I started serious Investing Journey in Jan 2000 to create wealth through long-term investing and short-term trading; but as from April 2013 my Journey in Investing has changed to create Retirement Income for Life till 85 years old in 2041 for two persons over market cycles of Bull and Bear.

Since 2017 after retiring from full-time job as employee; I am moving towards Investing Nirvana - Freehold Investment Income for Life investing strategy where 100% of investment income from portfolio investment is cashed out to support household expenses i.e. not a single cent of re-investing!

It is 57% (2017 to Aug 2022) to the Land of Investing Nirvana - Freehold Income for Life!

Click to email CW8888 or Email ID : jacobng1@gmail.com

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

Monday 28 February 2011

Noble Group net profit nearly triples to US$247.4m in fourth quarter

SINGAPORE: Mainboard-listed Noble Group says its net profit for the fourth quarter has jumped nearly three-fold to US$247.4 million.

This is compared with US$84.9 million profit in the same three-month period a year ago.

Noble says this is on the back of higher revenue, which rose 82 percent to US$17.4 billion, from US$9.6 billion last year.

The commodities firm say the better revenue is due to higher contributions from its agriculture, energy and metals, and minerals and ores units.

Meanwhile, for the full year the company has reported net profit of US$605.6 million, compared with US$556 million last year.

Looking forward, Noble says it is optimistic about its business and financial performance this year.

It also believes that the firm is well positioned to further expand its business and leverage its investments and supply chain activities.

- CNA/cc

Sunday 27 February 2011

How asset classes performed during inflationary periods?

Does that mean well-diversified commodities equality-linked counters such as Wilmar, Noble and Olam in SGX will continue to do well going forward in the expected inflationary period ahead?

Saturday 26 February 2011

Understanding Stock Market Risks - Financial Fraud Risk is real! (2)

Read? Understanding Stock Market Risks - Financial Fraud Risk is real!

Another two more S-Chips ... Fraud risk and as retail investors we can mitigate such risks by sticking on to those Singapore companies only as our law can punish those wrongdoers.



Friday 25 February 2011

NOL rises after CEO orders more vessels

SINGAPORE - Shares of Singapore's container shipping firm Neptune Orient Lines (NOL), rose as much as 2.5 per cent on Friday after saying it plans to order more vessels, a local trader said.

At 0113 GMT, shares of NOL, the world's seventh largest container shipping firm, were traded at S$2.02 with 849,000 shares changing hands, while the broader Singapore market was up by only 0.3 per cent.

NOL said in an interview on Thursday it will order more vessels to address an expected shortage in the global freight market within a few years.

NOL, around two-third owned by Singapore state investor Temasek Holdings , also posted better-than-expected quarterly earnings last week.

It said it had a fourth quarter net profit of US$177 million compared to a loss of US$211 million a year ago. Its results beat the average analyst estimate of US$121.9 million according to Thomson Reuters. -- REUTERS

High Dividend Yield Stocks? (10)

Read? High Dividend Yield Stocks? (9)

Since I like Kep Corp; similarly I will like Semb Corp too and it has become my second high yield multi-bagger pillow stock.

Receiving super fantastic high dividend yield of 59.8% did happen to me.


SINGAPORE, February 25, 2011 – Sembcorp Industries (Sembcorp) delivered a strong performance in 2010, reporting a 16% growth in net profit attributable to shareholders of the Company (net profit) for the full year 2010 (FY2010). Group net profit was S$792.9 million compared to S$682.7 million, while turnover was S$8.8 billion compared to S$9.6 billion in FY2009

Highlights from Sembcorp’s FY2010 Financial Results

• Turnover of S$8.8 billion, down 8%

• Net profit before EI of S$760.8 million, up 11%

• Net profit after EI of S$792.9 million, up 16%

• ROE at 22.2%

• EVA at S$809.4 million

• Strong balance sheet and cash flow

- Net cash position

- Operating cash flow (before changes in working capital) of S$1,440.2 million

• Proposing final tax exempt one-tier dividend of 17.0 cents per ordinary share, comprising an ordinary dividend of 15.0 cents and a bonus dividend of 2.0 cents, up 13%

Wednesday 23 February 2011


  • Record revenue of S$570 million
  • Net profit rises 18% to S$88.5 million
  • Recommends increase of final dividend to 3.50 Singapore cents per share

Singapore, 23 February 2011 – Mainboard-listed Hyflux Ltd (“Hyflux” or “the Group”) has posted its best profits in the Group’s history, chalking up an 18% increase in net profit after tax and minority interests (“PATMI”) of S$88.5 million for the financial year ended 31 December 2010 (“FY2010”) from S$75.0 million for the financial year ended 31 December 2009 (“FY2009”).

The profit for FY2010 was posted on the back of record revenue of S$569.7 million, driven by higher revenue contributions from both the municipal and industrial segments. The revenue for FY2010 was a 9% rise against FY2009 revenue of S$524.8 million.

“We kept a tight rein on expenses and restructured for cost competitiveness. We will continue to strike a prudent balance between costs, productivity and revenue growth, and especially so when our Group is embarking on expanding our capabilities and capacity in order to take on larger and more complex water infrastructure projects around the world,” said Ms Olivia Lum, Group CEO & President of Hyflux.

The Board of Directors of Hyflux has recommended a final dividend of 3.50 Singapore cents per ordinary share. This is in addition to an interim dividend of 1.0 Singapore cents per share that was paid out on 15 September 2010. The total dividend payout for FY2010 will amount to S$36.0 million compared to S$28.5 million in FY2009.


SINGAPORE, February 23, 2011 – Sembcorp continues to make progress for its first Indian power plant project, a 1,320-megawatt coal-fired power plant applying high efficiency supercritical technology. With preliminary site works already ongoing at the project site in Krishnapatnam in Andhra Pradesh‘s SPSR Nellore District, Sembcorp’s 49% joint venture with Gayatri Energy Ventures, Thermal Powertech Corporation India (TPCIL), has now given the green light to contractors to proceed with the supply of equipment and plant construction. It has issued an official

Notice to Proceed to Dongfang Electric Corporation, with whom it has signed a contract for the supply of the plant’s boiler turbine and generator equipment, and also to BGR Energy Systems, its engineering, procurement and construction contractor for the work on the balance of the plant.

The facility is expected to begin plant commissioning in the second half of 2013 and full commercial operations in 2014. The plant will be operated and maintained by Sembcorp Gayatri O&M Company, a separate operations and maintenance company which is 70% owned by Sembcorp and 30% owned by Gayatri Energy Ventures.

The Rs 6,869 crores (S$1.9 billion) facility will be well-positioned to meet the growing power demand in the southern, western and northern regions of India, which the Central Electricity Authority of India expects to increase at a compounded annual growth rate of 9% over the next 10 years.

Olam - Bought $2.41

I caught a Falling Knife! Hope not to get CUT.

Tuesday 22 February 2011

CapitaLand eyes China despite cooling measures

SINGAPORE: Singapore property developer CapitaLand said it is in China for the long run, despite a slew of cooling measures by the authorities to curb speculation in the Chinese property market.

The measures have caused price increases to slow in recent months.

Just last week, Beijing introduced a regulation which requires buyers not registered with the city to pay taxes for at least five years before buying their first property.

On Monday, Shanghai banned families registered with the city from owning more than two homes.

CapitaLand said it intends to build HDB-style affordable housing in China, starting with Wuhan City in central China.

It is going full-steam ahead with affordable housing, targeting Chinese families that currently spend 40 per cent of their household income on housing.

