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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Friday, 15 January 2016

What do seasoned retail lnvestors fear the most?


Read? What do Traders fear the most?

You know his answer. Right?

What do seasoned retail Investors with adequate level of stocks holding and strong war chest fear the most?
  


Slowly scroll ...


















War Chest: Collect interests

Stocks holding : Collect Dividends

 So, we either collect interests from our war chest or collect dividends from our stocks holding.

Flat market: Collect dividends from our stocks holding AND collect interests from our war chest.

Falling market: Buy slowly, reduce our war chest, reduce interests but increase dividends.

Rising market: Sell slowly, increase our war chest, increase interests but reduce dividends.

How fearful can it be?





13 comments:

  1. Look like WAR CHEST remains untouched?
    If so how to get capital gain to interests?
    If only interest is touched, how i think you must have a super duper WAR CHEST?
    Correct me if i misunderstood somewhere.
    Or may be you really don't have to touch your WAR CHEST?

    ReplyDelete
    Replies
    1. Revise

      Flat market: Collect dividends from stocks holding and collect interests from war chest.

      Falling market: Buy slowly and convert interests to dividends

      Rising market: Sell slowly and convert higher capital gain to collect interests.

      :-)

      Delete
  2. "Falling market: Buy slowly and convert interests to dividends."

    The above is bit confusing to me, it looks like you are buying slowly (with what i am not quite sure) unless you mean convert interests ( from/of WAR CHEST) to dividends (from/of stocks). Which means you only use interest from WAR CHEST to buy.
    If so it means you left your WAR CHEST untouched.
    Did i interpret or misunderstood?

    ReplyDelete
    Replies
    1. War Chest: Collect interests



      Stocks holding : Collect Dividends


      So, we either collect interests from our war chest or collect dividends from our stocks holding.


      Flat market: Collect dividends from our stocks holding AND collect interests from our war chest.


      Falling market: Buy slowly, reduce our war chest, reduce interests but increase dividends.


      Rising market: Sell slowly, increase our war chest, increase interests but reduce dividends.


      How fearful can it be?



      Delete
  3. Ah i see now.
    Agree.
    That was why i had the highest dividends income in history during 2008/2009. and some other same, same years.
    Now i got very low dividends income & higher interests income for more than 2 years or more already. (Suffering from stock market's withdrawal symptoms already= itchy & triggering fingers).

    Oops.....
    i really sound like a two timer.
    But i no traitor to the Market, O. K. !
    i always try to be as true to the market as possible.
    Shalom.

    ReplyDelete
    Replies
    1. temperament,

      Interestingly, most veterans who have survived more than 1 or 2 bull/bear cycles are sama sama.

      That's why I wrote this post to remind myself:



      Don't fire until you see the whites of their eyes

      Delete
  4. Idiot.

    That was supposed to be my "part 2"...

    Oh well!


    Eh? Somebody now talk big big after being massacred in 08/09 ;)

    I guess what didn't kill us will make us stronger?

    Now that's learning from real people real experiences! LOL!


    Now some "bei kambings" have wised up.

    If one does not have the "buffer" of past realized profits and dividends received, cannot follow your entries without a significant better entry price than yours ;)

    You got a lot more bullets!

    ReplyDelete
    Replies
    1. No "bei kambings"

      Must be seasoned retail investors or "EX-choa ta/hei kambings" with adequate stocks holding for sell slowly and strong war chest to buy slowly.

      Why need to be so scary?

      Delete
    2. CW,

      That's why I said you don't need "precision" to re-enter DBS - $15 or $16 does it matter when you have previously sold above $20?

      But for someone sitting on unrealized losses in DBS, buy slowly may not work if the prices continue southwards.

      New unrealized losses compounding on to existing mushrooming unrealized losses, now that's like a big snowball growing bigger and bigger until we capitulate under its weight.

      And the moment we do so, the market makes a strong mean revision recovery...

      That's enough to make someone swore off equities forever!

      Delete
    3. Must say the same for Keppel. So much blood spill. *curse*

      Delete
    4. There's three critical time points here - first bought time point and price, sell (slowly) prices and current buy (slowly) prices.
      It might also end up as a zero sum or negative sum game.

      Delete
  5. Timing still counts unless u r super good in identifying value stocks like WB, who most people think that they r.

    I agree with SMOL that those stocks already suffered hugh u realised losses, if u keep averaging down, then it can be capitulating eventually if they revert to the mean....

    So it's better to be selective in stocks. Some see white then fire all, some fire small regularly

    ReplyDelete
  6. If you read carefully about WB, though he is super good in identifying value stocks, he also said you should be, 'Be Fearful When Others Are Greedy and Greedy When Others Are Fearful'.
    Of course this is not timing the market for him because this is the time you have to be even more super good in identifying coys that can survive the BEAR's Attack.

    ReplyDelete

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