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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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.

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Value Investing
Dividend/Income Investing
Technical Analysis and Charting
Stock Tips

Sunday, 18 October 2009

Portfolio Management - Time In The Market

http://createwealth8888.blogspot.com/2009/10/portfolio-management-growing-money-tree.html

"You cannot afford to wait for perfect conditions. Goal setting is often a matter of balancing timing against available resources. Opportunities are easily lost while waiting for perfect conditions." -Gary Ryan

"You can't time the Market!"

You guess who are the people shouting that? Likely, these people are the fund managers and then echo closely behind are the retail value investors.

There are good reasons for fund managers to discourage investors from market timing so that there is less churn in their fund and they are less pressurized to perform as dividend yield from the portfolio is able to adequately cover the fund's management fees and expenses.

But, I don't understand why retail value investors also shouting that? "You can't time the Market!"

Now back to LHS.

LHS = Current Value of All the Stocks in our Portfolio + Available Cash left for investing or trading.

This requires you to try to time the Market and try to optimize the allocation of stocks and available cash according to your own market forecast in the next few months.

The Truth is that we can NEVER time the market CORRECTLY and no one can; but, it doesn't mean that we can't spend time in the market and also to time the market to exit when it hits our own profit target.

The key is that we want to time the market to generate cash flow for our portfolio and not to correctly time the market. See the difference!


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