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

Saturday, 31 December 2011

Do you still believe in financial experts or Gurus forecast and calls?

Read? 4 financial experts' forecast for this year

There are no experts who can forecast. They are just paid to tell a fairy tale story in the stock market.

Only Carmen Lee has a small consolation prize for her forecast for biosensors at $1.35

Closed at $1.43 on 30 Dec 2011

 
I have been holding biosensors since 21 Jan 2008, CAGR on unrealised gain is 22.2% over 3.9 years.
 
Biosensors is the newest multi-bagger in my current portfolio at last market closing.
 
I have sold some positions to lock in realised profit to make a new pillow but it is currently only 43% full of feathers. I will sell some to make it into the newest pillow stock aka zero-cost investment holding and hopefully to grow a new money tree when biosensors starts giving out stock dividends.

Biosensors International to Participate in the 30th Annual J.P. Morgan Healthcare Conference

Biosensors International Group, Ltd. (“Biosensors” or the “Company”, Bloomberg: BIG:SP; Reuters: BIOS.SI; SGX: B20), a developer, manufacturer and marketer of innovative medical devices for interventional cardiology and critical care procedures, today announced it will be participating in the 30th Annual J.P. Morgan Healthcare Conference which will be held from 9th to 12th January 2012 in San Francisco, United States.


During this conference, the senior management of Biosensors will present on Thursday, January 12th, 2012 at 11:00am PST within the Asia Healthcare Company Track, and will also meet investors in scheduled one-on-one and small group meetings throughout the conference.

Dreaming of financial independence by 55!

2011 is an important year for Createwealth8888. Why?

Read? Four Financial Progressive Stages

It was many years back .....

One day, after reading the book on "Rich Dad Poor Dad" by Robert, I began to like the idea of passive income, financial freedom and getting out of rat race so much that I have a mind flip. I began dreaming of financial independence by 55 and keep dreaming till this day.



(Another book that helped me is "Think and Grow Rich" ) Read? Two Books That Change My Views

But, how to achieve this wonderful dream?

Business or Investment?

For me, the choice is quite obvious. Without much talent for Business; I would have to take the Investment path to financial independence. Next, I would have to decide whether properties or stocks? I decided on stocks as I believe stocks are easier to execute.

Read? Why you must not stop dreaming of reaching financial freedom and pursue it?


Why we must get out of rat race as early as possible? Read? Regret of the Dying


Why 55?  When I began that dream, Singapore's official retirement age was 60; but now, it is 65. Too bad folks! We will have to work longer. 60 is the new 55.

Actually, when I have this dream I have already achieved financial security so financial independence is just the next step and leaded me to this simplistic thinking. If I put in enough time and effort to educate myself to become savvy with long-term investing and short-term trading; I will be able to create wealth from the stock market. (This is how I named the title of this blog. This is why I am still blogging since 2006).







I started reading many finance and investment books that I could find in NLB libraries. I also started to follow closely many investment and trading blogs, forums, cboxes closely and to identify who were the experts and gurus and hoping to learn more tips and tricks from them. (But, unfortunately, some of my superheroes were killed in 2008/2009. Read? Following My Superheroes!)

I also attended many investment and trading previews to hear from Gurus themselves; but all of them have failed to convince me to part my hard earned money to attend their so-called easy money making programmes. May be I was too stingy!

Setting Goals

It was only after a few years in the stock market, I realised that I must get real and set concrete goals to achieve this dream. I then set progressive yearly investment goals to be achieved from 2003 to 2011. This is how the investment marathon race for 2003 to 2011 has started. Basically, it is living part of my life in financial news and market and riding the emotional roller coaster ride up and down with the market.















2011 is an important year for Createwealth8888

Announcing final result

It is like students and parents waiting for the announcement of PSLE, GCE 'O' and 'A" level result.

The final result for 2003 - 2011 is as follows:



OMG! I missed the end goal!

I only achieved only 58.6%.

The reason for not achieving 2011 goal is so obvious! Look at the Red arrow in the above chart.

Sianz!!!

Financial Independence by 55

Lagi sianz .............















Look at the plunge in 2008 bear. Just a few moments of foolishness and greediness in me to bet much bigger in 2008 and the dream never come true!!!

I have to dream once again till 2015.

My net worth as on 30 Dec 2011




My net worth as on 30 Dec 2011 market closing price.

  1. Capital already invested in stocks and subjected to market volatility = 5% of net worth.
  2. Capital not invested yet and available as cash on hand = 20% of net worth.
  3. 30% of net worth comes from net profits from stocks and re-invested back into stocks and subjected to daily market volatility.
  4. 45% of net worth are assets not affected by market volatility.
Volatility is name of the Game


How bad will the next bear hit my portfolio?

My stress test result on my portfolio indicated that it may not be as bad as compared to 2008 Bear.

I am better prepared for the next bear this time than in 2007. Now, I will have far more bullets to take on the bear. See the chart below:


 


In 2007, I have too much capital invested in stocks and too little bullets.
In 2008, I have too little bullets to recover.
In 2012, I think I am quite balance with stocks and bullets.

Track, Measure and Visualise!

It is very important that we can visualise our portfolio performance and know how are we doing?

Can we reach our goals with the current investing strategies?

Know our XIRR!


  1. XIRR since one year ago = -2.5% (negative growth)
  2. XIRR since 3 years ago = +10.0%
  3. XIRR since 9 years ago = +11.0%
  4. XIRR since 12 years ago = +9.3%
2011 is a very difficult year with my current investing strategy. It has failed so badly. I will go to Batam in the New Year 2012 to think over it.

I never have so much cash for investing!

2011 is even more important year for me when I unlocked my Division of Commandos in my CPF OA to battle the next bear; but it can be a double-edged sword too. I can lose big.

