What Is A Good Investment Plan (Part Two - Goals)

Hi Everyone,

This post is the continuation of the "What Is a Good Investment Plan" - Part One - Financial Needs. 

Question on what Is A Good Investment Plan?

Recently (After I posted the part one on what is a good investment plan), I have received emails on asking that why a good investment plan requires us to know the financial needs, goals, liability and etc. rather than finding a high returns in both capital and dividends, isn't that the most important thing? 

Of course, high capital gain and dividends will certainly be welcome by me (who wouldn't want to earn more right?), however,  the "Give and Take" analogy still exist in investment plan. Whatever the investment plan can give you (interest, dividends and capital gain) there is always something that you will need to give in return (time, money, energy and etc. depending what kind of investment plan are you taking)

For example, if you purchase a saving plan, you will need to take into consideration of the monthly payment, the duration whereby you are unable to touch the money, the consequences of breaking the contract and etc. So understanding the "Give and Take" analogy, you will have to asked yourself, whether is this a good investment plan for you. Thus, you will have to study your own financial capabilities, liabilities, everyday needs and what is you goal that you would want to achieve.

Certainly, different people will have different ways to measure what is a good investment plan. Some might include the rate of return (the higher the better, ignoring the risk involved) and etc.

So without further ado, lets continue with the part 2 of "What Is A Good Investment Plan"!

What Is A Good Investment Plan - Part 2 - Goals

Having a goal for investment planning is important because it can help you decide whether what kind of investment plan that you can go for. For example, your plan is to be able to save up enough money for your child's university fees in 20 years time. So certainly, you will have to look for some saving plans so that you can contribute a sum of money to the plan so that you will have sufficient money for your child's school fees. 

Another example is that, you want to have a passive income per month so with that passive income it can help to offset your monthly bills or even offset your monthly expenses without risking much of your capital. For this, you will have to do shares investment, bank interest like OCBC 360, UOB ONE or BOC SmartSaver account for high interest and etc. 

So as you can see, there are many ways of creating an investment plan. However, a good investment plan requires you to really understand what you want to achieve so that you can have a better idea on which plan to go for.

Setting Your Goal

Setting goals isn't as easy as you think as you might think that we just write down whatever we hope to achieve and that will be the goal for me. This is a true statement however, if you set your goal too far, you will lose sight of it and naturally forget about it. 

So the trick to set your goals is to split them into different milestone or different terms. For example:

The picture above shows a short term goal / one year milestone of my personal goal, this will push me harder to reach this milestone before moving on to the next one. So let's compare with this goal setting:

I hope to generate $80,000 per year with my passive income with 2 private properties so that I can retire comfortably. 

If you compare these two, the second one will take years to achieve, if you are just a normal salary worker in Singapore. so naturally, you will either become too aggressive which resulted in loss of money or you naturally forgot about the goal you have set for yourself because it is too far away from your current status.

So setting your goal into different milestone will be an idea way of monitoring your progress and enables you to have the push to reach your goal!

So with this, you will be able to know what type of investment plan you should be aiming for and to further decide which investment plan you should go for, the other two factors will need to come into play which is the financial capability (current savings and income) and liability (loans, debt and etc.)

What Is A Good Investment Plan (Part One - Financial Needs)

Hi Everyone,

Before we move into this topic, it is essential for the readers to know that I am not a certified financial consultant or adviser, just a normal financial blogger who is sharing my own experience when it comes to financial savings and planning. So do not 100% follow my view on this matter and it is always better to do your own research. 

Okay, now let's come to my view on what is a good investment plan. Before we dwell into this topic lets first understand what is an investment plan

Definition on Investment Plan: 

The placing of funds into the proper investment vehicles based on the investor's future goals, time horizon, and priorities. This also takes into account the safety of the investments as well as liquidity and level of return. Ideally, proper investment planning will allow the investor's funds to produce financial rewards over time.

Source: http://www.investorwords.com/11657/investment_planning.html

With this definition, so what is a good investment plan? Personally, I believe that a good investment plan is a plan which can address your financial needs and goals that are within your financial capability and liability. Once you can address the 4 components above, you will be able to start planning for your investment plan. 

