As from April 2013 my Journey in Investing is to create Retirement Income for Life till 80 years old for two over market cycles of Bull and Bear.

Welcome to Ministry of Wealth!

This blog is authored by an old multi-bagger blue chips stock picker uncle from HDB heartland!

"The market is not your mother. It consists of tough men and women who look for ways to take money away from you instead of pouring milk into your mouth." - Dr. Alexander Elder

"For the things we have to learn before we can do them, we learn by doing them." - Aristotle

It is here where I share with you how I did it! FREE Education in stock market wisdom.

Think Investing as Tug of War - Read more? Click and scroll down



Important Notice and Attention: If you are looking for such ideas; here is the wrong blog to visit.

Value Investing
Dividend/Income Investing
Technical Analysis and Charting
Stock Tips

Tuesday, 30 June 2009

H1 2009 has ended!!! So how am I doing?

As on 30 Jun 09, I have achieved 26.84% of 2009 Goal (In 2003, I set bullish and progressive goals from 2003 to 2011).

Going forward, I believe that from 2009 to 2011, these bullish goals set at 2003 will be extremely difficult to achieve; but, nevertheless, I shall not change them, but still work towards getting them. Cheers!

Sunday, 28 June 2009

Olam - Weekly



Is Olam going nuts or crush into paste at $2.50?

Sector rotation

From Wikipedia, the free encyclopedia

Sector rotation is a term normally applied to stock market trading patterns. In this context, a sector is understood to mean a group of stocks representing companies in similar lines of business.

For example, an investor or trader may describe the current market movements as favoring basic material stocks over semiconductor stocks by calling the environment a sector rotation from semiconductors to basic materials.

Sector Rotation Models exist primarily to help investors identify and participate in new trending sectors of the stock market. A sector rotation investment strategy is not a passive investment strategy like indexing, and requires periodic review and adjustment of sector holdings. Tactical asset allocation and sector rotation strategies require patience and discipline, but have the potential to outperform passive indexing investment strategies.

------------------------------------------------------------------------
“If you are in the right sector at the right time, you can make a lot of money very fast” –Peter Lynch

Sector Rotation Theory can help you invest (or trade) in the key sectors that are outperforming the market right now. There are always stocks in certain sectors that are “on fire” or “out of favor”.

Your goal is to understand broad patterns that reoccur and try to find connections between ideas and occurrences in the market and the broad economy. The stock market can at times lead the general economy and provide high-probability trade ideas for longer term positions.

If you can come any closer to mastering the skills of recognizing sector rotation in play, you will be profitable in many months to come. Open your eyes wide. Take the advice from Jim Cramer: “If you want to make money,” Cramer said, “you need to take a chance. Sometimes you will be wrong, but if you never try…you'll never be right.”
Cheers!

Saturday, 27 June 2009

How Much Is Enough? Running Monte Carlo simulator

Read? How much is enough?

http://www.flexibleretirementplanner.com/java/LaunchFRPWeb.html

Quite interesting as the simulation supported my planning of retirement fund = 25 x Expected Annual Expenses with 3% average investment return and 3.5% average inflation rate.

Friday, 26 June 2009

Olam - sold @ $2.40, ROC 9.6%

Round 3: ROC 9.6%, 8 days, B $2.18 S $2.40

Round 2: ROC 7.0%, 8 days, B $2.18 S $2.35
Round 1: ROC 9.8%, 161 days, B $1.37 S $1.52


Making the next pillow in progress. Cheers!

Olam - sold @ $2.35 , ROC 7%

Round 2: ROC 7.0%, 8 days, B $2.18 S $2.35

Round 1: ROC 9.8%, 161 days, B $1.37 S $1.52


Looking for the next round. Cheers!

Thursday, 18 June 2009

Stocks Investors' Mentality

Olam - Got some nuts @ $2.18

Going nuts liao!

Wednesday, 17 June 2009

"An investment in knowledge always pays the best interest." - Benjamin Franklin

Singaporeans unclear about retirement income - Part 2

"Singaporeans unclear about retirement income: survey" <--- Part 1





aiyo, I am short of 26.7% of income and either to fund it from partial draw-down and/or others.

