Financial Freedom by 50.

September - A WHOLE NEW START.

noreply@blogger.com (20hopeful) — Wed, 31 Aug 2011 14:07:00 +0000

I will claim the world and make everyone recognize me for my successes someday.

Priorities: Grades, Career, Development
Priorities: Grades, Career, Development
Priorities: Grades, Career, Development
Priorities: Grades, Career, Development
Priorities: Grades, Career, Development
Priorities: Grades, Career, Development
Priorities: Grades, Career, Development
Priorities: Grades, Career, Development
Priorities: Grades, Career, Development
Priorities: Grades, Career, Development

When "trying your best" is not quite enough

noreply@blogger.com (20hopeful) — Sun, 24 Jul 2011 16:40:00 +0000

There was an interesting conversation at a friend's farewell gathering. Z asked if I was intending to go on an exchange and I replied "no", reason being that I needed both semesters to pull up my cGPA and ensure that I graduated with a first class honours. I told him that I would regret it if I didn't at least try. Z reply was "there's no try. you better make sure that you mug really hard and attain it, otherwise it will be such a waste". I think it made a hell lot of sense. My initial mindset was not to give up on any slightest chance and I would TRY. However, now I realise that sometimes "trying my best" is not enough. Instead, do what is necessary and ensure that you achieve your aims to avoid living with regrets.

Internship is coming to an end. I need to re-think my goals and move on with the next phase in life. Studies, Employment, Business, Investments? Hmmmm.

Life

noreply@blogger.com (20hopeful) — Thu, 23 Dec 2010 17:54:00 +0000

How much you get out of life is determined by how you conduct your affairs each day based on one's values and beliefs. Expect no utopia after hard times (eg.exams). The time spent mugging might have been bitter-sweet, but since you'll need to go through it anyway, make sure you do it well. Only in this way, you can give a pat to yourself after all that shit and feel deserving of all the fun and enjoyment.

Thoughts are meant to be personal. There is no need or point in sharing everything with everyone. One man's meat is another man's poison so don't expect others to share the same idea. At the very end of the day, just do what you think you'll need to do (eg. plan ahead for mods, read up in advance) because these things that people usually don't do are the things that put you a cut above the rest.

Insightful Navy recruitment poster: "Good leaders understand that the weather changes all the time. Purposeful leaders ensure that they never change." Undoubtedly, mistakes make one learn and mature but life is too short for one to go through and learn from every one of them. Learn from others and make it work the first time and all the time.

~You only live once so get the most out of it.

noreply@blogger.com (20hopeful) — Wed, 22 Dec 2010 20:34:00 +0000

An end to the 3rd sesmester in my tertiary education. I'm certain that I've screwed it up once again. This time it's probably going to be even worse than year 1 sem 1. For a person with a strong need for closure, I'm still desperately finding out the reason why this has happened and how did I let it happen. It'll be untrue to say that I didn't put in effort into mugging this semester. I did manage to stumble along the semester - albeit less conscientiously, and did well in all the continuous assessments but I messed up finals so badly.

1) Poor time management - haha my mum's nagging peeves me off sometimes but they do make sense too. From the way I handle my personal life, it isnt surprising that I've cultivated poor time management habits. Being late for meet-ups, project meetings and almost everything else, it isnt be surprising that I'm unable to work within the time constraints in exams. Today marks the day of a resolution to stop thinking that 'I still have time'. I must complete everything first before coming to any conclusions and this undesirable habit of being perpetually late. Furthermore, note the time that should be spent on each question in the future and adhere to it strictly. Work must be done efficiently in a productive manner in the shortest possible time.

2) Humility / Arrogance / Overconfidence - Knowing that you're able to do it doesn't mean that you've done it. hello?! Similarly having an improvement last semester does not imply anything for your future performance. It's a fresh start all over again my arrogance and over-confidence has led to my downfall. So what if last semester was better. So what? It's still second upper after all - just like everyone else.

Humility & Focus.

noreply@blogger.com (20hopeful) — Mon, 08 Nov 2010 15:50:00 +0000

Screwing up papers again and again feel like slaps across the face.
Your subconscious belief that success can be easily replicated is fucking you up.
Getting there is simple: work harder than the rest but it is NOT easy.

It's time to learn humility and focus on what needs to be done.
Or be prepared for the bitterness of 3.9 and being treated like scum.

noreply@blogger.com (20hopeful) — Sat, 21 Aug 2010 11:06:00 +0000

Went down to Invest Fair 2010 at MBS today. Depending on the agenda of your visit, takeaways might be different for different people. I personally felt that the event was mired by too much marketing and sales and it might disappoint those looking to gain useful investment knowledge. Nonetheless, attending seminars held by keynote speakers and panel discussions w/o slaes or promotion agenda would be good exposure. Otherwise, you could always familiarise yourself w e different trading platforms and services offered by the various participating exhibitors, or simply appreciate the awesome scenary at the promenade.

After a short stay at MBS, I followed N to his elder brother, D's start-up office along Clarke Quay. It was an inspiring experience! D provided me with pratical comments on my ambitions and goals, while sharing his experiences with as a partner of an IT start-up striving to carve his mark in the business world - real, cold, hard, first hand experience. Although the perspective shared by D wasn't new (MLM and the internship experience at GE had enlightened me on the various routes to success that hinge on business ideas, concepts, capital and hard work instead of only relying on academic achievements), it was wonderful to be able to share D's experiences in the area of business. The drive and eagerness to succeed motivates people to work, eat, sleep and practically live in their office. The level of motivation and energy is beyond amazing.

Insights/Reflections from the day:
1) Be constantly reminded of my personal roles in life : 1) student 2) investor 3) sportman and leader
2) Success almost always stem from specialization. Be it being a professional in a certain field, investing in a particular industry, etc. Only after you've attained a proven track record in a particular aspect, should you acquire more skill sets to enable you to overlook the entire process (CEO).
3) Drive and motivation stems from your values and belief in an idea. If I don't exhibit strong winning mentality then its probably because I've not found the sth that I truly believe in. Having said so, the values and beliefs that I hold in life should guide all my choices and decision in life. i.e. I want to extract the most out of life and excel in the things I do - that explain why I'm so competitive.
4) Expose myself to more opportunities and don't limit myself. Grab the chances for growth with what is offered by circumstances around me. e.g. career office developement programmes, recruitment drives.
5) Stay humble, always listen and learn. Yet, be confident about the person who has developed in me. There is a time to absorb and there is a time to tell - just like how the needs and wants of a person evolve over time, age, etc - take the appropriate action at each opportune.
6) Make a difference! People are the agents of creation and change. Make things happen and influence others. (e.g. calling of meetings, sending of thank you mails, arranging meaningful exchanges, initiation of ideas)
7) Power of networking and the need to strike a balance in the amount of time and money spent.

