Read? On why sound investing principles will always work??? (2)
Time to sell DBS if you happen to follow that forum on DBS crashing to $6 by the Guru?
Your entry price for that position matters the most and there after you have options to be active cum passive on core position and that is why we MUST buy slowly when market started going down and crash and recover.
Buy and Freehold on dividends paying blue chips are more relaxing and assuring that some income will flow into our bank accounts especially when we are retirees.
Trading on core is NOT easy as there is no sure formula. Hmm .. Okay if you believe in those investing or trading ads telling you winning formula on their methods. Go for them as course fee is cheaper than your losses! LOL!
Read? DBS: Bought Back For Round 30 @ 31.88
Posts
CW,
ReplyDeleteWe all start off with faith based investing.
I mean trading around a core position is a common technique used by hedge funds. It's not new.
But I've never heard of Buy and Freehold?
See? If you start your own course or seminars peddling snake oil, you've just "invented" your own religion denomination! A spinoff from Buy and Hold?
Lol!
Likewise, all veterans who are their own shepherd will discover shoes that fit their feet best.
Some are just not bleeding hearts arhats - self cultivation focused.
Some like to Joan of Arc others, "If you believe me, follow me!"
:-) Free snake oil here for believers! LoL!
Delete"Buy & Freehold!" Very nice term, CW.
ReplyDeleteI have not traded any shares ever, so I can only read other people's trading stories and envy their profits.
As a buy & hold investor, I do have some shares that have become "buy & freehold". Not a lot but some and hoping to see more of them become so.
The next question is can our CPF Savings become "Save and Freehold!?"
The answer is a big YES!! But it will take a long time!
For eg,, my wife and I have a combined CPF savings of $3M giving us about $100K interests yearly. In 30 years, the cumulative interests will be $3M and if we dont withdraw the interest, it will take less than 30 years to generate the $3M.
Same same as but different. It is probabilistic for shares and deterministic for CPF.
mysecretinvestment,
DeleteYou know me. Just having a bit of fun, no malice.
How young are you now? (You are inviting my poke! Lol!)
Hi SMOL,
DeleteNo worries. I am already poked full of holes by the Covid vaccination.
You know I could have used a lower starting base like $2M in our combined CPF and we would been near to half way to "Save and Freehold" ? What this meant is that out of the $3M, quite a fair bit was from interests.
And better believe it, the younger cohorts, those in their 30s and 40s, have a very high chance of attaining "Save and Freehold" in their CPF, now that more are aware how to go about it.
And I think there is a big misconception that people in the 1M65 movement only do CPF savings and nothing else. The CPF savings is their first layer. For the many not initiated into investing, the CPF layer is an important first layer to build up.
mysecretinvestment,
DeleteI knew you're sporting!
1. I'll leave CW to explain what's Buy and Freehold. I believe it involves SELLING to take back our initial capital safely back into our pockets. Not exactly the same as what you thinking ;)
Then again, I could be wrong (again)! LOL!
2) Agree. You and I are on the SAME page; we are opposite sides of the SAME coin :)
Big daddy got GIC and Temasek BOTH for a reason.
GIC? Just beat inflation can already! Don't go crazy on returns... Focus on safety and consistent results.
Temasek? Let it rip! Risky startups? Losing years? Volatility? No worries! Remember we got GIC?
Now in your 60s (still very young if we live to our 90s), you "dare" to remark "if we don't withdraw the interest"???
That's the surest indication your CPF is merely a minority portion of your total net worth! You EARN MORE tiger you!
Imagine those in their 30s and 40a who do only CPF savings and nothing else like what you've said, of course they CAN"T do that in their 60s like you!
Can survive on CPF Life and nothing else as in don't touch their CPF interest???
If inflation does not revert back to below 2% going forward... They'll probably start depleting their "beloved" CPF savings in excess of CPF Life pretty quickly! Yeeks!
You?
Runaway inflation HURTS everyone.
But for those who own productive assets (got pricing power) OUTSIDE of CPF...
Its same, same but DIFFERENT!
You the MAN!
Good morning SMOL & CW,
DeleteI have the same thinking as CW on the definition of "freehold". That is, it could be from holding the shares over many years and recoup the initial cost through collection of dividends and / or trading them profitably. Likewise for CPF savings, collect & USE the interests while preserving the capital. Over time, the interest earned could jolly well exceed the capital.
And yes, I am in my 60s and I do wonder if money would feature prominently in my life when I am in my 90s. Everytime I look at my 94 yo mom, I dont think money is what is on her mind.