CapitaLand Group CEO Liew Mun Leong said: "We think that we could duplicate the model in Singapore, the HDB model, where designs are based on more fundamental requirements

"We can standardise our design... industrialise our construction (and) improve our project management to give us a reasonable profit margin but over a larger volume".

CapitaLand intends to build a pipeline of over 15,000 low-cost housing in China this year.

China was the biggest contributor to CapitaLand's pre-tax profit in 2010.

Its Chinese business unit CapitaLand China Holdings saw earnings before tax jump 24 per cent year-on-year to US$532.6 million.

The company sold US$858.6 million worth of property in China in 2010, up 23 per cent on-year.

CapitaLand said it will be financially prudent when bidding for land sites in China.

CapitaLand Group CFO Olivier Lim said: "There have been in the past, bidders that have overbid for pieces of land, which has hammered their share price, so I think we got to be cautious about that".

CapitaLand said China will account for 35 to 45 per cent of its business in the next three to five years.

Mr Liew said: "We think that the fundamentals of the market in China are still very strong.

"Demand for example, because of urbanisation, is still very strong in China. Just for new family formation, China needs something like four and a half million homes every year.

CapitaLand reported on Tuesday a fourth-quarter net profit of S$522.1 million (US$405 million).

This far exceeded analysts' expectations of S$231.3 million (US$180 million).



Awards EPC contract to construct a new cogeneration plant, set to double the company’s power capacity in the country

SINGAPORE, February, 22, 2011 – Sembcorp is pleased to announce that it has today signed an engineering, procurement and construction (EPC) contract with Alstom Power Singapore and

Alstom (Switzerland) for the development of Sembcorp’s second cogeneration plant on Jurong Island in Singapore. Construction for the project is expected to commence in the second half of 2011 and the plant’s first phase is expected to be operational by the second half of 2013.

The combined-cycle gas turbine cogeneration plant will have an eventual capacity of 800 megawatts of power and 400 tonnes per hour of process steam, roughly doubling Sembcorp’s total power capacity in Singapore to 1,615 megawatts, up from the current 815 megawatts. To be developed in phases, the first phase of the project will have a power capacity of 400 megawatts.

The facility will operate under a generation licence granted to Sembcorp by the Energy Market Authority and will be fuelled by piped natural gas, as well as liquefied natural gas (LNG) for which Sembcorp has signed a long-term LNG supply agreement with BG Singapore.

With an EPC contract value of approximately S$900 million for its entire planned capacity, this new cogeneration project is expected to be funded through a mix of bank borrowings and internal sources.

This latest milestone marks further progress in the growth of Sembcorp’s energy business, which now includes facilities in operation and under development in Singapore, China, Vietnam, India, the UAE and Oman

CapitaLand full year net profit up 21% on-year

SINGAPORE: Property developer CapitaLand achieved net profit of S$1.27 billion for the full year ended December 31, a 21 per cent rise on-year.

This marks the fifth consecutive year that CapitaLand has delivered net profit exceeding S$1 billion.

The firm said the strong performance was due to contributions across the Group's businesses in the core markets of Singapore, China and Australia.

It also came on the back of sales of residential and commercial projects, higher fair value gains for investment properties, and lower impairment charges.

The property giant also reported a better-than-expected fourth quarter net profit of S$552.1 million although the figure was was 41.1 per cent lower from a year ago.

The net profit figure is higher than the average of S$231 million estimate from several analysts polled by the media.

The decline in fourth quarter profit was due to smaller one-off gains compared to 2009, when it benefited from gains from the listing of CapitaMalls Asia, its shopping mall business unit.

Group revenue for the three months to December rose 36.5 per cent to S$1.14 billion.

During the quarter, the Group recorded portfolio gains of S$194.2 million mainly from the divestment of a majority stake in Raffles City Changning and Ascott's injection of 28 serviced residence properties into Ascott Residence Trust.

Going forward, CapitaLand CEO Liew Mun Leong said the group plans to launch 1,700 homes in Singapore and about 4,000 homes in China this year.

He added that Ascott, CapitaLand's serviced residence business unit, will redeploy S$1 billion into new investments in key cities in Asia and Europe, and is on track to achieve its target of 40 thousand units by 2015.

- CNA/fa

Monday 21 February 2011

Hyflux to develop wastewater plant in China's Guizhou

SINGAPORE - Singapore water firm Hyflux said on Monday it has won a concession to build and operate a plant to treat up 150,000 cubic metres of wastewater per day for Zunyi City in China's Guizhou province.

Hyflux said that the investment will cost around 200 million yuan (US$30.4 million) and that it will operate and maintain the plant for 30 years. -- REUTERS

CapitaLand China to acquire additional 39.27% stake in LFIE Holding

SINGAPORE: CapitaLand China has entered into a sale and purchase agreement to acquire an additional 39.27 per cent stake in LFIE Holding from an unrelated party for S$125 million.

Capitaland currently owns a 6.95 per cent stake in LFIE, a holding company for real-estate investments in China.

The acquisition of shares is expected to be completed in the first quarter of this year.

LFIE owns a 575 thousand square metre waterfront site in Panyu District in Guangzhou, China.

Capitaland China together with two Hong Kong-based partners plan to develop the site, which is located along the Pearl River, and enjoys a scenic one-kilometre water frontage and a potential gross floor area of 1.1 million square metres.

CapitaLand China and its partners plan to build a residential estate comprising 7,800 low-density and high-rise homes targeted at the mid- to high-mid segments of the market.

The estate will also have retail, fitness and recreational facilities, as well as three schools.

CapitaLand China will be the lead development manager for the Panyu site.

- CNA/fa

Sunday 20 February 2011

More Youth in the stock market

Just For Laugh ...

Are more and more youths in the stock market due to more and more youth Investment bloggers blogging on their investing journey and their desire for financial freedom? So far no one get seriously burnt , right!

Guess who is telling you that you can start investing with a small account size?

Just For Thinking ...

Read? Stock Market Is War - Part 4

Guess who is telling you that you can start investing with a small account size?

Unless you are willing to place your betting with the Market Makers aka "Stock Market Casinos" instead of doing actual stocks.

Some Market Makers will enlist the help of Gurus to conduct free trading seminars to make you believe after attending the seminar you now have better knowledge to trade.

With the era of HFT and Algo trading so wide spread, have the teaching of these Gurus still relevant to retail investors and traders in today market environment? I really wonder?

Thursday 17 February 2011


The Placement Shares represent approximately 19.55% of the existing issued and paid-up share capital of the Company as at the date of this Announcement and will represent approximately 16.35% of the enlarged issued and paid-up share capital of the Company after the issue of the Placement Shares.

Upon allotment and issue, the Placement Shares will rank pari passu in all respects with the then existing Shares of the Company at the date of their issue.

The Placement Price of S$0.9283 for each Placement Share represents a discount of approximately 10% to the weighted average price of S$1.0314 per Share for trades done on the Singapore Exchange Securities Trading Limited (“SGX-ST”) from 9.00a.m. on 16 February 2011 to 9.15a.m. on 17 February 2011 when a trading halt of the Company’s shares was effected

Singapore sees 2011 inflation peaking near 6 pct

Createwealth88888: It is getting tougher for retail investors to get Returns on their investment better than 6%! It will hit less savvy retail investors harder e.g. investing in 2-yrs short term bonds of 2% yield.

SINGAPORE (AP) -- Singapore raised its 2011 inflation forecast Thursday as a booming economy and surging global food and energy costs boost prices.

