08 November 2018
Singapore Straits Times Index (STI) market cycles provided 4 major opportunities in the past 31 years from 1987 to 2018
Singapore Straits Times Index (STI) market cycles provided 4 major opportunities in the past 31 years from 1987 to 2018.
Assume you got USD1m, your money was trippled to USD3m in the first opportunity; USD9m in the 2nd; USD27m in the 3rd; USD81m in the 4th!
Assume you got another 4 opportunities in the coming 31 years, what will happen?
What will happen if you use a margin of 300% in each opportunity?
So my friend, do not worry too much. Even if you got USD100k only now, you could have USD8.1m after 31 years!
Long Term Investment Strategy:
Buy the bluest stocks at 100% of planned amount after STI drops by 50% from high; buy another 50% with margin after STI drops by 60%; buy another 25% with margin after STI drops by 70%.
All of following conditions must be met before long term buying.
MSCI World Market Index dropped by more than 50%; (To make sure the drop is significant and sufficient world wide)
S&P 500 dropped by more than 50%; (To make sure US drop is significant and sufficient thus does not affect other countries especially the country you are in)
STI Index dropped by more than 50%; (To make sure the drop is significant and sufficient country wide thus does not affect the sector you are in)
Sector Index of the stock dropped by more than 50%; (To make sure the drop is significant and sufficient sector wide thus does not affect the stocks you are in)
Stock dropped by more than 50%; (To make sure the drop is significant and sufficient)
Check past 30 to 50 years of chart history of the candidate stocks (usually coming from the national stock index component companies) and select those stocks that rose the most in percentage (much much more than the index growth) in every bull market from the bear market bottom; (To makke sure you are able to outperform the index)
Target price: rising by at least 200% from the bear market bottom. (This is the minimum target, do not consider profit taking before this price)
Assume you got USD1m, your money was trippled to USD3m in the first opportunity; USD9m in the 2nd; USD27m in the 3rd; USD81m in the 4th!
Assume you got another 4 opportunities in the coming 31 years, what will happen?
What will happen if you use a margin of 300% in each opportunity?
So my friend, do not worry too much. Even if you got USD100k only now, you could have USD8.1m after 31 years!
Long Term Investment Strategy:
Buy the bluest stocks at 100% of planned amount after STI drops by 50% from high; buy another 50% with margin after STI drops by 60%; buy another 25% with margin after STI drops by 70%.
All of following conditions must be met before long term buying.
MSCI World Market Index dropped by more than 50%; (To make sure the drop is significant and sufficient world wide)
S&P 500 dropped by more than 50%; (To make sure US drop is significant and sufficient thus does not affect other countries especially the country you are in)
STI Index dropped by more than 50%; (To make sure the drop is significant and sufficient country wide thus does not affect the sector you are in)
Sector Index of the stock dropped by more than 50%; (To make sure the drop is significant and sufficient sector wide thus does not affect the stocks you are in)
Stock dropped by more than 50%; (To make sure the drop is significant and sufficient)
Check past 30 to 50 years of chart history of the candidate stocks (usually coming from the national stock index component companies) and select those stocks that rose the most in percentage (much much more than the index growth) in every bull market from the bear market bottom; (To makke sure you are able to outperform the index)
Target price: rising by at least 200% from the bear market bottom. (This is the minimum target, do not consider profit taking before this price)
Labels: Back Test, Charts, Historical Teachings, History, Margin, plan, STI ETF, Stock Trading System, Thoughts, Value Investing, Warren Buffett
15 June 2018
Trading Plan 20180615
STI kept on dropping recent weeks, market sentiment turning to very negative/bearish, RSI14 close to 30 or below 30. if still got cash, may consider accumulating STI ETF, Nikko AM STI ETF, 3 local banks, SGX, KepCorp, CityDev, 10% gain should be easy in coming weeks/months.smiley I test bought OCBC and UOB today. Note: enter for long term, no quick money. Do not play big, nibble slowly slowly.
Not an enticement to buy or sell, no claim for any losses for whatever reason after taking any action upon looking at this message. Just my 2 cents.
Not an enticement to buy or sell, no claim for any losses for whatever reason after taking any action upon looking at this message. Just my 2 cents.
Labels: plan
23 October 2013
Plan
To buy 10% of total trading capital per trade in the US market next time. In such a way, I will be able to buy 10 times before trading capital is used up, then another 30 times by using margin, if necessary.
Labels: plan
10 September 2013
Do not plan to use fund in CPF Ordinary Account to reduce housing loan
I do not plan to use fund in CPF Ordinary Account to reduce housing loan because it can be used to buy STI ETF when it drops by 50% or more and get a much better potential return (100%!) in the future.
