Saturday, 14 December 2013
Read? How to invest in Blue Chips and make money?
To be successful long-term retail investors over several expected major market cycles in our lifetime, we must learn to look beyond the failures and successes of a few blue chips.
Otherwise, those old uncles in KopiTiam and old aunties in Pasar who are still holding to their IPO lots of SIA, DBS, UOB, OCBC, JCC, F&B, APB can call themselves Investment Gurus.
One of the most important lessons your old uncles and aunties might or should have taught you:
Learn to overcome your ego of thinking that you are right and the market is wrong and average down until no return!
Over long run, market is never wrong; only you are WRONG!
The Maths in long-term investing is simple.
When you are wrong; you can only lose 100% of your invested capital. But, no leverage!!!
But, when you are right; you are getting more than 100% and still counting for more. XXX% or even X,XXX% total return is not an impossible dream!
But, as a start, you should learn to look beyond single stocks and look at your portfolio management. That is the way to survive over market cycles.
Read? Portfolio Management
The time to truly celebrate your investment success in big way is when you have reached your 60s and not in your early 20s or 30s as the stock market is still relatively young for you unless you are the like of Warren Buffet or George Soros