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, 30 June 2012

How To Avoid Investing Too Conservatively

By Tim Parker


If you don't do anything, you can't lose money. That might be true with slot machines, horse racing and the lottery, but it's not true with investing. Skilled investors know that the price of doing nothing or not enough can result in losses; not the lost value of stocks or mutual funds, but other losses not plainly visible to the eye of a new investor. Here's what you need to know about how these losses can affect you.

Beware of Inflation

If you have a few decades behind you, you probably remember the days of being a kid, where you could hop on your bike with a quarter, take it to a local store and buy a piece of candy. As you got older, you remember buying gasoline for less than a dollar per gallon.

Your money had more buying power back in those days, but today a quarter has to be combined with other quarters to have much buying power and a gallon of gas is close to $4. For an investor, inflation is fundamentally important; just as inflation has contributed to changes in the price of gas over the years, it can have a surprising affect on your investments, if you're not prepared for it.

Don't Hold Cash

Holding onto cash for long periods of time, waiting for the market to bottom, reduces the value of your money. You might be able to earn 1% from a savings account right now but if the current rate of inflation is 2.3%, inflation is causing an annual loss of 1.3%.

Holding cash for short periods of time is a wise investment choice, but over the long term you're silently losing purchasing power, and purchasing power is the only reason we hold currency. How do you combat inflation? Put that money to work but only in investments that earn a rate of return higher than the rate of inflation.

How to become rich in stocks??? (5)

Read? How to become rich in stocks??? (4)

Number doesn't lie!!!


Read? Are you one of high income earners in 2009 in Singapore?
  1. How many of us are high income earners and can save more money for investing capital?
  2. How many of us don't want to marry and may have more money for investing?
  3. How many married couple want to be DINK and may have more money for investing? (Dual Income No Kids)
  4. How many of us can have an account size of more than $1M for investing?
  5. How many of us has an account size of lower $XXX,XXX and want to become rich in stocks?

I believe many of us will know the answer in our heart and know where we are and where we want to be?

Next come the two most common questions in investing in the stock market ....

Dividend vs. Capital Appreciation???

Income stocks vs. Dividend Growth stocks???

You have to make a choice!!!


Read? Can recommend some high yield dividend stocks for passive income? (2)

Guess what happened after someone asked me the above question. Many people become buay song with the "reply".


But, before I say my piece .....

“If you are in the right sector at the right time, you can make a lot of money very fast” –Peter Lynch
"You need $10,000 and two 10-baggers, and you're a millionaire." –Peter Lynch

It is how to become rich in stocks if we read Peter Lych correctly!
$10K ---> $100K ----> $1M

or

$XXX,XXX ---> $X,XXX,XX (A portfolio of multi-baggers will help)

Let begin ......


Read? Uncle8888, how do you find multi-bagger stock?

Uncle8888: "Well, I have successfully discovered 54 different stocks in SGX that I have bought in the past are not multi-baggers."

The moral of the above story is to keep finding one!

Is Uncle8888 super investor?

No. No. No!!!

I have made big losses in 2008 Bear market too!

Total net losses in 2008: $160K

  •  4 months of losses: Jan:$76K, Aug:$68K, Sep:$18K, Oct:$31K

Read? Trading Performance Review


I was the HERO and stubbornly held on to two rotten durians to ZERO and then the durian owners kind enough gave me two pieces of Toilet Paper to remind me of the SHIT!

Read? Stock Picking is like Choosing your own durians?









Do I earn the right to tell you this true life story in investing after many years of adventures and mis-adventures in the stock market?

What do you think? Hmm....

Why I am strong advocate of waiting for dividend growth stocks to come to us?


Case Study 1 - Kep Corp






Batch 1: Bought in 18 Sep 2001 after WTC Attack and holding it over 10.8 years

For past 10.8 years, the dividend yield is as follows:

Lowest: 10.4%
Highest: 44.2%

Total Dividend Return on initial investment cost = 291%

Annualized Return = 27%

Unrealized capital gain as of Friday market closing price at $10.28 = 681% over 10.8 years

Annualized Unrealized Return = 63%

So Dividend Return vs. Capital Appreciation291% vs. 681%


Batch 2: Bought in 26 Mar 2004 and holding it over 8.3 years

For past 8.3 years, the dividend yield is as follows:

Lowest: 5.7%
Highest: 18.1%

Total Dividend Return on initial investment cost = 99%

Annualized Return = 11.9%

Unrealized capital gain as of Friday market closing price at $10.28 = 220% over 8.3 years

Annualized Unrealized Return = 27%

So Dividend Return vs. Capital Appreciation99% vs. 220%


Paper profit is useless as it cannot buy food

I know!

That is why I am also doing short-term trading when market presents opportunity to make pocket money.

Read? Kep Corp: Sold $10.14

I have done 94 rounds of Kep Corp.