Inspiring and fruitful day! Keep thinking, keep reflecting. =)

Valedictorian Speaks Out Against Schooling in Graduation Speech

noreply@blogger.com (20hopeful) — Thu, 05 Aug 2010 12:42:00 +0000

Last month, Erica Goldson graduated as valedictorian of Coxsackie-Athens High School. Instead of using her graduation speech to celebrate the triumph of her victory, the school, and the teachers that made it happen, she channeled her inner Ivan Illich and de-constructed the logic of a valedictorian and the whole educational system.

Erica originally posted her full speech on Sign of the Times, and without need for editing or cutting, here's the speech in its entirety:

Here I stand

There is a story of a young, but earnest Zen student who approached his teacher, and asked the Master, "If I work very hard and diligently, how long will it take for me to find Zen? The Master thought about this, then replied, "Ten years . ." The student then said, "But what if I work very, very hard and really apply myself to learn fast -- How long then?" Replied the Master, "Well, twenty years." "But, if I really, really work at it, how long then?" asked the student. "Thirty years," replied the Master. "But, I do not understand," said the disappointed student. "At each time that I say I will work harder, you say it will take me longer. Why do you say that?" Replied the Master, "When you have one eye on the goal, you only have one eye on the path."

This is the dilemma I've faced within the American education system. We are so focused on a goal, whether it be passing a test, or graduating as first in the class. However, in this way, we do not really learn. We do whatever it takes to achieve our original objective.

Some of you may be thinking, "Well, if you pass a test, or become valedictorian, didn't you learn something? Well, yes, you learned something, but not all that you could have. Perhaps, you only learned how to memorize names, places, and dates to later on forget in order to clear your mind for the next test. School is not all that it can be. Right now, it is a place for most people to determine that their goal is to get out as soon as possible.

I am now accomplishing that goal. I am graduating. I should look at this as a positive experience, especially being at the top of my class. However, in retrospect, I cannot say that I am any more intelligent than my peers. I can attest that I am only the best at doing what I am told and working the system. Yet, here I stand, and I am supposed to be proud that I have completed this period of indoctrination. I will leave in the fall to go on to the next phase expected of me, in order to receive a paper document that certifies that I am capable of work. But I contest that I am a human being, a thinker, an adventurer - not a worker. A worker is someone who is trapped within repetition - a slave of the system set up before him. But now, I have successfully shown that I was the best slave. I did what I was told to the extreme. While others sat in class and doodled to later become great artists, I sat in class to take notes and become a great test-taker. While others would come to class without their homework done because they were reading about an interest of theirs, I never missed an assignment. While others were creating music and writing lyrics, I decided to do extra credit, even though I never needed it. So, I wonder, why did I even want this position? Sure, I earned it, but what will come of it? When I leave educational institutionalism, will I be successful or forever lost? I have no clue about what I want to do with my life; I have no interests because I saw every subject of study as work, and I excelled at every subject just for the purpose of excelling, not learning. And quite frankly, now I'm scared.

John Taylor Gatto, a retired school teacher and activist critical of compulsory schooling, asserts, "We could encourage the best qualities of youthfulness - curiosity, adventure, resilience, the capacity for surprising insight simply by being more flexible about time, texts, and tests, by introducing kids into truly competent adults, and by giving each student what autonomy he or she needs in order to take a risk every now and then. But we don't do that." Between these cinderblock walls, we are all expected to be the same. We are trained to ace every standardized test, and those who deviate and see light through a different lens are worthless to the scheme of public education, and therefore viewed with contempt.

H. L. Mencken wrote in The American Mercury for April 1924 that the aim of public education is not "to fill the young of the species with knowledge and awaken their intelligence. ... Nothing could be further from the truth. The aim ... is simply to reduce as many individuals as possible to the same safe level, to breed and train a standardized citizenry, to put down dissent and originality. That is its aim in the United States."

To illustrate this idea, doesn't it perturb you to learn about the idea of "critical thinking." Is there really such a thing as "uncritically thinking?" To think is to process information in order to form an opinion. But if we are not critical when processing this information, are we really thinking? Or are we mindlessly accepting other opinions as truth?

This was happening to me, and if it wasn't for the rare occurrence of an avant-garde tenth grade English teacher, Donna Bryan, who allowed me to open my mind and ask questions before accepting textbook doctrine, I would have been doomed. I am now enlightened, but my mind still feels disabled. I must retrain myself and constantly remember how insane this ostensibly sane place really is.

And now here I am in a world guided by fear, a world suppressing the uniqueness that lies inside each of us, a world where we can either acquiesce to the inhuman nonsense of corporatism and materialism or insist on change. We are not enlivened by an educational system that clandestinely sets us up for jobs that could be automated, for work that need not be done, for enslavement without fervency for meaningful achievement. We have no choices in life when money is our motivational force. Our motivational force ought to be passion, but this is lost from the moment we step into a system that trains us, rather than inspires us.

We are more than robotic bookshelves, conditioned to blurt out facts we were taught in school. We are all very special, every human on this planet is so special, so aren't we all deserving of something better, of using our minds for innovation, rather than memorization, for creativity, rather than futile activity, for rumination rather than stagnation? We are not here to get a degree, to then get a job, so we can consume industry-approved placation after placation. There is more, and more still.

The saddest part is that the majority of students don't have the opportunity to reflect as I did. The majority of students are put through the same brainwashing techniques in order to create a complacent labor force working in the interests of large corporations and secretive government, and worst of all, they are completely unaware of it. I will never be able to turn back these 18 years. I can't run away to another country with an education system meant to enlighten rather than condition. This part of my life is over, and I want to make sure that no other child will have his or her potential suppressed by powers meant to exploit and control. We are human beings. We are thinkers, dreamers, explorers, artists, writers, engineers. We are anything we want to be - but only if we have an educational system that supports us rather than holds us down. A tree can grow, but only if its roots are given a healthy foundation.

For those of you out there that must continue to sit in desks and yield to the authoritarian ideologies of instructors, do not be disheartened. You still have the opportunity to stand up, ask questions, be critical, and create your own perspective. Demand a setting that will provide you with intellectual capabilities that allow you to expand your mind instead of directing it. Demand that you be interested in class. Demand that the excuse, "You have to learn this for the test" is not good enough for you. Education is an excellent tool, if used properly, but focus more on learning rather than getting good grades.

For those of you that work within the system that I am condemning, I do not mean to insult; I intend to motivate. You have the power to change the incompetencies of this system. I know that you did not become a teacher or administrator to see your students bored. You cannot accept the authority of the governing bodies that tell you what to teach, how to teach it, and that you will be punished if you do not comply. Our potential is at stake.

For those of you that are now leaving this establishment, I say, do not forget what went on in these classrooms. Do not abandon those that come after you. We are the new future and we are not going to let tradition stand. We will break down the walls of corruption to let a garden of knowledge grow throughout America. Once educated properly, we will have the power to do anything, and best of all, we will only use that power for good, for we will be cultivated and wise. We will not accept anything at face value. We will ask questions, and we will demand truth.