Perhaps, I may need to allocate more money into CPF to earn risk-free 2.5% or increase more pillow stocks for dividends, and also look into other source of passive income.

Need to re-strategise liao!

Tuesday, 16 June 2009

Paradox Of Our Times

Today we have bigger houses, but smaller families

More conveniences , but less time

We Have More degrees, but less common sense

More knowledge , but less judgment

We have more experts, but more problems

More medicine, but less wellness

We spend too recklessly

Laugh too little

Drive too fast

Get too angry too quickly

Stay up too late

Read too little

Watch TV too much

And ponder too little.

We’ve multiplied our possessions,

but reduce our values

We talk too much, love too little and lie too often

We’ve learned how to make a living, but not a life

We’ve added years to our lives, but not life to our years

We have taller buildings, but shorter tempers

Wider freeways, but narrower viewpoints

We spend more, but have less

We buy more, enjoy it less

We’ve been all the way to the moon and back

But have trouble crossing the street to meet our neighbors.

We’ve conquered outer space,

But not inner space

We’ve split the atom

But not our prejudice

We write more, learn less, ---------------------- plan more, but accomplish less

we’ve learned to rush, but not to wait,

we have higher incomes , but lower morals

We build more computers to hold more information, to produce more copies

But have less communication

We are long on quantity,

But short on quality

These are the time of fast foods and slow digestion

Taller people, and short character

More leisure and less fun ,,,,,more kinds of foods ,,,,, but less nutrition

Two incomes ,,,,,but more divorce

Fancier houses ,,,, but more broken homes

That’s why I propose , that as of today , you do not keep anything for special occasions, because every day you live is a special occasion.

Search for knowledge , read more , sit on your front porch and admire the view without paying attention to the time.

Spend more time with your family and friends , eat your favorite foods, and visit the places you love .

Use your crystal goblets…do not save your best perfume for best…throw a party for no good reason.

Life isn’t only about survival … It’s about joy.

Do not delay anything that adds laughter and joy to your life.

Remove from your vocabulary phrases like “ one of these days “ and “ someday”

Let’s write that letter we thought of writing “ one of these days “

Let’s tell our families and friends how much we love them.

If you’re too busy to take the time to send this message to someone you love , and you tell yourself you will send it “ one of these days “

You missed the point! believe me

Source: Cyberspace. Author: ???

Saturday, 13 June 2009

Singaporeans unclear about retirement income: survey

Published June 13, 2009
By ZEINAB YUSUF

MOST Singaporeans - as in elsewhere - are clueless about what their retirement income will look like, a recent survey by HSBC revealed.

NOT FULLY PREPARED
Singaporeans are focusing on short-term finances rather than long-term considerations like retirement needs

Released yesterday, the fifth annual Future of Retirement study, It's Time to Prepare, questioned 15,000 people in 15 countries and found that 91 per cent of people here do not know what income they will receive in retirement.

Additionally, the survey identified a 'preparedness gap' in people's retirement planning across the world with nearly 9 out of 10 people not feeling fully prepared for their retirement.

------------------------------------------------------------------------------------

I have identified possible sources for Retirement Income as follows:

1) Dividends from stocks
2) Interests from Fixed Deposit/CPF (leaving it at CPF after 55 years old at 2.5%)
3) Minimum sum payout from 65 onwards
4) Any shortfall to be covered by partial draw-down from Retirement Fund


http://createwealth8888.blogspot.com/2008/09/retirement-drawdown-and-passive-income.html

Friday, 12 June 2009

4 Mental Keys That Help My Trading Performance

On Thursday June 11, 2009, 10:05 am EDT
Price Headley - CFA, CMT, President & Founder of BigTrends.com. Price has been widely quoted by Barron's, CNBC, The Wall Street Journal and USA Today. Price is also the author of the new book, Big Trends in Trading: Strategies to Master Major Market Moves.

