As from April 2013 my Journey in Investing is to create Retirement Income for Life till 85 years old in 2041 for two persons over market cycles of Bull and Bear.

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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

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Value Investing
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Technical Analysis and Charting
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Sunday, 11 December 2011

Everybody loses money in the market. EVERYBODY!

Just for Thinking ...

But, I tell you who doesn't lose money in the market. There are two groups of people who don't lose money in the market.

No 1: You turn to daily newspaper ads on investment and trading courses.You will find them. Some will admit that they have lost money; but after going up to the high mountain somewhere, the Mountain God or Goddess have imparted to them some magical powers or weapons that they no longer lose money in the market. They can slaughter the Demons of the market at their will and they have set up altars for you to worship them by parting some of your hard earned money of course and not by mere token donations. Respect, respect, respect hor!

No 2: You often hear them at forums, cboxes, and in the cyber space, the Hoalian royal patron of KopiTIAM and BreadTALK. Lose money TIAM TIAM. Make money TALK TALK.

Track, measure and report it as it is

Why it is so difficult to do it?

It is our human nature to Hoalian and quite difficult to overcome losing face mentality. Especially, when Asian common folks wisdom is we hate to lose face and Teochew got licence to Hoalian? I heard it from my Teochew parents. True or not?

But, once we come to term and accept the truth and reality of the market that everybody loses money in the market; nobody can escape from it. We should be able to track, measure and report as it is since we have accepted losing money is part of the game.

For measuring, we should use XIRR to measure the long-term performance of our portfolio (stocks and cash holding) over market cycles and use ROC to measure the performance of our stocks pick.

Numbers seldom lie unless it is a fraud!








7 comments:

  1. Hi CW,
    By the way, can you share why Teochew got licence to Hoalian? i have got some Teochew relatives.

    ReplyDelete
  2. CW8888,

    Nice word play on KoiTIAM and BreadTALK! Cool!

    Hey! We are "dang hiang" :)

    Teochew where got "haolian"? We just talk a bit louder only... LOL!

    Putting my maggi-mee pot to protect my head. Don't hit the face!

    ReplyDelete
  3. Hi CW8888,

    Am not sure about others, i am at -1.4% XIRR, so far.

    Underperforming the market by 15%.

    Am okay with that, as i am loading up on the stocks which are underperforming.

    Cheers

    V

    ReplyDelete
  4. Yes. Those who tiam tiam when lose money but talk big big when on the winning side loses my respect automatically.

    I tracked a good doctor facebook and at one point, the doctor mentioned we are already in a bear market. With the recent market movement, I could not find the post anymore and there was no reference of it anywhere in his forum as well.

    ReplyDelete
  5. Hi V,

    -1.4% XIRR since when 20XX?

    Hi Anonymous,

    doctor? Dr Michael Leong?

    ReplyDelete
  6. Hi CW8888,

    I started tracking on XIRR method only from Sep 2008, so i guess it is very early days, just three years odd.

    Also, my portfolio is quite small in comparison to some of the bigger investors like musicwhiz or LP or you. It is just 60K value.

    Hopefully, in the next decade or so, i will improve to your levels.

    Cheers

    V

    ReplyDelete
  7. Hi V,

    XIRR is a good performance measuring tool and irrespective of portfolio size.

    It helps to measure capital deployment efficiency over time i.e the rate of growth or if unfortunately the other way round - rate of capital destruction.

    How to prevent capital destruction? Serious thought in 2012/2013?

    ReplyDelete

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