone has seen how stock charts look like. But have you seen the chart for your investment capital – how your capital rise and fall with time? The way your investment capital moves depend on the type of investor. I have heavily generalised 3 kinds of charts for the Buy-and-Hold investor, Trader and the Clueless investor. This is important because all of us would always monitor our capital time to time to see if it has grown. By doing this, we subject our happiness to it’s rise and dejection to it’s fall. And whether we still have the tenacity to continue investing when we feel dejected. The end point maybe the same, but the journey can be very different. Find out which of the capital movement chart you prefer and you can find out the type of investor best suits you.

The Buy-and-Hold Investor

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Posted on March 10, 2010 - by Market Uncle

Do we need to monitor the stock market so closely?

Hectic but fruitful life after a new entrant

Ever since my girl was born and my confinement lady left, life have been very hectic, tiring and sometimes frustrating. Eventually, when she learnt to smile at us, its had been one of the happiest moment of my life and instantly felt all this was worth it :). Looking back, my last post was more than 3 months ago and I haven’t really got the time to meddle with my portfolio or look up company reports ever since.

Missed opportunities?

As my girl grow up, nearing her fourth month on earth (not counting the time she spent evolving in my wife’s womb), she finally seems to be able to adjust to our earthly culture and give me some peace to do my stuff without constantly crying and requiring us to decipher what she want. So finally I an able to find time to stock take on my portfolio, read up a little on my companies and what had gone on in the last 3 months. Surprisingly (at least to me), I neither didn’t miss much of the action nor any really great opportunities. As far as fundamentals go, the reporting seasons only occur once every 3 months and the last one was just concluded. Looking at the results and outlook stated in the financial reports of my companies and those I’m interested in, none really warrant much action and there isn’t really much changes in their stock price for me to bang wall on missed opportunities. Read more…

Posted on March 9, 2010 - by Alvin

Lessons Learnt as a Trader (so far)

It’s only been almost 2 years since I began trading and I must say I am still learning how to trade. I have summarized the lessons learnt so far in my trading journey:

Be patient and wait for the best opportunity to place a trade

Trading is really a patient game. It is not as quick as I imagined in the first place. The duration of the trade can be short, but the time waiting to place a trade is very much longer. The thought of profits urges me to be involved in the market and it just makes the wait feels like eternity. Sometimes, the charts do not show any opportunity but my eyes will try to find patterns to justify for a trade. And true enough, these forced trades usually end up in losses.

Statistics have shown that market generally spend most of the time consolidating (non-trending) or moving within a band. To understand more, read “90 days attribute to 95% of profits“. This is why traders have to spend most of their time waiting!

Back on forcing a trade. What I was doing (and still doing) was to demand the market pay me profits. Who am I to do that? I cannot force opportunities. The wise Sun Tzu said, “to secure ourselves against defeat lies in our own hands, but the opportunity of defeating the enemy is provided by the enemy himself.”  (more…)

Posted on March 8, 2010 - by musicwhiz

Kingsmen Creatives – Analysis of Purchase Part 1

I purchased shares in Kingsmen Creative on January 25 and 26, 2010, and the following few postings will elucidate the thought process and analysis which went into the rationale for the purchase decision. Note that some of the factors which led to this decision are qualitative by nature, and are also known as “intangibles”, but are nevertheless important in assessing if a company is suitable for investment. Though an objective assessment would be difficult to predict if a Company will continue to do well, a somewhat rational look at the business model and Management quality does give some hints as to what may come. That said, an investor should always prepare for some risk of partial permanent loss of capital, no matter how thorough or detailed the research is. My job is to minimize the risk of loss, and maximize the probability of gains over a decent period of time; and as the business grows.

This analysis will be split into several sections, of which I will cover the industry in which Kingsmen operates, its competitive climate, its financials, fundamentals and business units (divisions); and also its prospects, plans and investment merits (and demerits). Part 1 will touch on their business, industry characteristics and Profit and Loss + Balance Sheet.
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Posted on March 7, 2010 - by Aaron Lau

Estate Planning (Part 6 of 8)

Estate planning addresses lifetime needs like permanent mental or physical disability and post-death arrangements.

