So u didn't invest in stock market?
Just fully focus in UTs?

see
"QUOTE(mois @ May 15 2013, 11:11 AM)"

"Conclusion, stop speculating. Keep significant cash in case market drop."

i just started UT investing ...will try to review after 3 ~ ^ mths

4 Truths To Follow To Increase Your Market Returns
When it comes to your investments, if you feel your emotions are getting the best of you, come back to the following truths:

1. Do nothing. A conscious and thoughtful decision to do nothing is still a form of action.

2. Your money is like soap. To quote Gene Fama Jr., a famed economist, “Your money is like soap. The more you handle it, the less you’ll have.”

3. Never sell equities in a down market. If your funds are allocated correctly, you should never have a need to sell equities during a down market cycle. This holds true even if you are taking income. Just as you wouldn’t run out and put a for sale sign on your home when the housing market turns south, don’t be rash to sell equities when the stock market goes through a bear cycle. Wait it out.

4. Science works. It’s been academically proven that a disciplined approach to investing delivers higher market returns. Yeah, it’s boring; but it works.

Start following these truths now and become one of the few investors earning above average market returns. Why Average Investors Earn Below Average Market Returns

wow well said.

almost like what "wong" quoted in (go see page 99)
QUOTE(wongmunkeong @ May 15 2013, 12:39 PM)

but is a simplified english way.

This post has been edited by yklooi: May 15 2013, 11:59 PM

Ya, everyone know the golden rule buy low sell high.
But when crisis happened, it's best timing to enter the market but in fact many people no money on hand to invest.
Instead of saying they no ready cash, I think fearness is the main concern of many people.

That's why, KEEP SUFFICIENT CASH. Now, this is cash over and in addition to your 3-12 months emergency funds, I'm talking about excess liquidity that u CAN put to invest, so that when market turns south, not only u need not liquidate your investments, u can even top up or to use Wong Seafood's words - BUY AT LELONG PRICES!

This post has been edited by Pink Spider: May 16 2013, 12:05 AM

just looked at the Japan Stock market chart...just for arguement sake. it one were to have bought stocks between 1987 to 1991 then hold after it crashed at abt 38000 point.....until now no matter how much the topping up/DCA will not help till today at 15000 points

This post has been edited by yklooi: May 16 2013, 12:11 AM

Dividends leh...

just remember, i was relying on this type of chart and in year 1998, i betted against the trend...i said Japan had been down for 10 years, now should be the time....cos that time tech stock up...japan has alot of tech com...i go into United Japan Growth fund.....it up a while...then die when bubble burst....till now...not much gain if were to calculate the opportunity cost lost...that was history...learned a pricey lesson...no DCA for me

That is not quite the same. Kaka's forced rebalancing is more like it. The downside with the above normal rebalancing is your portfolio would suffer drawdown as the market move downward and you keep rebalancing. This is like doing dollar cost averaging in a negative way and you don't want to do this in a big market crash as the bottom could be very deep. Using forced rebalancing, you actually lock your portfolio value in fixed income and wait for market to start recovery before moving it back to equity to take advantage of the low NAV.

Bonds Weekly: Ringgit Advanced Hurt Foreign Bond Funds [13 May 2013]

Over the week ended 10 May 2013, bond segments were broadly mixed with the riskier segments of fixed income continuing to see their yields fall while the opposite held true for the safer segments. For the third time in 3 weeks, high yield posted the heftiest falls in yields, led by the US High Yield segment which shed -12bps while its Asian counterpart saw its yield fall by -5.9bps. As of 10 May 2013, the US High Yield segment had a yield of 5.09% and the Asian High Yield offered investors 6.57%. Taking the latest fall in yields into account, the US High Yield segment has seen its yield fall by -116bps since 31 December 2012.

Yields across the safer segments of fixed income rose on the back of improved investor risk appetite and strong equity market performance. US Investment Grade Corporates led the rise in yields for the week, with the segment seeing its yield rise by 8.2 bps to offer investors 3.19%. Global bonds and G7 bonds were not too far off, with their respective yields rising by 10bps and 10.13bps to end the week at 2.026% and 0.745% respectively.

On local front, Malaysia Ringgit (MYR) advanced momentously by 1.39% and 1.69% against USD and SGD last week, thanks to the large foreign inflow to domestic equity and bond markets on the back of the post election rally. MYR/USD and MYR/SGD closed at multi-month lows of 2.9887 and 2.997 respectively. Thus, SGD-hedged RHB Asian Total Return Fund and OSK-UOB Emerging Markets Bond Fund dropped 1.6% and 1.8% respectively which totally wiped out its year-to-date gains.

Following the interest rate cut in Australia by 25 bps to 2.75% last week, it compounded on the MYR/AUD weakness that declined 3.7% last week, hurting the performance of Hwang AUD Income Fund which correspondingly fell 3.04%. As of 10 May 2013, Malaysia Ringgit (2.27%) was the second best performing currency (against USD) in Asia, trailed behind Thai Bath (2.82%) by 55 basis points.