The mental part of trading is just as important as the systems and indicators you utilize. Today, we'll touch on some insights from an excellent book for traders, Larry Williams' go to amazon.com to find Long-Term Secrets to Short-Term Trading.

Insight #1: "Why do most traders lose most of the time? Markets can spin on a dime and most traders cannot."

Even the best traders (or the best trading systems) are going to be frequently wrong. That doesn't negate the trader or the system - that's just part of trading. The challenge for traders is accepting that the trade signal was errant. In a case such as this, Williams correctly points out that we've been trained to 'hang in there' and 'have faith in our initial insight', even if it's clearly the wrong course of action. That's just our ego needing to be right so badly that it will often ignore the exit signals that warn the trader of the impending problem. His analogy may help you work through this issue. He compares trading to robbing a bank. A bank robber may successfully break into a bank and start scooping up the money, but when the lookout guy warns the man in the safe that the cops are on the way, the robber drops the money and runs. If the robber were like too many traders, he might stay in the bank and hope the warning about cops being on the way was a false warning. As Williams says, "The instant you learn to trade reality, not wishes, you will break through the wall of fire to become a successful trader."

Insight #2: It's not the trade, it's the battle.

Too many traders believe that their last trade is a reflection of just how good of a trader they are (but they are the only ones who feel that way about themselves). This boils down to one word - expectation. If you expect to win all the time, or even the vast majority of the time, you're setting yourself up for a lot of heartache. That frustration, though, is the very same force that will truly make your negative perception of yourself a reality. And even a good trade can be damaging if you let it warp your disciplined approach. The fact of the matter is that this is a game of odds, and should be played over a long period of time. Focus on the war - not the battle.

Insight #3: The amount of (or lack of) evidence for a market move does not make the move any more or any less likely.
All traders, but especially new traders, have one of two problems. They either buy too soon, or buy too late (and in reality, when it comes down to it, those are the ONLY two problems in trading). The first problem of buying too soon is a sign of not wanting to miss out of any of a move. Of course, if you jump in and the move never becomes a reality, the trade suffers. The second problem is the opposite - the trader wants to make sure the move is going to happen, so he or she will wait for all the right signals to verify that the move is for real. Of course by that time, most of the move is behind you. While it's easier said than done, one has to find a balance between those two extremes. In this case, the best teacher is experience.

Insight # 4: What's the difference between winning traders and losing traders?
Well, first, there are a few similarities. Both are completely consumed by the idea of trading. The winners as well as losers have committed to doing this, and have no intention of 'going back'. This same black-and-white mentality was evident in their personal lives too. But what about the differences? Here's what Williams observed:

The losing traders have unrealistic expectations about the kind of profits they can make, typically shooting too high. They also debate with themselves before taking a trade, and even dwell on a trade well after it's closed out. But the one big thing Williams noticed about this group was that they paid little attention to money management (i.e. defense).And the winners? This group has an intense focus on money management, and will voluntarily exit a trade if it's not moving - even if it's not losing money at that time! There is also very little internal dialogue about trade selection and trade management; this group just takes action instead of suffering analysis paralysis. Finally, the winning traders focused their attention on a small niche in the market or a few techniques, rather than trying to be able to do everything. Hopefully the second description fits you a little better, but if the first one seems a little too familiar, you now at least know how to start getting past that barrier.

Thursday, 11 June 2009

Fed Rate vs STI

Wednesday, 10 June 2009

Myths that stand in the way of investors

Published June 10, 2009
By SHANE OLIVER

GIVEN the complexity of investment markets and investing, along with the massive amount of information available to investors, many people rely on logic based on 'common sense' or simple 'rules of thumb' in making investment decisions. However, while some such rules of thumb are reasonable, in many cases they are not and can result in investors missing opportunities or losing money. In this note, we look at some of these and why they are unreliable.