Setting the new goals









The next 10 years of progressive goals (2012 to 2021)







 
I have been tracking my annual expenses since 2000. The next 10 years of progressive goals are inflation adjusted at 3% rate based on this formula to compute the likelihood annual expenses to determine the amount required in retirement.
 
Likelihood Annual Expenses =
 
(Max Expense since 2000 + 4 x Avg Expenses since 2000 + Minimum Expense since 2000) / 6
 
 
 
 
 

The Money tree has grown and is bearing fruits

Sometime in life, we will reap what we have sowed. I will be reaping what I have sowed. Read? One click! That is more than enough to generate passive income for a long time.

These fruits will ease my future goals.

I hope to sow more One Click in the next bear.

I realized that passive income from stock dividends is fantastic once you got damn right. You don't even need to lift a finger to receive it. Really wonderful!






How will I end the next race in 2021?
















Will I have the wisdom not to repeat the same few moments of foolishness and greediness in me?




















Thursday, 29 December 2011

Keppel Offshore & Marine wraps up 2011 with new contracts worth S$150 million

Singapore, 29 December 2011 - Keppel Offshore & Marine Ltd (Keppel O&M) through its subsidiaries, Keppel Singmarine Pte Ltd (Keppel Singmarine) and Keppel Verolme BV (Keppel Verolme), has secured contracts totaling S$150 million from international customers.


Keppel Singmarine, the specialised shipbuilding division of Keppel O&M, has entered into contracts for the building of a 91-metre container vessel and three 4000 DWT (deadweight tonnage) bulk ore/fuel carriers for Papua New Guinea customer Ok Tedi Mining Limited (Ok Tedi Mining), while Keppel Verolme, Keppel O&M’s comprehensive yard in the Netherlands, is undertaking upgrading activities of a semisubmersible drilling rig, Scarabeo 6, for Italian customer Saipem Misr for Petroleu Services S.A.E. (Saipem).

Mr Chow Yew Yuen, Managing Director of Keppel O&M, said, “With these contracts, our new orders for the year to date has reached a record high of some S$10 billion, with deliveries extending to 2015. It reflects the confidence of global customers in the capabilities of our yards across the Keppel O&M group. We have established a solid track record of successfully completed projects and we intend to mainmaintain this by executing our orders to the satisfaction of our customers.


“With a network of yards around the world, we are proud to be able offer a variety of services to customers wherever they are. We will continue to strengthen the partnership with repeat customers like Saipem and gain the trust of new customers like Ok Tedi Mining.”

The container vessel to be built by Keppel Singmarine is capable of loading 3,000 tonnes of copper concentrate or carrying 236 TEU (twenty-foot equivalent unit) of containers. In addition, the three 4000 DWT bulk ore/fuel carriers that Keppel Singmarine will be building, will each be able to carry a minimum of 4,000 tonnes of copper concentrate or 1,900,000 litres of bulk diesel fuel. All the vessels are scheduled for delivery in 2Q 2013.
 

Saving, Lending and Investing (3)

Read? Saving, Lending and Investing (2)

One simple rule to remember.  How are we paid?

When we save - we are paid low interest rate.

When we lend (buying bonds or pref shares), we are paid coupon rate (interests)

When we invest in stocks- we are paid dividends and we also speculate for capital gains.

When we invest in property - we are paid rentals and we also speculate for capital gains.

Interests, coupons, dividends, and rentals are basically yield on investment cost; if we don't receive any yield regularly, it is pure speculation When we speculate, it is all about timing to recover capital and gain.

Some people may think that riding it and down is hedging against inflation???

But, when we invest long enough, one day we will recover our capital. Surely that day will come. So we better invest than speculate. Right? LOL







Top S'porean pastimes unveiled

SINGAPORE: The top three leisure activities among Singaporeans are eating, shopping and surfing the web.


A survey of more than 600 Singaporeans on their preferred leisure activities came up in this order.

More than two-thirds - or 68 per cent - cited food or dining-out as the top leisure activity in the MasterCard Survey on Consumer Purchasing.

Shopping was next with 65 per cent votes while surfing the web was third with 60 per cent. (Createwealth8888: Me too. LOL)

Interest in languages and literature as well as learning crafts made the bottom of the list of preferred activities.

Only about a fifth -- or about 20 per cent -- of those who responded liked these.

In terms of preferred dining outlets, the food courts and hawker centres reigned supreme as the most popular.

About 90 per cent cited these as their top choice for eating out.

The survey said Singaporeans visit hawker centres and food courts an average of 16 times a month.

This is followed by fast-food restaurants and other quick-serve restaurants where they visit about seven times a month.

- CNA/wk

Buy Gold/Silver as insurance or hedge against inflation? (4)

Read? Buy Gold/Silver as insurance or hedge against inflation? (3)

Gold fell near $1,560 an ounce, hitting a three-month low.




Wednesday, 28 December 2011

Your year-end bonus is here!

Read? Money Management - What to do with your year-end bonus?

I have been doing it for a long time and still doing it again for this year.

Budgeting is an important personal financial skill to acquire. It can help us to minimise financial stress and financially prepare for the next coming Bear without having to liquidate our investment near market low and regret.

How do you prepare yourself for the next economic downturn?

Tuesday, 27 December 2011

Hyflux's unit signs US$41.21m sale and purchase agreement with JV company

By CARINE LEE


Hyflux Ltd on Tuesday announced that its wholly-owned subsidiary, Spring China Utility Ltd, has entered into a sale and purchase agreement with Galaxy NewSpring Pte Ltd, in relation to the injection by Spring China to Galaxy of its entire equity interest in each of Hyflux Utility WTP (DZ) Pte Ltd and Hyflux Utility WWT (HCHX) Pte Ltd.

Hyflux Utility WTP (DZ) and Hyflux Utility WWT (HCHX) are special purpose vehicles which holds the company's two plants in China. The net tangible asset value of Hyflux's interest in them was US$25.2 million as at Dec 31, 2010.

