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.

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, 30 June 2012

How to become rich in stocks??? (5)

Read? How to become rich in stocks??? (4)

Number doesn't lie!!!


Read? Are you one of high income earners in 2009 in Singapore?
  1. How many of us are high income earners and can save more money for investing capital?
  2. How many of us don't want to marry and may have more money for investing?
  3. How many married couple want to be DINK and may have more money for investing? (Dual Income No Kids)
  4. How many of us can have an account size of more than $1M for investing?
  5. How many of us has an account size of lower $XXX,XXX and want to become rich in stocks?

I believe many of us will know the answer in our heart and know where we are and where we want to be?

Next come the two most common questions in investing in the stock market ....

Dividend vs. Capital Appreciation???

Income stocks vs. Dividend Growth stocks???

You have to make a choice!!!


Read? Can recommend some high yield dividend stocks for passive income? (2)

Guess what happened after someone asked me the above question. Many people become buay song with the "reply".


But, before I say my piece .....

“If you are in the right sector at the right time, you can make a lot of money very fast” –Peter Lynch
"You need $10,000 and two 10-baggers, and you're a millionaire." –Peter Lynch

It is how to become rich in stocks if we read Peter Lych correctly!
$10K ---> $100K ----> $1M

or

$XXX,XXX ---> $X,XXX,XX (A portfolio of multi-baggers will help)

Let begin ......


Read? Uncle8888, how do you find multi-bagger stock?

Uncle8888: "Well, I have successfully discovered 54 different stocks in SGX that I have bought in the past are not multi-baggers."

The moral of the above story is to keep finding one!

Is Uncle8888 super investor?

No. No. No!!!

I have made big losses in 2008 Bear market too!

Total net losses in 2008: $160K

  •  4 months of losses: Jan:$76K, Aug:$68K, Sep:$18K, Oct:$31K

Read? Trading Performance Review


I was the HERO and stubbornly held on to two rotten durians to ZERO and then the durian owners kind enough gave me two pieces of Toilet Paper to remind me of the SHIT!

Read? Stock Picking is like Choosing your own durians?









Do I earn the right to tell you this true life story in investing after many years of adventures and mis-adventures in the stock market?

What do you think? Hmm....

Why I am strong advocate of waiting for dividend growth stocks to come to us?


Case Study 1 - Kep Corp






Batch 1: Bought in 18 Sep 2001 after WTC Attack and holding it over 10.8 years

For past 10.8 years, the dividend yield is as follows:

Lowest: 10.4%
Highest: 44.2%

Total Dividend Return on initial investment cost = 291%

Annualized Return = 27%

Unrealized capital gain as of Friday market closing price at $10.28 = 681% over 10.8 years

Annualized Unrealized Return = 63%

So Dividend Return vs. Capital Appreciation291% vs. 681%


Batch 2: Bought in 26 Mar 2004 and holding it over 8.3 years

For past 8.3 years, the dividend yield is as follows:

Lowest: 5.7%
Highest: 18.1%

Total Dividend Return on initial investment cost = 99%

Annualized Return = 11.9%

Unrealized capital gain as of Friday market closing price at $10.28 = 220% over 8.3 years

Annualized Unrealized Return = 27%

So Dividend Return vs. Capital Appreciation99% vs. 220%


Paper profit is useless as it cannot buy food

I know!

That is why I am also doing short-term trading when market presents opportunity to make pocket money.

Read? Kep Corp: Sold $10.14

I have done 94 rounds of Kep Corp.



Case Study 2 -  Semb Corp
















Batch 1: Bought in 24 Dec 2002 and holding it over 9.5 years

For past 9.5 years, the dividend yield is as follows:

Lowest: 6.1%
Highest: 59.8%

Total Dividend Return on initial investment cost = 252%

Annualized Return = 26.5%


Unrealized capital gain as of Friday market closing price at $5.13 = 599% over 9.5 years

Annualized Unrealized Return = 63%

So Dividend Return vs. Capital Appreciation252% vs. 599%


Batch 2: Bought in 15 Sep 2003 and holding it over 8.8 years

For past 8.8 years, the dividend yield is as follows:

Lowest: 4.1%
Highest: 26%

Total Dividend Return on initial investment cost = 107%

Annualized Return = 12.1%


Unrealized capital gain as of Friday market closing price at $5.13 = 204% over 8.8 years

Annualized Unrealized Return = 23%

So Dividend Return vs. Capital Appreciation107% vs. 204%

Batch 3: Bought in 25 Oct 2005 and holding it over 6.7 years

For past 6.7 years, the dividend yield is as follows:

Lowest: 4%
Highest: 16%

Total Dividend Return on initial investment cost = 52%

Annualized Return = 7.7%

Unrealized capital gain as of Friday market closing price at $5.13 = 87% over 6.7 years

Annualized Unrealized Return = 13%

So Dividend Return vs. Capital Appreciation52% vs. 87%


Paper profit is useless as it cannot buy food

I know!

That is why I am also doing short-term trading when market presents opportunity to make pocket money.

Read? Semb Corp: Sold $4.25 ROC 5.0%

I have done 52 rounds of Semb Corp.




Now I am patiently waiting for more to come ...











Number doesn't lie!

Income stocks vs. Dividend Growth stocks???

Do your own thinking ....

After post add on story:

One reader sharing a story how to become millionaire with RM1K initial investment and grow to RM3.2M over 40 years.




























8 comments:

  1. Regarding your five points, read? I think married can double the savings rate, if you find the right partner :)
    http://www.mrmoneymustache.com/2011/09/15/a-brief-history-of-the-stash-how-we-saved-from-zero-to-retirement-in-ten-years/

    My takeaway from this post, wait for opportunity to buy at good price for stock which can give dividend and growth. From my newbie POV, the label of the stock (div/growth/etc) is not important, since if you buy at a low enough price, the div and capital gain will both grow.

    One question, what's your strategy to extract the $ out of all the capital gains in the future? Once your take out, the $ become real, but we still want to protect against inflation, so must put back somewhere right? Would you then consider putting into cash flow emphasis stocks or other mediums?

    ~RD

    ReplyDelete
  2. "Total net losses in 2008: $160K"

    Hi compare to me you are very lucky. I lost almost 2.0 times what you you lost. but i never expect to recover so soon and make money too in 2010, 2011 and 2012. Do you believe in buy & hold? If you don't, please be a trader.
    Actually 2012 is still in the process.

    ReplyDelete
    Replies
    1. Thank for sharing the part on losses so that newbies are aware that investing is rather risky and can really lose lots of hard earned money.

      Delete
  3. Praise be given to God because i ask for His Blessings in investment. The money i lost now or make are all given by HIM for all these 23 years+. i am a believer in unless God Blesses you whatever you do is in vain. Even after you make some money it doesn't mean you are O. K. IMHO.

    ReplyDelete
  4. And I thank you both Temperament and CW8888 for selflessly sharing:)

    You both recovered thanks to his Grace or lucky the durians were not rotten till zero.

    Some stocks that crashed in 2008 never recovered even till today... It's always back to stock selection and what price we have paid for them.

    For wisdom, I listen to those who have walked the path before me.

    "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

    How true it is.

    I pray when I sell you two are not buying from me. And when I buy, you both are not selling to me!

    Stay away! LOL!

    ReplyDelete
  5. Hi SMOL & All who read here: "We all shall be blessed if we do not turn ourselves into pigs or lemmings in the stock market. Not really a problem if we can remember this."

    ReplyDelete

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