Stress Test on Investment Portfolio for the next Fat Bear! (2)

Read? Stress Test on Investment Portfolio for the next Fat Bear!


(Carnegie 49)

 If you have a worry problem, do these three things: 

1. Ask yourself: “What is the worst that can possibly happen?
2. Prepare to accept it if you have to. 
3. Then calmly proceed to improve on the worst.

Assumptions

1. Doing nothing now i.e. no more re-balancing of portfolio.

2. Current holding stocks drop 50% from last Friday market closing price.

3. Start deploying War Chest after STI turns Bear i.e. drop of 20% from its recent peak.

4. New positions from War Chest drop an average of 30% from their initial investment cost.

 

Stress Test Result:

Still a Winner!

But, loser to inflation.