Prices will likely rise between 3 and 4 percent this year, one percentage point higher than the previous estimate, the Trade and Industry Ministry said. The government said it expects inflation to peak as high as 6 percent in the first half before dropping in the second half.

A jump in food and fuel costs and robust economic growth have helped push prices higher throughout Asia, leading many of the region's central banks to raise interest rates in a bid to ease consumer demand and economic activity.

"The inflationary concerns in Asia may prompt further monetary tightening," the ministry said. "Domestically, the economy is also facing a tighter labor market."

Singapore's economy soared 14.5 percent last year, rebounding from a 0.8 contraction in 2009, as global demand for the city-state's exports recovered from a slump the previous year, the ministry said.

Gross domestic product expanded 12 percent in the fourth quarter from a year ago, compared with 10.5 percent in the third quarter, the ministry said.

Manufacturing soared 26 percent in the fourth quarter from the previous year while services gained 8.8 percent and construction dropped 2 percent, the ministry said. Visitor arrivals and tourism revenue jumped to record highs last year as Singapore's first two casino resorts opened.

The economy grew an annualized, seasonally adjusted 3.9 percent in the fourth quarter after contracting 16.7 percent in the third.

The ministry said in a preliminary report last month that GDP had jumped 12.5 percent last quarter from a year earlier and grown 6.9 percent from the previous quarter.

The ministry left this year's growth forecast of 4 to 6 percent unchanged.

"The steady pace of growth in the advanced economies is expected to lend support to Singapore's manufacturing activities," it said. "Strong visitor arrivals will continue to underpin growth in Singapore's tourism-related services sectors."

Keppel bags two-rig contract from Transocean worth US$380 million

Keppel FELS Limited (Keppel FELS) has secured a contract worth approximately US$380 million from Transocean Offshore Deepwater Holdings Ltd, a subsidiary of Transocean Ltd. (Transocean), to build two high-specification jackup rigs based on the KFELS Super B Class Bigfoot design. The rigs' deliveries are scheduled from 2H 2012 onwards.

As part of the agreement, Transocean has options to order three additional jackup units.

Mr Tong Chong Heong, Chief Executive Officer of Keppel Offshore & Marine, said, "We are seeing encouraging demand in the jackup segment, particularly for high-specification rigs that can address tough climatic and field conditions, while meeting stringent safety standards.

"This is an area where Keppel FELS enjoys a strong competitive advantage, given our experience with harsh environment rigs, and proprietary jackup designs that have proven operational and safety track records globally.

"The new edition KFELS Super B Class Big Foot design was customised to suit Transocean's requirements. Working with trendsetting customers provides us with channels of input and feedback to improve our technology, as we bring to market a wider range of robust and viable solutions."

The KFELS Super B Class Bigfoot is designed with larger spud cans, expanding its operational coverage in more places, especially areas where soft soil is predominant. Having larger spud cans limits the extent of soil penetration by the rig's legs, thus enabling the unit to operate efficiently while minimising potential leg extraction problems in soft soil conditions.

A 1.5 million pound drilling system and maximum combined cantilever load of 3,200 kips fuel the Super B Class Bigfoot with great horsepower during drilling operations. In addition, the rig will be installed with offline stand building features in its drilling system package, which allows drilling and the preparation of drill pipes to take place concurrently.

The above contract is not expected to have material impact on the net tangible assets or earnings per share of Keppel Corporation Limited for the current financial year.

Wednesday 16 February 2011

Labour and Capitalist

Definition: a social class comprising those who do manual labor or work for wages
So anyone who works for wages is a labourer. I know you may protest wildly at that definition. LOL
When we labour, we are paid wages. How much we are paid is determined by someone or company that perceives our value for providing that services. The company is more likely to pay you enough wages to keep you in the jobs. The company is not there to make you rich.
As a capitalist is different, we are not paid for our labour but for the use of our money; but it can be a double-edged sword as we may lose some of our money instead making them.
Remember this: In stock investing you are NOT paid for your labour as the stock market doesn't know you are working very hard at it.
Moving quickly to over being more capitalist may be a wiser choice for most wage earners.

NOL posts Q4 net profit of US$177m

SINGAPORE - Neptune Orient Lines, the world's seventh largest container shipping firm, reported on Wednesday better-than-expected fourth-quarter net profit, reversing from a loss the previous year as freight rates and cargo volumes soared.

NOL, around two-third owned by Temasek Holdings, posted fourth quarter net profit of US$177 million compared to a loss of US$211 million a year ago. Its results beat the average analyst estimate of US$121.9 million according to Thomson Reuters I/B/E/S.

For the whole of 2010, NOL made a net profit of US$461 million compared with a loss of US$741 million in 2009.

The global shipping industry suffered its worst downturn in history in 2009 as the recession hit global trade and forced many companies to lay up ships and cut jobs.

NOL said that 'notwithstanding the improved performance for 2010, market conditions are uncertain'. -- REUTERS

Nice coffee treat from Jewel in Aussie

Today, I am happy to receive two cans of nice coffee from Aussie via Jewel' Auntie at Campass Point.
A special long distance coffee treat from Jewel in Aussie. Thank you very much, Jewel!

Will You Try To Pay Off Your Housing Loan ASAP If You Have One? (9)

Read? Will You Try To Pay Off Your Housing Loan ASAP If You Have One? (8)

Besides one does get a feeling of freedom when one is debt free; it may actually make it easier for the wife to make a decision to quit working and becomes a stay-at-home mum to look after kids.

Tuesday 15 February 2011

Keppel wins two jackup orders worth about US$1 billion from Maersk

Keppel FELS Limited (Keppel FELS) has been awarded contracts from Maersk Drilling Holdings Singapore Pte Ltd, a wholly owned subsidiary of A.P. Moller - Maersk A/S (Maersk), to build two Gusto MSC CJ70 harsh environment jackup rigs worth close to US$1 billion.

The first rig is scheduled for delivery near end-2013, with the second rig following seven months later. As part of the agreement, Maersk has the option to build an additional jackup unit with Keppel FELS.

Mr Tong Chong Heong, CEO of Keppel Offshore & Marine, said, "The Maersk-Keppel partnership, spanning decades, has achieved many significant milestones. We are pleased that our faithful customer, Maersk, has chosen Keppel to support them in the next phase of their rig expansion programme.

"These latest contracts reaffirm Maersk's confidence in Keppel's ability to deliver all types of complex offshore projects safely, on time and within budget in this win-win partnership. I am confident that the completed rigs will augment Maersk's premium fleet and position them at the forefront of harsh environment operations."

Mr Claus V. Hemmingsen, CEO of Maersk Drilling said, "We believe in continued strong demand for high capacity jack-up rigs on the Norwegian Continental Shelf, and have a strong track record since 1990 of operating in this challenging environment. Our commitment to build another two ultra harsh, high capacity rigs has been well received by our customers.

"The excellent performance and consistency, which Keppel FELS has demonstrated on the various projects we have had together, sealed our decision to entrust these important newbuilds to them."

The CJ70 rigs are especially suited for operation in the harsh environment of the North Sea at water depths up to 150 metres. The high capacity features include offline pipe handling and simultaneous operations as well as an enlarged cantilever reach, which will significantly increase the drilling efficiency compared to conventional units. The enhanced design also includes multi-machine control on the drill floor, which will allow for a degree of automation to ensure a safe operation and consistent performance. A total of 150 people can be accommodated on board in single cabins.

The above contracts are not expected to have a material impact on the net tangible assets or earnings per share of Keppel Corporation Limited for the current financial year.

