Are you talking to me?

This post has been edited by xuzen: Jul 3 2015, 03:55 PM


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Ini macam pinjam personal loan to pay off credit card outstanding....

The equity portion of my portfolio dropped 4.5% in total... mainly from China exposure.

At this moment is 60% China; 40% Tech Sector.

Xuzen

This post has been edited by xuzen: Jul 8 2015, 03:15 PM

@Labah-labah merah jambu & David... read my post Algozen™ for Jun'15

Basically my data was as of 31/5/2015 and I received it by 3rd week of June-15. My next fresh set of data will be for 30/6/2015 and I expect to get it by the final week of Jul-15.

I am not Bloomberg or CNNMoney... my info is not 24/7.

Xuzen

This post has been edited by xuzen: Jul 9 2015, 10:59 AM

Generally overlapping is not good idea.

Single country is like in the roulette table you buy the single number... kena will kena "kaw-kaw"

Asia ex-Jp is like buying "six" or 1/3 of the table... more chance to kena but pay-time, no shiok wan... chicken feet return only.

Single country or broad based... depends on your risk appetite and how much "$$$" you have lar....

Xuzen

For those with some technical knowledge may it this steady your nerves. For those without, just read it with an open mind.

My China exposure has moved to -1.24 z score. This means that there will be more than 68% chance that it will bounce back to the mean.

What this means? Top up lar!

Xuzen

Amboi! Semua merah-merah belaka, macam auntie visit!

Nowhere to run...no where to hide.



This post has been edited by xuzen: Jul 10 2015, 01:25 PM


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It is has gone above -1 SD liao... reversion to mean is highly likely.

Think of the mean or average as an imaginary elastic line. When you pull it too either side, it will want to go back to its original shape. The further you pull it from its resting line (aka the mean value) the more it wants to go back to the mean.

So in financial modelling, we use Standard Deviation as a marker from how far it has moved from the mean. Right now, the China fund has breached -1 SD and based on statistical modelling, it wants to revert to the mean (in technical term this is called regression to the mean). In financial modelling stats; -1 SD... it has a probability of 66.67% to move towards the mean. If it has gone to -2 SD.. then the probability becomes 95.00%. At - 3 SD... the probability becomes 99.99%. -3SD is the max liao. There is no -3.01 SD or whatever.

However do note that in Black Swan Event all calculations are off as are all the modelling will be null and void.

Xuzen

This post has been edited by xuzen: Jul 10 2015, 01:47 PM

Hmmmm yummy simple fifth grade soalan kira-kira:

Let's put some numbers for illustration.

Initial capital = RM 10,000.00

After two years, portfolio = 14,000.00 = ROI 40%.

IRR or CAGR =/= 20% = 18.32% p.a.

Lets say it drops 20%; 14,000 - 20% = RM 11,200.00

Then IRR =/= 10% = 5.83% p.a.

Now you owe me coffee....

Xuzen

This post has been edited by xuzen: Jul 11 2015, 04:06 PM

if IRR = 9.16% p.a., then the corresponding end period value is RM 11,915.00

the drop is from RM 14,000 to RM 11,915 i.e., a 14.89% drop in simple arimethic calculation.

Hence if the IRR is halved from 18.32 to 9.16, then the corresponding ROI drop is 14.89% and is not 20%.

You need to appreciate that arimethic is a simple straight line calculation whereas IRR is compounded return and uses geometric calculation (exponential and logarithmic function)

Awesome explanation J.passing.by!

Xuzen

In all fairness, I am glad I have a chance to experience such severe sell-down of a market that I am exposed to. During the sell-down, my equity portion consisted of 80% in China exposure.

Actually it allows me to experience the fear and anxiety and to test my resolve. It sort of answer my own personal doubt... will I panic, will I run and hide?

Again, without ever being in the market, you will never know and no amount of text-book material will help you manage your emotion.

I am happy I have chance to go through this roller-coster ride.... and Woo-hooo what a fantastic ride.

Xuzen

My china fund went more than -1 Standard Deviation, which to my understanding, based on my finance study, means the chance of a rebound is very high. So I use that to stay my emotion. If I don't know all this finance mumbo-jumbo hocus-pocus, I would have panic and sell everything!

Xuzen

I would reduce my exposure... or rather Algozen™ would "advise" me to reduce exposure.

Xuzen

p/s as of today's NAV, my China exposure has gone from > -1 SD to around +ve 0.5 SD. So it is now in the common zone.



This post has been edited by xuzen: Jul 14 2015, 04:39 PM

YKLooi,

Read back my post on the explanation of using an imaginary elastic rubber band to illustrate the concept of Standard Deviation and Z-score.

Understand or not?

This post has been edited by xuzen: Jul 14 2015, 04:45 PM

What is there to say? Our NAV still not updated yet....

Japan = only on fund that does Japan.

How to compare and evaluate it? For all we know, that fund manager may have given some "incentive" to FSM analyst to say something positive on Japan....

Xuzen

The oracle speaketh:

Do not ignore land of Uncle Sam;
rate hike in anticipation in that realm;
Technology theme is to watch;
much gain I may vouch;

The dragon has been wounded;
Reduce is wise, but remain grounded;
The elephant is charging again;
Time to ride its stampede to gain.

So sayeth the cystal ball.

elephant = India aka Modiland!

This post has been edited by xuzen: Jul 22 2015, 11:14 PM

There is no Thailand as a standalone country specific fund here... they usually round it up with ASEAN fund.

My previous exposure was Greater China = 60%; Global Tech Sector (as a thematic play) = 40%.

For this month moving forward, my Greater China = 30%, India = 30% & Global Tech Sector (as a thematic play) = 40%

You will notice I do not spread into too many fund as my Algozen™ tend to be focus.

Overall since last month, I made a loss of 3.5% from China exposure but gained back 0.5% from my Tech sector, making my net loss of 3.0% in one mth time. Yes, China was a scary ride... but what a ride! Woo Hoo,,,,,

Xuzen