Uncle8888 DOESN'T use Stop-loss; but he doesn't lose his pant! CASH got sound (in his mind)! Saturday, 10 October 2009
Portfolio Management - Stop Losses? I do cut losses to recover capital and redeploy the recovered capital to other stocks, but it is not related to the falling stock price. I don't need to win back in the same manner that I have lost. One day in 2008, a guy came to this cbox and said: "Bro, do you have stop loss and you are holding a losing position for too long!" I replied: "Bro, I don't use stop loss"
Method, Mind, and Money Management Stop-loss is nothing more than a technical risk control and money management tool. What if we have really have in our mind this risk control and money management; and we count our money to two decimal place and we know CASH got sound and don't lose our pant!
Over heard someone telling someone while waiting for registration to begin that he has Keppel @ $2.61 and the other one replied his @ $3+ Buy & Hold is not dead! At these entry price; they should be very long-term investors like Uncle8888
Generational gap! What current generation don't really understand the meaning of Shifting Goal Post! Let rewind back to 1980s when Uncle8888 was young @ 20s and Internet and blogging has been around for sometime. Singapore's investment blogosphere was very active with star investment bloggers like now who were championing topping up SA and transfer OA to SA as young as possible and then becoming becoming CPF Millionaire. What if Uncle8888 in his 20s has been sucked into it by these loud voices. He jumped into topping up his SA and transferring from OA to SA and dreaming of CPF Millionaire at 55, the official CPF withdrawal age at his time in 1980s. Then what happened years later .... Walau! RA withdrawal at 60 Walan! RA withdrawal at 62 WTF! RA withdrawal at 65 Soon RA withdrawal at 67? and then 7?, 8?
You can't blame Uncle8888 shaking his head. How many realize that these champions locking their good assets as rich assets for securing their retirement fund in CPF well advance may be just fraction of their net worth or portfolio? They can. You can. Chun bo?
Are you Hen or Pig? The Hen & the Pig Go To Breakfast A Hen and a Pig were sauntering down the main street of an Indiana town (yes, this is another shaggy dog story!) when they passed a restaurant that advertised “Delicious ham and eggs: 75 cents.” “Sounds like a bargain,” approved the Hen. “That owner obviously know how to run his business. “It’s all very well for you to be so pleased about the dish in question,” observed the Pig with some resentment. “For you it is all in the day’s work. Let me point out, however, that on my part it represents a genuine sacrifice.”
Hi UncleCW! Has been reading your blog for awhile, your blog posts really educate me on my financial journey. I've recently embarked on the financial journey earlier this year. Just a brief introduction about myself. I'm 19 year old and currently studying as a 3rd year student in a local polytechnic. Always interested in embarking on the journey towards achieving financial freedom. ...... ...... Would appreciate if you would be able to share on your views and possible advice for myself as a young individual embarking onto this journey!
What do you think is Uncle8888's prime suggestion? Always remember your career is your foundation of your investment capital. Earn more. Save more. In investing, account size really matters. LOL!
Review your investing diary or trading journal. Have you noticed if your entry is good, better, best - your chances of getting out unharmed were greater? It never was about market timing; its about risk management. OK, not everyone trades with 10:1 leverage to appreciate the nuance I've just said. Let's illustrate with an example: If you have entered Keppel at $2, at the current price of $6 plus, it feels like a "free" investment. (If you let this position turn into a loss you have no one to blame but yourself) Contrast it if you have bought Keppel at $10. Making less and losing money not even close to "same same". Using dividends or entry price as panadols - your choice.
We are more likely to believe in Mean reversion theory in long run over market and economic cycles of Boom and Doom. In practice; how does one look like?
Using dividends or entry price as panadols - your choice.
What does compounding INVESTMENT return actually mean in real life and practice on the ground for long-term retail investors? See for yourself! It is from losers to winners that is the true compounding investment return on the ground. You will have them all! You also have to live with the two common regrets throughout your investing journey! Read? Two Common Investing Regrets Among Retail Investors (2)
Uncle8888 is as lazy as these salt-water crocodiles; patiently and lazily wait for their targets to come within striking distance. Lazy and patience! Strike only when the targets are really near! Same same as for the market. He will strike only when the time is near! Lazy and extremely patient at the cost of going hungry for a long time; but the meal is full because of laziness the food can last long time till to the next meal.
Those are a few examples of surviving vs thriving. But all of these examples have the same underlying commonalities. They are: 1. To thrive, you must first survive. 2. You must have something steady in your lives before you can take the necessary risk in order to thrive. 3. You must be prepared to put even more effort and energy to thrive, because the game rules for surviving and thriving is different.
CW8888 Same as retail investing in the stock market; do we aim for surviving with high dependency on dividend income over future market cycles riding the boom and doom cycles of our invested companies or thriving for higher investment gains at the next doom at higher risk and return but forgoing current cash flow?
Two hours waiting time after taking queue number. More than enough time to scroll Chinatown a few rounds; but later Uncle8888 hid inside Chinatown MRT station for free Wifi to became cyber warrior roaming in the cyber space.
Sillyinvestor, CW, and I were bantering which one hurts more? 1. Sell too early and missed out on outsized profits? 2. Sell too late and left too much money on the table? Just to clarify. Letting a winning position turn into a loss is just plain dumb. Hmm ... This is where traders and long-term investors think differently and most traders don't get it. Where hurts more? Most traders don't get it! Panadols are pain killer! Dividends as panadols to ease heartache and then over long-term it can cure heartache when these stocks become freehold. Pain no more! You are true to Warren Buffet's Rule 1 & 2 as ultimate investors. High single digit dividend yield on investment cost : Panadol Double digits dividend yield on investment cost: Panadol Extra Strong. Passive income dropping from money tree and becoming dumb investor without the baggage of emotional loss over freehold stocks! Need clarification?
After more than 17 years of following investors' comments, postings, chats, and face to face talks with fellow retail investors; Uncle8888 has noted two common investing regrets among RETAIL investors. (1) They sold their potential multi-baggers way too early for decent profits. (2) They never sell their stocks at the high. Most retail investors will eventually make either (1) or (2) or Both. As Uncle8888 has done both i.e. (1) and (2) so he can feel which investing regret is the lesser evil over 20 to 30 years of market cycles as retail investors. Which is the lesser evil? (1) or (2)? Once SOLD; it is GAME OVER! That is why selling is more difficult to master. Who has the skills to sell that many stocks near the high? If you know someone can consistently do that; then he or she is the champion retail investor like Joseph Schooling in swimming. For 2, you have missed selling them near the high; how bad can it be? How much have you missed out? The answer will lie on your yield on investment cost. If your yield on investment cost is high single digit or double digits; then over the next 15 to 20 years of receiving cash flow from dividends? How bad can it be?
I am 60+ yrs old uncle living in HDB heartland who has retired @ 60 on 30 Sep 2016.
I have been doing long-term investing and short-term trading in Singapore stock market only since Jan 2000 and now becoming full-time retail investor. So I am that Panda or Koala in the investment world; but I am still surviving well in the wild.
I have two sons and one daughter; two working adult children and the youngest son is currently in his 1st year SUTD.
I am currently executing my Three Taps solution model to maintain sustainable retirement income for life till 2038
Last updated: 16 Oct 2016
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