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

Saturday 16 April 2011

Investing Made Simple by Uncle8888 (12)

Read? Investing Made Simple by Uncle8888 (11)

Clearly Know What You Really WANT or  NEED; you may be financially better off!


Classic example of WANT and NEED is a Car.

Most people will WANT car. Right? But how many people really NEED car?

A salesperson who travels around the island doing sales will definitely NEED a car to be productive and efficient.

Does a desk-bound office worker in CBD area traveling only from his home to office and back really NEED a car?

For the same desk-bound office workers without car; they may have more saving and may have more money for investment. If they manage to do well in their investment, they will be financially better off in the long run.

Investing in Stock Market

Do retail investors clearly know what they really NEED or WANT in the stock market?

Uncle8888 have no doubt that it is quite easy to understand the difference between WANT and NEED using the example of a Car.

But, to really understand the NEED and WANT in Investing, Uncle8888 don't think it is that easy. Firstly, you may need to open up your mind to seriously think it through. Secondly, be willing to change your mind-set if you don't think Uncle8888 is senile and talking nonsense. LOL!

Stock Dividends

Uncle8888 believe that most retail investors WANT Stock Dividends and there is no doubt about it.

How many retail investors clearly know that they NEED stock dividends as INCOME or they WANT stock dividends as CASH FLOW?

Uncle8888 believe that if retail investors clearly understand and know the difference between WANT and NEED; they may get higher TSR (Total Shareholder Returns) in the long run by revising or changing their investing strategies. Investing is still a Game of Strategies. The ones with better strategies are more likely to win more.

Who will need stock dividends as INCOME?

Giving two examples here:

1. For retirees having only portfolio of stocks as assets during their retirement will clearly NEED steady and regular streams of stock dividends as INCOME to meet their living expenses.

2. For fund Managers, they may NEED stock dividends as part of their overall cash flow management strategies to take care of expenses, staff salaries, redemption and other cash outflow.

Do some retail investors really NEED stock dividends as INCOME?

When you are employees or self-employed having good income and can save more than enough money every month. You will have enough spare money to invest in the stock market. Do you really need stock dividends as income?

You may have mistaken WANT from NEED. You may actually WANT stock dividends as cash flow and not as income.

If it is not for income, why do you need to chase after stocks such REITs and Biz Trusts as these financial instruments are primarily developed by the Market for the purpose of providing regular streams of stock dividends as income?

Focusing on stock dividends as cash flow will require different investing strategy. The important part of this strategy is deep understanding of this Golden Formula in the Stock Market!.

If you still don't understand it. We may need to talk it further over an Executive Lunch.

1 comment:

  1. Hi,
    I am "very greedy"; i want income dividend and realised profit when the price & time are ripe for husking (relised profit). i want the best of both worlds now. When i was much younger, i care for relised profit much more than dividend income.


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