Case Study 2 -  Semb Corp
















Batch 1: Bought in 24 Dec 2002 and holding it over 9.5 years

For past 9.5 years, the dividend yield is as follows:

Lowest: 6.1%
Highest: 59.8%

Total Dividend Return on initial investment cost = 252%

Annualized Return = 26.5%


Unrealized capital gain as of Friday market closing price at $5.13 = 599% over 9.5 years

Annualized Unrealized Return = 63%

So Dividend Return vs. Capital Appreciation252% vs. 599%


Batch 2: Bought in 15 Sep 2003 and holding it over 8.8 years

For past 8.8 years, the dividend yield is as follows:

Lowest: 4.1%
Highest: 26%

Total Dividend Return on initial investment cost = 107%

Annualized Return = 12.1%


Unrealized capital gain as of Friday market closing price at $5.13 = 204% over 8.8 years

Annualized Unrealized Return = 23%

So Dividend Return vs. Capital Appreciation107% vs. 204%

Batch 3: Bought in 25 Oct 2005 and holding it over 6.7 years

For past 6.7 years, the dividend yield is as follows:

Lowest: 4%
Highest: 16%

Total Dividend Return on initial investment cost = 52%

Annualized Return = 7.7%

Unrealized capital gain as of Friday market closing price at $5.13 = 87% over 6.7 years

Annualized Unrealized Return = 13%

So Dividend Return vs. Capital Appreciation52% vs. 87%


Paper profit is useless as it cannot buy food

I know!

That is why I am also doing short-term trading when market presents opportunity to make pocket money.

Read? Semb Corp: Sold $4.25 ROC 5.0%

I have done 52 rounds of Semb Corp.




Now I am patiently waiting for more to come ...











Number doesn't lie!

Income stocks vs. Dividend Growth stocks???

Do your own thinking ....

After post add on story:

One reader sharing a story how to become millionaire with RM1K initial investment and grow to RM3.2M over 40 years.




























XIRR/CAGR: Investor's true performance indicator! (7)

Read? XIRR/CAGR: Investor's true performance indicator! (6)

Someone brought to my attention: "I finally found a good example on why using networth to measure XIRR can influence results. Ref. to buddy post."

"If your $3k stock become $1.5k after a year, the loss is 50%. Yet by injecting cash to sit idle in the portfolio, the poor performance has diluted to become XIRR=-30%. That will make the investor happier but it does nothing to his pocket. In fact, the poor performance could be diluted even further to -1% by injecting more cash to sit idle in the portfolio. "


Createwealth8888's way of using XIRR is to measure the true investing performance on our portfolio based investible capital and not to include VIRGIN cash idling somewhere as investible capital.

One way is to have dedicated bank account for investment purpose and only idle cash that has been previously invested in this account is included in XIRR measurement.

Only when this investment account runs out of money and you need money to buy new stock, you then transfer the exact amount of cash from other bank account to this investment account to pay the newly stock purchase. It is how you can keep VIRGIN cash outside your investment account.

We should never be in an illusion of better XIRR performanance by injecting cash in a falling Bear market to improve XIRR. It is nonsense!


Stock Investment Portfolio = Current stock value at market closing price + Investible cash available

 = Capital + Realized P/L + UnRealized P/L

and XIRR this stock investment portfolio to measure our investing skills


Read? Two Bank Accounts? No, You may need Four! - (4)

Now you may know why I need four bank accounts.

Friday, 29 June 2012

H1 2012 Investment Performance Report


A goal-based investing approach


I use a goal-based investing approach by setting a 10-year goals target to achieve for each year from 2012 to 2021.


H1 2012 Result



Achieved 48.8% of 2012 Year Goal.

















Portfolio XIRR


Track, measure and visualise - without doing it how to revise investing strategies and improve year-on-year investing performance.


My portfolio XIRR includes all investible cash plus the current stocks value at market closing price as on 30 Jun 2012.

Since one year ago: -1.1%
Since 1 Nov 2008: +10.2%
Since 1 Jan 2003: +11.5%
Since 1 Jan 2000: +10.3%

From the above multi-years XIRR value, I believe my investing performance is quite consistent.















Riding market cycles of Bull and Bear















How is my investing skills contributing to my net worth and financial independence dream?











Two is Good!

Just For Laugh ....

Two is Good!!!

For yourself ....

  1. Two eyes
  2. Two ears
  3. Two hands
  4. Two legs
  5. Two lungs
  6. Two kidneys
  7. Brain - two halves
  8. Heart - two chambers
  9. Two balls
For investors ...

  1. Gut and Patience
  2. FA and TA
  3. Long-term investing and short-term trading

For men and women ...


Once there was a woman who kept chanting the goodness of singlehood on SundayTimes.

When people talked about their children, she talked about her niece.

Finally, she realized in her 40s, two is Good and got married!






Thursday, 28 June 2012

The Riskiest Day of Your Life

By Larry Swedroe | CBS MoneyWatch

The primary financial goal for most people is to make sure that their assets last as least as long as they do. The day on which there is the greatest risk of failing to meet that objective is the day you retire. The reasons, as "Someday Rich" authors Timothy Noonan and Matt Smith explain, are the day you get your gold watch, you have:

   - Exhausted your human capital (ability to generate income from your labors)
   - Assumed "longevity risk" (the need to fund your living expenses for the rest of your life)

Of the many risks we face when developing a financial plan, longevity risk is often the one most overlooked, or at least underestimated. And yet for many individuals, it might be the one that entails the greatest risk. Consider the following:

Today, while a 65-year-old male has a life expectancy of 19 years (to age 84), a 65-year-old couple has 50 percent chance of one surviving to age 92. That means half of all 65-year-old couples will have one spouse alive after 27 years. And they have a 25 percent chance of one reaching 97. Because being alive without the financial resources to support an acceptable living standard is too painful to even contemplate, we must plan for the possibility that we'll live longer than expected. We can reduce the risk of longevity by working longer, delaying taking Social Security benefits and buying longevity insurance (in the form of a payout annuity).

