Tuesday, January 6, 2015

Red Red Red!!!

Hi Everyone!

If you have notice, nearly all the stocks today (Singapore Stock) turn RED! Although there is not much different (most of the blue chips drop less than 5%) but seeing all red can be seen as a opportunity for investors. Well certainly, it is not really a good sign but if we take a look at another angle it can be a good opportunity to buy in new stocks! This will drive down your average price per stock which will increase your dividend yield. 

So do not be sad if the stock that you are holding fell, but use this chance to purchase a bit more to see whether it will drop in a huge margin. As for those who are holding into shares which is related to oil, do be careful because oil price is decreasing like mad. So you will have to do your own study and make your own decision on what to do with your stock. 

For investors investing in blue chips, it is important to understand the business nature as well as the probability of it affected by the decrease in oil price. Certainly, those stable stock (Singtel, M1, DBS, CapitaMall Trust, ST Engineer) their stock price will drop but they will eventually recover (that's what I believe). Even if it does not recover, or stabilize in a cheaper price, for me I would  purchase it to average out your price and increase your dividend yield instead. (This is just the technique that I will use, although you might have paper loss but you will have higher dividend yield - balancing out I guess)

So better take note of your own stock these few days and do some homework to determine your next step.


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