Financial Needs

So let's start with financial needs, for financial needs, this is where your monthly expenses, come along. You will need to set a side some of your monthly budget in order to maintain your currently lifestyle.

Budget/Expenses

So with a typical point of view, it will be something like what I have for myself as shown in the picture below, whereby I keep track of my monthly expenses. This will be my initial budget for my financial needs. 

So after getting your budget, which is the first step, you will have to follow it through for a few months in order to ensure that this budget can fit into your lifestyle. So while you are working on your expenses, there are somethings that you can take note of which is the area that you can reduce your expenses without sacrificing your lifestyle needs. 

Reducing Expenses without Affecting Your Lifestyle

Many people will asked, how do we cut down our expenses without affecting our lifestyle? Certainly, there are many ways that you can do it, by firstly cutting down those monthly recurring expenses. Let's take an example of the following expenses

Mobile Plan: $62.90 - 3GB data per month

Netflix subscription - $16.98 - Premium Plan

Internet Subscription - $59.90 - 1GB Fiber plan

Gym Membership - $128 per month

So, the above expenses are the common things that we use and pay for in our current life, so we can start off by reducing the expenses for each individual item. 

Mobile Plan: $62.90 - 3GB data per month - Change to another Telco, with the same data per month for $42 per month - $20.90 reduction

Netflix subscription - $16.98 - Premium Plan - Change to standard plan for $13.98 per month if you do not have HD TV - $3 reduction

Internet Subscription - $59.90 - 1GB Fiber plan - Change to another Telco with 1GPS for $39 per month (If you only use it to watch video and surf net, not necessary to get such an expensive plan) - $20.90 reduction

Gym Membership - $128 per month - If you are not a frequent Gym goer, can consider using pay per usage community gym which is around $3 per entry. ($3*30 = $90 - provided you go to gym every day) - $38 reduction or subscribe to cheaper gym plan

If you take a look at the reduction, and you still maintain your current lifestyle, with this slight modification, it can help you to save around $80 per month. Although it looks little but every single bit counts.

Finalized Monthly Expenses

After adjusting your monthly expenses, you will have your tentative budget for your financial needs. Do it for a few months and you can see that you can save more money and cut down your monthly expenses without affecting your lifestyle. This will be your financial needs for per month basis. 

So with this, you are one quarter towards the start of planning for your investment plan.

Price of Retirement

Hi Everyone,

Today I have come across an interesting blog which talks about the price of retirement. Price of Retirement. Understand that there are many blog are talking about how much money or should I say how much passive income should we go for before we can retire comfortably. 

Retirement can be very costly because when you officially declare yourself as a retiree, not only that your source of income will be gone but also you will have ample of time thinking of what to do. I understand that many people will not think the latter as a problem. Really, why should I complain if I can slack at home watch TV, wake up late and go for a good breakfast while others are rushing for work.

So each of us has a price for our retirement, so what is mine? and what is yours? 

Mine is basically very simple, I would need 2.5 times the amount that I intent to spend per year, in other words, if I spend around 1.1k per month, plus my family expenses around 1.5k per month and house installment 2k per month (if I manage to purchase condo), so I will need at least 4.6k and we round up to 5k per month. 2.5 times for me will be around 12.5k per month, so per year is around 150k. That is quite a lot!

So how much do I really need to generate such a huge amount of income?

If lets say my dividend yield is around 4.5% then I would need around 3.334mil to reach my retirement price!

If lets say my dividend yield is around 5% then I would need around 3 mil to reach my retirement price!

If lets say my dividend yield is around 5.5% then I would need around 2.728 mil to reach my retirement price!

Now I am 28 years old, so lets say I work for 22 years. So 22 years from now I should at least have 3 mil, so each year I would need to save around $150,000.... I must be dreaming, $150K is not a small sum to save per year. My yearly income didn't even reach 6 digit!

But as I say, this is a progressive goal, $150k might seems to be a huge figure, but if I start to earn a small passive income now, it will certainly make a difference! 

As I am going to get married soon, so I will most probably start from 0, after my wedding and down payment for my 2 bedroom condo next year. I will be getting allowance from my wife instead when I get married so that she can monitor the finance for the family. I will probably guide her on where to save and which instrument is better for getting good yield with low risk.

