How assets are valued - spoof video reveals shonky banking practices :) Clicked on other videos of the same series to discover banking motivations and Forecasting Techniques?
Thursday, November 11, 2010
Thursday, November 4, 2010
Portfolio Update October 2010
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1) NYSE - 26.97%
2) SGX - 41.41%
3) HKEX - 33.33%
4) ASX - 11.79%
Best performer so far is SGX & HKEX as I invested a bulk of the funds earlier in 2009 and subsequently into NYSE and ASX. Though appreciation of Aussie would have tip the ASX % more into the 20% region for me.
No correction so far of desired magnitude(touching indexes support lines) to partake in more equities. Hopefully a correction will come soon, though I wouldn't bet my horses on it with the impending US govt QE will keep the market running (Market will rely on past experience of QE and draw the conclusion that it will explode upwards like 2009). For the local scene, Singapore's drumming up of its own Election (as can be seen with the recent increased coverage of Election matters) will keep spirits high. Recent M&A or "intended acquisition" globally and locally (of noticeable interest is the high profile Peter Lim) might mean that most smart money are betting that the good times are back big time. No one will want to do acquisition at peak (ok.. maybe some sovereign wealth funds like that..keke).. But let's trust the smart money.. it's their money at stake.
So what are the best risk/reward for the upcoming year (assuming bull run continues)? I would guess it will be the small & mid-caps. Everything goes up in a bull market but the magnitude of rise will be higher with the small and mid-caps than the blue chips. M&A activities is usually value-destroying for the blue-chips(with their hoards of cash for M&A citing synergy and strategic fit but often at a premium) and value-creating for the small/mid-caps (usually at the other end of the acquisition). That's my guess.
Disclaimer : I'm not adding more to equities unless there is a correction. I'm already vested 60%, no point adding more with no increased in the reward part of the risk/reward ratio.
Sunday, October 10, 2010
What will you do with $1 million dollar?
This was a question posted by another blogger @http://sgboleh.blogspot.com/2010/09/what-will-you-do-with-1-million-dollar.html
This is what I would do with the $1million dollars.
When you come into the money, refrain from spending it on frivolous items you yearn for(Audi) or your family desires (holidays) with the money. These are expenses, you whittle down your money just like that? Poof... memories are forever, but it is only for once. What if you could repeat the memories for many times more?
Use "Delayed Gratification" instead.
Instead of thinking of how to spend the money, think of how to make every penny of the money work for you. Your business is a good idea (you mentioned $100k?). Though, would the business be able to break even or make a profit in the first year. What is the probability - calculate that. Now, what is the probability of getting a 4-5% yield in a year thru' investing? Is it higher? If after you assessed the probability and find the business to be more highly probable (your own confidence and knowledge of the business model and environment), then go ahead and plonked some money into the business.
However, if you think the probability of getting 4-5% yield on your stocks or bonds or properties are higher, then probably, you should put spread the money out into investments that yield 4-5%. After a year, you will get $40-50k. Why not use the $40-50k to start your business then in the first year.
For the family holidays, delay the gratification till the 2nd year, where another $40-50k, comes in.
For the audi (a "selfish" toy for only 1 person to enjoy :p ), you should delay the gratification till your investments are showing results more or equal to the costs of the car. That is, if you made $130k on your principal, you buy the car (but i would still use a 50% car loan.. that is just me as I believe the $65k balance can be invested and reap more than the interest on the loan).
What I do for my own portfolio is the same. I forbid myself from touching the principal and delays gratifications of all "desired but not needed" items till my portfolio generates enough for me to afford them. Any excess is re-invested to make more money for me to enjoy more passive income the year after (which indirectly increases my budget for gratifications I delayed). Of course, it is even better if you can delay the purchase of the items indefinitely and get more capital to invest.
Summarizing what I think people who come into the money should do : Learn to invest for yourself and Never ever touch the principal for spendings classified as expenses. Delay the gratifications till your profits on the principal is enough for the "desired but not needed" items and you will get a more sustainable way of creating more loving memories with your loved ones.
This is what I would do with the $1million dollars.
When you come into the money, refrain from spending it on frivolous items you yearn for(Audi) or your family desires (holidays) with the money. These are expenses, you whittle down your money just like that? Poof... memories are forever, but it is only for once. What if you could repeat the memories for many times more?
Use "Delayed Gratification" instead.
Instead of thinking of how to spend the money, think of how to make every penny of the money work for you. Your business is a good idea (you mentioned $100k?). Though, would the business be able to break even or make a profit in the first year. What is the probability - calculate that. Now, what is the probability of getting a 4-5% yield in a year thru' investing? Is it higher? If after you assessed the probability and find the business to be more highly probable (your own confidence and knowledge of the business model and environment), then go ahead and plonked some money into the business.
However, if you think the probability of getting 4-5% yield on your stocks or bonds or properties are higher, then probably, you should put spread the money out into investments that yield 4-5%. After a year, you will get $40-50k. Why not use the $40-50k to start your business then in the first year.
For the family holidays, delay the gratification till the 2nd year, where another $40-50k, comes in.
For the audi (a "selfish" toy for only 1 person to enjoy :p ), you should delay the gratification till your investments are showing results more or equal to the costs of the car. That is, if you made $130k on your principal, you buy the car (but i would still use a 50% car loan.. that is just me as I believe the $65k balance can be invested and reap more than the interest on the loan).
What I do for my own portfolio is the same. I forbid myself from touching the principal and delays gratifications of all "desired but not needed" items till my portfolio generates enough for me to afford them. Any excess is re-invested to make more money for me to enjoy more passive income the year after (which indirectly increases my budget for gratifications I delayed). Of course, it is even better if you can delay the purchase of the items indefinitely and get more capital to invest.
Summarizing what I think people who come into the money should do : Learn to invest for yourself and Never ever touch the principal for spendings classified as expenses. Delay the gratifications till your profits on the principal is enough for the "desired but not needed" items and you will get a more sustainable way of creating more loving memories with your loved ones.
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