So, here I stand. I am not standing here as valedictorian by myself. I was molded by my environment, by all of my peers who are sitting here watching me. I couldn't have accomplished this without all of you. It was all of you who truly made me the person I am today. It was all of you who were my competition, yet my backbone. In that way, we are all valedictorians.

I am now supposed to say farewell to this institution, those who maintain it, and those who stand with me and behind me, but I hope this farewell is more of a "see you later" when we are all working together to rear a pedagogic movement. But first, let's go get those pieces of paper that tell us that we're smart enough to do so!

Diversification & risk

noreply@blogger.com (20hopeful) — Mon, 12 Jul 2010 10:40:00 +0000

At a friend's gathering last night, I was asked about the portfolio of stocks that I'm currently holding: DBS, SGX, Noble, Yanzijiang, China Sky and suddenly someone asked this question: "Why only five stocks and not more to diversify risk?" At that moment, it forced me to reflect about the way that I've been doing things and here's my answer to it:

Although modern portfolio theory purports that holding a basket of 30-40 stocks will negate diversifiable risk as long as the beta of any one stock is not perfectly postively correlated with another. I do not diversify to such an extent because firstly, I do not have that much time everyday to actively monitor so many counters everyday. If my aim was to achive a well-diversified portfolio with the lowest risk, then I'd be better off just buying the STI index. Secondly, the small size of my capital does not allow me to do so. In fact, Phil Town had suggested that having ONE single stock in your portfolio is acceptable if you've have picked a quality stock with a good margin of safety. But to presume that I had picked the RIGHT stock with the RIGHT stock will certainly be being too confident in my stock picking skills and assuming too much risk. Therefore, my portfolio lies within the two extremes. I feel that when determining the number of counters to hold, this decision cannot be dissociated from the the level of risk that we're willing to undertake. So 5 stocks is a pretty comfortable number in my current situation.

I'll only double the number of counters that I hold when the size of my portfolio doubles. So at least for now its 5counters/$100k! =)

7 Lessons the World Cup Offers on the Stock Market

noreply@blogger.com (20hopeful) — Wed, 23 Jun 2010 17:06:00 +0000

by Brett Arends
Wednesday, December 31, 1969
provided by The Wall Street Journal

You can learn a lot from watching the World Cup -- and not just about soccer. As I've tuned into the games I've started to realize how many ways it's just like the stock market -- and how it can actually teach you a useful thing or two about making money.

Don't believe me? Here are seven lessons that "the beautiful game" can teach you about the money game:

1. Don't be shocked by "shocks."

Who would imagine that France, finalists four years ago, would crash out in such humiliation? That England would draw with Algeria? That Switzerland would beat Spain?

Yet these "shocks" happen all the time.

Many years ago, when I wrote a book about futures betting on soccer, a top bookmaker in London told me his firm made good money on unlikely events such as these. The gambling public, he said, typically underestimates the chances on an upset.

And so it is in the investing world. Nassim Nicholas Taleb calls such unlikely events "black swans." As English comic novelist P.G. Wodehouse once put it, "never confuse the unusual with the impossible." Not long ago it seemed impossible that, say, Lehman Brothers or General Motors could go bankrupt.

As we have been reminded in recent years, the unusual happens. The only thing surprising is that so many people are surprised.

2. You need a strong defense.

There's a saying in soccer: "It only takes a second to score a goal." But as England's hapless goalkeeper, Robert Green, could tell you after his schoolboy blunder against the United States last week, the truth is slightly different.

It only takes a second to concede a goal. Scoring one at the other end can take forever.

Investors know how it feels. The profits of a brilliant trade can be thrown away in a moment by a careless blunder.

Offense, trying to make money, is much more exciting than defense, trying not to lose it. But smart money management starts the other way around. After all, it takes a 100% profit to recover from a 50% loss. Or as value investors might put it: Rule number one, concede no goals. Rule number two? Never forget rule number one.

3. You have to think globally.

The World Cup is one of the few times fans everywhere drop their obsession with the sporting events, players and teams at home and start to pay close attention to everyone else.

Sure, you're rooting for Team USA. And the Japanese have been rooting for Japan, and so on. But everyone knows the biggest stories are teams like the Argentinians, the Portuguese and the Brazilians. And we're all watching anyway.

Investors need to learn the same trick. "Home equity bias" has long been identified as a big problem in most portfolios. Most people keep way too much of their money in their home stock market. Studies have found that U.S. investors typically keep more than 80% of their equity portfolio in U.S. stocks. According to the Investment Company Institute, fewer than half of households that invest in mutual funds even own a fund that invests overseas.

It makes no sense. You already have big economic bets on the U.S. economy -- your home, job and support network are all here. The U.S. only accounts for a third of the world's stock markets by value, so if you just stick to the home market you're missing out on two-thirds of the action.

Investing globally spreads your bets and gives you maximum diversification. A recent paper by AQR Capital Management, found that a global portfolio has typically given investors better long-term returns with less short-term turmoil.

4. Don't get blinded by hope.

I understand why someone from North Korea would choose to cheer for North Korea (0-for-2, nine goals allowed), no matter how badly the team does. After all it's their country.

What I don't understand are investors who stick with terrible investments all the way down, hoping and praying that bad management, bad strategy and bad products will somehow produce a good result. Hoping isn't expecting. Unless they actually worked at the company, no one needed to be stuck with their shares in Washington Mutual or Fannie Mae or General Motors. If it's not making you happy, stop complaining or praying. Sell.

5. Patience wins.

Once again the England team has proven, so far, a monumental disappointment to its fans at home. I used to live in England and watched this happen, oh, every four years.

Brazilian soccer legend Pele once explained the problem to a British TV reporter some years back. England, he said, needed to develop patience on the field.

They aren't alone in this. Too many teams try for the quick kill -- kicking the ball up field and hoping for the best. Great soccer teams -- especially the Brazilians -- take a very different approach. They are famous for passing the ball around dozens of times, waiting for just the right moment to strike. It works.

And so it is on the stock market, which Warren Buffett -- possibly the Pele of investment -- once called an efficient mechanism for transferring money from the active to the patient. Like most great investors, he'll bide his time almost indefinitely, waiting for the chance on goal. It's a better plan.

6. Watch your margin of safety.

The Slovenians looked pretty comfortable after securing a two goal lead against the U.S. half way through the match. But in the end they were lucky to escape with a draw. These kinds of turnarounds happen all the time. You can't get too comfortable. Almost anything can happen.

Ben Graham, the godfather of cautious "value" investing, reached a similar conclusion about his portfolio after the crash of 1929. Stock prices plummeted far further than he ever thought possible. (Real estate investors in the past few years have had a similar experience). That's why Mr. Graham turned his attention to the concept of "margin of safety." He recommended investors buy stocks when they are at least a third below their intrinsic value. Just in case.

7. Don't pin all of your hopes on the referees.

Financial regulators -- including the Securities and Exchange Commission, the Treasury and the Federal Reserve -- have come in for severe criticism in the wake of the financial crisis, and no wonder. They didn't believe there was a housing bubble. They didn't know the banks were playing shell games with their balance sheets. They didn't know what was really going on in the derivatives market. The list is pitiful.