As for me, I will go for shares with the little savings from my allowance and dividends from my shares. 

I assume myself getting around $900 per month (for travel and food during weekday and weekend), and I think I will save around $350 per month. With that amount, I will set myself to purchase STI EFT every half a year so that I can gain stable dividends from 29 years old onward. So If this works lets do a calculation

For 20 years, with compound interest, I will be able to achieve $115K, when I reach 49 years old. Not bad from my portion and the main account with my wife, would have been much much more than what I have! Probably 15 to 20 times more than mine when I am 49 years old. So with a little bit more push, we will be able to attain financial freedom if we let it roll for 5 to 6 more years. 

So, this is my retirement price, what about yours?

Just created UOB One Account Today!

Hi Everyone!

Today I just create UOB One Account and will be fully utilize it next month because I still need to wait for my UOB one credit card and have to make GIRO arrangement for three phone bills. So I will have to wait till November before I make any move.

The below is the illustration on what I am going to achieve.

I will satisfy the credit card portion and the 3 Giro transaction criteria in order to get the maximum amount of interest that I will get. This will give me 2.432% without including the rebate. It is better than OCBC 360 as OCBC 360 only gives 2.2% (Max) by fulfilling 3 criteria. 

So, am I going to close my OCBC 360 account? 

My answer is NO. The reason I am not closing this account is because I am greedy, I want the best of both world. for OCBC 360, I will try to get more bills to pay as now I have 3 telephone bills, one internet bill and one credit card bill. So I will need just one more, probably OCBC credit card bill in order to fulfill the 3 transactions. Adding to that, I will still be crediting my salary to OCBC 360. 

As I mention in my goal, I aim to have $100K cash, but I won't be focusing so much on stocks because I will need the money in two years time. So most of my cash are in banks which gives me 2% interest per year on average. 

Of course, I have set some cash for stocks because I want to generate more passive income (as much as possible) in order to hit $2400 per year.

Getting around $1.4K from UOB and around $400 from OCBC (basic projection, might be more or might be less, depending how much I invest in stocks). Dividends I hope to get around $600 in order to hit my target.  

Purchased M1 Shares

Hi Everyone,

Finally, I have a telco shares in my portfolio which makes my defensive shares formation complete. So to summarize, my defensive stocks are listed as below:

1) ST Engineering - 1000 units
2) M1 - 900 units
3) OCBC - 300 units
4) SCI (Depends) - 500 units

The reason why SCI had the label (Depends) is because some people might not view this shares as a defensive stocks but for me because of its utilities business, thus I personally label it as defensive stocks. (Personal view)

Okay, so the reason why I purchase M1 shares is because it had dropped during the XD stage. I have been eyeing on Singtel or M1 or Starhub for a long time and I decided to go with M1 mainly on the business and the company portfolio as well as my girlfriend and I are the customers of M1.

With the recent news on SMRT collaborating with OMG in becoming the 4th telco, it certainly affects the investor point of view. However, I believe it will take sometime in order for the 4th telco to become a threat to the 3 main telco. The reason why I said so is because they are the new entrant to the market and the 3 main telco already had strong customer based. Of course, customers can choose to jump ship whenever they want however, most of the customers are either tied down with contract or loyal customer to the telco that they have sign with.

In addition, customers might want SMRT to focus on their core business instead of being a 4th telco and the reason for SMRT and OMG to become the 4th telco might be a strategy to drive away the potential threat coming from myrepublic. (Just my personal view)

However, if SMRT and OMG telco really come up with a great subscription plan (concession + data plan), it might really be a threat if they can prove that their services wont be like their own train services (up time of the mobile services).

After due consideration and the recent price drop, I have decided to go with M1 to join my portfolio in the telco business. 

What are your views?

Green Green

Hi Everyone!

It's mid week already and when I and all of you (those who invest in Singapore shares) might find that the STI hits over 3500! That is really awesome! My portfolio are green which means all my shares are earning capital gains already. I am really happy with the results although I am just a small investor and just a newbie, the positive results is quite a good start. Of course, I believe is because of luck whereby the uptrend is here and not because I am good in trading/investing because I knew that I am not. 