[Related: 'Does the 4% Rule for Retirement Withdrawals Make Sense?']

The risk of stocks compounds the longevity problem, because contrary to popular belief, stocks are actually more risky the longer your horizon. While returns are less volatile (the standard deviation of returns is less the longer the horizon), the potential dollar results widen as time increases. Remember, even a small difference in returns (let alone a large one) leads to large differences in compound results as the horizon lengthens. And if you thought that stocks were safe if your horizon was long, just consider the case of the unlucky Japanese investors. In 1990, the Nikkei Index stood at close to 40,000. Twenty-two years later, it's close to 9,000. As Keynes might have said, markets can underperform expectations for a lot longer than you can remain solvent. We can address this risk by not taking more equity risk than we have the ability, willingness or need to take, and diversifying the risks we do take as much as possible, avoiding concentrating assets in single (or small groups of) stocks or even asset classes (such as U.S. stocks). Monte Carlo simulation programs can help you determine the appropriate amount of equity risk to take.

Another major issue we face when we retire is moving from the accumulation phase to the decumulation phase. During the accumulation phase, bear markets can be viewed as positive events as we get the chance to buy low as we add assets. When we hit the decumulation phase, bear markets can lead to selling low. And once you sell in order to spend, you can't recover. For example, from 1973 through 1999, the S&P 500 returned 13.9 percent per year and inflation rose 5.2 percent a year. Thus, the real return for an investor in the S&P 500 Index was 8.7 percent. Knowing that in hindsight one would think you could retire in 1972 and safely withdraw an inflation-adjusted 7 percent of your original principal every year and not worry about running out of assets. However, because the S&P 500 Index declined by approximately 40 percent in the 1973-74 bear market, you would have been broke by the end of 1982! In the decumulation phase the order of returns matters a great deal. Once again, a Monte Carlo simulation program can be of great value in helping you determine an acceptable withdrawal rate.

Another risk that increases when we retire from the workforce is inflation, as we no longer have our wages to rely on -- wages which typically increase with inflation. With the increased risk of inflation, retirees should prefer bonds with returns linked to inflation -- TIPS and I bonds -- and avoid long-term nominal bonds. They should also consider an allocation to commodities as they tend to perform well in periods of rising inflation.

There's another risk that increases as we enter retirement: the risk of increasing health care costs. As we lose the health care benefits provided by most employers, we face the combination of longer life expectancies, the majority of medical expenses occurring during the last years of life, and the fact that medical expenses are rising faster than the overall rate of inflation. This leads many to underestimate the risks. Consider the following. The Employee Benefit Research Institute estimates that a 65-year-old couple without employer provided health care benefits could need $216,000 if they live to 80, $444,000 if they live to 90, and $778,000 if they survive to 100. One way to hedge this risk is to purchase long-term health care insurance.

Even a well-thought-out investment plan can be undermined by the failure to consider the aforementioned risks as some are unrelated to investing. This is why it's important to have an investment plan that is integrated into an overall financial plan.


Keppel yards in U.S. and Azerbaijan secure projects for US$70 million

Singapore, 28 June 2012 Keppel Offshore & Marine’s (Keppel O&M) yards in the U.S. and Azerbaijan have secured contracts worth a total of about US$70 million.

In the US, Keppel AmFELS LLC, has secured a contract from Transocean Offshore Deepwater Drilling Inc. (Transocean) to repair and upgrade the semisubmersible (semi) rig Sedco 707.

Scheduled to arrive at Keppel AmFELS in July 2012, Sedco 707’s major scope of work includes steel renewal of the hull, repair of the thrusters, refurbishment of the living quarters as well as electrical and piping replacement work. The semi is expected to depart in 1Q 2013 and return to work in offshore Brazil.

Mr Tan Geok Seng, President of Keppel AmFELS added, "We thank Transocean for their trust and confidence in us and look forward to delivering another successful project to them safely and on time. Having built a long term relationship with Transocean, we are attuned to their needs and committed to support them in the renewal of their fleet.

"While we have a healthy base load of new builds, we have the capacity and expertise to undertake various repair projects which constitute an important part of our business. We are well positioned to support operators requiring efficient repairs in the region."

The Sedco 707 is a self-propelled, twin-hulled semisubmersible drilling unit with eight thrusters designed to work in water depths of up to 6,500 feet. She has been working off the coast of Rio de Janeiro, Brazil.

Separately, Keppel O&M’s shipyard in Azerbaijan, Caspian Shipyard Company (CSC) has also secured a contract to build a floating dock for Baku Shipyard LLC (BSC).

Expected to be completed in 4Q 2013, the floating dock will be 168 metres by 50 metres and equipped with two sets of 25 tonne Jib Cranes. It will have a maximum docking weight of 9,000 tonnes with a maximum docking draft of 6.5 metres.

CSC’s scope of work includes steelworks construction and the fabrication of the hull structure while BSC will provide overall project management. This arrangement will expedite the construction of the floating dock and demonstrates the synergy of Keppel O&M’s shipyards.

The above contracts are not expected to have a material impact on the net tangible assets or earnings per share of Keppel Corporation Limited for the current financial year.