URL: http://www.fundsupermart.com.my/main/resea...?articleNo=3443

The most important thing is not when to get in but when to get out. If you listen to news or analyst etc., they will tell you when to buy but never when to sell. If you know when to sell you'll cut your loses short. Housing may not be a good example as it is not easy to liquidate. With stock or UT, you don't want to keep your stock during downturn as you can make better use of the cash during this period. Also if you lose your job during this recession, your money go stuck in the equity.

For exampe, if you have rm100k in UT, 50K in fix & 50K in equity. When market went down by 10% on equity side, you forced rebalance to 20-80. Now you have rm19k in equity and 76k in fixed. If market went down worst case by 50% on equity side, your UT value is now rm11.5k in equity and rm76k in fixed, total 87.5k. I'm assuming fixed income did not suffer drawdown just for illustration.

Now, example if you use normal rebalancing. When market down by 10% in equity, you perform normal rebalance. Let see how the value ended up by the time market went down by 50%. 10% (47.5k fixed,47.5k equity), 20% (45k,45k), 30%(43k, 43k), 40%(41k,41k) and finally 50%(39k,39k).

If you follow normal rebalancing you ended up with about rm78k versus if you force rebalance, you still have rm87.5k. I stand corrected if my math is out a bit

This post has been edited by kimyee73: May 16 2013, 08:25 AM

Bro - trigger concept lar.

Put in your own trigger + planned actions based on:
1. Whether U are into bottom fishing (ie. buy more equities when equities tank significantly or buy more bonds when bonds tank significantly)
2. Whether U are into loss cutting
or heck
3. Whether U are into buy high and sell higher

forest, trees neh

This post has been edited by wongmunkeong: May 16 2013, 08:27 AM

Sounds more like "Forced cut-loss" / "flight to safety", rather than "forced re-balancing". Re-balancing - "to bring back to balance or planned" right?
anyhow, semantics only, pardon my Yinglish Nazi-sm


IMHO, the concept works fine... IF kaka really hits the fan, ie. a drop of 40% or more.

------
What if AFTER one cuts lost
eg. shifting from Equities 50: Fixed Income 50
to a defensive stance of Equities 20: Fixed Income 80 triggered by a mere 10% fall in equities
AND
the equity market rises, like in mid-late 2011?

Using similar concept of cut-loss / flight to safety but even upping the trigger to 20% fall in equities
same kaka as above or may be even worse in terms of cost of switching + opportunity lost
------

My point of thoughts are:
1. How many times, when the equities market falls, it fall BEYOND 30%?

2. Being a worker (ie work for $), my major point is that i'm just allocating $ into a few asset classes (and regions).
Thus, like allocating my grocery shopping $.
eg.
For meat - i'd buy chicken if it's cheaper/more value VS lamb, or vice-versa
thus, translating into investment vehicles,
i'd buy equity funds if it's of more value VS fixed income funds.
When will A be of more value than B?
When A's cost (ie price) has fallen enough.

Just a personal thought concept yar - investing and trading is a mix of art & science. No perfect right/wrong approach
If it's just art - i'll be dead in the water (my EQ sucks )
If it's just science/maths - all the ivory tower professors & accountants will be multi-millionaires

This post has been edited by wongmunkeong: May 16 2013, 08:54 AM

I am doing force rebalancing the way you mentioned. Looking at total value equity portfolio drop to certain percentage to cut more losses or lock in profit.

I am restless to wait when it drop rock bottom and need to wait 2-3 years for it to come back up while doing top up average down.

In my excel sheet, there is a value i put next to my total current value. So i can know when to execute force rebalancing.

Of course i will see also major market indices, if majority are all red for 1 week, 1 month, 3 months, then will force rebalance.

I think this is a layman investor method, no complicated technical analysis.

I will also do normal rebalancing one time a year towards end or begin or the year. Move some profit to balance fund or conservative fund ie Hwang Select Income or Kidsave.

I am open to improvise my method and evaluate others method as well. I just want to sleep well.

Ha ha... That is why my trigger is not based on portfolio value like kaka but on price chart and indicators. If based purely on value, you might have false trigger and missed the potential upside opportunity. The forced rebalancing also have its value but need to determine the trigger point. I use 10% as example only. Maybe kaka will come up with a workable percentage.

EDIT: Did not noticed kaka also look at market indices to confirm his trigger.

This post has been edited by kimyee73: May 16 2013, 09:34 AM

AmDynamic bond recent movement quite big compared to last time. Last time only like 0.0001 or 0.0002, now it is like 0.001

Sentiment on Malaysian market is so good; being equity, bond or even MYR.

Yea.

And Hwang Asia Quantum continues its Ponzi-like performance

Strong MYR is hurting my offshore funds.