The aggregate consideration payable by Galaxy under the agreement is US$41.21 million, and payable in tranches. It will be wholly funded in cash.

Galaxy is a joint venture company between Hyflux and Mitsui & Co Ltd to invest, develop, construct, operate and maintain water plants in China.

The Singapore-listed company said that the latest transaction 'has been entered into in furtherance of the intent of the joint venture between the company and Mitsui'.



DBS Group increases stake in DBS Bank with $1.35b

By CARINE LEE


DBS Group Holdings Ltd on Tuesday announced that it has subscribed for 116.18 million shares in the capital of DBS Bank Ltd for $1.35 billion.

Funded by internal resources, DBS Group satisfied the purchase wholly in cash.

Following the subscription, DBS Group now holds 2.17 billion ordinary shares in its wholly-owned subsidiary, DBS Bank.



Monday, 26 December 2011

Uncle, you work for Keppel?

Just For Laugh ...

One reader asked: "Uncle, you work for Keppel?"

I guess why he asked this question. Ha Ha. May be only employees of a company will hold its stock for a long time as retail shareholders are more likely to sell stocks that are going up too high.

Actually, I have been investing and trading Keppel family of stocks since 199X e.g. Keppel Finance, Keppel Bank, SPC, Keppel Land, and Keppel Corp. I like Keppel brand!

So You Think You Can Trade? - Re-visit

Investing and trading is simple as it doesn't require minimum educational or professional qualification to practise; but it is not as easy as advertised in your daily newspaper ads.

Read? So You Think You Can Trade?

Passive Income - Rental vs Dividend Yield (2)

Read? Passive Income - Rental vs Dividend Yield

What you will not find in property rental as passive income.

To receive unexpected special dividends down the road and especially when the special dividends are fairly large. Shiok!!! The key here is unexpected. Really shiok!!!



For examples, see below


Sunday, 25 December 2011

Year-end budgetting for the next 2 years

Just For Thinking ....

Common advice from financial advisors is to keep 6 - 12 months ready cash for emergency use; but there is no such thing as one size fits all.

You should sit down and do your year-end budgetting exercise for the next 2 years. You must seriously and consciously think through what are the expected expenses that may be coming up in next 2 years and how you are going to fund these expenses.

You should not be thinking that you can easily fund your expenses by liquidating your stocks next year.

Nobody can predict where the maket will be going in the next two years and you might be liquidating near market low. Heart pain hor!

Kep Corp : Not a dividend hunter's favourite animal???

Read? Kep Corp













Is the elephant too big to be hunted for its dividends?

For that one Click effort in 2001 and doing nothing else after that, Createwealth8888 has been paid total dividends of $3.57 per share (or total yield of 248% over 10.3 yrs) for maintaining his confidence and patience in Kep Corp.

With the backlog order book to S$10.7b, a level not seen since 2006, sustainable dividend payout is possible over the next 2-3 years.

Saturday, 24 December 2011

What should I do with my life?

Most people have good instincts about their calling in life, but they make poor choices and waste years


By TEH HOOI LING
SENIOR CORRESPONDENT

I HAD dinner with a reader some months back. During dinner, I lamented how the modern economy is compensating people in the finance industry. 'Because of that, all the bright brains are flocking to the financial sector. The other more productive sectors of the economy suffer as a result,' I said.

The reader countered. 'The market has a way of adjusting itself. Back in '80s, the shipbuilding, the marine sector was very lucrative. It attracted a lot of talent. Then there was a downturn, and wages plunged. In the '90s, the semiconductor industry was the place to be. In the early 2000s, it was the information technology sector. Now we have the banking sector which is drawing in the big bucks. But already we are seeing signs that the banking sector is set to shrink in the years ahead.'

That conversation lingered in my mind. And a few days ago, a friend posted a link on Facebook to an article titled 'What should I do with my life?'. The article wasn't new. It was published in 2007 but I found it still offers a lot of good insights and it's timely that we be reminded of them.

Written by Po Bronson, and adapted from his book 'What Should I Do with My Life? The True Story of People who Answered the Ultimate Question', the article said instead of focusing on what's next, let's get back to what's first.

'People don't succeed by migrating to a 'hot' industry ... They thrive by focusing on the question of who they really are - and connecting that to work that they truly love (and, in so doing, unleashing a productive and creative power they never imagined).

'Companies don't grow because they represent a particular sector or adopt the latest management approach. They win because they engage the hearts and minds of individuals who are dedicated to answering that life question,' he wrote.

Now that we've come to the end of what has generally been regarded as a terrible year, I thought it's a good time for us to pause and reflect on who we really are, and how one goes about finding that answer.

As part of the research for his book, Mr Bronson interviewed more than 900 people 'who have dared to be honest with themselves'. Below are what he gleaned from them.

Except for a select lucky few, for most of us, our calling is not something that we inherently know. Far from it. Almost all of the people he interviewed found their calling after great difficulty.

'They had made mistakes before getting it right. For instance, the catfish farmer used to be an investment banker, the truck driver had been an entertainment lawyer, a chef had been an academic, and the police officer was a Harvard MBA. Everyone discovered latent talents that weren't in their skill sets at age 25.'

Most of us don't get epiphanies. We only get a whisper, a faint urge. That's it. It's up to us to make the discovery.

'This lesson in late, hard-fought discovery is good news. What it means is that today's confused can be tomorrow's dedicated. The current difficult climate serves as a form of reckoning. The tougher the times, the more clarity you gain about the difference between what really matters and what you only pretend to care about.'

The thing is, most people have good instincts about where they belong. But they make poor choices and waste productive years on the wrong work because of a number of basic assumptions we have about the work we are supposed to have.

'These are stumbling blocks that we need to uproot before we can find our way to where we really belong,' said Mr Bronson.

