Einstein says "compounding is the 8th wonder ofthe world! He who knows it enjoys it while he who doesn't know it looses it". This is also cited by Warren Buffett in an interview on how he grows his wealth. Take a chess board 8x8 square and put one grain of rice on the first square then for every subsequent square DOUBLE the amount. 1,2,4,8,16,32,64, ... etc How much would you haveat the end of 64 squares? What is the final number? Is it 1 million? 1 billion? 1 trillion? No! The answer is 18 quintillion! That is a massive amount! THAT IS THE TRUE POWER OF COMPOUNDING!

Where do I begin? There is so much to share for 1st quarter of 2023. 1. Investment objectives During periods of uncertainty, it is always important to fall back to your basics. As for me, with cash lying around I could do 2 things: 1) put it in the bank and earn 2.5-3.5% per annum or put it in bank shares that yield max 5.5% dividend per year as of this writing. With these 2 options put side by side, I went on to buy bank shares. Learning the power of compounding (1,2,4,8,16,32,64,128…131072, 262144,524288,1048576…) and studying some investors out there who have concentrated portfolio of less than 5 stocks, I went on to buy bank shares and compound it. Referencing to what Charlie Munger says “ I don’t care how you make it but you must make your first $100,000 and invest it”. With this in

Many times, dividends are overlooked when it comes to investing. People often chase growth and forget about dividends. But what if dividends can save you in uncertain periods and protect your portfolio, what would you do? Below I list a few reasons why investors should also add dividend stocks to their portfolios. 1. Dividend-paying companies have strong balance sheets and free cash flow statements. For the companies to pay dividends to their shareholders, they need to generate cash from somewhere in their day-to-day business operations. Only when the company has determined that they have a very sound and strong free cash flow, in which they have nowhere else to deploy the capital as of now will they distribute the extra to the shareholders in dividends. 2. Companies that pay out dividen

Market crashes are part and parcel of economic cycles. What should investors do to prepare for market crashes? Investors should first and foremost prepare cash on hand. What I mean by that is that they should prepare emergency funds. This would be amounts that are set aside for daily expenditure and necessities. Most people would say to set aside 3-6 months of cash but personally, I would recommend 9-12 months of emergency funds. This is because when a market crashes, no one knows how long and deep it would take for the market to recover. From history, we can learn that the worst market crash was back in 1929, the great depression, where the time taken for the market to recover was 25 years. For investors who still want to invest into the markets, expect that whatever investment that you

Market corrections and recessions don’t happen very often, every investor knows that. Just like what Warren Buffett, the richest investor who has survived more than 8 market cycles, says, “When it rains gold, put out a bucket and not a thimble”. The question is what would you do when the market presents itself to you? Do not panic when you see the price of your holdings decrease in value When a correction or recession comes, investors in the market panic as they see their holdings decrease in value. When they panic, many thoughts race through their minds and they start to think if they should sell their shares; and eventually most of them sell it off at a loss, thinking that a decrease in share price is actually telling them something about the stock. This is because the emotion of FEAR ha

Volatility can be your friend or foe. Looking into SG stocks give a sense of stability and assurance.It never hurts to fortify your portfolio with stable stocks that you can rely on. For example, the banks which make up majority of the pillar for the economy have mixed so far. OCBC the leader of the pax has delivered 3.27% gain as of this writing. UOB has dished out a -2.25% and DBS has given -1.83%. People tend to chase the shiny objects. When the share price goes up, they have the tendency to buy more and increase their holdings. Likewise can be said. When the share price goes down, they can’t stand the losses and therefore keep averaging down. But there is another group who patiently sit and wait for the prices to move to their buy or they go for the objects that people dislike or hate.

$Tiger Brokers(TIGR)$  Where do I begin? There is so much to share for 1st quarter of 2023. 1. Investment objectives During periods of uncertainty, it is always important to fall back to your basics. As for me, with cash lying around I could do 2 things: 1) put it in the bank and earn 2.5-3.5% per annum or put it in bank shares that yield max 5.5% dividend per year as of this writing. With these 2 options put side by side, I went on to buy bank shares. Learning the power of compounding (1,2,4,8,16,32,64,128…131072, 262144,524288,1048576…) and studying some investors out there who have concentrated portfolio of less than 5 stocks, I went on to buy bank shares and compound it. Referencing to what Charlie Munger says “ I don’t care how you make

When it comes to investing in equities, emotions always get into people's way. When the price goes up, people FOMO (Fear Of Missing Out) and they buy it, but when the prices drop, people get nervous and panic sell.  One of the key lesson that can be learned from Warren Buffett "Be greedy when others are fearful and be fearful when others are greedy!". Just by using this one quote, you can make profits even when everyone is in losses. Looking back on hind sight at the stock prices for certain companies, I wished I have loaded up more shares, but was to afraid to. Now I am kicking myself to not have added in more positions while seeing the prices go up. Through this, it has taught me to not be FOMO and jump in as of now but wait for the correct time and sit on a cash pile that is i

With uncertain times ahead, a move to defensive companies is the way to go from here. Companies that are defensive in nature are necessities regardless of where the economy is going. People need them no matter what is happening. Therefore, the share price of the company would continue to do well even in uncertain times like now. For example, companies like Proctor and Gamble(PG), Johnson and Johnson (J&J) and Coca Cola (KO), all have been steadily going up these past few weeks. Why is that the case? It is because these companies provide goods and services that people need regardless of whether there is a recession or an inflationary period. So, although the mega cap stocks like those in the technology sector falling from the all time highs, there are gems