The objectives are unique to the individual but generally include:
- Distribution of property in accordance to one’s wishes
- Sufficient liquidity to pay off debts
- Appointment of executors
- Security for dependents
- Contingencies

The 4 step process:
(1) Determine goals
(2) Preparation of plan
(3) Implementation of plan
(4) Reviewing of plan

Determine Goals
A lot depends on one’s attitude towards security, philanthropy, risk, work and money. Important areas to consider are:
- Any known problems with a particular property (Do not leave the burden behind)
- Unresolved family issues (Relationship problems, children from other relationships, etc)
- Financial security for dependents
- Views towards chartiy
- Attitude about extraordinary life sustaining medical treatment
- Contingencies in the event of mental or physical incapacity

Preparation Of Plan
The following tools are used for the plan
Read more…

Posted on March 5, 2010 - by Jay

On Financial Freedom

Just some thoughts on this term “financial freedom” that has become a much coveted goal in life popularized by Robert Kiyosaki in Rich Dad Poor Dad. Btw apparently Kiyosaki was never as rich as he proclaimed. He got rich after selling his book. Well, some of his ideas are refreshing though.

What is the definition of financial freedom?

I guess to most people, it would be having enough money in your bank to last a lifetime living the same quality of life and thus having the freedom to choose not to work for money.

In the first ever post on this blog, we worked out this amount is probably slightly more than half a million dollars for a conservative guy and $3mn for someone more aspiring. And this amount is highly unreachable with normal jobs since annual salary is about $30,000 to $40,000 on average in developed countries. (Well actually it’s doable given enough time: like 30 years, as we shall see but that defeats the purpose I guess :)

Hence there is a need for passive income (another term from Kiyosaki) to help fund monthly expenditures. However passive income can only come from a few sources:

1. Dividends from stocks
2. Interest from fixed income instruments (bonds, T-bills etc)
3. Rental income from property
4. Pension or annuity payout
5. Cash flow from businesses (which you don’t have to run it)
6. Royalties from books, songs etc
7. Others: sponsorships, fees etc
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Posted on March 4, 2010 - by AK71

Seven steps to creating passive income from the stock market.

I have made it known to my family and many friends that I aim to create a minimum of $50k in annual passive income from investments in the stock market alone.  Recently, while chatting in the cbox at Bully the Bear, I mentioned this and at least one person was incredulous.  How to achieve this?

Well, to me, it’s quite simple, if I invest $500k in a basket of stocks that yields 10% per annum, I would have that $50k passive income.  Then, I gave it some thought later on and decided that perhaps I should share more in detail how this could be achieved.

Taking a leaf from successful authors using the number “seven”, this is AK71’s “Seven steps to creating passive income from the stock market”:

1.  Get full time employment – Sounds dreadfully straightforward, doesn’t it?  Well, sometimes we need to point out the obvious.  We cannot grow money in pots of soil or fabricate it at home; well, not legally anyway.  Get a well paying job that pays you as much as you are worth (or more than you are worth if you are lucky enough).  Don’t shortchange yourself.
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Posted on March 3, 2010 - by Kay Toh

Make full use of interest free study loan

If you are or you have kids who will be entering university soon, you should take advantage of the interest free study loan and tuition fee loan and use the funds to invest. The returns that are generated can be used to offset the cost of a university education slightly.

Fresh undergraduates who will be entering into any of the 3 local universities which includes NUS, NTU and SMU are usually able to take a tuition fee loan of up to 90% of their course fee. Depending on the selection of course, it ranges from around $6500 for most courses such as Engineering or Science to slightly less than $19,000 for medicine. Subsequently, they may be eligible to take up a study loan that can pay for the remaining 10% of their course fee and a living allowance of $3,600. For most courses, this means that the recipient can receive up to a potential amount of at least $10,000. Throughout the entire course of study, interest will not be charged on the loan amount. As such, if you have enough funds to pay off the tuition fee, my suggestion is that you should not pay it off straightaway but keep it to generate some returns and try to get the study loan too.
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Posted on March 3, 2010 - by Drizzt

Dividend Investing:It matters when you buy the stock

A question alot of folks ask about dividend stock is that they aren’t realy defensive when a bear market comes along as the share price will still go down. It would be more worth while to sell then buy back at cheaper price.

What do i think of this kind of move? I am all supportive of it, IF you can foretell future events and price movements well.

Lets say you trust your skill in analysis whether it is fundamental or technical. You see that in the future this stock will go down together in a bear market. How well would you fare?

I created a Dividend Stock Simulation Spreadsheet here to illustrate and analyse this.

I chose CapitaCommercialTrust which is a commercial property reit listed on a stock exchange.

Posted on March 2, 2010 - by musicwhiz

Tat Hong – 1H FY 2010 Analysis and Review Part 3

In this final Part 3, we will look at Tat Hong’s Inventory levels and I will comment on their slow but steady transformation into a “rental” company and also their building of their tower crane business in China. I will also give a quick summary and low down on the progress of their planned China expansion so far, based on announcements filed with the SGXNet.

Crane Fleet Profile

Total Fleet Profile Review
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