Monday 14 February 2011

Olam's Q2 net profit falls 8.4%


Olam International Limited reported on Monday that its net profit before exceptional gain for the second quarter ended December 31, 2010 grew 65.6 per cent from a year ago to S$112.2 million.

Including exceptional gain, the net profit attributable to shareholders for the quarter fell 8.4 per cent to S$145.44 million.

In the first half of 2011, Olam's results included exceptional gain amounting to S$33.6 million arising from the negative goodwill (net of transaction costs) of NZ Farming Systems Uruguay (NZFSU) in December 2010. As against this, in H1 FY2010 the company recorded exceptional gain of S$91.1 million for the acquisition of tomato processing assets in California in Q2 FY2010.

During the quarter, sales revenue grew 47.3 per cent to S$4.03 billion.

Given the strong performance recorded by the company in H1 FY2011 and the continued execution of long term strategic growth plans, Olam continues to be positive about its prospects for the remainder of FY2011.

Sunday 13 February 2011

Keppel FELS Brasil secures two FPSO topside contracts worth R$500 million

Keppel Offshore & Marine Ltd (Keppel O&M), through its subsidiary Keppel FELS Brasil, has secured two contracts totalling R$500 million (approx. S$381.4 million) - one from Single Buoy Moorings Inc. (SBM), and another from the joint venture company MODEC and Toyo Offshore Production Systems (MTOPS).

Mr Chow Yew Yuen, President (The Americas) of Keppel O&M, said, "Keppel has worked closely with various international drillers and fleet owners operating in Brazil for some 30 years. Today, in replicating Keppel O&M's proven systems and practices in Brazil, we are able to offer a full range of offshore solutions in construction, conversion, repair and modification, as well as the fabrication and integration of production topsides, among others.

"We are heartened that SBM and MTOPS have reaffirmed our position as the choice solutions partner in Brazil's offshore and marine industry with these contracts to fabricate and integrate modules for their latest FPSOs. As we grow our competencies and track record as the most established shipyard in Latin America, we will continue to nurture win-win relationships with our valued customers. We see the market improving and our yard has the capacity and capability to take on more jobs."

Keppel FELS Brasil's contract with SBM is for the fabrication and installation of topside modules on the Floating Production Storage and Offloading (FPSO) vessel Cidade De Paraty, which was awarded in association with Queiroz Galvão Óleos e Gás S.A. (QGOG) and is currently undergoing conversion at Keppel Shipyard in Singapore.

Mr Chow added, "Like our recent delivery of P-57, this project demonstrates the synergy of the Keppel O&M shipyards in providing a comprehensive suite of services to our customers and brings to bear our near market, near customer strategy."

Work is expected to commence at Keppel FELS Brasil's BrasFELS shipyard in Angra dos Reis, Rio de Janeiro in the first quarter of 2011. The vessel is scheduled to arrive in the first quarter of 2012 with delivery in the fourth quarter of 2012.

The work scope will include the fabrication and installation of six process modules and a riser gantry as well as the installation and integration of another six process modules supplied by SBM.

The FPSO Cidade de Paraty will be deployed in the pre-salt region of the Santos Basin and will have a production capacity of 120,000 barrels of oil per day, and be able to compress 5 million cubic metres of gas per day.

In its contract with MTOPS, a joint venture company between MODEC and Toyo Engineering Corporation, BrasFELS will undertake the module fabrication and integration of the FPSO Cidade de Sao Paulo MV23, which was awarded in association with Schahin Engenharia S.A.

Work is expected to begin at BrasFELS in the first quarter of 2011. The yard's scope includes the fabrication of topsides modules such as riser manifolds, laydown areas and the flare tower, as well as the assembly and integration of fabricated pancakes/skids.

To be completed in the 4Q 2012, the FPSO will be deployed in the pre-salt region of the Santos Basin. The FPSO will have a production capacity of 120,000 barrels of oil per day, and be able to compress 180 million cubic feet of gas per day and store 1,600,000 barrels of oil.

Ongoing at BrasFELS is the upgrading and repairing of Noble's Brazil-based drillships with delivery stretching into 2012.

The abovementioned contracts are not expected to have a material impact on the net tangible assets or earnings per share of Keppel Corporation Limited for the current financial year.

Can buy CPL or not?

Just for Laugh ...

Someone asked me: "Can buy CPL or not?"

For every stock transaction done, there is buyer/buyers matched to seller/sellers. There is no meaningful way to know who is right; who is wrong; and including those staying on sidelines giving their own views unless we know their respective time frame in investing/trading and their risks profile.

It is just like asking me which Disneyland should you go for the coming March school holidays? Walt Disney World, Disneyland L.A.,  Disneyland HK,  Disneyland Tokyo,  Disneyland Paris ...

How do I know? Go to where you like lor. LOL

Read? No losing; but getting stuck for a long, long time can be real hor.

$10K, two 10-baggers and you're a millionaire?

invest, Feb 13, 2011 sundaytimes

Just for Thinking ...

Gabriel quoted: " ... Peter Lych has said, you need $10,000 and two 10-baggers, and you're a millionaire."

hmm... $10K and two 10-baggers ---> $1M

Any Maths guru to explain the Maths in it?

Peter Lynch's 25 Golden Rules for Investing

Beating the Street (published in 1993), Lynch left investors with the following list of golden rules — 25 in all.

Peter Lynch's 25 Golden Rules for Investing

Rule 1: Investing is fun and exciting, but dangerous if you don't do any work.

Rule 2: Your investor's edge is not something you get from Wall Street experts. It's something you already have. You can outperform the experts if you use your edge by investing in companies or industries you already understand.

Rule 3: Over the past 3 decades, the stock market has come to be dominated by a herd of professional investors. Contrary to popular belief, this makes it easier for the amateur investor. You can beat the market by ignoring the herd.

Rule 4: Behind every stock is a company. Find out what it's doing.

Rule 5: Often, there is no correlation between the success of a company's operations and the success of its stock over a few months or even a few years. In the long term, there is a 100% correlation between the success of the company and the success of its stock. This disparity is the key to making money; it pays to be patient, and to own successful companies.

Rule 6: You have to know what you own, and why you own it. "This baby is a cinch to go up" doesn't count.

Rule 7: Long shots almost always miss the mark.

Rule 8: Owning stocks is like having children — don't get involved with more than you can handle. The part-time stockpicker probably has time to follow 8-12 companies, and to buy and sell shares as conditions warrant. There don't have to be more than 5 companies in the portfolio at any one time.

Rule 9: If you can't find any companies that you think are attractive, put your money in the bank until you discover some.

Rule 10: Never invest in a company without understanding its finances. The biggest losses in stocks come from companies with poor balance sheets. Always look at the balance sheet to see if a company is solvent before you risk your money on it.

Rule 11: Avoid hot stocks in hot industries. Great companies in cold, non-growth industries are consistent big winners.

Rule 12: With small companies, you are better off to wait until they turn a profit before you invest.

Rule 13: If you are thinking of investing in a troubled industry, buy the companies with staying power. Also, wait for the industry to show signs of revival. Buggy whips and radio tubes were troubled industries that never came back.

Rule 14: If you invest $1000 in a stock, all you can lose is $1000, but you stand to gain $10,000 or even $50,000 over time if you are patient. The average person can concentrate on a few good companies, while the fund manager is forced to diversify. By owning too many stocks, you lose this advantage of concentration. It only takes a handful of big winners to make a lifetime of investing worthwhile.

(Createwealth8888 only loves those words in RED)
Rule 15: In every industry and every region of the country, the observant amateur can find great growth companies long before the professionals have discovered them.

