Hard Is Good; Difficult Even Better!

 

Would anyone aspire to be a doctor if its easy to be one?

I mean anyone with a passing grade can get into the medical faculty?

And after graduate, no need pay your dues through the gruelling rigors of housmanship?

You know, just past exams with theory, and with zero real world practical experience. can immediately be a doctor?

Its the same for being an Airforce Combat Pilot. Or join elite military units like the Commandos or Navy Seals.

Notice the whole purpose of their training course is to "filter" out those who can't make it?

Never mind its already so hard to get selected into these elite combat units in the first place!

Its like this in the real world too.

A job that anyone and everyone can do. how much does it pays?

Contrast it with a job that requires:

1) Advanced degrees like Masters or Phds; 

2) broad and deep experience in certain fields (not 1st year experience times ten);

3) graceful social skills as in know how to wine and dine VIP clients;

4) and snake oil savvy enough to give speeches and talks to media (not always take umbrage at direct or difficult questions).

How?

You think you pay peanuts can get?

Humans are funny.

We all know this intuitively.

But when it comes to certain activities that involve money, we become opposite.

Like taking "instant noodles" courses and just like that, we can become "Masters" - the course says so mah!

Or we don't have to know much about anything, or putting any effort whatsoever, we can claim the rewards... Look! Anyone and everyone can do it!

Eh? Isn't this like buying Toto?

Marry rich requires lots of smarts and effort to bait your catch. There are so many other bitches and toy boys out there... Easy? 

You think!

Passive Investors in STI ETF - What's Your Response?

 

Owning Singapore stocks has been a poor bet even for investors with long horizons.

If you are an active investor, the response to such articles is easy - just show your own track record!

Like our good friend the fisherman - CW8888.

His one man army track record is only 2% off from big daddy's Temasek!

If you are a passive investor who bought or dollar cost average into the STI ETF for the past 10, it would be interesting to hear from you!

5 years ago, I poked passive investing got one biggest blindside - its active in disguise!

Why STI ETF?

Why indeed!

For the past 10 years, our STI has lagged US, Europe, and Global ETFs...

How confident are you that in the next 20 to 30 years, our STI will outperform the other Asian indices?

If you say the difference is only a few percentage points...

Precisely!

Isn't that your argument that passive investing is superior to active investing?

 

What Is Your Dream?

 

That's the difference between goal setters and people with dreams.

The irony?

People who monkey see, monkey do and come up with goals, bucket lists, annual resolutions, etc; are still dreaming...

You just come up with new goals to mask your inactions all this while...

People with dreams you can see in their eyes. 

They jump out of bed every day as they have a reason for getting up!

Despite setbacks and obstacles, they never waver... (That's tough!)

Why dreams (in corporate world they're called Visions) come first?

If you have no idea what you want to do with your life, what's the point of setting goals?

Wait you ended up climbing all the way up to the top of the ladder and find to your dismay, your ladder was leaning against the wrong wall all this time!!!

You think why so many have mid-life crisis in their 40s?

When the stark reality of, "Is this it?" hits you!

Active Versus Passive

 

Imagine you are one of the citizens of Kabul now.

You're probably mad with yourself for being so "passive" with what's happening in the months since May of this year...

This is what happens when you expect others to take care of you.

Before the 1997 hangover of Hong Kong to Mainland China, the company I previously worked for decided to shift their Asia Pacific office to Singapore. That's how I joined the company in  1997.

Yes, its a corporate "hedge".

10 years later, when the coast is "clear", the company shifted the Asia Pacific office from Singapore to Shanghai. I was already working in Shanghai at their trading office for 3 years.

Before you get angry or too patriotic, count the number of their retail stores located in China, Hong Kong, Taiwan, Korea, Japan versus the numbers of stores in Thailand, Malaysia, Singapore, Indonesia... 

It helps to see things from the perspective of landowner.

Its the same for those "active" Hong Kongers who decided to emigrate to Canada, Australia, United States, Singapore; etc - BEFORE the 1997 hangover.

When things turned out OK, they returned back to Hong Kong to work. Hey! Asia is where the action!

Just as long we do not have another World War 3 in Asia, this century should be our turn when it comes to prosperity and progress!  

Now if these returned Hong Kongers don't feel comfortable with what Mainland China is turning Hong Kong into today, do you think they were glad being "active" years ago before 1997?

Treaties are words written on water if you cannot enforce it.

Good luck trying to tell Mainland China, "But you promised 50 years no change!?"

Look, what's the point of being so called financially literate or financially free if you cannot protect yourself and your love ones?

Investing vehicles can be passive. That's not the issue.

But if you have a habit of sleeping on the wheel... 

Well, doing a mad dash out of the airport is like trying to get out of a fast declining stock before it gets halted...

That's when you realise from that point onwards, you have no say in your own future whatsoever.

You are now totally dependent on others. 

That's passive.

 

Bei Kambing Retail Customers

 

During my weekend sales gigs, I've come across some really "bei kambing" (naive, innocent, blue-eyed sheep) customers.

When I told them which countries the products are made, some customers remarked they can then get from the factories direct themselves.

I said, "Sure! You can definitely get them cheaper! Although the factories will ask how many 40 feet containers you want to order..."

You should see the blank look in their eyes.

Yup, it flew over their heads...

LOL!

Then there are customers who like to ask where the distributor/agent showroom is located in Singapore.

They think by going to the distributor direct, they will get better prices than from retailers' showrooms?