Labels: plan, STI ETF, Thoughts
04 September 2013
G3B - NIKKO AM SINGAPORE STI ETF 100
Accumulated G3B - NIKKO AM SINGAPORE STI ETF 100 at 3.10 on 04 Sep 2013.
Daily chart RSI 14 dropped to below 20. RSI at 19.2 at yesterday's close.
It is my plan to keep on accumulating STI ETF whenever the market looks bleak or pessimistic.
Daily chart RSI 14 dropped to below 20. RSI at 19.2 at yesterday's close.
It is my plan to keep on accumulating STI ETF whenever the market looks bleak or pessimistic.
Labels: ETF, Live Trading Records, plan, STI ETF
29 August 2013
G3B - NIKKO AM SINGAPORE STI ETF 100
Accumulated G3B - NIKKO AM SINGAPORE STI ETF 100 at 3.09 on 29 Aug 2013.
Daily chart RSI 14 dropped to below 20. RSI at 9.1 at yesterday's close.
It is my plan to keep on accumulating STI ETF whenever the market looks bleak or pessimistic.
Daily chart RSI 14 dropped to below 20. RSI at 9.1 at yesterday's close.
It is my plan to keep on accumulating STI ETF whenever the market looks bleak or pessimistic.
Labels: ETF, Live Trading Records, plan, STI ETF
28 August 2013
G3B - NIKKO AM SINGAPORE STI ETF 100
Accumulated G3B - NIKKO AM SINGAPORE STI ETF 100 at 3.07 / 3.08 on 28 Aug 2013.
Daily chart RSI 14 dropped to below 20.
It is my plan to keep on accumulating STI ETF whenever the market looks bleak or pessimistic.
Daily chart RSI 14 dropped to below 20.
It is my plan to keep on accumulating STI ETF whenever the market looks bleak or pessimistic.
Labels: ETF, Live Trading Records, plan, STI ETF
EWS - iShares MSCI Singapore ETF
Started to accumulate stock index ETF - EWS(iShares MSCI Singapore ETF) at US$12.32 per unit on 27 Aug 2013.
Assessment
PE at 14, neither cheap nor expensive; Price NAV ratio at 0.90, not too cheap; 5-year high at 14.7, paid price 12.32 is not too cheap at 84% of it;
An intermediate correction from 14.7 to 12.26 in the form of three waves ABC does not looks close to completion, C needs to be as long as A or longer than A;
Daily chart RSI 14 is at about 13.3, severely oversold;
MACD not at oversold area, looks more room to drop, not below or close to 1 year, 2 years, 5 years low.
However, I'm almost in cash position at this moment. It is time to begin to accumulate by probing buy for expected technical rebound.
Basic Information on EWS - iShares MSCI Singapore ETF
Overall Portfolio Composition (%)
Stocks: 99.63
Bonds: 0.00
Top 10 Holdings (64.63% of Total Assets)
Company Symbol % Assets
DBS D05.SI 11.09
SingTel Z74.SI 10.99
Oversea-Chinese Banking Corp Ltd OVCHF.SI 10.46
UOB U11.SI 9.74
Keppel Corp Ltd KPELF.SI 6.47
Capitaland C31.SI 3.47
Genting SP G13.SI 3.45
F & N F99.SI 3.29
Jardine C&C C07.SI 2.95
SPH T39.SI 2.72
Ratio
Average Price/Earnings 14.41
Average Price/Book 1.13
Average Price/Sales 1.29
Average Price/Cash flow 14.81
Assessment
PE at 14, neither cheap nor expensive; Price NAV ratio at 0.90, not too cheap; 5-year high at 14.7, paid price 12.32 is not too cheap at 84% of it;
An intermediate correction from 14.7 to 12.26 in the form of three waves ABC does not looks close to completion, C needs to be as long as A or longer than A;
Daily chart RSI 14 is at about 13.3, severely oversold;
MACD not at oversold area, looks more room to drop, not below or close to 1 year, 2 years, 5 years low.
However, I'm almost in cash position at this moment. It is time to begin to accumulate by probing buy for expected technical rebound.
Basic Information on EWS - iShares MSCI Singapore ETF
Overall Portfolio Composition (%)
Stocks: 99.63
Bonds: 0.00
Top 10 Holdings (64.63% of Total Assets)
Company Symbol % Assets
DBS D05.SI 11.09
SingTel Z74.SI 10.99
Oversea-Chinese Banking Corp Ltd OVCHF.SI 10.46
UOB U11.SI 9.74
Keppel Corp Ltd KPELF.SI 6.47
Capitaland C31.SI 3.47
Genting SP G13.SI 3.45
F & N F99.SI 3.29
Jardine C&C C07.SI 2.95
SPH T39.SI 2.72
Ratio
Average Price/Earnings 14.41
Average Price/Book 1.13
Average Price/Sales 1.29
Average Price/Cash flow 14.81
Labels: ETF, Live Trading Records, plan
EWM - iShares MSCI Malaysia ETF
Started to accumulate stock index ETF - EWM (iShares MSCI Malaysia ETF) at US$14.03 per unit on 27 Aug 2013.