Rule 16: A stock market decline is as routine as a January blizzard in Colorado. If you are prepared, it can't hurt you. A decline is a great opportunity to pick up the bargains left behind by investors who are fleeing the storm in panic.

Rule 17: Everyone has the brainpower to make money in stocks. Not everyone has the stomach. If you are susceptible to selling everything in a panic, you ought to avoid stocks and stock mutual funds altogether.

(Createwealth8888 only loves those words in RED)

Rule 18: There is always something to worry about. Avoid weekend thinking and ignore the latest dire predictions of the newscasters. Sell a stock because the company's fundamentals deteriorate, not because the sky is falling.

Rule 19: Nobody can predict interest rates, the future direction of the economy, or the stock market, Dismiss all such forecasts and concentrate on what's actually happening to the companies in which you have invested.

Rule 20: If you study 10 companies, you will find 1 for which the story is better than expected. If you study 50, you'll find 5. There are always pleasant surprises to be found in the stock market — companies whose achievements are being overlooked on Wall Street.

Rule 21: If you don't study any companies, you have the same success buying stocks as you do in a poker game if you bet without looking at your cards.

Rule 22: Time is on your side when you own shares of superior companies. You can afford to be patient — even if you missed Wal-Mart in the first five years, it was a great stock to own in the next five years. Time is against you when you own options.

Rule 23: If you have the stomach for stocks, but neither the time nor the inclination to do the homework, invest in equity mutual funds. Here, it's a good idea to diversify. You should own a few different kinds of funds, with managers who pursue different styles of investing: growth, value small companies, large companies etc. Investing the six of the same kind of fund is not diversification.

Rule 24: Among the major stock markets of the world, the U.S. market ranks 8th in total return over the past decade. You can take advantage of the faster-growing economies by investing some portion of your assets in an overseas fund with a good record.

Rule 25: In the long run, a portfolio of well-chosen stocks and/or equity mutual funds will always outperform a portfolio of bonds or a money-market account. In the long run, a portfolio of poorly chosen stocks won't outperform the money left under the mattress.

Investors who like it cheaper.

Just for Laugh ...

I observe this while I was eavesdropping investment cboxes and forums.

Some people will deduct the value of the stock dividends received off their stock purchase costs.

These group of people can be thought of as investors who like it cheaper. When their stocks are getting cheaper, they are getting happier. 

How do you treat your stock dividends?  Cash rebates or Returns from investment?

So you are shoppers or investors? LOL

CPL Weekly - Can it become even worse?

Saturday 12 February 2011

Can retail TA traders compete against Algorithmic Trading by BBs?

Read? Are Shares finally recovering?

Can retail TA traders compete against Algorithmic Trading by BBs?

Createwealth8888 is thinking to be a Pilot Fish to be with them or to be a American Coackroach to hide from them?

Read? I become a Pilot Fish?


Be like American Coackroach?

Trade and survive like an American Cockroach. Eat when there is food to be found, and can survive without water for 1 month and without food for 3 months.

Friday 11 February 2011

Sembcorp completes India acquisition


Sembcorp on Friday announced it has completed the acquisition of a 49 per cent stake in Thermal Powertech Corporation India (TPCIL) for Rs 1,042 crores (S$293 million),

TPCIL is a joint venture between Sembcorp's utility business and Gayatri Energy Ventures. The company is looking to build and operate a 1,320 megawatts coal-fired power plant in Andhra Pradesh, India

Investing Made Simple by Uncle8888 (6)

Read? Investing Made Simple by Uncle8888 (5)

Uncle8888 has been trying to understand this:

Where does the money from stock market come from?

He thinks that most of the money from the stock market will come from investors/traders participating in the stock market and only some money will be coming in the form of stock dividends distributed by companies and shares buy-back by companies.

In fact, the amount of money coming from companies is nothing compared to the enormous amount of money changing hands in the stock market.

Uncle8888 also remembered Warren Buffet once said: "The Stock market is a financial redistribution system. It takes money away from those who have no patience and gives it to those who have."

He believes it is true. So he understands it is important to be patient; or else he may end up distributing part of of his hard-earned salary to other people in the stock market.

Luckily, his favourite hobby is fishing and fisherman by nature will has more patience.

With the understanding where does the money from the stock market come from, it will be easier for Uncle8888 to understand why some people may choose to do short-term trading and/or  long-term investing

Why do people come to stock market?

1. To MAKE money

Some people come to the market to do short-term trading and their primary focus is to MAKE money in the stock market; and they are rarely motivated by stock dividends.

At first, these people came to the stock market and thinking that they can MAKE money from doing some short-term trading. But, they soon realize that making money from the stock market is not easy when they started to lose more and more of their hard-earned money to the stock market.

Once they realized that making money in the stock market is not easy. Some of them may give up or cut down on doing short-term trading and change their strategy. Most likely, these people may cross over to doing more long-term investing and less short-term trading.

So what is long-term investing?

Uncle8888 thinks that generally there are two camps of people doing long-term investing.

One camp belongs to the Cowboys and the Farmers.

2. To RECEIVE money

Read The CowboysThe primary objective of cowboys is to receive money from companies in the form of stock dividends either over quarterly, semi-annual or yearly. It is true that cowboys will feel happy or at least feel quite satisfied with their Returns on their investment. If you don't believe it; then you may want to visit some investment blogs, forums, or chatboxes and you may be able spot a few cowboys expressing their joy publicly that they will be receiving some stock dividends from XYZ companies soon.

The Farmers have the same primary objective as the Cowboys except they are not into REITs or Biz Trusts; they like to receive money from some fundamental strong companies which are known to be consistently paying out good stock dividends.


The other camp belongs to the D.O.G. ( Read on Graham's Investing?)

The D.O.G's primary focus is on making future big money from the stock market with their undiscovered market gems. Some D.O.G may also like to receive some money from their undiscovered market gems while waiting for future big money to come to them.

Who are doing long-term investing?

Uncle8888 thinks that there are three possible types of long-term investing.

1. Unintentional Long-term Investing

They at first came to the stock market to do short-term trading; but when their positions got stuck. They managed to convince themselves that they are in long-term investing. If they happened to receive some stock dividends; they will console themselves that the Returns from their investment have beaten the Bank's FD rate.

2. Intentional Long-term Investing

The Cowboys, Farmers and D.O.G are the ones doing intentional long-term investing. They clearly know what they are doing in the stock market.

So what is Uncle8888 doing in stock market?

He is only interested in doing short-term trading and making money. He doesn't go for intentional long-term investing. To him, stock dividends are just safety net to support him should he fail in his short-term trading and his positions got stuck. Read on "Receiving stock dividends".

Then how come Uncle8888 can be holding stocks for many years when he didn't intend to do any long-term investing in the first place?

3. Evolutionary long-term investing

Actually, Uncle8888's long-term investing positions evolve from his short-term trading positions. Most of his short-term trading positions were slaughtered for money and only a handful of them managed to survive and evolve. So he coined the term as Evolutionary long-term investing. 

The process of evolutionary long-term investing is best described with the following stories:.

Read Do you know where are rocks? (stocks)

The moral of the story: Know where are the rocks and step on them.

Read Opportunity In The Stock Market?

The moral of the story: Opportunities in the stock market rarely come by so learn to recognize them and stop habitually throw them away.

Read Pillow Stocks

The moral of the story: How to have the Cake and still eat it?

Answer: Buy another same Cake to eat. Now you will have the Cake and also have eaten it.

