Saturday, 19 March 2016

What am I doing during the recent STI rally?


Since the start of the year, it has been like a roller coaster ride for STI Index. See above diagram. It was 2883 points from start of year 2016, then the panicky slide to trough at 2532 points (late Jan to Mid Feb) before the recent raging rally above 2900 points.

In a recent interview of Bloomberg with Ray Dalio, he mentioned that it is unlikely that the world economy will go into a recession like what we encountered in 2008-09, but it is likely that the market will be volatile up and down in a low growth global environment for some time.  

Busy in work and quiet in stocks

While I am aware of the recent rally, I have hardly any time to pay too much attention on it. In other words, no action in my stock trades. It has been an extremely busy last month for me with travels to Australia, Europe and then this week with overseas visitors followed by upcoming Malaysia trip.

A big piece of news for me in work is my boss for only the past year, whom I had excellent relationship with, has tendered resignation. I was hence tasked with more responsibility on my shoulder by the higher management.

Wait a minute… Nope, this is neither a promotion nor a pay rise! Instead, just added responsibility and yet with higher expectation to do well.

Definitely not good news for me!

Moreover, I will now need to accustom to a new superior, someone who I does not know well at all. Apparently my current new boss is already the fifth one in the last 3 years for me. Crazy right?

This explains why I am pretty quiet in the blogosphere and stock market lately and expects somewhat the same going forward.

Get the mentality right

Meanwhile, in the depressed oil and gas environment which already see many people being shown the door, anything can happen to me as well.

No iron rice bowl!

I am always mentally prepared so that if the big axe is waved down on me, I will still survive the chop both financially and mentally! Which is why I am being very prudent in my expenses and stock-cash position since last year. Read:


Sell into the rally

In fact it is not a bad thing to be dormant especially in “purchasing” new shares during this STI rally. More so, I reckon that now is a good time to sell the rally for stocks that is mainly meant for trading purposes! For me, I had sold quite early when STI surpassed 2800 points in early March. Refer to my earlier post here.

Did I sell too early? Yes I did!

Did I regret it? No, I didn’t.

This is because you simply cannot time the market. Moreover, I will be too busy always not in office to properly execute the sale of shares. This is also an issue that if you are busy in work, you should not be doing too much trading, and focus in long term investing!

What should I do now?

For now, I will be patient to wait for the next downtrend to pick up more shares, if there are any!
If the rally continues, it will be good for my existing portfolio in terms of paper value. Similarly I may be prompted to sell more shares.

Alternatively, I can also spend more time focusing on work, which I expect to be very hectic going forward. That is if I still stay employable!

Most important of all is to spend more time with my kids and wife which I has been guilty of spending so little time with lately. 

How about you? What are you doing in the stock market right now? 

13 comments:

  1. Hi Rolf, in my experience the cash flow from salary is the one keeping us from frequent meddling of our investment portfolio. When we're not depending on the investment, indirectly we're giving it time to grow.

    Everything will be beautiful in it's time.

    ReplyDelete
    Replies
    1. Hi Yaruzi,

      I totally agree with you. Frequent meddling of our investment portfolio is never going to do us good because frankly it's not easy to have tactical allocation for retail investor and yet beat those of professional investors. So to me, the best way is to create a balance and well diversified portfolio and let it grow over long term.

      However, I split my portfolio into core portfolio which I don't meddle with and let it grow and also cater few portion of it for trading to have some fun in the up and down. But for those in trading I am prudent and will take profit earlier even when it is going to be marginally lower.

      Delete
  2. Any performance bonus this year from work?

    ReplyDelete
    Replies
    1. Hi EH,

      Yes for last year, thanks to my superior who resigned. And probably because he fight too hard that the top were not happy, because business in Oil and Gas is errr bad..n need no explanation!

      Many people are already on pay cut or struggling to keep their jobs.

      How about yourself?

      Delete
    2. Thankfully yes. This year must 'pia' even harder!

      Delete
  3. Rolf,

    Bulls and Bears both make money ;)

    You buy the dip; sell the rip.

    I sell the rip; buy the dip.

    LOL!



    ReplyDelete
    Replies
    1. Hi Jared,

      Totally agree.

      The issue is most retail investors are systematic buyers who only go long adopting the "value investing" style.

      Yes, if u have the flexibility to go both ways, that is when there is no such thing as a "bad market!"

      Unfortunately to go both ways, perhaps u require more guts, more deeper pocket, and also more time n skills in the market than part time retailers!

      I belong to the part time retailer :-( and u r the former who can go either long or short!

      Delete
  4. Like you, I have some stocks that I keep long term because they give me good dividends. I have 70% cash at the moment. If the market drops, I will acquire more stocks. I am into dividend investing in both SG and overseas stocks.

    Renewed investor

    ReplyDelete
    Replies
    1. Hi Renewed investor,

      Thanks for visiting. It seems like a good strategy and I hope that you are successful.

      But at some point 70% cash can be very high, subject to individual situation. For me, I have quite high expenses and because of the depressed O&G industry I am working in, I try to keep more cash. Bear in mind that Cash can be bonds as well.

      Diversified portfolio is good and most importantly, we must be very prudent in the current environment and not make risky bets!

      Delete
  5. Hi Rolf, I am building up my war chest as market rally. Meanwhile waiting for the next opportunity. OUE H Trust is issuing rights, I may subscribe to it.

    ReplyDelete
    Replies
    1. Hi Sweet Retirement,

      Sounds like a sensible strategy to build up a warchest as market rally. I am not familiar with OUE HT. Hmm... Hospitality sector Reit/Trust seems like suffering a bit more relative to the rest of the Reit sectors, Issit?

      Delete
  6. This comment has been removed by a blog administrator.

    ReplyDelete