Thoughts of a changing car

Recently we were almost going to switch our 7 year Toyota altis to another second hand car.

We went to chat with my hubby's friend who works as a car salesman. Actually we had no thoughts of changing car as there is still 3 years to go for our altis car.

He asked us to try out the cars he had in his shop. Well there were a few cars that were not too bad, e.g nissan teanna. Actually he did not recommend us to change our car since we bought it when coe was high.

In the end,  we got sold on the idea that maybe we should change our car.

But reality is even if we sold our car,  we still needed to fork out 10 over thousands.

Our bank account balances was over 14k. So it was not wise to empty our pockets just to switch car for no apparent reasons.

I told my hubby this. But he wasn't listening to me. Instead he felt it was OK to switch.

The point is this was not a need. It was obviously a want. We may have to fork out monies for his medical expenses in the later part of the year and he thought that it is going to be all right.

I am not a reckless person,  nor am I going to spend monies recklessly. Monies will not drop from the skies and if we do not practise prudence,  we may have to end up borrowing monies from family which is a big taboo.

I refused to budge and told him flatly that I did not agree to switch car. 

Investment funds

A few days ago, my sister approached me asking if I coukd help her invest 50k in stocks.

The few questions I asked is what is your expected returns per year and how long can you hold the investment.

Initially she told me 20k a year. Immediately I rejected her telling her that her returns are not possible. I am no magician to be able to generate such returns year in year out.

Then she relented and said decent returns a year. I pondered over the weekend what kind of stocks would fit her as her holding period is only a few years.

Her expectations are different from mine. Oil and gas companies are out of the questions. Reits might require injection of funds which she wouldnt have. In the end i zoomed in on the telco.

Telco are stable companies. I checked the 3 telcos M1, Starhub and Singtel.

Of the 3, I could say confidently that Singtel is the biggest player and if i were to buy this stock myself, and if the stock market prices somehow were not available for the next 10 years, I would not be so worried. It also has stable dividend payouts.

I informed my sister whom in the end, did not want to invest in Singtel because she felt the dividends based on current prices, at 5% is too low.

I told her honestly this is the best I could find. If she wants an alternative, she could ask my elder sister for advice because my elder sis is an active investor. The discussion ended on this note.

Some of my winners

I was re-reading some of my earlier post. Forgot to mention other stocks that made me some profits in my early days of investing

Super group and raffles medical.

I bought them when they were dirt cheap in 2007. But unfortunately as I was too green then, I sold off the shares when the prices double. If i were to hold on to them, their value wouod have increased 10 times more. What a bummer...

Sembcorp industries

I had some monies to invest after saving up abit. Had been looking for cheap bargains stocks to buy.

Some of the stocks that i considered buying were:
Boustead
Raffle medical
Starhub
And even comtemplating to buy index funds.

Those were the stocks that i was looking at before i chanced upon sembcorp industries.

This stock has main businesses dealing in utilities and oil and gas. While the O&G segment is still in the doldrums, I was more interested in the utilities business.

First, it is recession proof. 2nd, sembcrop industries had been moving into india (2nd most populus country after china). Earnings are stable. Dividend payout is low around 2.45% assuming it paya out 8cents and based on my entry price of 3.26.

In the end i decided to buy SI on 19/2. The recent feb market price drop caused it to dropped from 3.57ish to 3.22ish. A drop of 10% which make this quite irresistable.

Similar to Keppel corp which relies on it property business arm to prop up the share price, I believe the utilities arm of SI could similarly do so for SI.

The lowest price that SI had gone was 1.83 in 2008. The highest it went was close to 5.75ish. The potential downside is 1.43 and potential upside is 3.50. Although it is not possible to know the direction that stock prices are heading in the future, I could still tolerate such downside risks.

Buy when stocks are down

Stock bourses all over the world tanked on 5 feb. SG stocks are no exception.

Although stock price of some of my stockholding has dropped, their prices have not gone down too much for me to consider adding more.

I was not worried about my stock investment because I am confident that these stocks can ride out any storm.

Now is the time to be greedy and start shopping for cheap stocks when others are fearful.

Why it is so difficult to invest long term

Long term investing is difficult at this age reason being for the explosion of information.

Imagine buying a stock and then seeing the stock price goes down. It is not an easy feeling.

With current trading apps, you can get a overall view of how many % of your stock  you have lost on paper. The converse is true.

When you see yourself sitting on a hefty profits (once again on paper) it is difficult to curb the urge to sell the stock.

For myself, i will remind myself of the potential price that the stock will reach and that how hard it is to find an undervalued stock. Hence so far I have been able to rein in my urges.

One piece of advice that i always remembered from my father, was that it is very hard to save money when you started working. He stressed that 100k is what a person can normally save in 10 years.

I started working when I was 23. Sad to say after working for a decade, I did not even managed to save 50k cash after buying a car and house.

Hence calculating that i work 25 to 65, I could likely save 200k.

Imagine retiring with 200k, this can only last 6-7 years and worse shorter if I were to have any illnesses.

So if my investment has the potential to rake in huge profits, I will patiently wait even if it takes 10 years.

Stock picking time again

The year 2017 is ending in 3 weeks time. As we move to 2018, come the time for me to do my homework to pick the stock to invest in 2018.

For the next stock to invest - am thinking of going into healthcare industry.