The process of evolutionary long-term investing by Uncle8888 can be simply stated as follows:

  1. Know the Rocks.
  2. Feel the Touch Stones.
  3. Make the Pillows.
  4. Recover the Capital.
  5. Receive the Money.
  6. Sleep soundly.

Does short-term trading and long-term investing work for Uncle8888?

He has been doing short-term trading and long-term investing on Kep Corp since 2001. Read ? Kep Corp and his realized profits and stock dividends received on Kep Corp alone will be more than enough to cover ALL expenses to be spent for 4-year University study course at SMU and NUS for his two kids.

Read ? Cost of University study

The moral of the story: Be Focus. One may be Enough.

Uncle8888 is not a high income earner

He was shocked when one woman told him that her 2nd and 3rd Child Tax Rebate was consumed by the third year. He couldn't even finish his 2nd and 3rd Child Tax Rebate in 14 years!

Since he is not high income earner, he can't depend on saving MORE for retirement fund. He has little choice but to find other means to supplement in building up his net worth for his retirement needs. He tries to do it through his short-term trading and evolutionary long-term investing strategy by taking whatever money he has on hand and made it works harder.

Uncles8888's current Net Worth as on 11 Feb 2011, Friday, SGX closing.

As you can see from the Pie chart above, 47% of his net worth comes from making and receiving money from the stock market. 14% of this money is locked in CPF OA to generate 2.5% Compound Interests and the other 33% is re-invested back into the volatile stock market.

Can Uncle8888's investing strategy works for you?

Believe not?

"If you believe you can't, you can't!" - Createwealth8888

 (But, not the same as the other way round hor)

Read? Are you this Eagle?

Singapore DBS Q4 net profit up 38 pct; beats forecast

SINGAPORE, Feb 11 (Reuters) - Singapore's DBS , Southeast Asia's biggest lender, posted a 38 percent rise in quarterly profit on falling bad-debt charges and higher trading income, beating expectations.

DBS posted a net profit of S$678 million ($530 million) in October-December against S$493 million a year earlier. That compared with an average forecast of S$660 million, according to six analysts surveyed by Reuters.

Asia's strong economic recovery has boosted lending, reduced bad debts and increased capital-raising activity for lenders.

Portfolio Management - Buying Rule

Read? Portfolio Management - Stop Losses? (2)

When you see me buying more, please don't be mistaken that I am bullish to Average Down hor.

Read? Why I Don't Average Down?

To me, it is like a game at School Fun Fair stall. 

I have maximum three shots at it. If I miss all the three shots; I just move on to the next game stall. It is just that simple.


Thursday 10 February 2011

CPL bought @ $3.43

Ensco and Keppel Fels in newbuild deal

US drilling contractor Ensco has finalised a fixed-price shipyard construction contract with Singapore’s Keppel Fels for two new ultra-premium harsh-environment jack-up rigs

The rigs, which are capable of operating in water depths of 400 feet, will cost about $230 million apiece.

The first rig is scheduled for delivery in the second quarter 2013 and the second rig in fourth quarter 2013, Ensco said in a release.

The contract includes options for two additional jack-ups of the same design at similar terms that must be exercised by 2 August this year.

Ensco will pay 20% of the rigs’ cost up front with the remaining 80% payable upon delivery, all of which is expected to be paid in cash.

In life how can anyone financially fail or seriously damage?

Just for Thinking ...

In life, does anyone seriously stop for a while to think that a series of bad things can happen one after another.

E.g. market crashes, investment plunges, losing job, someone in the family becoming critically ill, insurance premiums lapse, and still in debts.

In market, does any retail investors seriously stop for a while to think even strong dividend paying companies can disappear under their noses during crisis and may cause them to lose money?

They are taken private and delisted at the price lower than their purchase price.

Wednesday 9 February 2011

Will You Try To Pay Off Your Housing Loan ASAP If You Have One? (8)

Read? Will You Try To Pay Off Your Housing Loan ASAP If You Have One? (7)

I am glad that someone like Dr. Michael Leong who is well-known and respected local BB has the same view of paying off housing loan asap.

Guess who are telling you to take the longest housing loan that you can find?  Are these people from the property or housing loans industry? Think about it. You probably know them, right? May be we shouldn't be taking advices from people who may profit from giving us such advices.

By Dr. Michael Leong

Firstly, pay off your loans

When I first started working, I was told that I should immediately take up a housing loan as it was my entitlement. Before having a job, the bank would not have granted me a loan. Hence, I was told not to 'waste' my entitlement and I then started on my journey as most people would - I took up a loan to buy a house.

As the years went by, I realised that having a housing loan forces one to be constantly employed because failing that, one cannot pay off the monthly loan amounts and when one defaults, the bank can repossess the house. In many ways, the age old logic of getting a housing loan actually strangulates one's ability to start off any new businesses because the housing loan requires a steady monthly income which one can only get when one is under the employment of others.

When we start off a new family, the original house that we bought is likely to be inadequate for our needs. We then upgrade and commit to a further 30 year loan. This process of upgrading eventually forces us to be employed for the rest of our lives. Hence, having a housing loan is like having a jail term where one is beholden to the bank for the life of the housing loan. To pay for this loan, one has to have full employment till the end of his housing loan.

The first step towards retirement is to have a plan in place to pay off your housing loan as this is usually the largest loan that you can have. Once you pay this off, you will have the feeling of freedom that you have never experienced before. This is the freedom that may initiate you to start off your first business which may then become your ticket to financial freedom. Unless you are a high flying executive, it is unlikely that employment alone can make you financially free.

Tuesday 8 February 2011

China Raises Rates for the Second Time in Over a Month

China's central bank raised interest rates on Tuesday, its second increase in just over a month, intensifying its fight against stubbornly high inflation.

Although annual inflation slowed to 4.6 percent in December, it is set to pick up again in January with food prices on the rise.

Benchmark one-year deposit rates will be lifted by 25 basis points to 3 percent, while one-year lending rates will also be raised by 25 basis points to 6.06 percent, the People's Bank of China said.

The rises take effect from Feb. 9.

Portfolio Management - Stop Losses? (2)

Read? Portfolio Management - Stop Losses?

Stop losses: Do or Do not. Don't doubt! - Createwealth8888

If you strongly believe in your technical analysis skills and also trust your favourite technical indicators then you should act on good faith, take that stop loss; go home and sleep.

If you are like me don't believe in stop loss, then how do you control the damages to your capital?

Instead of using STOP LOSS to manage risks, I manage risks from different perspectives. I have trained myself very hard to look at Portfolio and not at stocks so a few falling stocks may not impose a big risk to me and don't bother me too. When it becomes necessary; I will write off losing stocks as zero value and take that losses in the Realized P/L. There is no point looking at them as it does nothing to improve your investing skills. Just move on!

If magically the dead stocks somehow resurrect; then I will sell them and write back as profits.

Portfolio = Investing Capital + Realized P/L + Unrealized P/L 
               =  Current stocks + Cash available for investing

There are few important things to note:

1. I don't use any Leverages

2. I am using cash that are not needed for next 5-7 years.

3. I have enough emergency fund.

4. I will only hold on to falling blue chips that Temasek or White Knights are likely to come to rescue

Investing - No minimum paper qualification is required!

Just for Thinking ...

Some of you may at first guessed that Createwealth8888 has some background in Financials or Accounting.

Yeap, you may be somewhat "right". The only background that I have with Accounting was sadly walking around and taking the last look at the compound of School of Accountancy in then the University of Singapore after submitting my letter of withdrawal from the course to the admin clerk.                                   