But if they want to feel better about themselves, they should probably tune in to some of the World Cup matches. Some of the refereeing has been simply extraordinary. First-time referee Koman Coulibaly has been left out of the next round after the controversial, and probably blown call in the USA-Slovenia game that cost the U.S. a win. It wasn't the only controversy of the Cup. And if experience is any guide, it won't be the last. Dubious refereeing is as much as feature of soccer as it is of the stock market. As for Mr. Coulibaly: Maybe we could find him a job on Wall Street -- as a regulator.

Brokers and brokerage reports

noreply@blogger.com (20hopeful) — Mon, 21 Jun 2010 10:33:00 +0000

I am amazed by how my broker is spamming me with tons of brokerage reports when the stock market is roaring - probably to remind me to trade with them, and keeping a low profile when the markets are subdued. Although I've learnt never to trust the buy/sell recommendations by brokerage reports, there are still useful stuff that you can pick out to aid in your stock picking.

For example this weekly support and resistance monitor from PhillipCapital:

“S” & “R” here denote price based support and resistance for the counter. S1 and R1
are the first support and resistance from the most recent closing price. Similarly S2, S3,
R2, and R3 are respectively, the second and third price based support/resistance, from
the close.

Now I am sure you'd agree that this will save you from the trouble of analysing all the charts of the various counters one by one. But then again that is where the fun lies. =)

Anyway the report below pretty much sums up what has been going on on the global stage.

China Indicated A More Flexible Renminbi:

China’s signal of an end to the renminbi’s fixed rate to the US dollar will help accelerate a shift toward domestic demand as the prime driver of growth and ease strain with other nations caused by its long reliance on exports. The People’s Bank of China two days ago indicated that it is abandoning the RMB6.83 peg to the US dollar adopted during the global crisis in July 2008 to shield exporters. Before the exchange rate was explicitly re-pegged in July 2008, China had allowed a 21% appreciation of the renminbi vis-à-vis the US dollar over three years. Despite indicating its intention to increase the flexibility of the exchange rate, the People’s Bank of China said that there is no basis for large scale moves in the currency.
The central bank has yet to provide the details of the change but has hinted that the currencies of China’s major partners will play a greater role in determining the renminbi’s level, opening the way for more volatility of the renminbi against the US dollar. In July 2005, China ended the renminbi’s 11-year de facto peg to the US dollar with a one-time revaluation, after which it referenced the currency to a basket of currencies. China never disclosed the exact composition of the basket, saying only that it was heavily weighted towards the US dollar, yen and euro and included the currencies of more than 20 of China trading partners. In practice, however, the regime more closely resembled a crawling peg to the US dollar.
Meanwhile, the renminbi’s appreciation will likely be limited to 2-3% against the US dollar for the rest of this year as the currency has already strengthened 16.5% against the euro this year, eroding the competitiveness of Chinese exporters in the European Union, the nation’s largest export market. As it stands, the six-month non-deliverable forward contract on 18 June suggests that investors expect the renminbi to gain 1.0% to RMB6.7596/US$, from the spot rate of 6.8262.

The Euroland Economy:

Euro Gained Most Since May 2009 As European Debt Concern Eases.
The euro rose the most this week against the US dollar in more than a year, as an easing in concern over Europe’s debt crisis spurred traders to end bets that the euro would decline. An increase in demand at a Spanish bond sale and an agreement by European Union leaders to disclose how banks perform on stress tests also boosted investors’ confidence about the region’s financial system. Spain sold €3bn (US$3.7bn) of 10-year debt on 17 June at an average yield of 4.864%, less than the 5.04% that the bonds traded at before the sale. Part of the euro’s gain was due to short covering as well. As it stands, the difference in the number of wagers by hedge funds and other large speculators on a decline in the euro compared with those on a gain — so-called net shorts — was 62,360 on 15 June, after dropping 44% from 111,945 a week earlier.

In my personal opinion, (I should add some disclaimer somewhere in my blog soon), I think that the global recovery is intact. Although the Europe crisis has shaken up investor confidence pretty badly, I don't see any way for the economies around the world to deteriorate. Firstly, US corporate results have been mostly encouraging. Next, with most of the bad news in Europe released, things are moving on from the initial shock to a concerted effort to pull the EU out of this crisis. Currently, Greece bonds are already junk grade, how much worse can it get? Lastly, Asia is holding up pretty well. The Chinese are no idiots and if they have decided to unpeg the yuan to move from export-oriented economy to one that is consumption driven, they must be confident of sustaining their own growth and this will also help ease the pressure on countries are suffering from serious trade defecits.

In short, good days seem to be creeping back and I certainly hope that it is here to stay.

Don’t work. Avoid telling the truth. Be hated. Love someone.

noreply@blogger.com (20hopeful) — Sat, 19 Jun 2010 05:23:00 +0000

M shared this with me today:

------
Written by Adrian Tan, author of The Teenage Textbook (1988), was the guest-of-honour at a recent NTU convocation ceremony.

This was his speech to the graduating class of 2008.
-----

I must say thank you to the faculty and staff of the Wee Kim Wee School of Communication and Information for inviting me to give your convocation address. It’s a wonderful honour and a privilege for me to speak here for ten minutes without fear of contradiction, defamation or retaliation. I say this as a Singaporean and more so as a husband.

My wife is a wonderful person and perfect in every way except one. She is the editor of a magazine. She corrects people for a living. She has honed her expert skills over a quarter of a century, mostly by practising at home during conversations between her and me.

On the other hand, I am a litigator. Essentially, I spend my day telling people how wrong they are. I make my living being disagreeable.

Nevertheless, there is perfect harmony in our matrimonial home. That is because when an editor and a litigator have an argument, the one who triumphs is always the wife.

And so I want to start by giving one piece of advice to the men: when you’ve already won her heart, you don’t need to win every argument.

Marriage is considered one milestone of life. Some of you may already be married. Some of you may never be married. Some of you will be married. Some of you will enjoy the experience so much, you will be married many, many times. Good for you.

The next big milestone in your life is today: your graduation. The end of education. You’re done learning.

You’ve probably been told the big lie that “Learning is a lifelong process” and that therefore you will continue studying and taking masters’ degrees and doctorates and professorships and so on. You know the sort of people who tell you that? Teachers. Don’t you think there is some measure of conflict of interest? They are in the business of learning, after all. Where would they be without you? They need you to be repeat customers.

The good news is that they’re wrong.

The bad news is that you don’t need further education because your entire life is over. It is gone. That may come as a shock to some of you. You’re in your teens or early twenties. People may tell you that you will live to be 70, 80, 90 years old. That is your life expectancy.

I love that term: life expectancy. We all understand the term to mean the average life span of a group of people. But I’m here to talk about a bigger idea, which is what you expect from your life.