Money and meaning

One common false assumption is that I would make my money first, and when I have enough money, I'd walk away and use my savings to fund my dreams.

It turns out that people hardly walk away even after they have achieved financial independence. 'Making money is such hard work that it changes you. It requires more sacrifices than anyone expects. You become so emotionally invested in that world - and psychologically adapted to it - that you don't really want to ditch it.'

Money is not the shortest route to freedom. 'The shortest route to the good life involves building the confidence that you can live happily within your means. It's scary to imagine living on less. But embracing your dreams is surprisingly liberating. Instilled with a sense of purpose, your spending habits naturally reorganise, because you discover that you need less.'

Createwealth8888's comments

Living more simply by loving the nature and the sea more. Learn to hear the sound of waves hitting the seashore, seeing the beauty of sea waves and admire the brillance of the setting Sun. You will soon realize that you don't really need to spend much to enjoy all these.

Bring your kids to beaches, parks and gardens and soon you will realize you are not spending on expensive toys.

Read? Live Simply? (3)


Next, 'What am I good at?' is the wrong starting point. People who attempt to deduce an answer usually end up mistaking intensity for passion. To the heart, they are vastly different. Intensity comes across as a pale busyness, while passion is meaningful and fulfilling, said Mr Bronson. A simple test: Is your choice something that will stimulate you for a year or something that you can be passionate about for 10 years?

But stimulating work is not an end in itself. In the past decade, the working world has become a battleground for the struggle between the boring and the stimulating, he noted. We think that work should not only be challenging and meaningful, but also invigorating and entertaining.

'But really, work should be like life: sometimes fun, sometimes moving, often frustrating, and defined by meaningful events.'

Those who have found their place don't talk about how exciting and challenging and stimulating their work is. Their language invokes a different troika: meaningful, significant, fulfilling. And they rarely ever talk about work without weaving in their personal history, he said.

Place defines you

Every industry has a culture. And every culture is driven by a value system. One of the most common mistakes is not recognising how these value systems will shape you, said Mr Bronson.

'People think that they can insulate themselves, that they're different. They're not. The relevant question in looking at a job is not 'What will I do?' but 'Who will I become?' '

Once you're rooted in a particular system, it's often agonisingly difficult to unravel yourself from its values, practices, and rewards.

Ultimately, the answers to who we are, what our callings are, are very individual. On his journey, Mr Bronson met people in bureaucratic organisations and bland industries who were absolutely committed to their work. That commitment sustained them through slow stretches and setbacks. They never watched the clock, never dreaded Mondays, never worried about the years passing by. They didn't wonder where they belonged in life. They were phenomenally productive and confident in their value.

In places unusual and unexpected, they had found their calling, and those callings were as idiosyncratic as each individual.

Asking 'What should I do with my life?' is the modern, secular version of the great timeless questions about our identity, said Mr Bronson. 'Asking The Question aspires to end the conflict between who you are and what you do. Answering The Question is the way to protect yourself from being lathed into someone you're not. What is freedom for if not the chance to define for yourself who you are?'

Mr Bronson said he spent two years in the company of people who have dared to confront where they belong. They didn't always find an ultimate answer, but taking the question seriously helped get them closer.

'We are all writing the story of our own life. It's not a story of conquest. It's a story of discovery. Through trial and error, we learn what gifts we have to offer the world and are pushed to greater recognition about what we really need. The Big Bold Leap turns out to be only the first step.'

What % are you?

Keppel Offshore scoops $800m rig deal

The decision to contract a semisub with Keppel takes place just one day after Petrobras officially canceled its giant tender for the chartering of up 21 Brazilian-built ultra-deepwater drilling rigs.


Back in July, Sete Brasil partnered with Odfjell, Seadrill, Etesco, Odebrecht, Petroserv and Queiroz Galvao for the construction of a total of 15 drillships and six semisubs, while Ocean Rig bid alone for the construction of five drillships.

Petrobras said it is now engaged in direct negotiations with Sete Brasil and Ocean Rig in an attempt of getting better contract conditions.

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

Createweath8888

Fairly high chance of a few more semisubs coming from Sete Brasil.


Keep averaging down on your favourite stocks???

Read? Will you dump more than 50% of your capital at one go into your investment?

Not the first time and will not be the last time that I am hearing it again from the mouth of a big loser

I came to realise that there two groups of retail investors who are more likely to average down on their losing stocks to build up fairly large positions in their portfolio. They are smart ones or ignorant ones.

The rest of us who thinks that we are not that smart and are still attending lectures and doing tutorials in the University of Stock Market better stay far away from it. It is really very difficult to recover from huge losses in our portfolio without injecting significant new capital into our portfolio. How many of us can keep injecting more and more capital for investment?

Friday, 23 December 2011

Kep Corp

Noble to gain US$200m fr Yanzhou-Gloucester deal

SINGAPORE - Singapore-listed commodities firm Noble Group said on Friday it will make a one-time gain of about US$200 million from a proposed merger between its subsidiary Gloucester Coal and the Australian unit of China's Yanzhou Coal Mining Co.

The deal, announced in Australia late on Thursday, will create one of Australia's largest listed coal companies. Noble and its units together own about 64.5 per cent of Gloucester.

Noble said in a filing to the Singapore stock exchange that it will receive about 130.9 million Yancoal Australia shares and A$420 million (US$416 million) under the terms of the proposed merger.

'Based on information the group has to date, the group estimates its gain on the disposal to be approximately US$200 million,' the Singapore-listed firm added.

Noble said it plans to reinvest the cash proceeds from the proposed merger in its global businesses. -- REUTERS



Singapore inflation quickens even as economy slows

SINGAPORE - Singapore on Friday reported higher-than-expected November inflation even as industrial production surprisingly fell, putting pressure on the government to announce new measures to contain prices and keep costs down in its February budget.