Read? Parents can be an Asset or Liability to the children?

To further educate myself on financial and investment knowledge, I have visited the book-shelf in "Finance and Investment" section in all NLB branches that are located near MRT stations.

Some people may find that all finance and investment books are more or less the "SAME" and stop reading them. But, I am still reading them whenever I come across any unread book and hoping to find one or two new ideas presented by the authors. However, it is getting harder to find unread books so I am waiting for the new NLB branch at NEX Serangoon to be opened next month and hopefully I could find a few unread books there.



Having lived a reasonably contented life, I was musing over what a person should strive for to achieve happiness. I drew up a list of a few essentials which I put forward for the readers' appraisal.

1. First and foremost is GOOD HEALTH. If you do not enjoy good health you can never be happy. Any ailment, however trivial, will deduct from your happiness.

2. Second, A HEALTHY BANK BALANCE. It need not run into crores but should be enough to provide for creature comforts and something to spare for recreation, like eating out, going to the pictures, travelling or going on holidays on the hills or by the sea. Shortage of money can be only demoralizing. Living on credit or borrowing is demeaning and lowers one in one's own eyes.

3. Third, A HOME OF YOUR OWN. Rented premises can never give you the snug feeling of a nest which is yours for keeps that a home provides: if it has a garden space, all the better. Plant your own trees and flowers, see them grow and blossom, cultivate a sense of kinship with them.

4. Fourth, AN UNDERSTANDING COMPANION, be it your spouse or a friend. If there are too many misunderstandings, they will rob you of your peace of mind. It is better to be divorced than to bicker all the time.

5. Fifth, LACK OF ENVY towards those who have done better than you in life; risen higher, made more money, or earned more fame. Envy can be very corroding; avoid comparing yourself with others.

(Read? Learning to Overcome Jealousy and Live Your Own Life)

6. Sixth, DO NOT ALLOW OTHER PEOPLE to descend on you for gup-shup. By the time you get rid of them, you will feel exhausted and poisoned by their gossip-mongering.

7. Seventh, CULTIVATE SOME HOBBIES which can bring you a sense of fulfilment, such as gardening, reading, writing, painting, playing or listening to music. Going to clubs or parties to get free drinks or to meet celebrities is criminal waste of time.

8. Eighth, every morning and evening, devote 15 minutes to INTROSPECTION. In the morning, 10 minutes should be spent on stilling the mind and then five in listing things you have to do that day. In the evening, five minutes to still the mind again, and ten to go over what you had undertaken to do.

RICHNESS is not Earning More, Spending More Or Saving More, but ...

Monday 7 February 2011

Property or Stocks Investing

Just for Laugh ...

So far I came to know two Singapore's Big Name or BB who didn't advocate property investing and they still prefer stock investing. They are:

Mr. Peter Lim
Dr. Michael Leong

Do you know any other big name or BBs?

DBS to launch yuan-denominated products in Singapore on Tuesday

SINGAPORE, Feb 7 (Reuters) - DBS, Southeast Asia's largest lender, will launch a suit of investment products linked to the Chinese yuan for retail investors in Singapore on Tuesday.

"The increasing internationalisation of the renminbi (yuan) in the global markets has put the currency in the spotlight, with rising demand from investors," DBS said. (Reporting by Kevin Lim)

Classes of retirees

Just for Thinking ...

This is what I observe on Sunday afternoon at Chinatown on the classes of retirees:

  1. They were happily drinking cold beer and eating roasted duck, pork belly and char siew and cheering each other.
  2. They were happily drinking MacCoffee and chatting at one cozy corner inside MacDonald and enjoying air-con.
  3. They were happily drinking kopi-o at the coffee stall and chatting in the natural afternoon air flow.
  4. They were sitting at the bench and staring at the crowds.

Sunday 6 February 2011

Time Can Change Many Things Including Passion, Love and Hobby (2)

Read? Time Can Change Many Things Including Passion, Love and Hobby

Just for Laugh ...

I was once so passionate in Chinese Chess. I spent lots of time reading all those chess playing books that I could find in NLB. Almost every weekends playing in community chess club and every lunch time playing it with similar chess-craze colleagues by taking super quick lunch so we would have maximum time for the game. I also took parts in various organized lower chess competition or watching masters playing in international tournament matches and trying to learn from the very best.

Then, few years back during Spring Cleaning, I threw away the last chess set and that passion finally has died off.

I believe in life for those activities that we do other than making a living or making good money out of them that we may have little choice but to do them; but for the rest of those free-willing activities we may have to do them on purpose-driven or mission-driven basis or else they may one day just die off when we faced with stronger competing needs for our time.

So when will I stop fishing and blogging? May be not so soon I think!

Investing Made Simple by Uncle8888 (5)

Read? Investing Made Simple by Uncle8888 (4)

What was Uncle8888 doing in the stock market during the 80s/90s?

If Uncle8888 has recalled correctly; in 80s/90s he was just drifting along in the stock market without a clear and definite investing Goal as he didn't even know what he actually wanted from the stock market.

He was just hoping to strike more IPOs and would be happy to be able to make some money from selling "lucky-strike" IPO stocks. He didn't have any big ambitions from making money from the stock market.

Sometime, he might follow some investing tips from his office/brokers into some stocks. From times to times, he might get lucky and made some money and other time he might get stuck and became a long-term passive income investor. It might take a few more years for him to finally get rid of these stuck positions sometime at break even costs or lower after collecting some dividends.

Uncle8888 did a Mind Flip

Read? Reading and Mind Flip (2)

After that mind flip he finally realized that the best way to get out of Rat Race without becoming another Rat in a different form e.g. doing more part-time jobs was through the Investment Quadrant.

He finally realized that to succeed in his investing journey he would need a very strong motivation and full commitment to do whatever it took to do it well. At last, he finally has a CLEAR AND DEFINITE INVESTING GOAL i.e. to reach FINANCIAL INDEPENDENCE.
To reach this goal, he has put in lots of his time and efforts into educating himself on financial literacy and finding out what might work for him and discarding those that clearly didn't work well towards his Investing Goal. He also kept revising and refining those that seen working fine for himself to remain relevant in the ever changing market conditions of bull and bear cycles.

Looking back, Uncle8888 realized that he did the following to stop himself from drifting along the stock market:

1. An End In Mind - Having a Clear and Definite Investing Goal helps.

With this investing goal, he knew exactly what he wanted from the stock market. He knew that he has no better choice but to succeed in the investment quadrant in order to get out of Rat Race.

Read more on investing goals? Portfolio Management - Measuring your success!

BTW, Uncle8888 realized that many retail investors too share the similar goal; but often it lies in the strength of their belief and the level of their commitment in reaching towards that goal.

2. An End in Mind is Not Enough
Uncle8888 knew that having an End in Mind is only the beginning and it will be never enough for him to reach that End in Mind. He knew that he needed to track and measure his investing performance towards that End. From times to times, he needed to find out the following:
Was he progressing well at the right paces towards his End?
Was there any setbacks and obstacles that needed to be overcome?
In another word, he kept reviewing his 3M's and sometime he did a reality check on his investing life journey by doing some simulation on the type of CAGR expected on his investing capital in order to take him  from "where he was" to "where he would like to be ". He then proceeded to change or revise his investing strategies when it became necessary and hoping with the changes he could still remain on the right path towards his End.  He strongly believe that he needed to be reasonably good and be focus at all three aspects of his 3M's.   Read more on 3M's?.

