I hope to educate more readers on the importance of long-term investing, as I realised many around me are still very new to this term. Some are afraid of it, and others are avoiding it. If we continue to put our savings in the bank, we eventually end up losing more money due to inflation, and this will definitely jeopardise our journey to financial freedom.
Please help to spread the investing habit to your loved ones. Thank you to all my readers for staying with me, given the infancy stages of my site. Rest assured that I will keep writing to provide good information.
In order to expedite the education process, I will be providing links to good investing blogs to share more knowledge to our community. I have added a new link under 'Good Reads', which demonstrates good value investing by Musicwhiz.
I really hope to bring more like-minded individuals into the investing community in the years to come. Cheers!
Thursday, January 24, 2008
Long Term Investing
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5 comments:
Any stock recommendation for this downward plunge in SSTI, (with the recovery today).
What is your target for SSTI ? grounds for that ?
Hi,
I agree with your view that one should stay invested with good coy that pay high dividend. With the current volatile mkt, how can we justify holding a stock for a 5% dividend with a price swing of 5% per day?. Thanks to share your view.
hi anonymous, I am still optimistic about 2008 and I feel this year will end up in positive grounds, so maybe capped at around 10% and my guess will be 3800. Comparing HK and SG markets, the PE valuations of SG companies are really trading at very cheap price, especially the S-shares. I personally favour S-shares as they provide good growth potential and there are always catalysts associated with China companies. Try to take a look at cash-rich with low-debt companies, they provide good opportunities. Possible candidates are China Sky, China Milk, China XLX, China Sun Bio, Sino Techfibre.
Hi anonymous, many investors will agree that it is good to hold high dividend companies in current volatile markets, because even though there is no capital appreciation, shareholders are compensated minimally in the form of dividends.
However, my personal optimal scenario will be the management re-investing the profits into the company and not distributing any dividends (similar to the practices of Berkshire Hathaway and Google). These companies will actually bear more fruits at the end of the investing journey if the management is able to generate more returns on the additional capital.
As for the justification of holding a 5% dividend with a price swing of 5% per day, guess an investor who is confident of his holdings will be delighted to be able to buy more at cheaper prices. Probably he will snap up more shares if the price drops 50%, since in retrospect, the dividend yield goes up a 100%.
End of day, it really depends on an individual's risk threshold and his/her ability to deal with market volatility. My advice to those who are badly affected by the recent volatility will be to withdraw your holdings and preserve your capital for this period. Remember, the market will always be there, so take a break and stay sidelines when needed. =)
Good ideas!
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