Singapore's consumer price index rose 5.7 per cent last month from a year ago, accelerating from October's 5.4 per cent increase and matching the near three-year high seen in August.

Industrial production fell 9.6 per cent in November from a year ago, hurt by a 30.1 per cent plunge in electronics.

The government had already warned last month the Southeast Asian city-state's economy could contract in the current quarter when it cut its growth forecast for 2011 and the Monetary Authority of Singapore (MAS) expects inflation to ease in 2012.

'The MAS is between a rock and a hard place. You've got pretty sticky inflation and you've got an economy that is slowing,' said Matthew Hildebrandt, an economist at JPMorgan in Singapore.

He said private transport costs are high due to government measures to restrict the car population and tighter immigration policies mean labour costs are firm.

Citi economist Kit Wei Zheng said in a recent report that the Singapore would have to use fiscal policy measures to contain prices and cut business costs.

Inflation in most Asian countries has eased in recent months and economic growth slowed because of weakness in West, while China has begun easing restrictions on bank lending to help support its economy.

Singapore manages monetary policy by letting the local dollar rise against a basket of currencies, keeping import prices down.

But inflation in the city-state is currently at elevated levels partly due to high private transport prices, which have been affected by the government's decision to tighten the supply of certificates of entitlement (COE) that people must get before buying a car.

Singapore has also tightened its once-lax immigration policy, keeping demand for labour tight even as the economy slows.

The Monetary Authority of Singapore's (MAS) core inflation measure, which excludes private road transport and other components whose prices are influenced by government policy, rose by a smaller 2.4 per cent year-on-year in November.

Singapore next reviews monetary policy in April while its budget for the fiscal year beginning April is likely to be announced in February.

The central bank's current policy stance is to allow a modest and gradual appreciation of the local dollar.

Looking ahead, most market players expect inflation in Singapore to ease.

'After achieving about a 5 per cent growth in 2011, we expect GDP growth in Singapore to be at the lower end of the 1-3 per cent range forecast by the government. Against this backdrop, inflationary pressures will gradually abate into 2012,' said Cheng Duan Pang, head of fixed income at Manulife Asset Management in Singapore.

'We expect upward pressure on the Singapore dollar to reduce as the market will form expectations that monetary policy could revert to a neutral stance,' he added.

Song Seng Wun, regional economist at CIMB, said Singapore's manufacturing sector is likely to remain weak except for pharmaceuticals which has been boosted by new plant openings.

'Electronics will only start to improve once we start seeing the Europeans spend again. As for the US, even though fewer people are filing for jobless claims and we see modest improvement, but the economy is still not generating enough jobs to be supporting a strong recovery,' he said. -- REUTERS



Has Keppel Corp struck a contract gold mine?

Petrobras cancels rig tenders


Brazilian giant Petrobras said it is cancelling a tender for the contracting of 21 offshore drilling rigs to be built in Brazil.

Luke Johnson 22 December 2011 23:20 GMT

In a brief statement, the state-controlled behemoth said it will “immediately start negotiations” with the two companies that have bid on the projects so far, Ocean Rig do Brasil Ltda and Sete Brasil Participacoes.

The goal is to get better contract conditions, Petrobras said.

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

DMG seems to think so, predicting more semisub orders after its current win.


The fearless forecast came as Keppel Corp secured a $809m (S$1.05b) semisub drilling rig from Sete Brasil, bolstering its chances for winning similar contracts.

"We believe there could be more deepwater rigs in the pipeline as Petrobas concludes its rig building program with Sete Brasil and Ocean Rig. Keppel has submitted bids for six semisub units and more contracts could be on the way," said DMG in a release.

DMG estimates that the unannounced Petrobas awards are now more likely to go to Keppel Corp, and that these will be confirmed by 1Q12 at the latest.

Here's more from DMG:

Semisub order from Sete Brasil. Confirming our confidence that Petrobras awards could materialise by 1Q12 (latest), Keppel announced that they have secured a US$809m (S$1.05b) order for a semisub drilling rig from Sete Brazil. The rig is based on Keppel’s DSSTM 38E design and is scheduled to be delivered in 4Q15. We noted that: (1) the price of the semisub rig was 8% higher than its semisub bid to Petrobras in Dec 2010 at US$749m. (2) The contract period of more than four years (award to delivery) is longer than the period required for semisubs built in Singapore at around 40 months. This helps to alleviate some delay risks as the yard in Brazil is less efficient. (3) The order also marks the first full design and build semisub contract for Keppel since August 2008. We maintain our FY11-12F EPS estimates and raise FY13F EPS by +2%, assuming the semisub achieve initial recognition in 2013 and 8% operating margin. We maintain our BUY rating on Keppel with an unchanged TP of S$11.40.

Backlog order book climbed to S$10.7b. This semisub is part of the proposal submitted by Keppel O&M to Sete Brasil in Jul 2011. This contract lifted its YTD 2011 order win to S$9.8b (2010: S$4.6b) and backlog order book to S$10.7b, a level not seen since 2006. We understand that this DSSTM 38E design semisub will be part of the 21 deepwater rigs offered by Sete Brasil to Petrobras. Queiroz Galvao (QGOG), one of Keppel’s partner in the Petrobras bid, has previously taken delivery of two DSSTM 38 design semisubs from Keppel and could be the operator of this unit. Management has not guided on the potential margins for this project and in our earnings model, we have assumed 8% operating margin on this semisub. Bulk of the revenue for this semisub will be recognised in FY14-15 and hence, the impact on our FY13F EPS estimates is marginal (~2%).

We believe there could be more deepwater rigs in the pipeline as Petrobras concludes its rig building program with Sete Brasil and Ocean Rig. Keppel has submitted bids for six semisub units and more contracts could be on the way.






No other details we available.



Talent and Investing?? (4)

Read? Talent and Investing?? (3)

Why you must not stop dreaming of reaching financial freedom and pursue it?