You may be very happy to know that Singapore is currently ranked as the country with the third highest life expectancy. We are behind Andorra and Japan, and tied with San Marino. It seems quite clear why people in those countries, and ours, live so long. We share one thing in common: our football teams are all hopeless. There’s very little danger of any of our citizens having their pulses raised by watching us play in the World Cup. Spectators are more likely to be lulled into a gentle and restful nap.

Singaporeans have a life expectancy of 81.8 years. Singapore men live to an average of 79.21 years, while Singapore women live more than five years longer, probably to take into account the additional time they need to spend in the bathroom.

So here you are, in your twenties, thinking that you’ll have another 40 years to go. Four decades in which to live long and prosper.

Bad news. Read the papers. There are people dropping dead when they’re 50, 40, 30 years old. Or quite possibly just after finishing their convocation. They would be very disappointed that they didn’t meet their life expectancy.

I’m here to tell you this. Forget about your life expectancy.

After all, it’s calculated based on an average. And you never, ever want to expect being average.

Revisit those expectations. You might be looking forward to working, falling in love, marrying, raising a family. You are told that, as graduates, you should expect to find a job paying so much, where your hours are so much, where your responsibilities are so much.

That is what is expected of you. And if you live up to it, it will be an awful waste.

If you expect that, you will be limiting yourself. You will be living your life according to boundaries set by average people. I have nothing against average people. But no one should aspire to be them. And you don’t need years of education by the best minds in Singapore to prepare you to be average.

What you should prepare for is mess. Life’s a mess. You are not entitled to expect anything from it. Life is not fair. Everything does not balance out in the end. Life happens, and you have no control over it. Good and bad things happen to you day by day, hour by hour, moment by moment. Your degree is a poor armour against fate.

Don’t expect anything. Erase all life expectancies. Just live. Your life is over as of today. At this point in time, you have grown as tall as you will ever be, you are physically the fittest you will ever be in your entire life and you are probably looking the best that you will ever look. This is as good as it gets. It is all downhill from here. Or up. No one knows.

What does this mean for you? It is good that your life is over.

Since your life is over, you are free. Let me tell you the many wonderful things that you can do when you are free.

The most important is this: do not work.

Work is anything that you are compelled to do. By its very nature, it is undesirable.

Work kills. The Japanese have a term “Karoshi”, which means death from overwork. That’s the most dramatic form of how work can kill. But it can also kill you in more subtle ways. If you work, then day by day, bit by bit, your soul is chipped away, disintegrating until there’s nothing left. A rock has been ground into sand and dust.

There’s a common misconception that work is necessary. You will meet people working at miserable jobs. They tell you they are “making a living”. No, they’re not. They’re dying, frittering away their fast-extinguishing lives doing things which are, at best, meaningless and, at worst, harmful.

People will tell you that work ennobles you, that work lends you a certain dignity. Work makes you free. The slogan “Arbeit macht frei” was placed at the entrances to a number of Nazi concentration camps. Utter nonsense.

Do not waste the vast majority of your life doing something you hate so that you can spend the small remainder sliver of your life in modest comfort. You may never reach that end anyway.

Resist the temptation to get a job. Instead, play. Find something you enjoy doing. Do it. Over and over again. You will become good at it for two reasons: you like it, and you do it often. Soon, that will have value in itself.

I like arguing, and I love language. So, I became a litigator. I enjoy it and I would do it for free. If I didn’t do that, I would’ve been in some other type of work that still involved writing fiction – probably a sports journalist.

So what should you do? You will find your own niche. I don’t imagine you will need to look very hard. By this time in your life, you will have a very good idea of what you will want to do. In fact, I’ll go further and say the ideal situation would be that you will not be able to stop yourself pursuing your passions. By this time you should know what your obsessions are. If you enjoy showing off your knowledge and feeling superior, you might become a teacher.

Find that pursuit that will energise you, consume you, become an obsession. Each day, you must rise with a restless enthusiasm. If you don’t, you are working.

Most of you will end up in activities which involve communication. To those of you I have a second message: be wary of the truth. I’m not asking you to speak it, or write it, for there are times when it is dangerous or impossible to do those things. The truth has a great capacity to offend and injure, and you will find that the closer you are to someone, the more care you must take to disguise or even conceal the truth. Often, there is great virtue in being evasive, or equivocating. There is also great skill. Any child can blurt out the truth, without thought to the consequences. It takes great maturity to appreciate the value of silence.

In order to be wary of the truth, you must first know it. That requires great frankness to yourself. Never fool the person in the mirror.

I have told you that your life is over, that you should not work, and that you should avoid telling the truth. I now say this to you: be hated.

It’s not as easy as it sounds. Do you know anyone who hates you? Yet every great figure who has contributed to the human race has been hated, not just by one person, but often by a great many. That hatred is so strong it has caused those great figures to be shunned, abused, murdered and in one famous instance, nailed to a cross.

One does not have to be evil to be hated. In fact, it’s often the case that one is hated precisely because one is trying to do right by one’s own convictions. It is far too easy to be liked, one merely has to be accommodating and hold no strong convictions. Then one will gravitate towards the centre and settle into the average. That cannot be your role. There are a great many bad people in the world, and if you are not offending them, you must be bad yourself. Popularity is a sure sign that you are doing something wrong.

The other side of the coin is this: fall in love.

I didn’t say “be loved”. That requires too much compromise. If one changes one’s looks, personality and values, one can be loved by anyone.

Rather, I exhort you to love another human being. It may seem odd for me to tell you this. You may expect it to happen naturally, without deliberation. That is false. Modern society is anti-love. We’ve taken a microscope to everyone to bring out their flaws and shortcomings. It far easier to find a reason not to love someone, than otherwise. Rejection requires only one reason. Love requires complete acceptance. It is hard work – the only kind of work that I find palatable.

Loving someone has great benefits. There is admiration, learning, attraction and something which, for the want of a better word, we call happiness. In loving someone, we become inspired to better ourselves in every way. We learn the truth worthlessness of material things. We celebrate being human. Loving is good for the soul.

Loving someone is therefore very important, and it is also important to choose the right person. Despite popular culture, love doesn’t happen by chance, at first sight, across a crowded dance floor. It grows slowly, sinking roots first before branching and blossoming. It is not a silly weed, but a mighty tree that weathers every storm.
You will find, that when you have someone to love, that the face is less important than the brain, and the body is less important than the heart.

You will also find that it is no great tragedy if your love is not reciprocated. You are not doing it to be loved back. Its value is to inspire you.

Finally, you will find that there is no half-measure when it comes to loving someone. You either don’t, or you do with every cell in your body, completely and utterly, without reservation or apology. It consumes you, and you are reborn, all the better for it.

Bread on the table

noreply@blogger.com (20hopeful) — Mon, 14 Jun 2010 18:41:00 +0000

More reasons for achieving my financial goals:

1) So that happier moments can be enjoyed with my family

2) To do my loved ones proud

3) My parents will not save up the bread that I've forgotten to eat today for their breakfast tomorrow

How they scrimp and save to put bread on the table and to provide us with a better future serves as my strongest motivation.