Reasons
PE at 16.1, a little bit expensive; Price NAV ratio at 1.01, fair value; 5-year high at about 17, paid price 14.03 is not too cheap at 82.05% of it;
An intermediate correction from historical high of 17 to 13.88 in the form of three waves ABC likely close to completion;
Daily chart RSI 14 is about 20.11, oversold;
MACD also at oversold area, below or close to 1 year, 2 years, 5 years low.
I'm almost in cash position, it is time to begin to accumulate by probing buy for expected technical rebound.
Basic Information on EWM - iShares MSCI Malaysia ETF
Top 10 Holdings (52.53% of Total Assets)
Company Symbol % Assets
Malayan Banking Berhad 1155 9.67
CIMB Group Holdings Bhd 1023 7.84
Sime Darby Bhd 4197 5.72
Tenaga Nasional Berhad 5347 5.52
Genting Bhd 3182 4.49
Petronas Chemicals Group Bhd 5183 4.14
PUBLIC BANK LOCAL PBLOF 4.08
Axiata Group Bhd 6888 3.87
Digi.com Bhd 6947 3.63
Maxis Bhd 6012 3.57
Ratio
Average Price/Earnings 16.13
Average Price/Book 1.79
Average Price/Sales 2.24
Average Price/Cashflow 5.66
Reasons
PE at 16.1, a little bit expensive; Price NAV ratio at 1.01, fair value; 5-year high at about 17, paid price 14.03 is not too cheap at 82.05% of it;
An intermediate correction from historical high of 17 to 13.88 in the form of three waves ABC likely close to completion;
Daily chart RSI 14 is about 20.11, oversold;
MACD also at oversold area, below or close to 1 year, 2 years, 5 years low.
I'm almost in cash position, it is time to begin to accumulate by probing buy for expected technical rebound.
Basic Information on EWM - iShares MSCI Malaysia ETF
Top 10 Holdings (52.53% of Total Assets)
Company Symbol % Assets
Malayan Banking Berhad 1155 9.67
CIMB Group Holdings Bhd 1023 7.84
Sime Darby Bhd 4197 5.72
Tenaga Nasional Berhad 5347 5.52
Genting Bhd 3182 4.49
Petronas Chemicals Group Bhd 5183 4.14
PUBLIC BANK LOCAL PBLOF 4.08
Axiata Group Bhd 6888 3.87
Digi.com Bhd 6947 3.63
Maxis Bhd 6012 3.57
Ratio
Average Price/Earnings 16.13
Average Price/Book 1.79
Average Price/Sales 2.24
Average Price/Cashflow 5.66
Labels: ETF, Live Trading Records, plan
27 August 2013
G3B - NIKKO AM SINGAPORE STI ETF 100
Accumulated G3B - NIKKO AM SINGAPORE STI ETF 100 at 3.12, 3.13, 3.14 on 27 Aug 2013.
Daily chart RSI 14 dropped to below 20.
It is my plan to keep on accumulating STI ETF whenever the market looks bleak or pessimistic.
Daily chart RSI 14 dropped to below 20.
It is my plan to keep on accumulating STI ETF whenever the market looks bleak or pessimistic.
Labels: ETF, Live Trading Records, plan, STI ETF
22 August 2013
G3B - NIKKO AM SINGAPORE STI ETF 100
Accumulated NIKKO AM SINGAPORE STI ETF 100 at 3.15 on 22 Aug 2013.
Daily chart RSI 14 dropped to below 20.
It is my plan to keep on accumulating STI ETF whenever the market looks bleak or pessimistic.
Daily chart RSI 14 dropped to below 20.
It is my plan to keep on accumulating STI ETF whenever the market looks bleak or pessimistic.
Labels: ETF, Live Trading Records, plan, STI ETF
16 August 2013
Stock Market has been under pressure due to bad news in recent days such as impending tapering of US FED's quantitative easing (QE) measures expected to start in Sep 2013, Cisco's bleak outlook (reason for retrenching 4000 workers), economic bellwether WalMart sales decreasing and so on.
Market may be in the process of correction which will be likely to give me another chance to buy stock index ETF's in due course (RSI 14 drops to 20 or below, price drops to SMA50 or 100 or 200 or below).
Buy on fear and be prepared to keep for long term investment, sell on danger signal(s)- this applies to well diversified stock index ETF only.
