Investing Strategy

My current investing strategies involves buying blue chips on the Singapore stock market such as Singapore Press Holdings, Capitaland, Keppel Land and OCBC which pay out more or less consistent dividends payout each year. I expect around 5% dividend yields each year which are then reinvested.

Have been reading The Intelligent Investor, by Benjamin Graham and commentary by Jason Zweig. I was trying to look into the more practical side on how to improve the way I invest. Some of the things that I learnt include

1. Buying into the stock market when the prices are undervalued.

The stock market is a very emotional place, and occasionally. when there is some rumours, or scandals, there presents opportunities to buy up good stocks for cheap prices.

2. Identifying the good stocks.

Obviously, it is important to be able to identify good stocks in the first place. Some stocks are like apples that look good on the outside but are rotten on the inside. It takes time to understand which stocks are the good ones.

My opinion is that Singapore blue chips are quite a safe option as the government has large stakes in them. Moreover, the Singapore government has a reputation to maintain.
The negative aspects are that Singapore has a small market. However, many of the companies are already expanding into the rapidly growing markets of China and India.

3. Looking for Stocks that Grow Steadily.

Warren Buffet looks into stocks that he understands, and which have large growth potentials. Incidentally, a lot of his stocks have low beta values, i.e, the stock prices do not fluctuate a lot, which could also that the business cycles of these companies are less cyclical as compared to technology stocks.

Money and the Fear of not Having Money.

To many people, money is a very important thing. Yet, they fail to understand it, and constantly make poor financial decisions due to fear and greed.

Some are self-deluded and seek to live a lavish lifestyle or seek instant gratification. Others try to fall into get-rich schemes or lose huge amounts of money through speculation on the stock markets due to greed.

Many poor people live in fear of losing their jobs and are afraid that they are not able to pay off their mortgage especially during a time of recession.

Financial literacy is important. Being financially disciplined is important. It involves setting goals. There is no quick way of getting rich. There are three things that I would like to mention,

1. Control Spending
As mentioned about instant gratification, many people do not plan a budget and spend excessively with a consumerism mindset. Many even get into debts by swiping their credit cards.

2. Invest in Assets
Assets are things that generate income, eg stocks that pay off dividends.

3. Generate Alternative Sources of Income
This will require creativity by thinking of business ideas, or writing books etc.

Recommended Reading
Rich Dad Poor Dad
4-Hour Workweek.

Creativity

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I found this from got-ads.blogspot.com. It's amazing how much can be achieved by being creative. Feel like having an Oreo now.