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.

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Value Investing
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Thursday 29 December 2011

Saving, Lending and Investing (3)

Read? Saving, Lending and Investing (2)

One simple rule to remember.  How are we paid?

When we save - we are paid low interest rate.

When we lend (buying bonds or pref shares), we are paid coupon rate (interests)

When we invest in stocks- we are paid dividends and we also speculate for capital gains.

When we invest in property - we are paid rentals and we also speculate for capital gains.

Interests, coupons, dividends, and rentals are basically yield on investment cost; if we don't receive any yield regularly, it is pure speculation When we speculate, it is all about timing to recover capital and gain.

Some people may think that riding it and down is hedging against inflation???

But, when we invest long enough, one day we will recover our capital. Surely that day will come. So we better invest than speculate. Right? LOL

1 comment:

  1. Hi CW,
    But sometimes, it is not so easy to draw the line. Is hedging your SGX portfolio in a Bull Market Run with an appropriate hedging instrument, trying to capture as much capital return(ROI) as possible, consider speculation or what?
    You tell me.
    If you retire your portfolio too early even before the Bull Run reaches it's half way finishing line because you don't know how to hedge, is it then considered as wise investment?
    Or both ways are considered as speculations?
    Meanwhile, as long as you have a portfolio in the market, you are enjoying some dividends return.
    So what's investment? What's speculation? i believe your current intention/action behind your portfolio determine whether you are investing or speculating now. Ha! Ha!
    Or can even be both at the same time. Possible or not?
    i am confused more than "Confucious" can teach me. (No offence to Confucious).


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