EGPT
EGPT seems interesting for me. It is the only Egypt stock index fund traded in the US stock market currently, its PE is at around 7, PB at 0.8 at this moment. It seems that top 10 components of this fund will not be affected too much by the current political crisis which is similar to the Jun 4th Tiananmen Square democratic movement in China in 1989.
Await patiently. Patience is one of the keys to success.
Market may be in the process of correction which will be likely to give me another chance to buy stock index ETF's in due course (RSI 14 drops to 20 or below, price drops to SMA50 or 100 or 200 or below).
Buy on fear and be prepared to keep for long term investment, sell on danger signal(s)- this applies to well diversified stock index ETF only.
EGPT
EGPT seems interesting for me. It is the only Egypt stock index fund traded in the US stock market currently, its PE is at around 7, PB at 0.8 at this moment. It seems that top 10 components of this fund will not be affected too much by the current political crisis which is similar to the Jun 4th Tiananmen Square democratic movement in China in 1989.
Await patiently. Patience is one of the keys to success.
Labels: ETF, plan, Risk Management, Stock Trading System, Thoughts
20 March 2013
Awaiting long-term investment opportunities in stock index funds and luxurious condominium, which can only appear during financial crises or economic recessions.
Labels: Dollar Cost Averaging, ETF, PE Ratio, plan, STI ETF, Thoughts, Warren Buffett
04 July 2012
Charts - Automatically Updated!
Finally, I found a way to paste monthly / weekly / daily charts which are able to update itself automatically of S&P 500 index component stocks / Nasdaq 100 index component stocks / the largest 100 US ETF's in the same page in my blog! This can save me lots of time because from now on I do not have to enter the symbols one by one to see the charts one by one! But I am still not satisfactory with the existing SMA's setup (SMA 20/50/200 instead of my favorate setup of SMA 50/100/200) and trend lines in the current daily charts which look very messy. I'll try to find a way to just place SMA 50/100/200 without any trend line in the charts.
04 June 2012
Main US ETF's
Finalized main US ETF's planned buy levels (retracing 50, 60, 70, 80, 90% from 2007 high) and placed alerts at 50% in the trading platform today. Main Solid US ETFs - SPY QQQ EEM IWM EFA EWZ XLE XLF DIA FXI GDX VWO IVV MDY XLU XLK IWF VTI IWB IWD IJR IVW VGK IWR IJH VEU VEA VOO GLD SLV
Labels: Dollar Cost Averaging, ETF, plan, Thoughts
15 May 2012
VGK - How to Use ETFs to Win in Europe
By Will Ashworth, InvestorPlace Contributor On April 20, Morningstar ran an article about European ETFs that included several specific recommendations.
It reasoned that while European leaders have yet to address the root causes of the Continent’s financial crisis, the low valuations of European equities provides investors with remarkable opportunities. However, the story cautions that the turnaround in Europe will be measured in years, not months, so patience is essential. Here’s how you can use ETFs to win the European game.
The top pick of the Morningstar analysts is Vanguard’s MSCI Europe ETF (NYSE:VGK). It tracks the MSCI Europe Index, holds 457 stocks and has an expense ratio of just 0.14%. That’s cheaper than any other comparable European ETF. I don’t think you can go wrong with Vanguard. Its top 10 holdings account for just 21.3% of total assets, so diversification is not an issue. Morningstar does make the point that over the past 10 years, the S&P 500 was closely correlated (about 91%) with the MSCI Europe index. Nonetheless, Europe accounts for 25% of the world’s market capitalization. To avoid such a big part of the world’s stock markets is what they call “home-country bias,” and it can lead to long-term under performance.
An excellent way to make money with ETFs — which can also be done with stocks, though not as easily — is to buy an initial amount and then some more every 365 days. There’s a catch: Rather than practicing what’s essentially a form of dollar-cost averaging, you’ll buy more only if the price is lower than the previous year’s close. For example, let’s say you bought 100 shares of the Vanguard fund at the May 9 high of $43.01. If on May 8, 2013, it closes at $46.01, you would pass on buying more shares and wait until the following year. If, on the other hand, they were trading for $40.01, you’d buy. In 2014, you’d buy only if the shares were less than $40.01, and so on through the years. The reason this works better with ETFs than with stocks is specifically because of diversification.