The below picture is my portfolio (From DrWealth): 

Unlike other big investors or experience trader, I still believe in playing safe for now because I still prefer to have 70% cash in my pocket for now until I am really confident in my investment method. (As you can see, the shares that I have is very little as compared to you guys) I believe that everyone will huat and hope more to come! Dividends is coming so I am waiting for it! May is the important period where my dividends comes into my bank account :D But DrWealth keeps the ex-div date and I believe is because after ex-div date, the dividend is certainly yours to grasp even though you sell it.

So huat ar!

Portfolio Template from Investment Moat

Hi Everyone,

Just today, I have started using the portfolio tracker from investment moat. Although I have heard of this portfolio template/tracker few months ago even before I started investing, however, due to the fact that the functions and the usability is quite unfamiliar to me (mainly because of my lack of knowledge in stocks) which deters me from using this portfolio done by Investment Moat. 

A few months later, which is today, I decided to use this template for my portfolio update for this blog as well as a spreadsheet to help me track my progress. After 15 mins of understanding how it works, I manage to did up my portfolio using this template done by Investment Moat. 

I am happy about the results and I believe that this is a good initiatives by Investment Moats to help us the investors (probably small/retail investors) to keep track our personal portfolio record. The below is my portfolio using the new template

As you can see from the above portfolio, it is much clearer about my progress as compared to my own personal spreadsheet that I have created by myself. It also keep track of the stocks I have sold and the dividends I have collected. This makes the entire process runs even smoother for me and good for me to keep track of my own personal record.

So, for those who have yet to have a portfolio tracker, do use this, it is quite a good one :D

You can get this portfolio at this link: http://www.investmentmoats.com/stock-market-commentary/portfolio-management/introducing-our-free-stock-portfolio-tracker-spreadsheet/

Just follow the tutorial and it will get you to what you need :D. 

Adjusted Projected Passive Income

Hi Everyone,

Due to the huge adjustment from OCBC 360, my projected passive income (in Dividends Section), will be largely affected because most of my cash are in OCBC 360. So after doing some calculation based on the interest rate of 2.05%, I have calculated at an average monthly interest of around $61.50. Personally, I believe is still quite alright since the risk is super duper low and I will be looking forward to the two new criteria for earning additional interest. 

From my point of view, I believe that it will goes the same way as what DBS does with it's multiplier programme, in other words, I will have to open an trading account with OCBC or if they allow blue chips investment plan, I will gladly follow it. (But lets just see how it goes)

At the same time, I am looking forward to the new Singapore Saving Bonds (SSB). If it comes out in the this coming quarter or next quarter, I will put 80% of my cash into Singapore Saving Bonds if the interest rate is more than 3%. 

So either way, I am still trying to find out the best way to maximize my passive income by looking at various low risk options. 

Singapore Saving Bond

Hi Everyone,

I believe most Singaporean or people here had heard about Singapore Saving Bonds.

A short description:

Singapore, 30 March 2015…The Monetary Authority of Singapore (MAS) today provided more information on the features of Singapore Savings Bonds. This followed Senior Minister of State Mrs Josephine Teo’s announcement that the Government and MAS would introduce the Savings Bonds programme to provide individual investors with a long-term savings option that offers safe returns . This will expand the range of simple, low-cost investment options available to individual investors to help them meet their long-term financial goals and retirement needs.

The basics

.    Principal guaranteed: Investors will always get their investment amount back in full. In other words, they will not suffer any capital losses.

ii.    Term of ten years: This allows individuals to save for the long term and receive higher long-term interest rates (which comprise what investors call “term-premium”).

iii.    Step-up interest: Investors will earn interest that is linked to long-term Singapore Government Securities (SGS) rates. Unlike SGS that pay the same coupon each year, Savings Bonds will pay coupons that “step-up” or increase over time. As a result, the average interest rate is higher the longer the Savings Bonds are held.

iv.    Monthly issuance: This makes Savings Bonds accessible on a regular basis.

v.    Flexible redemption: Bond-holders can choose to get their money back in any given month, with no penalty. This means that individual investors do not have to decide upfront how long they wish to invest.

vi.    Small minimum investment amount: A minimum of $500, and in subsequent multiples of $500 up to a limit to be announced later. A limit will help to maximise participation and to ensure a broad reach.

vii.    Only individuals can apply for and hold Savings Bonds.