I told them confidently, "Sir, this is their address. Feel free to visit their showrooms and then come back to buy from us."

"Why? Shouldn't the prices be lower at the distributors?" asked the perplexed customer.

I patiently explained, "Think about it for a moment. We retailers are the ones selling their products for the distributors. If they undercut us, which retailers will continue to display and promote their products?

Some customers will sheepishly smile as they knew I made sense.

Some practice Trust But Verify - they come back a few weeks later and buy from me. Yeah, I was right! Our prices cheaper...

LOL!

Of course I understand and empathise.

Not everyone has worked in sales or with supply chain. 

Or have profit and loss responsibilities.

You could be highly educated but you work in academia or at the back office all your lives...

How would you know how the real world worked?

If you are one of those customers, just have the awareness that when you embark on your journey as a fundamental "investor", you do not start at ground zero - you start from negative.

Right off the bat, your fellow cohorts who had more real world experience than you have an edge over you when reading annual reports. 

They can read between the lines and beyond the numbers.

You can either do your best to close the fundamental gap (no, its not taking more courses) by asking your sales or supply chain colleagues out to lunch, or maybe switch to technical analysis instead?

Look, technical analysis is voodoo. Since its voodoo, how can anyone claim to have an edge over others?

And it involves less brain power too. 

Its like looking at ink blots or ice cubes in a glass. We see what we want to see!

P.S.   The only times when distributors have prices lower than their retail showrooms are:

1)  Clear horribly aged stocks that no retailers are carrying anymore. Great for retail customers looking for that "retro" look.

2)  Reconditioned products. When we bought lemons and returned our products to the distributor and got a brand new replacement, have you ever thought where your defective product ended up?

Landlords love reconditioned products. I mean if you are renting out your apartment, you don't expect your tenants to take care of your home appliances, do you?

 

Freak Weather and Weird Market Movements

 

I was buying dinner at ABC market just now at around 5:30 pm.

Just as I was about to cross the road to take the bus home, the sky suddenly opened up like those monsoon rain!?

And its still shining brightly with sunlight piercing through the rain!!!

Idiot!

So I walked back to have my Chendol to wait the rain out.

I knew from experience, the rain although heavy, will not last long.

True enough, the rained petered out even before I finished my Chendol.

 

I wish I had that level of confidence when it comes to my trading though...

Ever got shaken out of a perfectly good position because the market have one of those weird and unexplained counter-trend moves against us?

Very frustrating right?

I'm a coward.

I prefer to get stopped-out. 

See the price retrace.

Sheepishly get back into the same position I had before. 

Sometimes at an even worst entry price than before @$%^$#@!!O

What to do?

If the rain didn't stop like what I expected, I can always have another bowl of ice kacang (sugar rush and brain freeze).

I'm still dry.

But in trading...

No way I'll let a paper cut turn gangrenous!

I noticed some retail traders do the opposite.

Who's afraid of some rain?

Just dash and run like mad. Its only water!

For trading, they are not afraid to let a short term trading position turn into a long term investment!?

Stocks always go up right?

Don't worry.

We are "investing" for the long term.

Remember Warren Buffett said if you can't stomach a 50% loss you should not be in stocks?

Wait.

Have you noticed retail "investors" looking to breakeven one day are often good at parroting wise investing quotes?

 

Find Shoes That Fit

 

When it comes to investing, FIRE, or just plain vanilla dreaming about getting rich, most just think of the rewards, end goal stuffs, or destination.

For me, the journey is more important. 

But then again, its no fun to embark on the journey when your ladder is leaning against the wrong wall from the very start...

The process is excruciating painful, and when you got what you wanted, you now discover this is not what you thought you wanted all along.... 

Let's be honest. Most goals you've set in life are not through deep introspection, its more about monkey see, monkey do.

Or to be what you think others expect you to be.

Don't believe?

Try spotting how many times people ask others how much they need to be financially independent? 

How much to retire on?

Buy shoes ask others what shoe size they wear?

Do you do that in real life?

No right?

Your own feet who better to know whether comfortable or not but you?

The irony when it comes to financial independence is that most people don't quite fully grasped the part about independence.

I find it hard to believe just because you hit your money goals, you suddenly become "independent" overnight...

Again, you can verify it quite easily by looking around your friends, neighbours, or relatives.

Some have very modest means, but super independent in thinking and actions!

Some maybe millionaires, but people say left, they go left; people say right they go right.

What has this got to do with getting rich or FIRE?

You decide.

(See? I not telling you what to think!)

How Old Is The Captain? Most get it wrong...

Click on the video below.

Once you've got the question, pause the video and try to figure out the answer on your own. 

No, you can't ask your mother.

Or your ex-tuition teacher.

Don't cheat!

Once you're done, click on the video to get the answer.

 

Those who majored in Math, and who knew the answer long ago, did you apply what you've learned when it comes to investing/trading?

As for the majority of us who were confused, or got the answer wrong to this primary school math question, how?

Does it reminds you of those talking heads on TV (or analysts with their newsletters) who try to explain the market moves for the day?

Don't believe?

Try explaining the gains on our 3 bank stocks in STI last Friday when big daddy removed the cap on dividends payout?

But it fizzled out today...

Or Keppel's price popped when dividends got increased, but now price retracing back... Eh? Those selling today made their contra gains already?

Now you know why most retail traders eventually quit trading and become born again "investors".

Trading is hard. (Unless you're the savvy ones who sold last Friday and bought back today)

Most of the daily moves in the markets are like the math question above, "How old is the Captain?"

LOL!