Wednesday, 27 June 2012

Inflation Makes Big Incomes Smaller

$100,000 income: No big deal anymore

By Craig Guillot | Bankrate.com

One hundred thousand dollars. Since the 1980s, the magical "six-figure" salary has been a benchmark for financial success. Not too long ago, that income often meant two nice cars in the garage of a large house, fun family vacations and plenty of money left over to save for retirement and college tuition.
But times have changed. Not only has standard inflation steadily eroded the real value of a $100,000 income, but the cost, of housing, health insurance and college tuition have risen dramatically in recent years. Consider the rising costs of food, energy and the necessities of a middle class life, and that six-figure luxury quickly turns to six-figure mediocrity.
Less than 20 percent of American households even break the six figures. But many who earn incomes near the mark find that their prized incomes don't take them as far as the hype. Many say that while breaking the $100,000 annual income mark may still be an impressive milestone, it doesn't exactly roll out the red carpet.

Costs eat away at benchmark

According to the U.S. Census Bureau, only 6.03 percent of individual over 18 and only 19.9 percent of households had incomes of $100,000 or more in 2010. In fact, the median annual household income for 2010 was $50,046, just more than half of the six-figure benchmark. The overwhelming majority of Americans still look up to a $100,000 income, but the expectations of what comes with that income are rapidly slumping.
“Without a doubt, the housing situation is the biggest thing that eats into our income.” -- Brian Neale, investment manager
According to Labor Department statistics, the average inflation rate for 2011 was the worst since 2008, with consumer prices rising 3.1 percent, compared to an average of 1.6 percent in 2010. Much of this was fueled by energy costs (up 15.2 percent for the year) and food costs (up 3.7 percent for the year). Just to keep up with standard inflation, a $100,000 salary in 1990 would have to be $172,103.29 in 2011.
"What would have cost you $100,000 in 1976 would cost you $381,000 today. That's just the inflation, and there are so many other things that have grown very expensive," says Mari Adam, Certified Financial Planner and president of Adam Financial Associates in Boca Raton, Fla.
Adam points to health care as a major expense that has grown almost twice the rate of inflation. The Kaiser Family Foundation, which tracks the costs of health insurance, found in 2011 that insurance costs had increased by a whopping 134 percent since 2000. The total cost of health insurance now averages $5,429 per year for individuals and $15,079 for families. Adam says college costs have also grown tremendously in recent years. According to the College Board's annual "Trends in College Pricing" report from last year, published tuitions at four-year public universities are up 42 percent in five years, the largest increase of any five-year period since the 2007-09 school year.
"These are things that everyone spent money on 30 years ago, but the percentage of what was going out of their paycheck is a lot higher now. More of the income is being taken away to pay for a lot of these things," says Adam.
The cost of housing has also played a major role in diminishing the power of a six-figure income. In many parts of the country housing prices have outpaced wage growth for almost a decade. The Housing Affordability Index, which compares the cost of housing against median family income, dropped considerably between 2000 and 2007. In 2000, the median family income was $50,732, and the median home price was $139,000. While median income grew to $60,831 in 2011, median home prices skyrocketed to $229,299 in 2007 before leveling off at $166,200 in 2011. In those 11 years, median home prices had risen 19.6 percent while median incomes had risen 16.6 percent.

"Without a doubt, the housing situation is the biggest thing that eats into our income," says Brian Neale, an investment manager from Westminster, Md.

Money doesn't go far

Neale, 33, says he surpassed the $100,000 mark last year but says that between mortgage payments, the high price of heating fuel, gas, food and everyday items in life, his salary doesn't go as far as he thought it would. Neale is married with three children and says that his extracurricular real estate and investment activities help them buy the extras in life.
"Now that I've made (a $100,000 salary), it's not all it's cracked up to be. We make sacrifices. It's not like I tell my kids we're going to have to eat peanut butter and jelly every night. We live well, but I wouldn't consider it anything extravagant," says Neale.
Many now consider $250,000 the new $100,000 income. Adam says that level of income is typically required to provide what many have before expected of a six-figure salary. Adam also points to other expenses that are not necessities but are considered part of a middle class lifestyle -- things like cellphones, high-speed internet access, vacations, karate lessons, iPods, laptops and digital cameras.
"What you might think people deserve for a person that has a reasonable income is excessively high. Add in all the other expenses, and there just isn't anything left and that's part of the reason why a $100,000 income isn't going that far," says Adam.

Geography and lifestyle factors

With the cost of housing typically the largest expense for a family, location is one of the most important factors in dictating the power of a $100,000 income. While that level may not go far on the coasts, it may still provide a fairly comfortable lifestyle in much of Middle America. Jeff Eschman of Brazos Financial Advisors in Houston, says that in much of that state $100,000 income earners can enjoy very comfortable lifestyles.
"I don't see many families who are at the $100,000 income level currently making a lot of sacrifices. Families at that income level should be able to afford a very nice lifestyle in this area," says Eschman.
“There is still only a small percentage of people making this income. It points out that for your average person in your average job, this is becoming an increasingly hard country to live in.” -- Mari Adam, certified financial planner
In cities like San Francisco; Manhattan, N.Y.; Los Angeles; San Jose, Calif.; and Washington, D.C., the cost of housing alone can take a major bite out of a $100,000 income.

The Council for Community and Economic Research's Cost of Living Index, which compares typical family and individual expenses across hundreds of cities shows that. According to the Index, for 2012 Q1, a typical family earning $100,000 per year would need to earn around $228,300 in New York City and $166,500 in San Francisco to maintain that same lifestyle
In low-cost areas, Eschman says that people at that income level tend to run into financial problems when their lifestyle outpaces their income. While this is a problem for many Americans in all income levels, top figure earners are not immune from it. Adam says she has even seen people with incomes of up to $300,000 having trouble covering their expenses.