Making gains: History indicates time and again that the best gains in stocks are usually made when the economic news is poor and economic recovery is just beginning or not even evident

Myth #1: High unemployment will prevent an economic recovery

This argument is wheeled out every time there is a recession - like now. If it were correct then economies would never recover from recession but simply spiral down into the sort of crises that Karl Marx predicted would ultimately lead to the demise of capitalism. Of course, no such thing happens. Rather, the boost to household discretionary income from lower mortgage bills (as interest rates fall) and tax cuts or stimulus payments to households during recessions eventually offsets the fear of unemployment for the bulk of people still employed. As a result, they eventually start to spend more which in turn gets the economy going again. In fact, it is normal for unemployment to keep rising during the initial phases of an economic recovery as businesses are slow to start employing again fearing the recovery won't last. Since share markets normally lead economic recoveries, the peak in unemployment often comes a long time after shares have bottomed.

Myth #2: Business won't invest when capacity utilisation is low

This argument is also rolled out during recessions. The problem with this myth is to ignore the fact that capacity utilisation is low in a recession simply because spending - including business investment - is weak. So when demand turns up, profits improve and this drives a pick-up in business investment which in turn drives up capacity utilisation. So while business investment in key countries right now is poor, providing there will be a pick up in demand - and several indicators are pointing to such later this year - then business investment will start to improve even though many factories are still idle.

Myth #3: Corporate CEOs, being close to the ground, should provide a good guide to where the economy is going

Again this myth sounds like good common sense. However, senior business people are often overwhelmingly influenced by their own sales figures but have no particular lead on the future. In the late stages of the early 1980s and early 1990s recessions, anecdotal comments from Australian CEOs were generally bearish - just as recovery was about to take hold. Note this is not to say that CEO comments are of no value; but they should be seen as telling us where we are rather than where we are going.

Myth #4: The economic cycle is suspended

A common mistake investors make at business cycle extremes is to assume that the business cycle won't turn back the other way. After several years of good times, it is common to hear talk of 'a new era of prosperity'. Similarly, during bad times it is common to hear talk of 'continued tough times'. But history tells us the business cycle is likely to remain alive and well.

Myth #5: Crowd support for a particular investment indicates a sure thing

This 'safety in numbers' concept has its origin in crowd psychology. Put simply, individual investors often feel safest investing in a particular asset when their neighbours and friends are doing so and the positive message is reinforced via media commentary. The only problem with it is that while it may work for a while, it is usually doomed to failure. The reason is that if everyone is bullish and has bought into the asset, there is no one left to buy in the face of any more good news, but plenty of people who can sell if some bad news comes along. Of course, the opposite applies when everyone is bearish and has sold - it only takes a bit of good news to turn the market up. The trick for smart investors is to be sceptical of crowds rather than drawing comfort from them.

Myth #6: Recent past returns are a guide to the future

This is another classic mistake that investors make, which is again clearly rooted in investor psychology. Reflecting the difficulty in processing information, short memories and wishful thinking, recent poor returns are assumed to continue and vice versa for strong returns. The problem with this is that combined with the 'safety in numbers' myth it results in investors getting into an investment at the wrong time (when it is peaking) and getting out of it at the wrong time (when it is bottoming).

Myth #7: Strong economic growth and strong profit growth are good for stocks and poor economic growth and falling profits are bad

This is generally true over the long term and at various points in the economic cycle, but at cyclical extremes it is usually very wrong and constitutes another big mistake investors make. The big problem is that share markets are forward looking, so when economic data is really strong - measured by strong economic growth, low unemployment - the market has already factored it in. In fact the share market may then start to fret about rising cost pressures and rising short-term interest rates. As an example, when global share markets peaked in October/November 2007 global economic growth and profit indicators looked good.

Of course, the opposite occurs at market lows. For example, at the bottom of the last bear market in shares back in March 2003, global economic indicators were very poor and the general fear was off a 'double dip' back into global recession. As it turned out despite this 'bad news' stocks turned around, with better economic and profit news only coming along later in the year to confirm the rally. History indicates time and again that the best gains in stocks are usually made when the economic news is poor and economic recovery is just beginning or not even evident.