While it’s possible to buy a dud stock and then catch a falling knife on each anniversary, that’s far less likely to happen with an entire market. The probabilities work for you, not against you. To illustrate how this would have worked in the past, I’ve gone back five years to test the results. First, let’s assume we bought 100 shares of VGK at the May 9, 2007, high of $75.80 for an initial investment of $7,580. In 2008, we bought another 100 shares for $72.16, a 100 more in 2009 for $39.75 a share and then we passed on buying in 2010 and 2011 because the share price on May 9 in both those years was higher than the year before. Here’s where the curve ball appears: On May 9, 2012, we bought 300 shares (three years times 100 shares) at $43.01 for an investment of $12,903. Since May 9, 2007, we bought a total of 600 shares of the ETF for an average price of $52.79 a share. Our return without dividends was -19.1%. If we bought just 100 shares in 2007, our return would be -43.7%. But there’s more. The ETF paid $2,654 in dividends on our 600 shares, with an additional $1,300 or so due in December. Including the December dividends, our loss is just 7.5%. When reversion to the mean kicks in, and it always does, you’ll be looking at some significant upside. While I’ve applied this ETF buying plan to a European strategy, the same principles apply to any equity ETF. Long term, very few markets stay stuck in reverse forever. Europe will be no exception.
It reasoned that while European leaders have yet to address the root causes of the Continent’s financial crisis, the low valuations of European equities provides investors with remarkable opportunities. However, the story cautions that the turnaround in Europe will be measured in years, not months, so patience is essential. Here’s how you can use ETFs to win the European game.
The top pick of the Morningstar analysts is Vanguard’s MSCI Europe ETF (NYSE:VGK). It tracks the MSCI Europe Index, holds 457 stocks and has an expense ratio of just 0.14%. That’s cheaper than any other comparable European ETF. I don’t think you can go wrong with Vanguard. Its top 10 holdings account for just 21.3% of total assets, so diversification is not an issue. Morningstar does make the point that over the past 10 years, the S&P 500 was closely correlated (about 91%) with the MSCI Europe index. Nonetheless, Europe accounts for 25% of the world’s market capitalization. To avoid such a big part of the world’s stock markets is what they call “home-country bias,” and it can lead to long-term under performance.
An excellent way to make money with ETFs — which can also be done with stocks, though not as easily — is to buy an initial amount and then some more every 365 days. There’s a catch: Rather than practicing what’s essentially a form of dollar-cost averaging, you’ll buy more only if the price is lower than the previous year’s close. For example, let’s say you bought 100 shares of the Vanguard fund at the May 9 high of $43.01. If on May 8, 2013, it closes at $46.01, you would pass on buying more shares and wait until the following year. If, on the other hand, they were trading for $40.01, you’d buy. In 2014, you’d buy only if the shares were less than $40.01, and so on through the years. The reason this works better with ETFs than with stocks is specifically because of diversification.
While it’s possible to buy a dud stock and then catch a falling knife on each anniversary, that’s far less likely to happen with an entire market. The probabilities work for you, not against you. To illustrate how this would have worked in the past, I’ve gone back five years to test the results. First, let’s assume we bought 100 shares of VGK at the May 9, 2007, high of $75.80 for an initial investment of $7,580. In 2008, we bought another 100 shares for $72.16, a 100 more in 2009 for $39.75 a share and then we passed on buying in 2010 and 2011 because the share price on May 9 in both those years was higher than the year before. Here’s where the curve ball appears: On May 9, 2012, we bought 300 shares (three years times 100 shares) at $43.01 for an investment of $12,903. Since May 9, 2007, we bought a total of 600 shares of the ETF for an average price of $52.79 a share. Our return without dividends was -19.1%. If we bought just 100 shares in 2007, our return would be -43.7%. But there’s more. The ETF paid $2,654 in dividends on our 600 shares, with an additional $1,300 or so due in December. Including the December dividends, our loss is just 7.5%. When reversion to the mean kicks in, and it always does, you’ll be looking at some significant upside. While I’ve applied this ETF buying plan to a European strategy, the same principles apply to any equity ETF. Long term, very few markets stay stuck in reverse forever. Europe will be no exception.