BTW, Uncle8888 realized that many retail investors thought that they are tracking and measuring their investing performance when in fact they are just doing detailed recording of their stock transactions or having a view of their portfolio's cash flow. Recording is not measuring. Learn to know the difference will definitely help you to progress well in your investing life journey in order to effect changes when it may become necessary.

To be continued in the next Weekends ...

CH said in his email to Uncle8888: "I was struck by your name, the 2 processes of Long Term and short term trading are mentioned and these are what I've been struggling with since I began."  Uncle8888 may do a post relating to it.

Saturday 5 February 2011

DBS Weekly

Likely to break its tough resistance next week in view of DOW setting a higher high.
FY10 result will be out on 11 Feb 11, Friday, AM.

The Most Common Mistake of Investors

Read? Why does stock price move?

And more ideas from Jeff Augen ...

Investors often make the mistake of assuming that they have unique insights that market has failed to recognize. They buy stocks that they believe are under-priced, or they purchase high-yielding corporate bonds because their instincts tell that the risk of default is exaggerated. In the worst cases, these mistakes evolve into an an investment strategy.

Unfortunately, the investment community tends to overuse the words "under-priced" and "over-priced." Strictly speaking, a financial instrument cannot be under priced unless the market is inefficient. The opposite is generally true; market tend to be very efficient, especially with regard to pricing of heavily traded stocks that are closely followed by large institutions. An investor who believes he has discovered a discount would usually be better off assuming that he has missed something. Humbleness is the most valuable attribute an investor can have.

Most investors would prefer to believe that they can out-think the market. They continue to believe that have this capability even when they are wrong and lose money. When someone buys a stock and the price falls, they often blame the market or the lack of knowledge of other investors. In modern times, it has also become fashionable to blame large institutions and hedge funds. Message boards and investor char rooms on the Internet are filled with various forms of the statement: "Large institutions are driving down the price so they can buy more."

However, when a stock rises, the same person will automatically credit themselves with making a good investment. If the stock rises immediately, they are also likely to take credit for perfect timing. Few investors ever adopt the opposing view that when they make money it's because they are lucky, and when they lose money it's because they made a bad investment.

Finally, many investors may declare that short-term trading is always difficult because precisely timing the market is impossible. They believe, however, they have a better chance of making accurate long-term predictions. That belief implies that complexity and uncertainty decrease over time. Unfortunately the opposite is true - complexity and uncertainty tend to increase as new forces come into play. Complexity as the situation might appear, it can't compare to the uncertainty of the future, which includes new competitors, new products, and ever-changing market place. Nothing changes faster than future.



If you really like what you have been reading so far, you may want to read further "Trading Realities - The Truth, The Lies, and the Hype In-between" by Jeff Augen

Why does stock price move?

Read? What you may not know about stocks?

More ideas from Jeff Augen

Stocks rise when buyers are more aggressive than sellers. They fall when sellers are more aggressive than buyers. Most investors mistakenly believe that stocks rise when there are more buyers than sellers. The difference is significant and it has far-reaching implications. Liquid markets always have an excess of both buyers and sellers who generate bid and ask prices. A transaction occurs when the high bid and low ask come together; either the bid is raised or the ask is lowered. A rising bid represents aggressive buying and a falling ask represents aggressive selling. Aggressive buying drives up the transaction price while aggressive selling lowers it.

Buyers and sellers can become aggressive for many different reasons. Triggers can include news about the economy, other stocks, or individual industries. Money can also flow in or out of other markets as interest rates rise and fall and currency exchange rates fluctuate. News surprise also cause investors to shift money between stocks in the same sector. Investors make these choices thousands of times each day. Simply stated, money that flow into the stock market does not evenly into all stocks.

It is also important to understand the underlying forces that cause investors to become aggressive buyers and sellers of a stock or other financial instrument. The dynamics are simple. At any time, the market sets a price that comprehends everything that can be known about a particular stock including confidential information known only to insiders. The moment new information becomes available, market forces adjust the price.

Every stock trades at a characteristic price/earning (PE) ratio. The market bids up the price of a stock when it anticipates that earnings will rise sharply. A high PE, therefore, is the market's way of predicting future growth and pricing that growth into a stock. Analysts raise  their "price target" for a particular stock, when their forward-looking view reveals that earnings will rise faster than previously forecast. If the market completely agreed with new forecast, the price would immediately rise to equal the new predicted value. The difference between a stock's trading price and an analyst's future price target  is important because it represents the difference between two views. The market votes with real money and analysts vote with words on paper. Sometimes the gap reverses because information surfaces that causes the market to become more bullish on a stock than existing forecasts. The more optimistic view will drive the price above targets already set by the analyst community. If the situation persists, analysts will raise their forecasts.

Unfortunately, investors often misinterpret the meaning of price targets set by the analyst community. The common belief is that stocks experience steady growth, and that they are always on a trajectory to reach future price. In reality, there is no trajectory. The price will remain flat if company continues to perform as predicted by the market.

Friday 4 February 2011

What you may not know about stocks?

Some ideas from Jeff Augen

Most investors who buy a stock believe that they are investing in a company. That view, while technically correct, is also misleading. A stock investment is really nothing more than a bet on the direction that money will take as it flows through the financial markets. A stock can rise only if market forces align to aggressively drive up the bid price causing new money to flow into the stock.

Many different factors are involved including economic news, announcements from other companies in the same industry, political events, the actions of large institutional investors, analysts' forecast, and a variety of global economic forces such as changes to currency exchange rates and interest rates. the long-term performance of a stock represents nothing more than the compound effect of these forces over time.

It is important to recognize that the financial markets are zero sum game with competition at all levels. the stock market competes for money against the bond and currency markets; industries compete for money with each other; and money flows between stocks within a particular industry. An individual stock can fall because money is flowing into the bond market. It can also fall because money is flowing into another stock in the same industry. Conversely, the stock of a poorly performing company can rise if market forces are properly aligned. All factors considered, the price of a stock is often loosely connected to the performance of the underlying company.

There was a time, not long ago, when individual investors were the dominant force in the market. Buying a stock was equivalent to betting on the behaviour of other market participants. Those days have passed. Today's markets react to economic news in fraction of a second. Heavily traded stocks in the S&P 100 or DOW rise and fall for reasons that are nearly impossible to understand at the individual stock level.

Investors who recognise these complex dynamics can gain advantage because they have a balanced, realized view of the problem. They spend most of their time identifying the underlying forces driving the markets, and they always try to invest with those forces instead of against them. In this regard, the most important attribute an investor can have is humbleness because successful investing is a never-ending struggle.

Thursday 3 February 2011

Measure, Measure, Measure (5)

Read? Measure, Measure, Measure (4) - Revisit

Someone said to me: "Just started to follow your excellent blog. If I'm successful, will definitely buy u a few cups of kopi."

How do we measure our success in investing in the stock market? If they can't measure their success, I will never get my kopi? LOL!

Read? Portfolio Management - Measuring your success!

So generally, we may measure our success in investing in the stock market in two ways:

  1. Sustainability: e.g. beating bank FD rate, inflation rate or passive income streams.
  2. Progressive: e.g. building up kid's university fund, retirement fund or financial independence.
While our investing goals may have not changed; but the market condition with its opportunities, risks and dangers is ever changing. We must be honest and realistic with our investing strategies and methods. What may be working and rewarding for us in 2009/2010 may not be working well towards our investing goals in 2011 and beyond if we didn't realize that market condition has changed.

So don't forget to periodically review e.g. quarterly or semi-annual to check whether our investing strategies are still working well in the current market condition with different opportunities, risks and rewards.


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