As from April 2013 my Journey in Investing is to create Retirement Income for Life till 80 years old for two 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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Monday, 28 January 2019

What Is Your True Holding Power Across Volatile Past And Future Market Cycles???


1) Our money i.e. a bigger war chest


Our holding power in term of money will ease our heartache while receiving doses of Panadols during bad times and smiling during good times and giving us the right to brag during CNY gathering among friends and relatives - "I told you to invest! You no listen"

2) Our yield on investment cost e.g. high single digit or double digits dividend yield on cost

During good times in our FIRE, FIRe or retirement phase; we can't live off those paper gains in our investment portfolio; but during bad times; we will still be receiving dividends but just smaller!


What is our true holding power across volatile market cycles? Money or yield?





8 comments:

  1. Both is best :)

    High yield .... need to buy a basket of strong moats dividend-growth companies at low-to-moderate valuations .... and hang on for years & decades. It's a game of patience .... longer you hold the better, provided the companies maintain their strong moats! LOL. Need strong conviction & analytical skills to be able to re-invest dividends or keep putting new money into these companies as well.

    Money as security blanket .... have liquidity / living expenses fund for the shorter term (1-3 years). Frankly, any expected expenditures for the next 3 years (or even 5 yrs) shouldn't be in stocks or other risk assets.

    Money --- should also build up warchest during good times e.g. saving up a portion of dividends; using appropriate overbought indicators to harvest some paper profits; using appropriate trend indicators that you're comfortable with to prevent losing too much profits + capital back to bear market or serious corrections.

    Trend indicators --- also need to know when to buy back in or scale in as well.

    I personally try to use the money methods above. But too impatient for the Yield method haha! And also too lazy & too stupid to analyse & monitor those individual companies. :P

    ReplyDelete
    Replies
    1. Money can buy laziness and over ride impatience. Money can buy many thing. Lol!

      Delete
    2. There are reasons why W. Bufett advocate in general, people like us should buy Index Funds rather than individual stock.

      Delete
    3. I also tend to KIV it is best to have 3 to 5 years of money in safer assets rather then in stock market.

      Is money in FH rental property comparable to money in stock?

      Anyone?

      Thanks!

      Delete
    4. Without incurring income from full-time job it is even more critical to keep a few years of rotting cash to fund household expenses and to ride over the next bear market to deploy war chest.

      Delete
    5. For long-term investmentors maybe, what about short to very short-term investors?.

      Thier funds are in and out of the markets anytime.

      Delete
    6. very short-term investors are traders

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    7. Ya.

      So compare to trader we seems to lose out the way we tie-up our money.

      Especially now after 10 years or more, no really Big, Big bear appears.

      Yet those who try trading but never get a hang of it, what can they do next?

      Delete

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