Why Singapore investors always lose money in shares

For the past few years, there has been a proliferation of young investment bloggers in Singapore. While I am not sure if this is a good phenomenon, it certainly reflects a growing interest in the stock market among young Singaporeans. However, have you paused to wonder why Singapore investors always lose money in shares?

Many years ago, a veteran in the stock market told me that when taxi-drivers, housewives and students start to dabble in shares, it’s a warning sign that the market has peaked. In fact, for the past few years, the stock market in U.S. has rallied and surged to multiple highs. Entering the market during this boom period can be dangerous because many stocks have risen beyond their fair values. In such case, the return of your money is far more critical than the return on your money.

You must have heard of Warren Buffett’s famous quote “be fearful when others are greedy, and greedy when others are fearful”. To be frank I am not sure whether Warren Buffett practice what he preached because in reality, nobody knows how he invests behind the scene. In reality, telling this to someone who try to find value stocks in the current market is akin to telling a horny male to remain celibate, and thus, I often find this quote unhelpful.

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17 Proven Currency Trading Strategies – How to Profit in the Forex Market

What is leverage all about and how do investors take advantage of money-making opportunities in the forex market to earn high returns? These two questions had been bugging me for many years since I started my wealth building journey.Indeed, most people are aware that trading in forex is highly risky and is considered not suitable for amateur investors. But I think to be a good investor, it is important to equip myself with knowledge on various financial instruments. My guiding principle in life is that if you don’t learn anything new everyday, you have a bad day.

With an average of $4.3 trillion exchanged daily, the forex market is considered to be the largest market in the world. Given the sheer size of this market, it would be foolish to ignore the impact of forex, never mind whether you are finance or business professionals who are not currently involved in forex trading.

Always remember that capital flows into a country first before it flows into any financial assets. This is the reason why some local listed companies declared their earnings in foreign currencies in their annual reports instead of Singapore dollars. The exchange rates can have significant impact on the business impact and this is something that investors and business owners can ill afford to ignore.

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The Little Book of Market Wizards: Lesson from the Greatest Traders

Being a value investor, I buy shares of growth stocks at a price below or near it’s intrinsic value. Even though I am not a trader, I believe it is important to keep an open mind and understand the insights and strategies of traders. This is because  whether you like it or not, there will always be speculators and traders in the markets. Their behaviors and actions will invariably affect market performances and impact the way you make money in the markets.

In The Little Book of Market Wizards: Lesson from the Greatest Traders by Jack Schwager, I realized that there are many relevant investment principles that are useful for investors and wealth builders. For example, to be a successful trader, you need to manage your ego and develop a set of trading methodology that best suits your character. The important thing to note is that losing money is part of process and you can never win all the times. This principle is applicable to investing as well. Most traders and investors lose money in the stock market because they try to avoid losing money. On the other hand, professional traders who become rich from stock market understand that they have to take losses in order to win the game.

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The New Retirementality

http://www.wiley.com/WileyCDA/WileyTitle/productCd-1118705122.htmlHave you ever wondered how to build your wealth effectively in Singapore? One of the latest additions to my blogroll was “Growing your tree of prosperity”. The author of that blog, Christopher Ng had apparently made enough money to quit from his engineering job and retired at the young age of 39. However, money is only one side of the equation. He is currently busy studying for a law degree to prepare himself for a second career in life. His story inspired me and resonate the teachings in Mitch Anthony’s The New Retirementality (ISBN: 978-1-118-70512-4)Originally written to get the attention of baby boomers, who were approaching 55, author Mitch Anthony started a revolution by showing people why they need to have a new attitude about retirement – a “new retirementality”. More than a decade later, many people are facing a very different retirement reality than previous generations – failing pensions, an endangered social security system, and inadequate savings. They have been forced to face the reality of a retirement that may never happen, or one that will take place much later in life than ever expected.

While most books focus on a “number”, this reliable resource shows readers that attitude is also an essential part of the equation.

