Introduction

         My aim of setting up this blog is to share my personal views and experience on investing in Singapore's context. In particular, this blog is targeted at those with no experience in investing but wish to take their first steps. It might be scary for those taking the plunge for the first time, for example, putting down your first few hundreds or thousands you have saved up into a company's stock, and watching its price fluctuations for the next couple of weeks. Some might also find it not worth the effort to invest, thinking that the initial meager returns do not justify putting in a few hundred dollars each month into a regular savings plan. The money could have been spent on holidays or buying a car etc.

     

         Unfortunately, our schools did not equip us with the knowledge, tools and the benefits of making our money work for us, maybe aside from the power of compounding learnt in our Math lessons. The power of compounding is one of the reasons extolled by many to start investing at a young age, however, I feel the exponential growth story does not really reflect the realities of the market, which has its ups and downs. To achieve the "exponential growth", one might require certain strategies. These strategies are what I what to share through this blog.

         Personally, I think I am quite a risk-averse investor, which is the stance I feel most should take if they are just starting their investment journey. Ultimately, capital preservation is one of the key tenets of Warren Buffet's investment principles. Hence the strategies I will be proposing will be of lower risk (low volatility), takes a long-term view, but still gives decent returns. I am not an expert in economics or finance, thus I do not know the nitty-gritty details of the European crisis, US fiscal cliff, etc. Neither do I have the know-how of dissecting a company's annual report and forecast its future growth. Luckily, you do not need to know those things in-depth (maybe just know of their existence if you must) to invest successfully. This also mean you can ignore analyses by the so-called "experts", which can influence your investment decisions. (A case in point: I remember reading an article painting a gloomy picture of Starhub losing its BPL rights, leading my to sell my Starhub shares in late 2009 at around $1.90. As of today, its share price is above $4.) Fundamental analysis does have its merits though, but unless you are half as good as Warren Buffet, it is more of an art, which just improves your odds when investing.

         In my next few posts, I will cover some of the strategies proposed by others which I have come across, and  am adopting myself. They are my own personal take, so feel free to tweak them to suit your own expectations and goals if necessary. It has been about a year since I started, and there has been no significant market crash to test the resilience of my strategy. Hence, one should keep in mind of the risks that are inherent in any kind of investments.