Personal View

For me, I would think that it will be a good way to diverse my portfolio as my current portfolio only consist of OCBC 360 account and equity. I did not touch on any bonds yet so this might be a good bond for me to go into. 

The risk is minimal as the principal is guarantee, which is suitable for people like me who seeks for low risk. So if you are seeking for low risk investment, I believe this would be a good bond to invest. However, we would still need to wait for the final information about this bond to come out before making any rash decision.  

March Report - Portfolio and Passive Income Result

Hi Everyone,

Today is the last day of March, thus, I will do a consolidation of my activity for this month.As you can see on the dividend's column, you will know that I did not hit my target of $120 for this month. The reason is because I only have AIMSAMP CAP REITs for dividend collection and OCBC interest rate. $23.72 more to hit my target but oh well, have to see month effort on reaching the goal, which is highly possible due to the fact that I will be collecting dividends from ST Engineering, which gives a dividend of $110 in the month of April. Plus OCBC 360 interest rate, I should be able to hit that target.Now I am a bit worried that my company did not cash in my salary to OCBC 360 account on time, which leads me to lose 1% of my interest rate for this month. Hope they can get it done as soon as possible :D

This is my updated portfolio:

OCBC is the latest member on board, welcome OCBC :)

Breakeven

Hi Everyone,

Today I have come across an interesting topic in HWZ forum where there is a new investors talking about calculating break-even for a counter.

When he/she asked that question, in my mind, I already had my own way to calculate my break-even point. So I explain to him/her my point of view. 

This is the example that I provided:

[(Current Share Price * Number of Shares) + Dividends collected up till date] - [(avg share price purchased * Number of Shares) + commission (both selling and buying)] = x

If x < 0, it will mean that you are still losing money 

If x = 0, break-even

If x > 0, profited from your investment 

Of course, this is just a standard way to calculate break-even, or let's say explain about break-even.

For me, I take a step more when it comes to calculating break-even point. My personal formula adds a bit of thrill in it  

My formula:

[(Current Share Price * Number of Shares) + Dividends collected up till date] - [(avg share price purchased * Number of Shares) + commission (both selling and buying)+ (number of year invested*dividend per year)] = x

If x < 0, it will mean that you are still losing money 

If x = 0, break-even

If x > 0, profited from your investment 

*I will be doing a round up to the years, for example 1 year 1 month, I will round up to two years worth of dividend

So the final portion is the additional thing that I have take into consideration, which is the dividend * number of year invested.

So why do I do that? The reason is because I want to take into consideration of opportunity cost. For example, if I invested $5000 in Sheng Siong, I will have $5000 less in my OCBC 360 to collect interest or other methods of investment. So in order to make sure that my money stays in a good shape, I will always include one year worth of dividend into my calculation before selling. 

If I can hit the break-even point in just a few months (like 2 to 3 months) I will sell it to lock my profit. I believe this can be done for growing stock and other blue chips which had sudden spike in it. For REITS, I will be putting there for a few years before selling it. 

How about you? How do you calculate your own break-even point?

Temptation of Locking Profits

Hi Everyone,

I believe every investors have felt this way before, the temptation of locking profits. I am just a two months old investors and I already have this feeling of locking profits from DBS share. The reason is because it is going to hit my target price, which will be around one year worth of dividends (from DBS) plus a bit of extra coffee money. 

My criteria of locking profit is simple, if it hits one year worth of dividend, I will locked it. Although other people my disagree with my action because there is a possibility of the share growing even more. However, I am not an expert in reading fundamental analysis and technical analysis, I wouldn't bet on that especially for DBS because DBS really is a roller coaster. I prefer something like a stable stock like Starhub or M1, which is one of the shares that I will go into when I cash out from DBS. 

My eyes are on Starhub or M1 or maybe both depending on the cash flow I have. Then after that wait for a while to see if bank stock will fall back to it's normal state before going in again to earn some profits. (These are just my personal views - do not follow)

Well, lets see tomorrow whether DBS will hit my target price. If yes, there will be a change in my portfolio. If not, then will probably need to wait till next week, or get my dividends first.