Labels: ETF, plan, Stock Trading System
20 October 2011
My Financial Plan
(Updated on 26 Aug 2013)
1.0 Assets
1.1 Bank Savings
Time depositsSavings accounts
1.2 Mini Cash Fund for Children
Monthly Transfer (to convert to Nikko STI ETF 100 when it drops by 50% or more from historical high, best for kids - 26 Aug 2013)1.3 Salary Income
1.4 Property
2.0 Insurance
NTUC I-Term Life Insurance (Self, wife)
Company Group Term Life Insurance Underwritten by HSBC (Self)
Company Group Critical Illness Insurance Underwritten by HSBC (Rider to Company Group Term Life Insurance)(Self)
Company Group Personal Accident Insurance Underwritten by AXA(Self)
CPF Medishield Life (Self, wife, children)
Company Group Hospital and Surgical Insurance Underwritten by Tokio Marine Life(Self)
Company Group Outpatient Insurance for GP / Specialist Underwritten by Tokio Marine Life(Self)
Company Group Business Travel Insurance Underwritten by AXA(Self)
CPF Home Protection Scheme (HPS) (Self, wife)
CPF Dependants' Protection Schedme (DPS) (Wife)
Home Fire Insurance Underwritten by AIA (changed to ETIQA Insurance Berhad, 1 North Bridge Road #08-01 High Street Centre Singapore 179094 from 20 Apr 2012, Tel 6331 9253, 6331 9254) (Self, wife)
3.0 Debt & Expenditures
Property Mortgage
Family Food
Water & Power Bills
Community Town Council Charges
Telephone & Broadband
Tuition
Fund for Parents
School Fees
Painting Course for Children
Piano Course for Children
School Meals
Travel & Entertainment
Shareinvestor Subscription
Poems ProTrader Subscription
4.0 Investment Plan
4.1 Long Term Investment Plan
4.1.1 CPF
CPF Ordinary Account (to convert investable portion to Nikko STI ETF 100 when it drops by 50% or more from historical high - 26 Aug 2013)
CPF Special Account (to convert investable portion to Nikko STI ETF 100 when it drops by 50% or more from historical high - 26 Aug 2013)
CPF MediSave
4.1.2 A Small Pension Fund with Mercer in Australia
to convert to EWA or stock index ETF traded in Australia stock market when the ETF drops by 50% or more from historical high - 26 Aug 20134.1.3 Monthly Dollar Cost Averaging (DCA) on STI ETF 1000 (Committed, ongoing, with Phillip Securities Pte Ltd)
Buy S$5,000 worth of STI ETF units through Phillip Share Builders Plan(SBP) by Phillip Securities on 18th day of every month irrespective of price. Started in May 2011 and ongoing, investment period - 30 years or more
Objective - To achieve 7 to 8% compounded annual growth rate (CAGR) consistently
Note - units bought can be transferred to margin account, if necessary, to increase purchasing power up to 3 times of net assets.
(To expand with supporting documents)
4.1.4 Long Term Stock Index ETF Investment (With Standard Chartered Bank Singapore)
STI ETF 1000 (with SCB, to continue to buy whenever the market looks bleak or pessimistic)
Nikko AM STI ETF 100 (with SCB, to continue to buy whenever the market looks bleak or pessimistic) (Nikko AM STI ETF 100 is the former DBS STI ETF 100. DBS Asset Management was acquired by Nikko Asset Management. Nikko AM is majority-owned by The Sumitomo Trust and Banking Co., Ltd., while DBS Bank Ltd is the second largest shareholder, controlling 7% plus. Employees also own a stake in the company.)
4.1.5 Dollar Cost Averaging (DCA) At Price Correction Levels of 50, 60, 70, 80, 90, 95% From Historic High (Plan, to implement)
Use margin account (why? - shares bought can be used as collateral for further DCA and short term trading as mentioned below in case cash is depleted during DCA at various correction levels).
Five excellent opportunities were created for long term investors like Warren Buffet to accumulate blue chip index funds (if available) and blue chips from the past 7 serious corrections in Singapore stock market in the past 32 years (I only have so many data) that we could take advantage of by using the method mentioned above.
STI achieved more than 100% profit each time in 4 out of these 5 excellent opportunities after corrections; While STI achieved 91% profit so far after the latest correction due to US financial crisis in 2008. STI achieved a profit as high as 181% (formula: (High after serious correction - DCA Price) / DCA Price = 181%) after a serious correction from high in Jan 1984,
114% after a serious correction from high in Aug 1987,
132% after a serious correction (caused by Asian financial crisis triggered by currency attacks by George Soros, a Hungarian-American Jewish financial speculator) from high in Feb 1996,
203% after a serious correction (caused by bursting of US Internet bubble in 2000 and 911 terrorist attack to World Trade Center in New York by Osama Bin Laden of Al-Qaeda on 11 Sep 2001) from high achieved in Jan 2000,
91% so far after a serious correction (caused by US Sub prime mortgage crisis and collapse of Lehman Brothers) from high achieved in Oct 2007.
In total, STI achieved a CAGR of 11.44% (formula: (2^5)^(1/32)-1 = 11.44%) assuming that we had bought STI 5 times and had achieved 100% profit on average each time in the past 32 years.
In fact, some profit could also be achieved from remaining 2 out of 7 opportunities created by serious corrections in the past 32 years. Although STI failed to drop 50% or more during these 2 corrections, but some large / mid caps could fall 50% or more and thus buying opportunities could still be created.
Some dividend could also be collected in the past 32 years.
Therefore, STI could achieve a better CAGR than 11.44% as projected above, which would be much higher than 7 to 8% compounded annual growth rate (CAGR) that was supposed to produce by means of "Monthly Fixed Amount Dollar Cost Averaging (DCA) on STI ETF".
Guess what will happen if we have another 5 times of serious corrections in the coming 30 years?