Myth #8: Strong demand for a particular product produced by a stock market sector (for example, housing) should see stocks in the sector do well and vice versa

While this might work over the long term and for a while it suffers from the same weakness as Myth #7. That is that by the time, for example housing construction, is really strong it should already be factored into the share prices for building material and home building stocks and thus they might even start to start to anticipate a downturn.

Myth #9: Having a well diversified portfolio means that an investor is free to take on more risk

This mistake has been clearly evident in recent years. A common strategy has been to build up more diverse portfolios of investments less dependent on equities and with greater exposure to alternatives such as hedge funds, commodities, direct property, credit, infrastructure and timber. This generally led to a reduced exposure to truly defensive asset classes like government bonds. So in effect investors have actually been taking on more risk helped by the 'comfort' provided by greater diversification. Yes, there is a case for alternative assets. But unfortunately the events of the last two years have exposed the danger in allowing such an approach to drive an increased exposure to risky assets overall. Apart from government bonds and cash, virtually all assets have felt the blow torch of the global financial crisis, with agricultural investments being the latest victim in Australia.

Myth #10: Tax should be the key driver of investment decisions

For many the motivation to reduce tax is a key investment driver. But there is no point negatively gearing into an investment so as to get a tax refund if it always makes a loss. Similarly the recent experience with Managed Investment Schemes also highlights the danger in relying too much on tax considerations to drive investments. The first priority is to make sure that an investment stacks up well in its own right - without relying on tax considerations.

Myth #11: Experts can tell you where the market is going

Economic and investment forecasts are often seen as central to investing. But, at the risk of being thrown out of both the 'economists club' and the 'market strategists club', no one has a perfect crystal ball. And sometimes they are badly flawed. It is well known that when the consensus of experts' forecasts for key economic or investment indicators are compared to actual outcomes, they are often out by a wide margin. This was particularly the case last year. Forecasts for economic and investment indicators are useful, but need to be treated with care. If forecasting the investment markets was so easy then everyone would be rich and would have stopped doing it. The key value in investment experts' analysis and forecasts is to get a handle on all the issues surrounding an investment market and to understand what the consensus is. Experts are also useful in placing current events in their historical context, and this can provide valuable insights for investors in terms of the potential for the market going forward. This is far more valuable than simple forecasts as to where the ASX 200 will be in a year's time.

Conclusion

The myths cited here might appear logical and consistent with common sense, but they all suffer often fatal flaws which can lead investors into making the wrong decisions. The trick to successful investing is to recognise that markets (and economies) are highly complex, that they don't go in the same direction indefinitely, that markets are usually forward looking and that avoiding crowds is healthy.

Shane Oliver is head of investment strategy and chief economist, AMP Capital Investors

STI




Ah Gu beri strong leh.

Tuesday, 9 June 2009

It pays to stay invested

Business Times - 06 Jun 2009

WEALTH INSIGHTS

When market recovers, emotional investors will be left with a portfolio of defensive assets and a truckload of regret

By Lim Beng Tat
Director
Russel Investments Asia

WE ALL know equity markets rise and fall. However, the recent market correction has worn down many investors. Weary of asking 'have we reached the bottom yet?', investors want to know when the recovery will come. And unfortunately no one knows the answer to that.

To sit back and watch investments post negative returns is simply unbearable for many. The truth is there may be more value in 'inaction' for the smart and disciplined long-term investor. And experience tells us that decisions about money made under highly emotional circumstances rarely turn out to be good ones.

What we do know is that when equity markets do finally have a rally (as history has shown they do) investors who have chosen not to stay invested in equity markets risk missing out on a recovery that could help them recoup some of their market losses.

Towards the end of 2007 we witnessed one of the greatest bull markets of all time. Investors in the Singapore stock market had been riding a euphoric wave of double-digit equity market returns over the preceding five-year period as can be seen in Chart 1. Then 2008 arrived and the party was over.

In the last few years many 'emotional investors' who traditionally invested in more defensive assets (such as bonds and cash) transferred money over to equities blindly attracted to the apparent returns without considering the associated risks. When equity markets collapsed, these emotional investors started to realise that markets could go down as well as up.