End of GE internship that changed my life

noreply@blogger.com (20hopeful) — Mon, 14 Jun 2010 17:09:00 +0000

Today marks the end of my internship at Great Eastern. The programme should last for 8 weeks and although this is only the 4th, it is time for me to move on after achieving my goals in this programme. There is little value left in staying any longer and to forsake the promised $600 that was to be disbursed only after contracting with GE was a simple decision to make. I will not do sales for any company other than my own - a decision I've made which will be explained in another entry.

In this 4 weeks, I've earned certification in modules 5 and 9 of the Capital Markets and Financial Advisory Services Examinations. Won the 'Best Entrepreneur Team Award' and received a plaque and an autographed copy of Adam Khoo's new book, 'Master Your Mind Design Your Destiny'. All this will spruce up my resume and the complimentary book written and given to me by my mentor, which I met for the first and last time today, was the perfect farewell gift from GE.

More importantly, this internship has changed my life. Not only has it developed my soft skills, it revealed the secret for succes and the formula behind it. 2 of my favorite quotes "Success is not a matter of chance, but a matter of choice." and "Stay Hungry. Stay Foolish." will guide all my actions in the future. Life will never be the same again.

On a side note, I am seeing too many excuses and reasons. Too many distractions, too much talk about wanting to succeed but too little action. I firmly believe that in order to succeed, one must constantly ask himself "What are you doing NOW that is helping you realise your goals? What are you doing TODAY that is helping you build that better tomoroow?" Honestly, deciding whether we want to succeed or not is easy. Who doesn't want to be successful in life? But deciding to do something about it TODAY is what truly matters. How can we expect goals to materialize if we choose to do nothing about it? So make sure that you set clear and precise goals before scheduling your daily activities to ensure that you can take a step closer towards them.

Goodbye Great Eastern. Welcome Bloomberg!

Semester 2 draws to a close

noreply@blogger.com (20hopeful) — Thu, 27 May 2010 16:22:00 +0000

4.61 for this sem! I've never felt THIS happy for a long long time! :) The last time was probably when PLSE results were released. Haha. Anyway this result means SO MUCH to me becos I desperately needed the affirmation that I'm not stupid. Now that my cgpa has moved into second upper, first class is my next goal.

The smiles on mum and dad's faces, despite waking them up at 2am to break the news, and dear's beaming smile made all the hard work in this semester worth it. Of cos, it was also for my own future. And as Colin Ong advised, I will "bottle up this feeling of joy in my heart and open it to fill my body when the going gets tough. Now I know what I am fighting for and this feeling will recharge my mind and soul when the need arises."

However, I must not let this small little achievement get over my head. Past successes offer far too little lessons for one to learn from. Failures, on the other hand, are wonderful teachers. 4 more semesters to go. Gdnite world. For a better tomorrow.

Why everyone needs to invest.

noreply@blogger.com (20hopeful) — Wed, 20 May 2009 01:56:00 +0000

With the coming of age, there has been a great increase in the number of people who are interested in investment. However, many people still hold different perceptions about it. To some, it is merely regarded as a 'shortcut' to riches, one can do without if you have no interest in finance matters. Comments such as "I am just not interested in investing!" or "Investing is just needed for you to get rich which I can live without." are just too familiar. I cannot disagree more. If you are one of these people, I hope I can change your perception by the end of this entry. Let me run a few numbers to illustrate my pont:

Lets say you have just stepped into adulthood by turning 21 year old this way and intend to work after 4 years of university study.

Assuming an average expenditure of $2,500 every month, the mean for an average working Singaporean and a lifespan of 85 years, you probably need this much money now in order to stop working yet be able to maintain a decent lifestyle till 85. $2500 X 12 X 60 = $1,800,000.

This 1.8 million of course do not include family, or any other commitments that you may incur while you survive till 85. (I am expecting home loans, car loans, medical bills and enough spare dough for some travelling etc) Thus it's quite an underestimate.

Coming back to reality, if you hope to retire at the age of 55 and maintain your expenses after you retire all the way till 85, you'll need $900,000. Put it simply, you need to save $2,500 every mth now for 30years just to have enough to spend in the next 30. That's hard savings for a very long period, considering a monthly pay cheque estimated to be about $3,500? That doesn't even take into account the annual inflation rate of about 2-3%. So do your maths and think again. Will working and just saving for retirement suffice? No doubt the government has done a good job with the introduction of CPF but taking into account unforseen circumstances and wanting to lead a fairly comfortable life, I rather not risk it.

Therefore, the importance to invest in today's world cannot be overlooked. I used to want to invest so as to become rich. Now I see that I need it just to be able to get by. Even Einstein believed that compounding interest is the most powerful formula, and why not let your money work for you and not the other way round? With the same scenerio, lets take a look with what investing can do for us:

Lets say we have a capital to put aside for investment now and we are able to grow it at a annual rate of 15%. (With no trading formula or strategy, the US stock market has provided a annual compounded return of 12.08% with dividends reinvested for the past 50years, while the the STI achieved annual compound interest of 10% for the past 19 years, so hopefully 15% is not over-estimating.) Every 5 years, our capital will double. 4.8 years to be exact. There are 6 doubles in 30 years, equivalent to 32 times of the initial capital outlay. So the amount that I need now to successfully accumulate $900,000 by 55 will only be $28,125. So as long as I can achieve my target of 15% annual returns, I will achieve my target comfortably by 55, without any additional capital outlay too. Compare that with $2,500 every month! That is also why I started investing with 30k.

No doubt, people will ask "Where do I get so much capital from the very start?" All I have to say is that it doesnt hurt to start early. The earlier you do it, the earlier it will benefit you. I read this from a fellow investor's blog: "Investmenting is an inverse pyramid. The bigger your capital grows to become, the easier it'll be for you to earn a fixed amount." To earn 1 k with 10k, you need a 10% capital appreciation. But with 11k now, you'll need less. That said, I advise you to please read up and learn more before moving into the real thing, as we all know that there are bound to be risks involved. As dangerous as driving can be as an activity, the most important factor to determine whether you get to your destination is who you put behind the wheel. Does an infant or an experienced driver makes a difference? Hell yeah. It is about whether you know what you are doing in order to minimise risks.

Having said so, how can anyone not invest? It's not impossible to reach financial independence, but it'll be very hard if one has to do it by savings alone. Happy investing!

Personal sin reflected upon breeds regret and wisdom.

noreply@blogger.com (20hopeful) — Tue, 19 May 2009 04:19:00 +0000

I committed a sin yesterday.
Got swayed by emotions and sold 1 lot of DBS at $11.62. I had no concrete reasons to do so except that I read too many articles on 'Bear Rallies' and saw every counter in my watchlist turning red while DBS was the ONLY survivor. Then thoughts of impending doom overwhelmed me, coupled with the fall in US futures (took a U-turn after SG markets closed), I sold 1 lot for fear of losing profits. Now I locked in profits of $1.8k but that cost me $600 and possibly another $140 in dividends. Total of $740.