Just buy and hold until DCA prices double, our money will become 25.77 times of current amount ((formula: (1+11.44%)^30 = 25.77)! In other words, we will have 25.77 million dollars in 30 years if we have an investment fund of 1 million dollars now!
Targeted market - SGX
Targeted counters - STI ETF, Nikko AM STI ETF, majority of large caps (STI 30 components) and some selected mid caps
Targeted market - US Markets
Targeted counters - Large (>US$5b) and solid (fund buys index components only and diversified with many counters preferably more than 100) ETF's such as SPY MDY QQQ DIA EEM IWM EFA EWZ XLE XLF FXI GDX VWO IVV XLU XLK IWF VTI IWB IWD IJR IVW VGK IWR IJH VEU VEA VOO GLD SLV. Buy levels (retracing 50, 60, 70, 80, 90% from 2007 high) and placed alerts at 50% in the IB trading platform already on 04 Jun 2012.
Investment period - 1 to 3 years
TP - Doubling of DCA price or higher
(To expand with supporting documents)
4.1.6 Buy quality condominium during economic recessions / crises when price drops by 50% or more if fund is available then
Investment period - 1 to 3 years
TP - doubling of purchase price or higher
4.2 Short Term Trading Plan
4.2.1 Trade long using margin A/C
Trading conditions
Trend is up (SMA50 > SMA100 > SMA200 and all must point upwards) and price breaks out of double bottom formation
Targeted Market
SGX, HK, US, KL(if chart is available), UK (if available for trading)
Targeted counters
Large caps and selected SG mid caps
Trading platform
Poems / Poems ProTrader / IB
Order type
Limit / stop / stop limit
SL
Stop loss, to place stop limit order daily if possible
TP
To be determined by trailing stop if possible
Note: A few stocks, COSCO Sinagpore, NOL, Noble Group, Nam Cheong, bought a few years ago are still in the margin trading account with Philip Securities Pte Ltd icluding. Nam Cheong is in paper profit. I believe the other three will recover their paper losses sooner or later in the future. In addition, there is about S$24k invested in the Phillip Securities Managed Cash Fund (MMF).
4.2.2 Trade short using CFD A/C
Trading conditions
Trend is down (SMA50 < SMA100 < SMA200 and all must point downwards) and price breaks out of double top formation
Targeted Market
SGX, HK, US, KL(if chart is available), UK (if available for trading)
Targeted counters
Large caps and selected SG mid caps
Trading platform
Poems CFDTrader / IB
Order type
Limit / stop / stop limit
SL
Stop loss, to place stop limit order daily
TP
To be determined by trailing stop
5.0 FAQ
Why buy CPF Medishield instead of Private Medishield or private health plan?
Former NTUC Income chief TKL explained excellently, to attach what he said.
Why trade HK, US, UK (if possible) and KL markets also?
To have sufficient number of large caps so that more potential opportunities can be identified since the trading conditions set above are very stringent and thus opportunities are rare if no at all. Trading setup with stringent conditions produces high probability rate of success (as high as 80%) (to expand with supporting document).
I met this problem and made no money from 2009 low so far despite I have an excellent trading system because I focus on Singapore market only but opportunities here are rare. When I looked at other markets such as HK and US, there were many opportunities that had met the stringent conditions mentioned above!
Why not trade Forex any more?
Real trading with Poems (lost about S$10,000) and Demo trading with Oanda (Lost about US$12,500 of fake money given by Oanda) in the past few months indicate that forex was not or will not be a cup of tea for me. US$12,500 in total was lost even though my risk per trade is S$100 to 300 only for demo trading!
On the other hand, equities are more stable and more predictable.
I am more comfortable with equities because I know many good opportunities will still be out there in the future.
(Update to be continued...)
6.0 Reference
S&P 500 Price (Inflation Adjusted)
S&P 500 PE Ratio
Risk management
The 3 Secrets of Margin Trading - Position Sizing, Risk Management and How to Track Total Exposure
Position Sizing
Position Sizing: How to Limit Risk & Maximize Gains
STI ETF
4 Reasons to invest in STI ETF
Why and How to do long term investment in STI ETF using Dollar Cost Averaging Method?