Choice is yours

Bryce Danley, a Certified Financial Planner and advanced financial adviser with Ameriprise Financial, says the real power of any income is all about perspective and choices. He says buying too much house, spending too much on automobiles and having too much debt is commonplace with families in the $100,000 income level and largely responsible for the six-figure pinch. In one example Danley uses a household that earns $100,000 a year, owns a $375,000 home, leases 2 vehicles for $450 each per month and pays $250 per month on credit cards. After that household pays the mortgage, car notes, debt and takes out social security and federal income taxes, it has spent 75 percent of its income.
"This is a very typical situation for someone in that income range. And we wonder why average Americans don't save any money -- it's because of the decisions they made in housing, cars and debt," says Danley.
While the real power of a $100,000 income has been drastically diminished, it highlights that the burden of increasing costs on those making less is even more profound. Danley says that regardless of income level, Americans' penchant for debt, consumerism and outspending themselves is what ultimately causes financial disappointment or stress.
"There is still only a small percentage of people making this income. It points out that for your average person in your average job, this is becoming an increasingly hard country to live in," says Adam.

Can recommend some high yield dividend stocks for passive income? (2)

Just For Thinking ....
Read? Can recommend some high yield dividend stocks for passive income?


"Any Tom, Dick, and Harry who has $X,XXX or $XX,XXX on Monday can immediately become an investor with high yield dividend stocks for passive income." - Createwealth8888

Why not?
Visit for your select: S-Reits

REIT
Period
DPU cts
Mkt
Yield
NAV
Gearing
Assets Type
Sabana REIT
Q1 – Mar12
2.26
$0.975
9.323%
$1.040
33.90%
Industrial

Any Tom, Dick, and Harry can see for themselves by visiting the above URL and buy Sabana REIT and become an investor with high yield dividend stocks for passive income today.

Number doesn't lie. Words can be twisted to sound more pro but sometime it is just not.


Still buay song?









Monday, 25 June 2012

Why are we blogging?

Just For Laugh ...

Why I blog? Read? The journal begins ...

Then after sometime, one blogger suggested to me: "You can collect money from ads. It is passive income,"

Really???

But soon, I realized that it doesn't seem working for me. Where is the money? So kacang!!!

Now, you can see that my blog has no commercial ads unless somebody willing to pay me upfront fee; otherwise no bother to email me. BTW, I am not your courteous uncle so don't expect any courteous email reply from me. I read. I buay song. I delete.

Like any public bloggers, sometime when we may write some "interesting" blog posts.

Anything that are publicly "interesting" by nature will draw strong emotional response from your public readers. They either love or hate that "interesting" blog posts.

When the hate becomes too much, who will they turn to? They will turn to the root cause of their buay song. Guess who get f..ked for nothing?

New bloggers may want to take note.

If you cannot take Sun-burn don't take up mid-day fishing as hobby! You kena choa ta for nothing because under hot sun, usually no fish one!













Singapore inflation eases to 5.0% in May

SINGAPORE: Singapore's inflation eased to 5.0 per cent on-year in May, down from 5.4 per cent in April, as prices for accommodation and oil-related items rose at a slower pace.

Forecasters had expected May's consumer price index (CPI) to rise 5.1 per cent.

Accommodation cost inflation fell from 12.7 per cent in April to 9.0 per cent in May, largely due to the timing of the disbursements of rebates for services and conservancy charges for HBD households, the Monetary Authority of Singapore (MAS) said in a statement.

Imputed rentals on owner-occupied accommodation also rose at a slightly slower pace of 10.4 per cent in May.

The overall price increase for domestic oil-related items eased from 8.9 per cent in April to 7.8 per cent in May, reflecting the recent weakness in global oil markets.

Services and food inflation rose marginally, by 0.1 percentage point to 2.9 per cent and 2.5 per cent respectively in May.

However, private road transport costs picked up from 8.2 per cent in April to 10 per cent in May after a spike in COE premiums which pushed up the cost of cars.

Together, accommodation and private road transport costs account for about two-thirds of CPI-All Items inflation in May.

Excluding the costs of accommodation and private road transport, MAS Core Inflation remained steady at 2.7 per cent.

The MAS said CPI-All Items inflation "will likely ease gradually in the second half of 2012 after averaging an estimated 5 per cent year-on-year in the first half, though it could fluctuate from month to month".

The central bank said accommodation and car costs are expected to remain high, with "leasing contracts continuing to be renewed at rentals that are considerably higher than those under existing contracts, especially in the HDB segment."

Car prices are also likely to remain elevated, MAS said.

The MAS expects the upward pressure on wages and other business costs will continue to pass through to consumer prices, but at a more moderate pace than that seen earlier in 2012.

- CNA/wm


How to become rich in stocks??? (4)

Read? How to become rich in stocks??? (3)

If you are not already rich and wealthy, then this is the Golden Formula of becoming rich in stocks. Remember them by heart like you memorised your time-table when you were in primary school.


Create wealth through stocks = Money in Your Pocket
                                                   = Cash Flow = Stock Dividends + Realised Gains


Like it or not. Any paper profit is never yours yet and Mr Market has every right to take it back without ever serving you any notice.

With money in your pocket, you will be laughing to bank. Keep doing it in a big way, you will be smiling to your Financial Independence to become Man or Woman of Leisure!