Time is the most precious commodity in our life.
We can have more control over how to use it
or
We have little control over how to to use it.




What is your body energy level after a day work for making a living? 


Time and Body Energy

Most of us will spend our precious commodity in our life i.e.Time, Body Energy; and together with our talents to make a living. After making a living, we will be left with limited spare time and body energy to spend freely.

However, some will try to free up more spare time by sleeping less. By habitually sleeping less over a long period is actually bad for our health. Our health is Number 1 so we must consciously take good care of it. Once we start losing it; no amount of money in the world can restore the body energy back to its last level.

How do we use our spare time and body energy?

  1. Some will use part of it to further monetise them by working part-time.
  2. Some will privatise them for family, relatives and friends.
  3. Some will "publictise" ??? them for the community.
Why do we wish to reach financial freedom sooner and not later?

The most common reason is that we may want to privatise more of our time and body energy. However; some may even want to "publictise" them and inject free energy radicals into the cyber space for their community.

Createwealth8888 is nearer to his financial freedom so there is no need for him to monetise his spare time and body energy. He is able to conserve body energy at works too. He can afford to release more of his spare body energy freely into the cyber space and hopefully his daily unique visitors of several hundreds or more; and some time more than a thousand may benefit from the free energy radicals floating in the cyber space injected by him. It may have multipler effect too. Who knows?

What is your reason for reaching financial freedom?

 








Thursday, 22 December 2011

Olam to buy 75.2% of Spain's Macao Commodities Trading for US$20m

By ANGELA TAN

Olam International Limited said on Thursday that it plans to buy a 75.2 per cent interest in Macao Commodities Trading SL (MCT) for US$20 million.

'This transaction provides an accelerated entry into the Spanish and larger Iberian market for Olam,' the commodities group said, adding that the purchase also opens up new markets involving chocolate, bakery and beverage ingredients.

The purchase will include all land, buildings, inventories of MCT and its shareholding in Solimar Food Ingredients (SFI) - a joint venture established in 2005 as a 51:49 holding between MCT and Olam.

Established in 1994 in Valencia, Spain MCT is a leading supplier of cocoa powder, cocoa beans, desiccated coconut, dried fruits, vegetable fats and dairy products to the chocolate, beverage and biscuit Industries in the Iberian region.

Olam has the option to acquire the remaining 24.8 per cent interest in five years' time.

The acquisition would be funded through internal accruals. It will be both EBITDA and earnings accretive from the first full year after consolidation.



Do you still believe in financial experts or Gurus forecast and calls?

Read? 4 financial experts' forecast for this year

See it for yourself!

Talent and Investing?? (3)

Read? Talent and Investing?? (2)

Why you must not stop dreaming of reaching financial freedom and pursue it?


Look very closely at these three pictures and how do you understand them?





Once you fully understand the different state of commodities in our life: time, body energy, and money.

Got time, got body energy; but lack of money.

Got body energy, got money; lack of time.

Got time, got money; but lack of body energy.

Read? Wealth Or Financial Freedom Doesn't Just Happen!

Tuesday, 20 December 2011

Talent and Investing?? (2)

Read? Talent and Investing??

Two possible paths to financial freedom

Most of us will have two forms of assets: human asset and financial asset.

Few of us will have superior human or financial asset. Even fewer will have both superior human and financial assets.

Those who have either superior human or financial asset will have no problem in reaching their financial freedom fast. It is only those who has limited human or financial asset will be the ones struggling to reach financial freedom or can  never reach their financial freedom.

Unfortunately, most of us will have limited human or financial assets. Our talent is our human asset. With limited talent, it is extremely difficult to earn high income as no employers, customers, or businesses will pay high salary to the less talented ones. This is the fact of life. This is how the real world works. The less talented ones will not be able to climb corporate ladder and will not earn high income.

So how do the less talented ones with limited financial asset reach their financial freedom?

One way is to take the path to financial freedom via stock market and many of us are thinking of taking this path as stock investing doesn't require us to be talented or financially rich to begin. Every less talented ones with limited financial asset are eligible to try and nobody is stopping you from trying.

Good luck to all financial freedom seekers. I am like you too!






Reading this won't make you great!

Business Times - 17 Nov 2007


Reading this won't make you great!

Mark Sellers, founder of a Chicago-based hedge fund, argues that the best investors are born with particular psychological traits that others can never learn

By TEH HOOI LING
SENIOR CORRESPONDENT

WHAT makes someone a great investor? It's something you have to be born with, said Mark Sellers, founder and managing member of Sellers Capital LLC, a long/short equity hedge fund based in Chicago.

Apparently, it's not about your IQ, the education you've had, the books you've read, or the experience you've accumulated. 'If it's experience, then all the great money managers would have their best years in their 60s and 70s and 80s, and we know that's not true,' he said in a speech to a class of Harvard MBA students.

Intelligence and learning are obviously necessary too, and are sources of competitive advantage for an investor, but there are structural assets some possess that cannot be copied or learnt by others. 'They have to do with psychology and psychology is hard wired into your brain. It's part of you. You can't do much to change it even if you read a lot of books on the subject,' said Mr Sellers.

He said that there are seven traits great investors share that are true sources of advantage because they cannot be learned. You are either born with them or you aren't.

The seven traits are:

One, the ability to buy stocks while others are panicking, and the ability to sell at a time when other investors are euphoric. 'Everyone thinks they can do this, but then when October 19, 1987, comes around and the market is crashing all around you, almost no one has the stomach to buy,' Mr Sellers said.

'When the year 1999 comes around and the market is going up almost every day, you can't bring yourself to sell, because if you do, you may fall behind your peers.

'The vast majority of the people who manage money have MBAs and high IQs and have read a lot of books. By late 1999, all these people knew with great certainty that stocks were overvalued, and yet they couldn't bring themselves to take money off the table because of the 'institutional imperative', as Buffett calls it.'

