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...
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.
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.
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.
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.
One of my biggest debt is my hdb flat, for which I took up a bank loan. Not because of the low bank interest rates but more because we are not eligible for a hdb loan.
Personally I would prefer to have a fixed interest rate loan for 25 years so I can have peace of mind, not having to worry about fluctuating interest rates. Along which comes fluctuating monthly instalment.
We took a 2 year fixed interest loan from UOB. Recently the 2 year is up, so I went hunting for refinancing packages.
I asked UOB for refinancing package but because there are upfront fees, I decided to refinance with other bank. That is where i chanced upon posb loan. They offer fixed interest rates for 4 years. So far this is the longest fixed rate tenure. I need not have to fret over the loan every 2 years. In the end, I refinanced my loan with POSB.
Another question that were burning in my mind were whether i should make partial repayment using my cpf OA monies. I pondered over this for quite some time.
Eventually I decided not, so that if i were to become jobless, my hdb loan could still be sustained using my cpf OA monies for a while (1-2 years).
Recently I had been listening to some of warren buffett speeches on youtube to see if I could gain some wisdom from his wise words.
There was one speech where he mentioned that investors do not need to be right about all the companies. He just need to be right about SOME.
And he asked the audience to imagine that they could only invest 20 companies in their whole life, what would it be.
I pondered over this and reflected on my strategies.
I only invest 10k a year. Assuming I do this for the next 30 years, i would have invested in 30 companies or less in my entire life. This synch with Warren Buffett.
There is no need to know everything about all the listed companies. One should just focus on a industry and learn as much as possible about the business.