PS: Let me know if you happen to know someone who is at first not rich and became rich in stocks just from stock dividends alone



Sunday, 24 June 2012

SAFE HAVEN IN REITs ???

Just For Thinking ....

Read? How to become rich in stocks??? (3)

One analyst's view:

As for REITs, OCBC’s Eli Lee likes CapitaMall Trust, which offers a dividend yield of 5.1%. The trust also has significant exposure to suburban retail malls that has proven to be resilient in macroeconomic downturns. It has also shown a good track record of executing its asset enhancement programmes, with the completion of the Bugis+ and Jcube shopping centres. Lee has a “buy” recommendation and a price target of $2.02.


Top 20 dividend-yield plays with market caps above $2B


Look for Rank  No 18

Keppel Corp offers dividend yield at 4.25% and secured order book as on Q1 2012 at $8.4B

I have found one good practical exercise:

Is 5.1% yield on 90% dividend payout ratio better than 4.25% yield on 51% dividend payout ratio?


How about comparing Kep Corp to top S-REIT - Sabana?

S-REITs

Do your own thinking














Saturday, 23 June 2012

Booming Iceland repays IMF early, again

WASHINGTON - Iceland, whose economy has recovered rapidly following the 2008 collapse of its banking sector, on Friday repaid US$483.7 million in loans to the International Monetary Fund, the lender said.

The early repayment, which follows another one of more than US$900 million in March, is a symbolic step for the country of just 320,000 people as it works its way out of a financial meltdown that ravaged the economy.

Iceland's main commercial banks collapsed in the space of a week as the global financial crisis struck in late 2008, imploding under the weight of huge debts built up during an aggressive overseas expansion.

But the country's rebound has been equally surprising.


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

Just For Laugh ...

PIIGS -----> PIGS






Investing Made Simple by Uncle8888 (34)

Read? Investing Made Simple by Uncle8888 (33)

Read? Active Income and Passive Income

What is passive income?

Passive income is money received on a regular basis, with little effort required to maintain it.

The three key words: regular, little effort. and maintain

What is active income?

Active Income will require significant effort and time to acquire with services performed.

Simply, it just means that we have to frequently use our human asset, significant effort and time to get the payouts from these activities. The frequency to execute these activities is often measured in term of minutes, hours, days, or week to receive the expected financial rewards.

What is passive income from stocks?

The conventional and traditional wisdom on passive income is based on these three key words: regular, little effort, and maintain will lead retail investors to think of dividend play stocks and especially S-REITs for their high yield - Can recommend some high yield dividend stocks for passive income?

What is regular???

Most retail investors will define "regular" to mean receiving cash flow from stocks in the form of stock dividends or cash DPUs via quarterly, semi and annual basis.

What is passive income from stocks?

Most retail passive income investors will refer to stock dividends and cash DPUs as primary source of passive income from stocks and realized gains from stocks as passive income is hardly found in their investing dictionary.

What is cash flow from stocks?

Cash flow from stocks can come from either or both (1) stock dividends/DPU AND (2) realized gains from partial or full divestment of stocks.

What is really passive income from stocks?

Please read again the above question.

If we may personally want to re-define passive income from stocks to mean:

To receive cash flow from stocks with little effort required to maintain it. (This definition will almost exclude you from becoming an active trader who will need lots of effort and close attention to profit from short-term market and stock price movement)

By removing the time element from this definition of passive income from stocks and focusing on little effort required to maintain it, you may flip your investing mind to revise your investing strategies for a mixed portfolio over long-term investing to meet your investing goals and avoid falling into dividend traps.

Read? Current Dividend Yield is good but avoid falling into potential Dividend Traps (5)

It is especially true for the younger investors in their 20s, 30s and may be even for early 40s. (as Uncle8888 also started quite late in getting very serious in the stock market)

Get it???



























Current Dividend Yield is good but avoid falling into potential Dividend Traps (5)

Read? Current Dividend Yield is good but avoid falling into potential Dividend Traps (4)

One way to avoid falling into potential high yield dividend traps is to apply a Bear Market yield test. Are we in a Bear market?

We must fully understand this fact! Our high dividend yield should be personal to us and only available in Bear market.













Friday, 22 June 2012

Can recommend some high yield dividend stocks for passive income?

Just For Thinking ....

Someone asked: "Can recommend some high yield dividend stocks for passive income?"

High yield dividend stocks har???

Easy leh!

Any Tom, Dick, and Harry who has $X,XXX or $XX,XXX on Monday can immediately become an investor with high yield dividend stocks for passive income. Why not?

Visit for your select: S-Reits

But, if you want to rise way above Tom, Dick, Harry as a passive income investor; then there are certainly more works to be done.  Monday is not the day yet.

Read? More articles on high dividend yield

The choice is yours.



Wednesday, 20 June 2012

Keppel FELS to deliver Ukraine’s second KFELS B Class jackup rig

Keppel FELS Limited (Keppel FELS), a wholly owned subsidiary of Keppel Offshore & Marine Ltd (Keppel O&M), is on track to deliver Ukraine's second KFELS B Class jackup rig ahead of schedule, within budget and with a perfect safety record. This follows the redelivery of their first jackup rig of the same design, in Ukraine in May this year.

Built to Keppel's proprietary KFELS B Class design, this second jackup rig will be deployed on the Ukrainian shelf of the Black Sea for its owner Chernomornaftogaz. According to Ukraine's official estimates in 2011, the country boasts proven reserves of natural gas (1200 billion cubic meters) and oil and gas condensate (220 million tons).