How do you measure dividend yield?

Hi Everyone,

I have been wondering how do people calculate their dividend yield because there are two main ways that I have seen people in the hardwarezone forum, in the stock and indices section, calculate the dividend yield. 

There are two main ways that people calculate (of course there might be other ways which I do not have knowledge of). 

The first way is through current price of the share price. 

For example, I buy Stock A price at $1 and the annual dividend is around $0.05, at this point of time, my dividend yield would be 5%

However, few days later, my share that I bought, raise from $1 to $2, based on the current price, my dividend yield now would be 2.5%. 

This is the first way, for the second way, I would use my average cost price to calculate dividend yield. From the above example, if I do not purchase any shares further, I would still have my 5% dividend yield. 

So why are there people use the first method and some people using the second method? The reason is because for using first method, the investors can make a solid decision on whether or not the share provides a good dividend yield as compared to other shares. (Mainly for comparison, especially for investors who are aiming to generate passive income).

As for the second method, it is just mainly for personal tracking of our own dividend yield which ignores the current market price. 

Well, each people has their own way to calculate dividend yield and I do respect that but do remember to check properly when asking people for advice based on dividend yield, because you will need to know how they calculate their dividend yield in the first place :D

Which Telco to purchase?

Hi Everyone,

I have been trying to get into tele-communication stocks which includes Singtel, M1 and Starhub. (Either one) At first, I was thinking of getting Singtel because it is the first telco company in Singapore and with strong backing by various shareholders, I feel pretty safe with this telco but the problem is the share price is quite high as of now. 

The second option is Starhub, the reason is because of its stable dividend payout each year and last but not least, M1, the reason for me to go for this share is basically because of its cheap share price.

The reason why I am thinking of this is because as the price of DBS keeps going up, I would cash it out for profits when it hit my target price. So I would have some cash for investment. Certainly, I can keep it in OCBC 360 to earn interest but that will determine whether I can make decision on which telco to focus on. 

So back to the topic, out of these 3 telco, I am currently looking at Starhub and M1. As Singtel, as I am the current user of Singtel but I dont see any positive outcome when it comes to customer service. I can see a lot of people are jumping from Singtel to other telco. I will do that too when I have complete my contract in June 2015. I am thinking of M1 because of the benefits for its customers (one for one movie ticket on every Sunday).

Maybe I will go with both Starhub and M1 but more focus on M1 because I will be M1 users and people around me are using M1 also. But still in Dilemma.... well, there will be a fw days for me to decide. (Hope I can make a decision by the time I sell DBS)

Well, what are your views on telco? (I understand that I did not even touch on fundamental and technical analysis because I am suck at it. I only go with my own observations and understanding of the company itself.)  

OCBC Interest for the month of February

Hi Everyone!

I have just received my OCBC 360 interest for the month of February. It is lower as compared to the month of January because I have invest some of my cash into stocks. So the current passive income that I have for the month of February is $82.13. I would need around $37.87 more to go in order to hit my target. Although it would be hard because my only passive income for this month is from AIMS AMP CAP Industrial Trust which gives me the dividend on $13.85. Well, it's just the beginning of March, so there might be something good happening (I hope) which gives me an additional $24.02 in order to hit my target. 

Well, if I am still unable to achieve my target, then I would need to wait for the month of April to cover for this month and the month of January. The reason is because April will be the dividend payment from ST Engineering in which will gives me $110 of dividends!!! Also, I expect my OCBC interest to hit around $90 which will gives me a total of $200!

I also looking forward to May as well, because I will receive over $140 of dividends and also June as well, because of the inclusion of DBS, my dividend will hit over $110! Slowly inching up to my goal of having passive income of $1440!

Huat ar!

Feburary Portfolio Update

Hi Everyone,

The month of February is over, it's so fast that the second month of 2015 just fly pass in a blink of eye.

In the month of February, I have added DBS into my portfolio which gives me an addition of a bank stock into my portfolio.

On the month of February, I have receive my dividend from Soilbuild Business Space REITs and Fraser Centerpoint Trust.