Morning mysecretinvestment,
DeleteEquities or properties, the yield received or capital gains realised are returned to our pockets. No covenants. No terms and conditions. No need to get big daddy's approval on what we can use it for. No need to worry about moving goal posts; etc ;)
CPF, one chunk is locked-up under CPF Life for socialising purpose (cannot freehold if we sell salted eggs early).
As for the rest beyond CPF Life, well, at 4% interest/yield, anyone with primary school math can calculate how many years that will take for the accumulated interests to exceed our CPF contributed.
And you did!
30 years ;)
That's why I poked how "young" you were when I knew you are in your 60s ;)
I wonder how many CPF millionaires in their 60s are willing to wait another 30 years just to achieve "Buy and Freehold" status?
Its all very "academic" since its nominal returns... I mean CPF 4% with CPI at 4% equals...
I'm more confident anyone who dumped $1 million in Singapore properties (equities harder) 30 years ago would be better off than just leaving that $1 million in CPF ;)
That's me in the inflation camp.
Then again, CPF would win if Singapore experience the multi-decades of deflation like Japan going forward. That would also mean everyone in the FIRE community would have underperformed SAVERS who just put cash under their mattresses!
Yeeks!
Everything is a speculation!
Ha ha!
ReplyDeleteLet define new spin off from buy and hold
Buy and Freehold on the same counter can be achieved by either accumulation of dividends or combination of dividends and net trading gains to recover our own investing capital and then continue to generate freehold investment income from future dividends and/or trading gains on core position.
Freehold interests from CPF principal i.e. our monthly CPF contributions and based on Rule of 72 on 2.5% or 4%; start young and voluntarily contribute more, it can be achieved. LoL!
CW,
DeleteHow?
Are you going to STOP withdrawing your CPF interests? I mean why forgo the interests on interests!? You think why big daddy also encourage those who can, delay their CPF Life payouts to age 70 instead of 65?
That's the paradox of CPF. If we want to squeeze maximum blood from the CPF stone, the trick is to delay or never taking CPF money out. Wait! What???
I remember someone was quite pissed off with the moving goal posts on the CPF interest withdrawal rule...
Its not the same with dividends and capital gains realised, isn't it? If our brokers did that, we'll complain to MAS!
Just a rhetorical question.
Would you be better off if you had not read Rich Dad Poor Dad and never had your Mind Flip?
No investing in shares; no experiencing the pain of collecting salted fishes, no selling at steep losses to support people that mattered at the worst possible time...
And all you did was voluntarily contributing to CPF?
See?
We all have to find and discover our own paths.
That's why I never pour cold water on youths who are into cryptos even though I dare not touch them ;)
I know its a lot more fun to be a millionaire in our 30s than in our 60s!
Hey! I'm a wine, women, and song man of leisure :)
Definitely not saving sex till my old age!!!
LOL!
Well, if my friend had not dump that book Rich Dad Poor Dad on me, I might not have experienced a mindset change and embark on a holy quest for financial security. I am glad that I took the quest to investing. Painful and salty as it has been, throwing away what I has been taught in the old schools. The fruits of the quest is now helping me to cope with the crazy inflation.
DeleteWah! Another mind flip after reading Rich Dad. Poor.
DeleteUncle8888,
ReplyDeleteLol! In crypto it used to be "when lambo?" Here it's when freehold?
I was thinking about rule of 72 when seeing your "buy and freehold" phrase.
Just calculate using dividend yield or interest rate. Faster if got capital gains along the way.
Still takes a long time though with blue chips. Most people don't have the patience or time horizon ... they want to see profits every day or at least every week.
For a large portion of Gen Z, it's easier for them to focus on cryptos & getting 5-figure salaries by 30. ;)
Every generation & cohort needs to find their own way. Hoho!
CW,
ReplyDeleteGlad you added the table of transactions for better clarity!
Its like ink blots; we see what we want to see ;)
Buy-and-Hold acolytes and yield hogs will focus on the dividends to achieve "freehold" status.
Traders would focus on the rounds 1, 2, 3 capital gains as the "freehold" catalysts.
You then chime in with your snake oil spin:
"People, why argue?
Its much easier to fly with TWO wings!
Come to my workshop and I'll show you the Buy and Freehold way to achieve FIRE with minimum risks to your hard earned capital!"
Just buy me a drink and I'll sing like a canary to promote your workshops!!!
LOL! Look like the days of free talks are over from our investment organiser friend. No chance to spin story on Buy and Freehold.
Delete