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

Friday, 12 May 2017

What's The Edge For Successful Retail "Investors"?

Read? What's The Edge For Successful Retail "Investors"?

So by now; you may read many version and definitions of what's the edge for successful retail "investors"?

First thing first; he doesn't add a single cent as additional capital since Jan 2000 when he became a very determined DIY retail investors.

So what is Uncle8888's edge?

10 years yearly Goals; plan and re-plan; think and re-think; strategize and re-strategize; refine and refine; track, measure and see its performance.

He answered to nobody!

At the end of day; the outcome and result truly matters. The rest is just theories and concepts and good for teaching and earning some teaching fees. 






6 comments:

  1. This also highlights the large element that Luck plays in investment or speculation outcome. Becoz you can spend hundreds of hours (or just 1 minute) putting in the efforts to analyse, strategise, calculate, formulate. And at end of day, hopefully got 2 or 3 stocks out of 50 or 100 will carry you through.

    And it's really thanks to GFC and -60% drops in the stock markets around the world that enabled me for early retirement.

    That's why I always tell my bosses I rather be lucky than good!! Heheheh!

    ReplyDelete
  2. CW,

    8 immortals cross the Eastern Sea!

    Each doing their own way ;)


    "First thing first; he doesn't add a single cent as additional capital since Jan 2000 when he became a very determined DIY retail investors"

    For the sake of clarity, this statement is about you right?

    You even more power!!!

    From age 32 to 44, the main source of growth for the investment side of my portfolio was my day job. Especially the 7 years when I was away - most expenses paid by "ah kong" mah!

    I bow in respect ;)



    ReplyDelete
  3. WOW!

    Fantastic!

    Don't add a single cents more!?

    From starting till now?

    Me very greedy one.

    Always thinking of putting all my "NET WORTH" into the Market when opportunity knocks.

    But 2008/2009 i chickened out at about only 40 to 50 % of my "NET WORTH".

    Now i am even more chicken even when opportunity knocks at my door again.

    i will definitely be more 4Ks liu.


    Because

    ////

    If you don't know your hurdle rate (or choose to ignore it), you put yourself at risk of losing your retirement. Consider this real life example:
    In 2002 , a 70-something-year-old couple came in to see me, and told me their story. In 1998, they had a million dollars. Their cost of living was $50,000, and they had $15,000 coming to them from Social Security. This couple's investments needed to generate $35,000 a year to make up the difference. $35,000 is 3.5% of a million dollars, so leaving some room for inflation, their hurdle rate was about 4%. If they made 4%, they would probably cover their cost of living for the rest of their lives.
    They had their money in Treasurys, CDs and cash. Interest rates at the time were 6.5%, so they were making $65,000 a year. They were well above their hurdle rate with relatively no risk. They spent $35,000 of their returns a year and banked the other $30,000. If you look at their situation mathematically, you can see they would never run out of money.
    But what did they do? They saw that the technology stocks were making 20%-25 %. All of their friends were telling them about all the wonderful returns they were making.They started thinking about all the money they were leaving on the table by only making 6.5%. The market kept going up, and after two years, the couple finally succumbed to the mermaids' song. They put all their money into technology stocks at the beginning of 2000. We all know what happened next. In a little over a year, the dot-com bubble burst. The couple lost 90 % of their money. Their million dollars became $100,000.
    Moral of the story

    ReplyDelete
  4. Replies
    1. temperament,

      Wow! I remember the story your quoted!

      I not sure whether its your Google skill or you bookmark every article of interest, but I'm impressed with your library of stories and articles!


      When young and with less to lose, of course its easier to go all-in or show-hand!

      In 2009, you were 62. Why take the full throttle risk and be 100% vested in equities when in an alternative universe, we could just as easily have ended up like in Japan where after 30 years, its still below its all time high...

      If the 70 plus US couple had bought the Nasdaq Index ETF at its high at around 5,000 points during 2000, it will take 15 years for the couple to break-even.

      So even if they didn't "lose" money after 15 years, pray tell what they were supposed to live on from 70 to 85?


      At 70, even if you doubled or tripled your networth, would it make a difference to your current lifestyle?

      Unless you interested to have one last fling with Xiao mei meis?

      LOL!



      Delete
  5. Know when to cut lost, know when to go in again. That's how GFC secured my retirement at 40. And all this using bei kambing UTs. :)

    "It's the man, not the machine." -- Chuck Yeager :) :)

    ReplyDelete

Related Posts with Thumbnails