When it comes to investing in equities, emotions always get into people's way. When the price goes up, people FOMO (Fear Of Missing Out) and they buy it, but when the prices drop, people get nervous and panic sell.  One of the key lesson that can be learned from Warren Buffett "Be greedy when others are fearful and be fearful when others are greedy!". Just by using this one quote, you can make profits even when everyone is in losses. Looking back on hind sight at the stock prices for certain companies, I wished I have loaded up more shares, but was to afraid to. Now I am kicking myself to not have added in more positions while seeing the prices go up. Through this, it has taught me to not be FOMO and jump in as of now but wait for the correct time and sit on a cash pile that is i

With the FED recently increasing the interest rate by another 75 basis points in November, coupled with the 3 local banks in Singapore reporting that they have better earnings than expected (net profit all increasing). By the end of the year, it is forseeable thatthey will end the year strong with the share price rising another 3-5%. I remain bullish on all 3 banks and already have positions in 2 of them. Backtesting with each of the local bank share price have given me confidence into how I invest. I am looking to add many more positions into my existing holdings. Always remember to do your own due diligence. What are your thoughts?

2022 has been a crazy year for everyone. There is the Russia-Ukraine war causing supply chain problems, the US having to raise interest rates to the highest point in the last 100 years to fight the out of control inflation, then there is also the coronavirus that is never ending. With so many problems happening, investors are being overwhelmed on what things they should do. One thing that would come back, that has been ignored for the last 2 years, would be that of value or simply put it investing in value companies. Investors would start to turn their eyes back to investing with value, something that they may have forgotten over the past 2 years, as they were chasing the trends. The question would be “Why would investing with value come back into play?” There are a few reasons why it wou

It is the start of a new chapter in the markets with the ushering of the new year 2023. The past year has surely been a roller coaster for everyone in the markets. With the beginning of 2023, the question investors ask would be “where do I invest my money in 2023?” This question can be easily broken down into many sections but only a few would be covered here. Broad ETFs (Exchange Traded Funds) Broad ETFs are said to be the go to point where investors seek coverage if they do not know which stocks to put their money in. Broad ETFs give the investor a diversified base meaning that they would not have to worry about each individual stock they choose. Typically in such situations or environments that we are in, broad ETFs like those that track the S&P 500 usually do well compared to cherr

With the job numbers coming in stronger than expected as of lately, what would the FED do? Will they change their decision to 75bps? Will they raise it aggressively to 100bps? Or will they remain at 50bps? My take will be discussed below. With job numbers way above 200,000 (stronger and higher than expected) and inflation as of the last reading at 7.7% (FED wants the number to be 2%), J Powell, chairman of the FED may take a second look at the rates. There are 2 things that he can do.  Number 1: first introduce a 50bps to let the market rally and rebound, this would effectively wipeout all their efforts of taming inflation for the past year, and then at the next meeting (in 2023) slap on a 75bps, to bring the markets back down again. Number 2: continue with ei

It is no surprise that everytime a bear market happens, people tend to let their emotions give in and sell away their positions if not get them forced sell by the brokerage because of margin call. But instead of selling away their holdings, you shouldactually be adding to your existing positions in which you have strong convictions on. After all, bear markets don't last forever. Following the teachings of Warren Buffett, the greatest investor of all times, he says "I like it whenthe markets are down, because I can buy more ofsomething at a cheaper price". For example, AAPL as we all know is the biggest company out there in terms of market cap ($3 trillion). During this time, yes people will spend lesson purchasing their products, yes people will avoid upgrading their phones. But let m

Market corrections and recessions allow investors to take a hard look at their portfolios. They make investors rethink about their holdings and if they need to change anything. The good investors like Warren Buffett and Charlie Munger, are legendary investors who know what to do in certain times of chaos. Here are some of the points that they have done or may do in such uncertain times. 1. Removing holdings that they have little conviction over If there is one thing that must be reiterated during such uncertain times, that is to remove holdings that the investor has no longer any conviction over, the company is continuing to burn massive amounts of cash and are currently still not profitable at all or that the company has changed and pivoted to another area. Holdings that are burning

What would the FED do tonight? With CPI numbers coming in lesser than expected, will the FED decrease the interest rate or increase or remain constant in the interest rate? If they decide to decrease the interest rate, the market will rally thereby putting the entire effort of the FED this year to waste and the inflation will still be out of control. If the increase or remain constant at 75bps, the market will tank again because they did not expect the FED to be so hawkish.  But remember that the FED does not really care about whether they crash the market or not! Their only mandate is to bring inflation down and have stable prices. Invest safely!

As of now, interest rates are very high and they can only get higher from here as the FED tries to bring inflation down to 2%.  Banks will naturally benefit from this process as this would mean their net interest margins (NIM) would increase, bringing them more profits when they report their earnings. This would also translate to more dividends being rewarded to shareholders. Not only that, as a result of an increase in profits, bank share prices would naturally increase and if you are a shareholder, you would not only be able to lock in a good yield for the shares, enjoy capital appreciation but also collect dividends along the way! Do you invest in banks? Comment down below!

$OVERSEA-CHINESE BANKING CORP(O39.SI)$  If you see this in your portfolio, would you panic?Or would you celebrate? Comment down below!

With CPI numbers coming out yesterday below than exepected, inflation rate has also came down to 7.7%. The markets in turn rallied.  The question that is on everyone's mind is "Is this the beginning of a proper rally into the marketsor is this another dead cat bounce?" Although inflation rate has come down to 7.7%, but it is still not good enough for the FED. They want the target of 2%. To achieve this, they have to continue to keep raising rates to achieve their goal. Therefore, I think that this is just a relief rally before more downside pain is experienced. But on the flip side, those who have positions in banks outside US should benefit as increasing interest rates would mean that the bank's balance sheet and profits will go even higher! What are your thoughts? Comment down below