Two, the great investor has to be obsessive about playing the game and wanting to win. 'These people don't just enjoy investing; they live it. They wake up in the morning and the first thing they think about, while they're still half asleep, is a stock they have been researching, or one of the stocks they are thinking about selling, or what the greatest risk to their portfolio is and how they're going to neutralise that risk.

'They often have a hard time with personal relationships because, though they may truly enjoy other people, they don't always give them much time. Their head is always in the clouds, dreaming about stocks. Unfortunately, you can't learn to be obsessive about something. You either are, or you aren't. And if you aren't, you can't be the next Bruce Berkowitz.'

(Berkowitz was a managing director of Smith Barney and set up his fund Fairholme Capital Management in 1999. Since inception, Fairholme Fund has returned 18.7 per cent annually on average.)

The third trait of a great investor is the willingness to learn from past mistakes. 'The thing that is so hard for people and what sets some investors apart is an intense desire to learn from their own mistakes so they can avoid repeating them. Most people would much rather just move on and ignore the dumb things they've done in the past.

'I believe the term for this is 'repression'. But if you ignore mistakes without fully analysing them, you will undoubtedly make a similar mistake later in your career. And in fact, even if you do analyse them it's tough to avoid repeating the same mistakes.'

A fourth trait is an inherent sense of risk based on common sense. 'Most people know the story of Long Term Capital Management, where a team of 60 or 70 PhDs with sophisticated risk models failed to realise what, in retrospect, seemed obvious: they were dramatically overleveraged. They never stepped back and said to themselves, 'Hey, even though the computer says this is OK, does it really make sense in real life?'

'The ability to do this is not as prevalent among human beings as you might think. I believe the greatest risk control is common sense, but people fall into the habit of sleeping well at night because the computer says they should. They ignore common sense, a mistake I see repeated over and over in the investment world.'

Five, great investors have confidence in their own convictions and stick with them, even when facing criticism. 'Buffett never get into the dotcom mania, though he was being criticised publicly for ignoring technology stocks. He stuck to his guns when everyone else was abandoning the value investing ship and Barron's was publishing a picture of him on the cover with the headline 'What's Wrong, Warren?'. Of course, it worked out brilliantly for him and made Barron's look like a perfect contrary indicator.'

Mr Sellers said that he is amazed at how little conviction most investors have in the stocks they buy. 'Instead of putting 20 per cent of their portfolio into a stock, as the Kelly Formula might say to do, they'll put 2 per cent into it. Mathematically, using the Kelly Formula, it can be shown that a 2 per cent position is the equivalent of betting on a stock which has only a 51 per cent chance of going up, and a 49 per cent chance of going down. Why would you waste your time even making that bet?'

The Kelly Formula arose from the work of John Kelly at AT&T's Bell Labs in 1956. His original formulas dealt with the signal noise of long-distance telephone transmission. It was then adapted to calculate the optimal amount to bet on something in order to maximise the growth of one's money over the long term.

Six, it is important to have both sides of your brain working, not just the left side - the side that's good at maths and organisation. 'In business school, I met a lot of people who were incredibly smart. But those who were majoring in finance couldn't write worth a damn and had a hard time coming up with inventive ways to look at a problem,' said Mr Sellers.

'I was a little shocked at this. I later learned that some really smart people have only one side of their brains working, and that is enough to do very well in the world but not enough to be an entrepreneurial investor who thinks differently from the masses.

'On the other hand, if the right side of your brain is dominant, you probably loathe math and therefore you don't often find these people in the world of finance to begin with.'

So finance people tend to be very left-brain oriented - and Mr Sellers said that that is a problem. A great investor needs to have both sides turned on, he said. 'As an investor, you need to perform calculations and have a logical investment thesis. This is your left brain working. But you also need to be able to do things such as judging a management team from subtle cues they give off.

'You need to be able to step back and take a big picture view of certain situations rather than analysing them to death. You need to have a sense of humour and humility and common sense. And most important, I believe you need to be a good writer.'

He cited Warren Buffett as one of the best writers ever in the business world. 'It's not a coincidence that he's also one of the best investors of all time. If you can't write clearly, it is my opinion that you don't think very clearly,' Mr Sellers said.

And finally the most important, and rarest, trait of all: the ability to live through volatility without changing your investment thought process.

This, said Mr Sellers, is almost impossible for most people to do; when the chips are down they have a terrible time not selling their stocks at a loss. They have a really hard time getting themselves to average down or to put any money into stocks at all when the market is going down.

'People don't like short-term pain even if it would result in better long-term results, he said. Very few investors can handle the volatility required for high portfolio returns. They equate short-term volatility with risk.

'This is irrational; risk means that if you are wrong about a bet you make, you lose money. A swing up or down over a relatively short time period is not a loss and therefore not risk, unless you are prone to panicking at the bottom and locking in the loss.

'But most people just can't see it that way; their brains won't let them. Their panic instinct steps in and shuts down the normal brain function.'

Monday, 19 December 2011

Sembcorp Marine's unit wins US$140 specialised contract

By CARINE LEE


Sembcorp Marine on Monday announced that its subsidiary, Sembawang Shipyard, has secured a US$140 million contract from Equinox Offshore Accommodation Limited to convert a ropax vessel to a DP2 Accommodation and Repair Vessel (ARV).

The vessel will be a diesel electric DP2 high specification vessel, uniquely designed and equipped to provide extensive accommodation and workshop facilities to support and service offshore facilities and projects in deep water areas. It will have accommodation facilities to comfortably house a complement of 450 persons and will be renamed ARV 3.

The vessel is expected to arrive in the shipyard in January 2012 for the conversion and modification works, which is scheduled for completion in the fourth quarter of 2012.

