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Read? Compounding Investment Return Pornography???
Read? How Soon Should You Start Investing Your CPFIS And SRS?
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Posts
CW,
ReplyDeleteI was laughing when I saw the YouTube ad featuring a young local female snake oil (nice to see equal opportunity here) touting the wonderful magic of compounding...
Day 1 put $1, day 2 doubled to $2, day 3 double again to $4, day 4 double to $8!
That's stolen with pride from that 1 rice on a chessboard and double for each square story ;)
If only bei kambings knew the true average rate of compounding investing in STI for the last 10 years... Even cryptos cannot double every year!!!
Why is passive investing "faith-based"?
Because you need to have "faith" that it will compound around 8% over the LONG term...
When for the last 10 years, STI's return with dividends is more CPF like... Of course snake-oils will carefully chose the index 100 starting point to make the returns sexier!
But snake-oils can't earn commissions and fees if they sell you CPF. So passive investing for the intellectually lazy, and active investing/trading for those who have animal spirits and think they are better than their neighbours!
I'm not a fan of voluntary contribution of CPF, but the ugly fact is that the majority invested with CPFIS is underperforming CPF...
Heck! Even my put $50K under the mattress parody strategy will beat the performance of most CPFIS investors! No capital gains or dividends needed mom!
Investing is hard.
Trading is harder.
Speculating lagi even harder than hard!
Call sell training course on How To Sharpen Your Mind To Profit from the Market? LOL!
DeleteHi Uncle8888,
ReplyDeleteThe problem with investing (or trading) is that compounding in real world markets doesn't happen in a straight line.
Sometimes a year gives you +100% or +50%. Sometimes it gives you -30% or -50%.
If you're willing to pay the price & hold ... then you'll see the "compounded" 6%-10% over a few decades. Most can't.
Thanks to simplistic maths education in school, we confuse savings compounding with investing compounding. They are not the same. ;)
And that's when CPFIS or cash investing returns lower than POSB savings account. 🤣
However as I've previously said, millennials are enjoying an extremely lucky period for investing. Sure some of them graduated in the middle of the GFC recession, which has undoubtedly affected their lifetime active incomes. But diligent & patient investing can help overcome that. No I'm not selling any i-can-do-it-so-can-you courses lol.
We're still in the middle of a secular bull & my totally bullshit guess is that there's still roughly 7 more years.
Another milestone for the VIX in this post-Covid cyclical bull ... 2nd weekly lower close below 20. The more boring institutional investors are getting less fearful about potential market crashes. The change in market character continues.
Not to mention the Ups and Downs of the market may give electrocution to weak hearts!
ReplyDelete