The rig was named NEZALEZHNIST (which means independence in Ukrainian), at Keppel FELS today with Mr Evgen Bakulin, Chairman of the Board of Ukraine's National Joint-Stock Company, Naftogaz, as the Guest of Honour.

Mr Bakulin said, "Ukraine is rapidly growing and we are keen to further develop the country's significant oil and gas reserves. This latest KFELS B Class jackup will add to our capabilities in E&P and increase our energy self sufficiency. We work with the world's leading rig builder and designer, Keppel FELS, because they have an established track record of delivering high quality rigs on schedule and within budget.

"We witnessed this first hand when Keppel delivered our first KFELS B Class jackup some 45 days early in Ukraine in May this year. The rig is successfully operating in the Black Sea and we are confident that this second rig will be just as successful. The KFELS B Class jackup rig is a proven design that will enable us to meet our goals."

Mr Tong Chong Heong, CEO of Keppel O&M, added, "We are pleased to be able to support Chernomornaftogaz in expanding their E&P capabilities for Ukraine. With a global network of yards, we are committed to meet the needs of our customers wherever they are.

"With this rig, there are now 34 KFELS B Class rigs in the market and there are another 19 more on order. This clearly reflects the strength of the design which is today the industry standard for modern jackup rigs. It is also currently the most versatile and advanced rig to operate in the Black Sea region. We are privileged that Chernomornaftogaz has chosen to work with us and we look forward to continuing this win-win partnership."

Developed by Keppel's jackup rig design arm, Offshore Technology Development, the KFELS B Class rig is able to operate in water depths of 400 ft with a drilling depth of 30,000 ft.

Designed for maximum uptime with reduced emissions and discharges, the KFELS B Class rig received the Prestigious Engineering Achievement Award 2009 from Institution of Engineers Singapore for its environmentally-friendly features.

Tuesday, 19 June 2012

How to be richer than your boss?

Watch video? How to be richer than your boss?

Are you impressed???

Negative Demo!!!

Right?

Read? I want to be richer but .... (2)


Sunday, 17 June 2012

What sex got to do with investing?

Just For Laugh ...

Read? How Pornographic Analysis can lead to good SEX!

How do you adequately explain to a virgin the experience of sex either by words or by pictures?

Likewise. How do you adequately explain to a newbie what is investing either by words or by financial statements?

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








How to become rich in stocks??? (3)

Tired of seeing the same old pic of bunnies again and again.

Time for a change. See my son's 16 year old smelly rabbit at his bed that he refused to throw it away!


Bunny Growth or Bunny Yield???




Read? How to become rich in stocks??? (2)

"Having said that, nothing wrong with using a high yielding strategy. I use it to provide cash flow to pay for my living expenses. But I am under no illusion it will help grow my net-worth... " - SMOL

Excellent comment from SMOL. Clap clap clap!

Yeah. We can't buy food with our multi-baggers! Paper profit is absolutely useless for our hungry stomach.

Read? Current Dividend Yield is good but avoid falling into potential Dividend Traps (4)

"I believe there are many bloggers, cboxers, forum particpants and investing kakis telling you that focusing on stock dividends as passive income is an important key to successful investing. Agree, right?

Perhaps, I am the rare blogger who dare to challenge you to rethink your investing strategy of focusing too much on passive income when you have no real need for it at this stage of your long investing journey and especially when you are not expecting to 'retire' from the workforce soon." - Createwealth8888 aka Uncle8888


Let me ask you this question:

When you have no real need for cash flow to pay for living expenses, why do you want more cash in form of higher stock dividend from high dividend payout ratio from your stocks?

I would expect the frequent answer to be: "More cash to re-invest"

Good answer: To re-invest!!!

Next two questions for you to think over carefully before answering them for yourself.

Who knows you may have a mind flip after that.

First question:

Is 10% yield on 90% dividend payout ratio = 5% yield on 45% dividend payout ratio?

Second question:

Is retained earning = Re-investing?












How to become rich in stocks??? (2)


Read? How to become rich in stocks???

Borrow the idea from La Papillion

** "BIAS" is a special feature in my blog where I get to say whatever I want with scant regards for your feelings. I'm not politically correct in this feature, so go ahead, judge me."



Read? Does Your Account Size Matter? - Part 3

Read? When you have money, what would you do with it?

Read? Preserving or building wealth? That is the difference!

Have you read and understand the above three posts?

Why?

Because I am going to do another BIAS post and it may raise your blood pressure when you read liao buay song.


Understanding the importance of Retained Earning by company


Same picture but different Bunnies so different story.

This time ..

Bunny Growth on the Left side and Bunny Yield on the Right side.



S-REITs and other high dividend payout ratio (90% or more) stocks


Bunny Y is showing off his impressive big big leaves to his fellow Bunny G.

Hey! Did you see my big big yield bor?
10% yield hor!!!
Don't play play!!!

Ya, above the ground, it is really  impressive. There is no doubt about it. But, what we can't see is below the ground. Bunny Y's carrot is small small nia but Bunny G's carrot is so big hor.

What is this carrot below the ground?

Retained earning by the company!!!

It is what we can't see above the ground may actually be even more important and critical than what we can see and feel above the ground.

Retained earning is the undistributed profit that is poured back into the company to provide extra working capital. This extra working capital may even help company to reduce its dependency from borrowing more money or raising more equities to fund its growth strategies.