Similarly, over attention to risk during the current market downturn has focused investor attention on minimising losses rather than waiting to participate in the recovery. As a result, these investors have oversold equities and transferred the proceeds into bonds and cash.

Investors have also held back from investing in equity markets in recent months because there is continued uncertainty and a seemingly never-ending run of bad news of corporate failures and bailouts.

However, what many of these investors have forgotten is that when market do recover, they will be left with a portfolio of defensive assets and a truckload of regret.

Although the current market volatility - triggered by the US housing slump and sub-prime mortgage crisis - has been a painful experience, investors can take some comfort in putting the recent downturn into perspective. If we step back and look at the performance of the Singapore market over the past five or six years, it is easy to appreciate the value of long-term investing and it is quite clear there will be another 'party'. We just don't know when.

The current bear market's intensity has been compared to the Great Depression and the bear market of 1973-74. The 1973-74 bear market created many jumpy equity investors. However, those who maintained their equity positions were well rewarded in the second-half of 1974 and the first quarter of 1975.

Charts 1 and 3 illustrate this fact and also show the different time periods where US and Singapore equity markets recorded strong negative returns. As you can see, periods where there are heavy losses on the markets are generally always followed by significant bounce backs.

What we do know is that markets can't go down forever. Although sometimes, in the middle of a strong downturn, it is hard to believe that markets will one day recover. While nobody can accurately predict when the bottom of the trough will be reached - or if indeed it has already - everybody knows that it will (sooner or later) arrive.

And when it does, it will pay to be invested. Some of the highest returns are experienced suddenly in an oversold, overshot market.

Give it some thought - as shown in Chart 1, the Singapore market experienced consecutive negative returns in 1997 and 1998. However in 1988, the market bounced back in a big way climbing close to 80 per cent. We saw it again from 2000 to 2002 and then in 2003 we saw returns of over 30 per cent.

While it may be tempting to simply convert equities into cash and bonds and watch from the sidelines, history tells us that investors selling to cash during falling markets can expect to see significant underperformance when equity markets return to health.

Yes we would all like to 'buy low and sell high' but the reality is that emotions work against this investment principal. While extended bear markets inevitably induce fear in investors - professionals and individuals alike - a disciplined approach can help minimise losses during the downswing and ensure readiness for the upswing.

Forecasting represents predictions of market prices and/or volume patterns utilising varying analytical data. It is not representative of a projection of the stock market, or of any specific investment.

Sunday, 7 June 2009

Simple Guidelines for Happiness

Remember these .....


1. Free your heart from hate.
2. Free your mind from worry.
3. Live simply.
4. Give more.
5. Expect less.


The story of old man and his happiness .....

A man of 92 years, short, very well-presented, who takes great care in his appearance, is moving into an old people’s home today. His wife of 70 has recently died, and he is obliged to leave his home.

After waiting several hours in the retirement home lobby, he gently smiles as he is told that his room is ready.

As he slowly walks to the elevator, using his cane, I describe his small room to him, including the sheet hung at the window which serves as a curtain.

"I like it very much", he says, with the enthusiasm of an 8 year old boy who has just been given a new puppy.

"M. Gagn√©, you haven’t even seen the room yet, hang on a moment, we are almost there. "

" That has nothing to do with it ", he replies.

" Happiness is something I choose in advance. Whether or not I like the room does not depend on the furniture, or the decor – rather it depends on how I decide to see it. "

" It is already decided in my mind that I like my room. It is a decision I take every morning when I wake up. "

" I can choose. I can spend my day in bed enumerating all the difficulties that I have with the parts of my body that no longer work very well, or I can get up and give thanks to heaven for those parts that are still in working order. "

So, my advice to you is to deposit all the happiness you can in your bank account of memories.

Thank you for your part in filling my account with happy memories, which I am still continuing to fill…

Friday, 5 June 2009

STI - Where are you going to?


Wednesday, 3 June 2009

Will STI bulls continue to ignore DOW?



Ang mo bulls legs soft soft?

Tuesday, 2 June 2009

SML - Got in @ $3.07

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