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The Warren Buffett Way (New Third Edition)

Over one million copies sold in cloth and paper formats of the two previous editions, a New York Times bestselling book, The Warren Buffett Way, is now completely revised to cater for the new generation of investors. With additional chapters on the important distinctions between investment and trading; and the examination of Buffett’s most successful disciples, the third edition focuses on the timeless principles and strategies behind Buffett’s extraordinary investment success. 

The Warren Buffett Way, + Website, 3rd Edition is bundled with a companion website, www.thewarrenbuffettway.com, an interactive resource which offers an array of information to facilitate investors with putting Buffett’s approach in practice. It also comes with two supplemental materials which are a workbook, The Warren Buffett Way Workbook, and software, The Warren Buffett Video Course; each sold separately.

Author Robert G. Hagstrom’s authoritative and detailed interpretation of Buffett’s investment methods in The Warren Buffett Way, + Website, 3rd Edition provides essential insights into the psychological challenges of managing a Warren Buffett portfolio as well as the role of patience in long-term investing.

The suggested retail price of the The Warren Buffett Way, + Website, 3rd Edition (hardcover) is US$29.95; e-book (oBook, ePub, Adobe PDF and MobiPocket) is US$19.99; and The Warren Buffett Way Workbook and The Warren Buffett Video Course are priced at US$39.95 respectively.
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Value Investing in Growth Companies

One of my readers recently wrote to me requesting my views on a few Reits in Singapore. I have not replied him but followers of my blog would know that I don’t believe in Reits and have never invested in any Reits before. This is because the business model is too complicated for me to understand. In this article, I will share my thoughts on value investing.

One of the most important things that investors have to realize is that a good stock must have a simple business that are easy to understand. For example, we know that Super Group sell instant coffee and SingTel provides telecommunication services. Many investors, especially the novice ones, rush to invest in Reits simply because they thought that Reits provide dividends, so Reits must be a form of good dividend. They fail to understand the real business model and if you prodded them further what is Reits all about, they would be clueless. It is like putting the cart before the horse and missing the forest for the woods. To this end, I will like to recommend a good investment book for my readers.

A Unique Guide to Wealth and Financial Independence Using Value Investing Strategies

Many people spend their life working for active income.

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Build a New Investing Brain

Since young, I always thought that there must be a scientific approach towards investing. I don’t believe that intelligence play a part when it comes to investing because I have seen many smart professionals lost their hard earned money in the stock markets. I have also seen not-so-educated friends making huge piles of money from their investments. So the perennial question: is investing a form of art or science?
While we cannot change the external environment, we can certainly control our own thoughts and actions. Many people mistakenly thought that the market is our greatest enemy. Actually they are wrong. The greatest enemy is yourself. Your decisions, thought processes, actions and personal experiences shape your investment destiny. To truly succeed in investing, we must know our own self and do self-assessments. Otherwise, it will be very hard to change the way you think in order to change the way you invest.

As an investment advisor to high net worth individuals, Wai-Yee Chen has spent years watching her clients make investment decisions—some good decisions and some not-so-good decisions. Though confronted by the same market variables, those clients often make very different choices with very different results. Here, Chen argues that it’s usually not the data that affects investor decision-making as much as the way investors themselves think.

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A Unique Guide to Wealth and Financial Independence Using Value Investing Strategies Singapore

Many people spend their life working for active income. They are either ignorant or skeptical about stock investments. Even those who have invested their money, more often, entered into less effective methodology of making money in the stock market. They go for quick money gains and end up losing their net worth by speculating in the market. However, according to authors Victor Chng and Rusmin Ang, the odds can have a better likelihood if one knows what sustainable methodology to use.