What was I thinking?! Selling at a pessimistic low while trying to buy at a optimistic high? What a great way to lose money. Being a contrarian IS the rule of the game. "Be fearful when others are greedy, and be greedy when others are fearful.". ASL dropped to $0.71 yet I was too fearful to buy and anticipated further drops. WRONG WRONG WRONG. It went below my MOS price that I wanted to buy at, and by such a margin too! I should have bought below my MOS price and then slowly accumulate if it dropped further. Now it trades at $0.82. Well done.

Then again, Dow Theory states that one should follow the current market trend rather than trying to anticipate it, or worse, go against it. Doesn't it go against the view on contrarian trading? How do you follow the market trend and act contrary to it at the same time? It just didn't make sense. After mulling over it, I think its the nature of investor that you are and your investment horizon. Contrarian methods are for long term investors that are willing to ride out short term price fluctuations and hunt for bargains when valuations are low. While traders with a shorter investment time frame are opportunists that can only ride on market trends.

So what kind of investor am I? I wish to be a hybrid of both. My 'pillow stocks' will be made up of blue chips that give constant dividends while trading smaller caps. With all said, to sell yesterday without valid reasoning is a suicidal act that I must not turn into a habit.

Sticker Price of ASL Marine

noreply@blogger.com (20hopeful) — Wed, 13 May 2009 04:22:00 +0000

ASL Marine recently released its financial results for 3Q FY09. Better than expected results and WD's interest in this stock in the past lured me into crunching the company's numbers according to Rule #1. (Some practice will do good!)

The four ingredients for calculating sticker price:

1. Current EPS : $0.212 +$0.038 = $0.250

($0.212 based on EPS for 9M FY '09. Based on $0.078 for the last quarter, I estimate a conservative $0.038 [50%] for the remaining quarter and that adds up to a pretty nice whole no.)

2. Estimated EPS Growth Rate : 36.80%

(According to Phil Town, Equity growth is a good approximate for future EPS growth rate so I used Total Equity for FY '03 = $50,131,000 and Total Equity for FY '08 = $240,196,000 in the first calculation.)

But to be on the safe side and see if this is true I calculated the historical YOY EPS growth since FY '03: 6.7% decline, 24.1% rise, 55.9% rise, 51.0% rise, 39.2% rise. The average for the past 5 years stands at 32.7%. However with the current economic slowdown, I rather err on the safe side with a 20% safety margin. Therefore, I take future growth rate to be 26%.

3. Estimated future PE : 3

(Historical data for past 5 yrs)

4. Minimum expected rate of return : 15%

(Aligned to my long term goal taking into account a 10 year investment horizon)

Doing some simple calculations with the rule of 72.

72 / 26% = 3 yrs for to double = 3 doubles in 10 yrs

Estimated EPS in 10 years : $0.250 X 2 X 2 X 2 = $2

Estimated Price of stock in 10 years : $2 X 3 = $6

Current sticker price of ASL Marine : $6 / 4 = $1.5

Sticker price with Margin Of Safety (MOS) : $1.5 / 2 = $0.75

Taking into account the number of safety margins in place, (50% discount on EPS in the last quarter, 20% discount on future growth rate and 50% MOS) I believe that ASL Marine will be a good buy when the px does hit $0.75.

The Big 5 Numbers + Debt are as follows (In order of importance):

Looks pretty good to me too! Too bad that I missed the boat when the price was about $0.50. Will keep this counter on my watchlist.

Welcome your valuable comments.

Li Heng

noreply@blogger.com (20hopeful) — Mon, 11 May 2009 03:06:00 +0000

Overall markets seemed weak today with more realising that the recent rally has been getting irrational. However, I predict that markets will rocket once US futures pave the way for an overnight rally this afternoon.

I realised I missed the sell signal for my DBS at $12.
I must establish and continuously review px targets.

Bought 9 lots of Liheng at $0.245.

Reasons were not substantial but the desire to ride this bull rally was strong:

Blue chips are over-valued and S-shares are my current bet.
Buy px lower than $0.265 entered in January. (Average down)
MACD (abit late though) and RSI indicated buy signals.
Increase in volume and brokerage coverage over past few days.

Resistance at $0.30 still some way to go with 20% upside potential.

Px target $0.30. Cut loss at immediate support of $0.22.

Welcome your various inputs.

STI above 2000pts. Financials rose by 10%!

noreply@blogger.com (20hopeful) — Mon, 04 May 2009 15:39:00 +0000

Today the markets rallied a whooping 5.65% to close at 2028.71!
My DBS is trading at $10.5.

Many do not seem to understand why the rally took place.
I didn't too until I read this article that provided some insights.
However, do exercise your own judgement, it could very well be just another bubble.

Shareholder Privileges

noreply@blogger.com (20hopeful) — Mon, 04 May 2009 04:46:00 +0000

http://info.sgx.com/webcoranncatth.nsf/VwAttachments/Att_364C022DE3904DA0482575A8002D1397/$file/ShareholderPrivilegeCard.pdf?openelement

Wow I didn't know there was even such a thing!

Good to know if you are those looking for the small little extra perks in life. :)

Debt and the importance of Phantom Money

noreply@blogger.com (20hopeful) — Mon, 04 May 2009 04:35:00 +0000

"It is August. In a small town on the South Coast of France, holiday season is in full swing, but it is raining so there is not too much business happening. Everyone is heavily in debt.

Luckily, a rich Russian tourist arrives in the foyer of the small local hotel. He asks for a room and puts a Euro100 note on the reception counter, takes a key and goes to inspect the room located up the stairs on the third floor.

The hotel owner takes the banknote in a hurry and rushes to his meat supplier to whom he owes E100. The butcher takes the money and races to his supplier to pay his debt. The wholesaler rushes to the farmer to pay E100 for pigs he purchased some time ago.

The farmer triumphantly gives the E100 note to a local prostitute who gave him her services on credit. The prostitute goes quickly to the hotel, as she was owing the hotel for her hourly room use to entertain clients.

At that moment, the rich Russian is coming down to reception and informs the hotel owner that the proposed room is unsatisfactory and takes his E100 back and departs. There was no profit or income. But everyone no longer has any debt and the small town's people look optimistically towards their future. "

Story received in the mail from my broker. Maybe, just maybe, all we need is the Fed to print money to help solve the current financial crisis which is largely triggered by "phantom" money. Take with a pinch of salt, smile and lets pray that global economic stimulus plans work. What an analogy. lol

The Bull befriends the Swine (even when the latter has flu)

noreply@blogger.com (20hopeful) — Mon, 04 May 2009 02:50:00 +0000

Last Monday, 27-Apr-09, STI ended down 34.24pts, or 1.85%, to 1,818.61 due to fears of a global outbreak of swine flu. Investors largely speculated that the virus outbreak will have significant impact on the US economy, thus the decline was deep and broad-based with S-shares being hit the hardest. The Dow Jones industrials ended down 51 points, or 0.6%, to 8,025. The Standard & Poor's 500 Index fell 9 points, or 1%, to 856, and the Nasdaq Composite Index slipped 15 points, or 0.9%, to 1,679.

