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, 14 December 2013

How to invest in Blue Chips and make money? (2)



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










8 comments:

  1. How many of us really understand the nature of investing?

    It is never about not losing money in the stock market. It is about winning much more money than we have lost.

    ReplyDelete
  2. CW8888,

    How to you define BlueChips? It is only from the STI component stocks alone?

    How about those LightBlueChips (may turn into bluechip one day)?

    ReplyDelete
    Replies
    1. Do you mean those few stocks on STI reserve list after quarterly index review?

      Delete
    2. Yes. Do you consider them as light bluechip?
      The reserve list are UOL, Capital Comm Trust, YangzhiJiang, Keppel Land and Ascendas REITS.

      Delete
    3. In fact, I will just look at the top 20 of STI in the next bear. It is safer of getting of not getting kick out in the next few quarterly.

      20 counters with 4-5% distribution

      Delete


  3. SINGAPORE: The 30 stocks that make up the benchmark STI index paid an average dividend yield of 3.4 per cent over the last twelve months as of mid December. This is according to the latest data released by the Singapore Exchange (SGX) on Monday.

    That makes Singapore's blue chips among the highest dividend yielding stocks in the region.

    Boosted by special cash pay outs, publisher Singapore Press Holdings is the highest dividend yielding stock in the SGX, averaging 10 per cent over the year.

    Along with container port business trust Hutchison Port Holdings Trust with 9.25 per cent; telecommunications firms Starhub and Singtel with 4.94 per cent and 4.71 per cent respectively; and aircraft maintenance unit SIA Engineering with 4.53 per cent -- they make up the top five stocks with the highest dividend yields in 2013.

    Geoff Howie, director of market strategy at the Singapore Exchange, said: "On average, those five stocks have together generated a twelve-month yield of around 6.7 per cent.

    "To an investor, who had evenly balanced a portfolio of those five stocks to the amount of say S$50,000, the investor would have generated around S$3,350 of income with that S$50,000 portfolio just in this year."

    On average, STI component stocks generated a dividend yield of 3.4 per cent over the year. That is higher than the other regional markets.

    Dividend yields for Hong Kong stocks averaged 3.2 per cent, while yields for the S&P Asia 50 -- a regional index that tracks blue chip companies in Hong Kong, Korea, Singapore and Taiwan -- averaged two per cent.

    At the same time however, the Singapore market has slipped 0.6 per cent lower year-to-date, making it one of the poor performers among regional markets.

    Roger Tan, CEO of Voyage Research, said: "In a condition whereby -- like this year -- where markets are not doing very well, or are very volatile, these dividend stocks tend to give a boost, some form of stability within your portfolio.

    "So for this year, dividend stocks would have given you some form of returns, but I think in a good year where markets are going up, they may be the drag in your total portfolio."

    Even as investors hope for better market conditions and higher stock prices in 2014, analysts said they are likely to put more weight on smaller, lesser-known stocks with high growth potential.

    However, experts also said that it would be wise to keep some blue chip stocks in their portfolios to maintain a stable income from dividends.

    - CNA/ac

    ReplyDelete
  4. "How many of us really understand the nature of investing?"
    Unquote:

    It's about how to survive in the Bear Markets in the first place. If you can you should do well again and again in the Bull Markets.
    IN fact it's about how to survive even before you entering the Market for the first time.
    And to be able to survive after the 1st time, for the rest of your life.
    In other words, investing in the Market should be taken as one of your a lifetime "calling".
    No?

    ReplyDelete

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