 Linda Tay heads the Operations and Human Resource department of a corporate advisory company. I AM NO expert, I don't do candle sticks analysis but I will like to share what works for me. This is for my personal sharing only and please do not take offence should your opinions differ. I don't see myself as a trading but investing. What I do is save cash and during a bear market, I will start buying. My preference are bank shares and I only stick to specific banks that I buy/ sell. That's my approach for the last 18 years. I don't contra and ensure I can pay off the shares I purchase. When markets are bad like this, price fluctuations happen, hence to be able to hold the shares is important. I have learnt I can't predict when the market bottoms out, when I can buy at the lowest, or when I can sell at the highest. My strategy is to buy a couple of lots, then when the price plunges further, accumulate some more to average out. Once you buy, no need to panic and offload when the price drops further. Once it bottoms out, the big players will come in to buy and it will appreciate. During a bull market, I will also set a target price to sell, it doesn't matter if someone can sell it at $10.00, I will sell at $9.00, as I have bought in large quantities.
In the interim, while I hold the shares, there is still dividend income. Do note not all shares pay dividends as the company must be profitable to do so. Why invest in banks? I believe MAS regulates our banks with strict compliance and won't let them collapse. I do not believe in penny stocks as many listed companies are family-controlled, hence the board of directors may not act in the best interest of the rest of the minority shareholders. The best time to accumulate wealth is in bad times, it takes courage to step out of your comfort zone to make $$$. Good luck all, as the market opens again next week and may the force be with you! |
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On how I feel about penny stocks: Banks are accountable to stakeholders, major ones who have the power to sue them and at AGMs there is definitely good attendance which shows stakeholders are taking their stakes seriously. Banks have been paying dividends, they have strict compliance, corporate governance. The executive board is a separate team from the management. |
Comments
Currently my top pick property blue chip are CITYDEV trading below RNAV $9.53+ while bank will be DBS below RNAV $15.2+
What I do is to target an amount to save annually that I use these funds to buy bank shares and I spread my basket between the banks.
I do aquire SGX shares if I have excess funds, only in bear market and sell during bull. They do pay decent dividends.
Not that other shares are not good, and hence I do not but them. Time is a luxury to me, so I can also concentrate on 1 sector, which also relates closely to my trade. I do have a good broker to advise me, but ultimately I have to do my own homework and decides if I should proceed with the purchase.
As with my company, I believe in focus. There are only that many banks in Singapore listed on SGX, its easy to follow on any adverse media, announcements, reading the financials. Using my own firm as an example, My secretarial team focus on company secretarial matters, the accounting team- preparing accounts, tax team- focus on tax etc.... If I allow anyone to have dual roles, which I have tried, they are not efficientl. Jack of all trades , master of none.
Thus, I agree with Linda that there is no issue concentrating her investments in the banks only. What she is doing is to buy low and sell high taking reference from the conditions of markets (bull and bear) and pre-set target prices when she buy or sell shares. She has a methodical approach to her buying and selling which she constantly sticks to minimising emotions out of her decision making. I believe she must have been reasonably profitable in her investment approach so far over the past 18 years. So long as her average yearly rate of return from her dividends plus capital returns is consistently good over the years (at least 10% and more per annum), I believe it is already good enough.
May I ask if you have always invested this way? Or you had prior experiences which used different approaches with different results?