In their newly revised book, Value Investing in Growth Companies: How to Spot High Growth Businesses and Generate 40% to 400% Investment Returns, Chng and Ang explore a unique way of analyzing companies using value investing strategies. This unique and simple methodology, called the “Jigsaw Puzzle model,” is broken down into four segments, namely Business, Management, Numbers and Valuation. The authors introduce this concept for building an accurate picture of a company before deciding whether or not to invest. It also forms the basis for investors and traders who want to generate multiple returns in the area of small and fast growing companies to achieve the wealth and financial independence they want and deserve.

The strategies discussed in this book are designed to create a relatively stress-free method of creating a secondary source of income.

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Value Investing

Last night, I read the investment book, “The Value Investors: Lessons from the World’s Top Fund Managers” for the second time. The Value Investors contains a lot of useful investment insights from successful fund managers and value investors, so I strongly recommend the book to investors, especially newbies.
Indeed, hands-on experience is important when it comes to stock investments. But then again, having the right knowledge on security analysis will certainly reduce the learning curve needed for picking the winning stocks.

Investment wisdom
Nobody can claim to beat the stock market consistently but it is important that you learned from your investment mistakes. Three investment wisdom gained from Irving Kahn, one of Benjamin Graham’s disciples, is that in order to succeed in picking the winning stocks, you need to have patience, discipline and skepticism.

To many, these three traits seemed straightforward, logical and common sense. But when it comes to real life application, many investors (including myself) were guilty of not following these rules. Very often, we would be tempted to invest in certain hot stocks after reading good reviews from analysts. We fear that if we waited on the sideline for too long, the opportunity to buy cheap and make profits would be gone.
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Financial Independence (Getting to Point X)

Below is a press release on Financial Independence (Getting to Point X), a personal finance book. Readers can pick up valuable tips on how to manage personal wealth. 

Written by John J. Vento, an expert with decades of experience helping people of all walks of life realize their dreams of financial independence, Financial Independence (Getting to Point X): An Advisor’s Guide to Comprehensive Wealth Management (Wiley; March 2013; 978-1-118-46021-4) arms you with the knowledge and tools you need to get to your Point X—the point at which you no longer have to work for your money but where your money works for you.

Throughout our lives, we will encounter many questions and problems relating to money, but every one of them will fall, in some way, under one or more of the 10 Key Wealth Management issues addressed in this book.

No matter how you define your particular path to financial independence or “Point X,” whether it is an annual income of $25,000 or an estate of $250 million, you need to not only understand but effectively deal with 10 fundamental wealth management issues. They are:

  1. Committing to living within your means and conscientiously saving for the future;
  2. Understanding taxes and how to effectively minimize your tax obligation;
  3. Realistically defining your standard of living, including your net worth and your current cash flow;
  4. Managing debt;
  5. Insuring yourself and your family in case of extreme illness or death;
  6. Protecting your property;
  7. Planning for the education of yourself and your children;
  8. Investing intelligently and productively;
  9. Planning for retirement; and
  10. Preserving your estate.
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The Value Investors: Lessons from the World’s Top Fund Managers

When I was approached to do a book review on “The Value Investors: Lessons from the World’s Top Fund Managers” last year, I was quite hesitant because I don’t believe in fund managements. As a self-style investor, I prefer a more hands on approach to investing. Even if I lose my monies, at least I learnt some lessons out of my investment mistakes. However, when I chanced upon a review by another fellow blogger, I changed my mind.

Apparently this book is an investment-biography book which features interviews of twelve value-investing legends from around the world, learning how their personal background, culture, and life experiences have shaped their investment mindset and strategy. These men, who became strong advocates of the approach despite considerable age and cultural differences, include: Mark Mobius, Irving Kahn, William Browne, Teng Ngiek Lian, V-Nee Yeh, Shuhei Abe and many more.

The book’s focus is on the investment techniques and approach of value investing. The content is engaging and unravels how these investors, each of whom has a unique value perspective, have consistently beaten the stock market over the years. The book attempts to answer some pressing questions such as “Do these value-investing legends share a trait that allows this to happen?”,

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