Nikko AM STI ETF, Investment Plan
Buy STI ETF Using Dollar Cost Average Method
Trading System
The most profitable and safest trading system in a bull market
New dummy trading system
Reflection on Trend - 08 Nov 07, Thu
TA Essence in my trading system
Historical Teaching
疯狂的代价：世界上最惨烈的几次股市大崩盘
Labels: CFD, Dollar Cost Averaging, ETF, Health, Margin, plan, Position Sizing, Risk Management, STI ETF, Stock Trading System, Thoughts
18 July 2011
DBS STI ETF 100
bought 100 units at 3.11.
starting to implement a 5 year plan to deploy / invest S$500k in STI index only using dollar cost averaging method to achieve a stable and predictable long term return (CAGR of 7 to 8%). Investment period will be 20 to 30 years. This plan will be executed by myself.
another plan (SBP)is with Poems to buy StreetTRACKS STI ETF 1000 to diversify.
the remaining capital will be used for short term trading (long), CFD shorting in bear market and Forex trading.
starting to implement a 5 year plan to deploy / invest S$500k in STI index only using dollar cost averaging method to achieve a stable and predictable long term return (CAGR of 7 to 8%). Investment period will be 20 to 30 years. This plan will be executed by myself.
another plan (SBP)is with Poems to buy StreetTRACKS STI ETF 1000 to diversify.
the remaining capital will be used for short term trading (long), CFD shorting in bear market and Forex trading.
Labels: Live Trading Records, plan, STI ETF
26 September 2008
I continue reviewing historical charts on those buy setups and short setups and their further development after breaking out for future trading reference.
Labels: plan
18 April 2008
Live Trading Records for 14 Apr 08, Mon
E8GW HSImblECW080429P bot .405, added .39, sold .375
Live Trading Records for 15 Apr 08, Tue
E8GW HSImblECW080429P bot .345, sold .34 since chart is down thus can not manage risk properly without looking at the chart since I was in dark without chart, sigh
Ending of Full Time Trading
mmmmm...it's so difficult to make money nowadays. I'm looking at the 3 year charts to go over the past glorious days - nice trends, beautiful chart patterns, breakouts - the good old days, made tons of money every day! trading capital increased every day! bot what, what rose!
will the good old days come back? - definately! time will prove that again.
but for now, it is not possible. hope brother bulls can come back as soon as possible.
I plan to find a solid job to tide over the bear market period - I had to make this painful decision today after days of disapointments to my trading performance. my agent will arrange a job interview for me soon. the monthly pay is not bad, close to 5 figures, of course can not compare with huge trading gains in the good old days. I plan to use ProTrader to execute my orders during my day job period.
I think it is prudent to secure a solid job considering impending storms in the real economy although my current capital can tide my family over many years to come.
saddly, another full time trader is about to disappear from the bear market!
but temporary disappearance is for long term appearance and survival in the brutal marketplace.
Live Trading Records for 16 Apr 08, Wed
E8GW HSImblECW080429P bot .38, sold .385, bot .35, sold .34, dropped to .315 swiftly from .365 after buying, I'm really fed up with this game!
Live Trading Records for 17 Apr 08, Thu
E8GW HSImblECW080429P shorted .415, covered .41, US / Europe mixed
Live Trading Records for 18 Apr 08, Fri
E8GW HSImblECW080429P shorted .41, covered .395 , bot .37, sold .375 , .385 / .39 seen, bot .37, US / Europe futures not bad, sold .385 , MM to disappear soon
E8GW HSImblECW080429P bot .405, added .39, sold .375
Live Trading Records for 15 Apr 08, Tue
E8GW HSImblECW080429P bot .345, sold .34 since chart is down thus can not manage risk properly without looking at the chart since I was in dark without chart, sigh
Ending of Full Time Trading
mmmmm...it's so difficult to make money nowadays. I'm looking at the 3 year charts to go over the past glorious days - nice trends, beautiful chart patterns, breakouts - the good old days, made tons of money every day! trading capital increased every day! bot what, what rose!
will the good old days come back? - definately! time will prove that again.
but for now, it is not possible. hope brother bulls can come back as soon as possible.
I plan to find a solid job to tide over the bear market period - I had to make this painful decision today after days of disapointments to my trading performance. my agent will arrange a job interview for me soon. the monthly pay is not bad, close to 5 figures, of course can not compare with huge trading gains in the good old days. I plan to use ProTrader to execute my orders during my day job period.
I think it is prudent to secure a solid job considering impending storms in the real economy although my current capital can tide my family over many years to come.
saddly, another full time trader is about to disappear from the bear market!
but temporary disappearance is for long term appearance and survival in the brutal marketplace.
Live Trading Records for 16 Apr 08, Wed
E8GW HSImblECW080429P bot .38, sold .385, bot .35, sold .34, dropped to .315 swiftly from .365 after buying, I'm really fed up with this game!
Live Trading Records for 17 Apr 08, Thu
E8GW HSImblECW080429P shorted .415, covered .41, US / Europe mixed
Live Trading Records for 18 Apr 08, Fri
E8GW HSImblECW080429P shorted .41, covered .395 , bot .37, sold .375 , .385 / .39 seen, bot .37, US / Europe futures not bad, sold .385 , MM to disappear soon
Labels: Live Trading Records, plan