The ARV 3 will be deployed to support offshore works in Brazil for five years under owner's charter contract with Petrobras of Brazil.



My dream of pursuing financial independence by 55 in 2011!

Read? Four Financial Progressive Stages





It was many years back .....




One day, after reading the book on "Rich Dad Poor Dad" by Robert, I began to like the idea of investment, financial freedom and getting out of rat race so much that I have a mind flip. I began to dream of financial independence by 55.



(Another book that helped me is "Think and Grow Rich" ) Read? Two Books That Change My Views



But, how to achieve it?




Business or Investment?




For me, the choice is quite obvious. Without much talent for Business; I would have to take the Investment path to financial independence. Next, to decide on properties or stocks? I chose stocks and that is the way to go.













Read? Why you must not stop dreaming of reaching financial freedom and pursue it?









Why we must get out of rat race as early as possible? Read? Regret of the Dying



Why 55? 



When I began that dream, Singapore's official retirement age was 60; but now, it is 65. Too bad folks! We will have to work longer. 60 is the new 55.



Actually, I have already achieved financial security when I had this dream so financial independence is just the next step so I have this simple thinking. If I put in enough time and effort to educate myself to become savvy with long-term investing and short-term trading; I will be able to create wealth from the stock market. (This is how I named the title of this blog. This is why I am still blogging since 2006).

















I started reading many finance and investment books that I could find in NLB libraries. I also started to follow closely many investment and trading blogs, forums, cboxes closely and to identify who were the experts and gurus and hoping to learn more tips and tricks from them. (But, unfortunately, some of my superheroes were killed in 2008/2009. Read? Following My Superheroes!)



I also attended many investment and trading previews to hear from Gurus themselves; but all of them have failed to convince me to part my hard earned money to attend their so-called easy money making programmes. May be I was too stingy!



It was only after a few years in the stock market, I realised that I must get real and set concrete goals to achieve that dream. I then set progressive yearly investment goals to be achieved from 2003 to 2011 and this is how the investment marathon race for 2003 to 2011 has began.
































2011 is the most important year!




The race has ended.









I missed the end goal and achieved only 58.6% and the reason for failing is too obvious!



When one race finished, the next race (2012 - 2021) begins












The next 10 years of progressive goals for 2012 to 2021












Sometime in life, we will reap what we have sowed so I will be reaping what I have sowed in the past. It will continue to contribute to the future without much effort required. Read? One click! That is more than enough to generate passive income for a long time.



I will be looking to sow more One Click in the next bear.


































Volatility is name of the Game















Sunday, 18 December 2011

XIRR/CAGR: Investor's true performance indicator! (2)

Read? XIRR/CAGR: Investor's true performance indicator!

Investor A said: "I have made $100K passive income from the stock market in 2011"
Investor B said: "I have made $250K passive income from the stock market in 2011"

Wow, wow, wow! Did you say that?

You must be impressed by the number! You may actually go and congratulate them, and hoping to learn from them as well.

Sorry to tell you this!

You have been affected by "trigger" number! It is similar to "trigger" words used by SMOL in his sales tactics to earn higher commissions. They are powerful!!! Read? The pleasure of naked skin over leather...

Investment gurus who are conducting investment courses love to use "trigger" number and "trigger" words in their newspaper ads. It will help them to catch lots of potential investors to attend their free previews. During the previews, more "trigger" words and "trigger" numbers will be presented. Soon some attendees will be sucked into it and pay for the course.

As investors, we must learn to be savvy enough and not fall into "trigger" number used by investment gurus who are trying to impress upon us. We must equip ourselves with essential knowledge and skill to better gauge investment performance and read beyond "trigger" numbers and "trigger" words.

It is true that they may have made $100K from the stock market. But, so what? These "trigger" number said nothing about their investing performance. Absolutely nothing! By putting cash or income into their pocket is not the same as getting real return on their investment. Did the investment gurus tell you this? If no, why not?

Why do we invest in stocks?

When we invest in stocks; we are actually investing with expected yield and return; and also to accept the risk of capital loss too. But, we don't expect capital loss when we place a buy order. Nobody with a sound mind will execute a buy order while expecting capital loss upon buying. Nobody!

Investors who are not ready to accept capital risk will continue to stay at the sideline to watch the market actions.

In short, stock investing is about expected yield and return; and acceptance of capital risk so our investment performance measurement must reflect that too.

Yield and Return

When we say return, we are actually referring to Total Return or Total Shareholder Return (TSR)

As investors, we should be using both Yield and TSR to measure investment performance on stocks. We must also know the difference between Yield and TSR.

It is very important to know that. Read? Don't Be a Yield Pig

Did you understand the moral of the story in that article? If not, read again.

Yield measures income or cash received from stock but totally ignore capital gain/loss while TSR takes into account of measuring both yield and capital gain/loss. TSR is a better measurement of a stock investing performance.


For example, when investor A invested $1M in stocks and received $100K in stock dividends.His yield on his stocks investment is 10%

$100K passive income at 10% yield!

Wow, wow, wow! Did I hear you saying that again?

Again, the "trigger" number of $100K and yield of 10% tell us little about investor A's real investing performance.

For example, what if, the market value of his stocks investment has dropped to $800K and that is -20% capital loss even though it is an unrealised loss. But, TSR will measure both yield and capital gain/loss so his TSR = 10% (yield) - 20% (unrealised capital loss) = -10%. 

Despite, putting $100K into his pocket, investors A is actually experiencing negative growth of -10% when that measurement was taken.

In conclusion, by putting cash or income into our pocket is not the same as measuring the true performance on our investment.

XIRR and TSR

What is the key difference between XIRR and TSR?

The key difference is XIRR will include measurement of investment performance over a time period so XIRR is a better option as an investor's true performance indicator.

Have you started using XIRR to measure your portfolio performance? If no, why not? Any good reason for not doing it?



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