The next day, 28-Apr-09, Tuesday, the investors found themselves right! To a certain extent the US major market indexes had dipped and so the sell down continued. However, many started to take reference to the closest comparison, SARS crisis in 2003, and start to realise that the impact of the pandemic on global economies totaled less than 1%. (considering the possibility of the virus wiping out the human race, it's surprising.) Smarter investors chose to keep their holdings and buyers were only too eager to buy at support when the prices dipped. STI ended down 10.2pts, or 0.56%, at 1,808.41. (Now notice the decrease in the rate of decline.) That night, coupled with news that US regulaters may need BAC and Citi to shore up their capital, The Dow Jones Industrial Average closed down a mere 8 points to 8,017. The index cross the unchanged level 82 times during the day, Dow Jones officials said. The Standard & Poor's 500 Index was down 2 points, 0.2%, to 855. The Nasdaq Composite Index was off 6 points to 1,674.

By now people start to realise that the impact of swine flu on the economy might not be that dire. Sure enough, the next day STI gained a decent 41.16pts to, or 2.28%, to end strong at 1,849.57. Thursday, the STI was up 70.71pts, or 3.82% to 1920.28. Looking ready to break the resistance at 1950pts.

Despite MACD indicator prompting me to sell my DBS shares at the px of $9 and prices falling to $8.8 on Tuesday, I no longer remained objective from a technical viewpoint. Factors such as higher consumer confidence, consumer spending, Baltic Dry Index, US Fed's suggestion that the worst might be behind us, have greatly improved the investment climate and a surge in investors' confidence and appetite of risk. More importantly, I observed DBS price rebounding with strong volume everytime prices reached the support of about $8.8, while a slew of buy recommendations were rolling out from various brokerage firms.

I reckon that too many investors are afraid to miss the bull and financials lead the turn of the tide in both recession and boom. I decided not to sell, not even when my px target of $9.3 was broken. Today another rally is seeing DBS breach resistance at $10 and trading at $10.12. Im glad for the correct (lucky?) choice but now, is this really the start of the bull OR is it just a bubble created by over optimistic investors?

What does this conclude?

Despite the arguments for EMT, speculative investing still do exist in today's modern markets.
The outcome of similar past events in the market can be extrapolated to determine impact on future prices to a certain extent.
Technical anaylsis though useful, its accuracy can be enhanced with a deeper understanding of the overall market conditions and sentiment.

Value vs Price

noreply@blogger.com (20hopeful) — Mon, 13 Apr 2009 03:26:00 +0000

Went to the Adidas sale at expo with a few friends awhile back. Some of them passed by the shoe section and commented on how some items were great buys, now that they are so much cheaper. Something that went for $140 in the past was now going at $80. They were clearly enticed but I was not half shaken. For me the long-standing money-making principle stands: I buy an item for its value, not its price. If I see the value of an item in my life, I will gladly pay what it is worth. But I will never buy something that I do not need just because it is cheap. Because something that is cheap doesn't mean that it is of value, if you can do without it in the first place. Emphasizing on value rather than price is what makes one rich.

I'm sure they will see my point in due time.

How much do you need to save to be a millionaire?

noreply@blogger.com (20hopeful) — Sat, 11 Apr 2009 15:23:00 +0000

Was watching Money Sense on Channel 8 that day and a viewer asked how much should he need to save monthly to become a millionaire by the age of 65. That prompted me to do some calculations for myself.

Assuming I start at the age of 21 and achieve returns of 8% per annum in savings and investments.

$1000,000 by 65
Let a be the amount of money I have to save per year.
(a X 1.08^44) + (a X 1.08^43) + .... = 1000,000
a = $2,594
Therefore, per month I have to save about $220.

$1000,000 by 40
Let a be the amount of money I have to save per year.
(a X 1.08^19) + (a X 1.08^18) + .... = 1000,000
a = $22,340
Therefore, per month I have to save about $1,200.

$1000,000 by 50
Let a be the amount of money I have to save per year.
(a X 1.08^29) + (a X 1.08^28) + .... = 1000,000
a = $8,900
Therefore, per month I have to save about $750.

Based on calculations, I probably have to make changes to my financial goals after all.
Hmmm....

Poker and Investing

noreply@blogger.com (20hopeful) — Sat, 11 Apr 2009 14:09:00 +0000

The weekend poker sessions drew out certain noteworthy lessons that can be applied to investing.

1) Discipline is of paramount importance.

In poker, have the discipline to fold when you receive 2 lousy cards. How many times have you called merely to 'buy a chance' and see what luck brings? Yes it's gambling but even so, do not ignore probability in play. And with the lower odds, why so eager to satisfy your curiousity but increase the chances for losing money? No one is able to name a price for what the risk is worth for others. But unless you have a huge appetite for risk, I suggest that you not do so. For every call you make just to see the next 3 cards accumulates to a sizeable amount after 10 rounds! Similarly, we can never predict the market direction but we can always reduce risks to the minimum. Simply have the discipline to follow the investing strategies that you've set out on and attempt to make them as objective as possible. (If I had sold 1 lot of DBS at $9.10 on thursday just because I was worried that I will miss out on profits, despite indicators saying otherwise and its failure to reach my px target of $9.30, I'd probably miss out on the larger gains that we expect to see come Monday following steep gains by US markets on Thurs.) Never take the stock markets as a gamble and see what luck brings. Otherwise, you'd be duly punished like my first ever buy in (DBS at $15.50 on market decline in 08).

2) Grab opportunities when they come along.

I was under $10 at a point in time after an unluckily hand. (The market still do burn you sometimes even if you've already minimised risks.) But when the time came with 2 pocket Aces and the best possible full house, there was no way I was letting it go and eventually the pot of $30+ was mine. Similarly, do not miss out on the golden opportunites present today in the stock markets. My personal opinion is that with stocks currently trading at such attractive P/B and P/E ratios, it's certainly a good time to buy IF you have a fairly long investment timeline. Taking note that the market almost always goes up and in the past 19 years, the dow jones and STI have already proved this point and provide annual returns of ~9-10%. Yes, valuations of stocks may not be their cheapest, but they are cheap now and with an adjustable investment timeframe for about 10 years or more, I am quite assured of the choices I've made.

3) Every cent counts and eventually adds up to something.

I did not think particularly in this way until JY suddenly blurted this out before arriving at kwee's. "Woah big blind is 40cents?! Doesn't that mean a loss of at least $2 every 5 rounds you call and not win?" That truly made me realise how a small amount adds up to a sizeable one after rounds of compounding. Thus, save every cent of hard-earned money possible, avoid incurring large brokerage costs through excessive trading but instead let your money grow to a larger amount through compound interest in investing. =)