Fundamentally, we know that there are two common methods to value a company. One is through its future earning growth and the other is through its assets growth.

In short, year-on-year retained earning by the company is the fuel and catalyst to expand and grow the company's assets and business prospects without having to raise more and more equities.

And sooner or later, investors in this company will be rewarded by higher stock dividend and higher valuation of the company through its higher and higher earning and assets growth.

It is this year-on-year multipler effect of the company's retained earning and successful execution of its growth strategies using these retained earnings that will help to form the higher base for sustaining its higher and higher stock price over market cycles of gloom and boom.

It is how you become rich in stocks by holding multi-bagger high yield stocks over long run with the right position sizing with respect to your net worth!!!

BTW, nowadays it is quite common to read on bloggers talking more on the importance of dividend income and reits; but can't really remember reading something on retained earning.

Understand bo?








Saturday, 16 June 2012

How to become rich in stocks???


Both Bunnies in the picture are really good at their act;
but who may become rich in stocks???


Bunny T on the Right side is a successful retail trader.
Bunny I on the Left is a successful retail investor.

Look at picture again and think over it carefully.

Who may become rich in stocks?

Bunny T on the Right or Bunny I on the Left?

I am telling you Bunny I on the Left side is more likely to become rich in stocks.

Why, why, why???

For two simple reasons:

One,  Their mind: The difference in Investing mind and Trading mind can be startling and that may prevent many retail traders to become rich in stocks.

Famous stop-loss strategy: 2% and 6% Rules and Trailing stops!!!

Have you come across any successful retail traders who proudly and loudly tell you that they don't have stop-loss and trailing stops???

These stop-loss and trailing stop rules are self-limiting to protect traders against losses and limiting huge profits in endless market cycles of Bull and Bear. Finally, the market action by itself will stop out their winning or losing positions either by stop-loss rules or trailing stops.

Second, Their winning position sizing:

It is quite common for successful retail investors to hold winning position size that is X% or XX% of their Net Worth. Read again. It is NET WORTH!!!


Get it or not?

It is X% or XX% of their Net Worth.  Right sizing of winning position that counts!!!













Have you ever heard of successful retail trader holding position size of  X% or XX% of their net worth?



Uncle8888's advice to anyone want to become rich in stocks by creating wealth from the stock market, learn to be successful retail investor like Bunny on the Left side. This picture is so obvious to understand unless you really have poor eyesight hor!

You can trade for some income. No problem. But, you must invest to become rich in stocks for two simple reasons. No meh???














Friday, 15 June 2012

Higher dividend yield stocks = REITs???

Just For Laugh ....

Read? Investing or trading????

When you are looking for higher dividend stocks, you may go around asking which REITs to buy?


                                        REITs

What you may not know that it is possible to find high yield growth stock like this one.

But, you need to have super patience to become super farmer to grow this type of carrot.


Investing or trading????

Just For Laugh .....


Investing or trading ???


A successful trader can go around showing off like the one on the Right side.

A successful investor has nothing impressive to show off like the one on the Left side.

If you don't believe what I say, you can go around visiting trading or investing blogs to check it out yourself and let me know.




Wednesday, 13 June 2012

How do you see your investing or trading success?

Which side do you see for SUCCESS?

Right side or Left side???


Happy in winning pennies but forgetting hidden losses in dollars.

 
Read? Measuring portfolio performance

To see both sides of SUCCESS in investing or trading, we should track and measure everything in our portfolio.

Portfolio = Current stocks value + Cash available for investing
               = Capital + Realised P/L + Un-Realised P/L



Tuesday, 12 June 2012

Barbell strategy

From http://www.investopedia.com

The barbell strategy is an investment strategy that involves purchasing both short-term and long-term bonds and securities but no intermediates (such as in a “laddered” approach).

The thinking behind this strategy is to help you, as an investor, diversify your portfolio and increase the probability of higher returns. The long-term investments will provide the benefit of higher interest rates and increasing value over time. Maintaining some holdings in short-term bonds will provide you with flexibility to take advantage of interest rate changes.

When using this strategy, you’ll want to keep your long-term bonds but be poised to make changes to your short-term investments (buy or sell as needed) if interest rates change. Evaluate your portfolio’s performance and then consider selling and reinvesting your long-term investments when they reach approximately the half-way point to maturity.

A barbell strategy, it uses both ends of the intensity spectrum—with almost nothing in between. 

We should be able to apply this strategy for long-term and short-term stock investing and trading strategy. One end for long-term investing to collect cash flow and the other end for short-term quick capital gain when market presents trading opportunity. In between, we do nothing else but just wait patiently for each end to happen.








Sunday, 10 June 2012

Four types of stock investors

Just For Laugh ....

There are four types of stock investors in the market.

1. Lazy, impatient, and non-savvy

The stock market loves them as they are ones who consistently donate part of their earned income from their jobs to the other savvy players in the stock market.

2. Hardworking, patient, and savvy

They are hardworking, patient, and savvy. They will analyse their companies upside down and inside out and paying attention to the finest details before committing their money to the stocks. They are value investors.

3. Hardworking, impatient, and savvy

They are hardworking, savvy; but impatient. Should we call them speculators?

4. Lazy, patient, and savvy

They are too lazy to analyse their companies upside down and inside out like value investors. They are the market hunters and fishermen. No meh???

The moral of story

There is only one way to lose your money but many ways to make money from the stock market.










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