The total amount of dividend that I have received on the month of Feb is SoilBuild Business Space REITs ($9.51) Fraser Centerpoint Trust ($13.75), with a total of $23.26. 

With that adding up to the interest received from OCBC and my side income from surveys, the total amount is $142.87!!

I have exceed the monthly target of $120! YAY!

Hope next month I can earn more passive income and hit $120 in March! Wish me luck :D

Multiple sources of income

Hi Everyone!

I have just started in my investment in stocks where my objectives is to gain passive income via dividend. This is quite an interesting way to building up my income though passive income which is via investment. Certainly, there are multiple way to build our own source of income, through working, investment, part time job, doing business, doing survey and etc. All these options are opportunities to earn more income which will enables us to retire early or have a sum of money so that we can enjoy later in our life.

For me there are 4 ways of building my source of income.

First way: Salary through working.

This is the most common way to earn our own income. Certainly working or having a job and getting salary, will be my main source of income.

Second way: Getting interest from banks

Recently, I have sign up for OCBC 360 in order to gain up to 3.05% interest with 0 amount of risk. For me, although this might be a temporary source (Because I might not know when they are going to change or remove the scheme), however, it is essential to have a backup plan for this income source (well, it might be lower interest rate than this amount). 

Third way: Investment

Stocks is quite an high risk options for me because you might lose your capital if the market doesn't go into your way. However, it is essential to understand your own safety margin to understand how much you can lose before selling. Personally for me, I am a long term investor, thus, I do not really care about the daily growth and loss. The most important thing that I care about is the future growth and the stability of the company. Which is why I focus more on blue chips stock as most of my portfolio is betting on blue chips stock. Slowly getting dividends year by year is a good option for me as I just have to sit down and collect dividend and once a while purchase some stocks which deemed to be good. The current dividend yield that I have calculated is around 4% which is better than the bank interest rate. But also it is important to note that, no pay no gain - risk exist in such investment

Fourth way: Doing survey

I also take some of my free time to do some online surveys through MySurvey (which I just gotten my $10 vouchers last month) and other survey sites (will inform you when I confirm that the survey website deliver their promise).

Overall: 

Certainly, there are other ways you can open up your source of income, like property investment, open business and many more. However, do not engross with making money because you only live once and also take good care of your family member. Don't save it unnecessary that you neglect the people around you. Saving is good but spending the money on your loves ones are equally as important.

Candlesticks

Hi Everyone,

During the previous post, I have post about understanding the market direction. For today's topic, it will be about candlesticks. I have heard a lot of people talking about reading candlestick as the gauge to understand whether is it a right time to go in or a right time to sell in order to gain profit/reduce loss.

Certainly, as a long term trader, it's no harm for me to understand a bit on candlestick to ensure that I am not purchasing as a unfavorable price in the market. Thus, I decided to check out on some video tutorial on candlesticks. On youtube, I have found one rather clear and concise video about how to read candlesticks for beginners. Certainly there are more to learn as it is no an easy feat to learn candlestick in just one video.

The below is the video that I have come across

Certainly, if you have come across any interesting video about candlestick do drop me a comment because I am curious to learn how to pick up this skill.

Thank You!:D

Learn about market direction

Hi Everyone!

As a newbie like me, we are still learning how to grasp the market movement to ensure that we understand the movement/trend of the market. There are a lot of learning materials that we can obtain to understand these terms. I have found a very nice video on Youtube which provide a clear explanation on how to read the market trend. 

The video are as follows:
Part 1

Part 2

Not sure whether this is a good video to start with but I do understand some technical terms on reading market movement/trends

Averaging Down... Can you handle it?

Hi Everyone!

I came across an interesting concept on the ability for oneself to averaging down on the share that you are currently holding. I saw it at hardware zone - share, stock and indices section of this forum. I saw a certain forum-er who show an interesting graph. The graph below show the attitude a investors/trader when it comes to trading.

I certainly take this graph into consideration when it comes to averaging down some of my shares. It certainly an interesting lesson that one trader must understand. But for me, I am a longer term investor rather than trader, thus, I only look into low risk and stable blue chips company that I have confidence in and invest in it to see it grow (or sometimes fall). Afterall, I am building my own empire :D