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.

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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

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Wednesday, 26 February 2014

Learn from late Uncle Chua???


Uncle8888 has met someone last week for lunch meeting.

Told him we can learn from late Uncle Chua.

Read? Uncle Chua's investing skills


What are the two lessons we can learn from him - an illiterate?

Making money from stocks is not about how good we are at prospecting business or doing deep dive analysis into companies; otherwise full time professional analysts will be very rich and retire early to manage their own investment portfolio.

Lesson one: You have large war chest during market crash and dare to buy big.

Lesson two: Replenish your war chest for the next market crash and patiently wait to repeat lesson one.


You don't think so?












13 comments:

  1. i agree i agree, usually i don't ask this kind of question but i ask anyway cos i'm a fool, investing wise,

    whats the % (ratio) between war chest vs vested capita at any given time or range, is there an optimal ratio??

    and whats yours may we know (so that i can copy if necessary).

    many thanks.

    ReplyDelete
    Replies
    1. lesson 2 debatable?

      we will always run out of cash when there is a market crash or we can't get enough of it.

      but i must say lesson 1 and lesson 2 are the same lesson isn't it.

      Delete
    2. so we need only to learn lesson 1, that will do.

      lucky me haha.

      Delete
    3. Sad truth. We will run out of money sooner than market bottom out and recover or

      the other case is still sitting on huge pile of cash and thinking that market bottom is still far away.

      Delete
    4. Or we chicken out like we thought 2008 was the bottom. But no 2009 march was the real bottom. Besides we all also like to sleep well at night.
      Secular bear may hibernate longer than we can take. If secular Bull market then Bingo! Who says Lady Luck or God's blessings doesn't play a part in your life?
      Definitely not me. Amen.

      Quote:-
      "A secular market trend is a long-term trend that lasts 5 to 25 years and consists of a series of primary trends. A secular bear market consists of smaller bull markets and larger bear markets; a secular bull market consists of larger bull markets and smaller bear markets."

      Delete
  2. CW,

    On perfect hindsight, hoot the farm in 97, sell in 2000. Reload again in 2003, sell in 2007. Reload with glee in 2009, and.... ??? That's the 64 million dollars question! When will the next shoe drop?

    Will past cycles rhyme; or this time it's different? STI 6000 over the next 4 more years (I making this up)?

    I fell asleep in 2000; you in 2008.

    The preparations we do today will reflect our own learning and past experiences ;)

    Looking back it's so easy right? This market cycle investing theme?

    You are right. Difficulty is in the "sitting".

    I must go learn fishing!

    ReplyDelete
  3. When to start buying?

    One grand old uncle (80+) told me this. The same old uncle who held APB for XX years and lost count of how much money he has made.

    When you see both ST and Zaobao showing at the same time large graphical of global market crashes at the front page.

    This is the time to start buying slowly.

    Ah Peh, you chun bo?


    LOL!

    ReplyDelete
    Replies
    1. CW,

      Old vinegar and old wine power!

      This uncle must be laughing all the way to the bank after the ThaiBev buy-out :)

      Delete
  4. great we are all here.

    chicken out is not an option, the question is is there cash lying around for us to pick stocks? thats the most problematic when market crash. but there is one remidy for short of cash.

    as market crash and volatility increase (usually the case but not necessary), the market price will have distortion and we can take advantage of reallocation of our investment, thats the next best thing to do if you run out of cash.

    on the subject matter, how fast can we replanhish out cash after we invest? its only the dividend portion we can take into account, say 3,4,5,10%? if we are full time investor/trader/retires, where can we get the money? no need to eat?

    sitting is not difficult la, its like almost impossible to me haha.

    ReplyDelete
    Replies
    1. so what to do if i retired from trading?

      get someone to sit on my behalf. i go and play snooker.

      Delete
    2. coconut,

      No wonder Fat is willing to let someone trade his account for him - although that didn''t work out.

      Managed accounts? Managed Futures?

      I guess that's what retired entrepreneurs do too. They become angel investors to young start-ups.

      Old no energy but got money; young got lots of energy but no money.

      Good match!

      Delete
  5. "on the subject matter, how fast can we replanhish out cash after we invest? its only the dividend portion we can take into account, say 3,4,5,10%? if we are full time investor/trader/retires, where can we get the money? no need to eat?"

    Ha! Ha!
    coconut i know you are always "brilliant" by asking the $64,000,000.00 question.

    Please choose one of the following, it may answer your question.

    1) "Man without visions (dreams) will perish".

    2) "Man must first persieve before can achieve".

    3)"Imagination is more important than knowledge".

    No 3 is by Albert E.
    But i think it's very, very close to No1 and No2

    ReplyDelete

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