Everyone has their own recipe. Just for sharing.

Since early of this year, I started to consider PER of different market in my annual asset allocation. Use PER to select the market, and rear view mirror method (performance + downside risk) to select funds within the same market. Anyway, i still new with it. Just for sharing.

Buy market with relative low PE (compare with Fair PE/ historical average PE aka big difference in (current PE - fair PE), not compare PE between different market/sector), is buying a market with a bigger room of increment. Buying market with relative high PE is buying a market with limited room of increase but bigger room for correction/ back to its average value.

Base on my experience, invest base on PE is much much faster than rear view window method.

For example, I entered back KGF in Jan/Feb when the PE of KLCI was 13, and exited last Monday when PE was 16.67 (plus some other reason), fair PE for msia is 16.0. But, if used rear view method, i might enter it in June, when the excellent half year data is out, and still stay with it now.

Note: China PE is low now, but most of greater china fund in FSM invest in China companies list in US (alibaba PER is 68 as i last checked) HK , Taiwan companies. Therefore, you may refer to CIMB GC's master fund Schroder ISF GC for its latest PER of holding. As i last checked, it is 21.04, still not at dangerous level i think.

"IF" only "IF" based on this....
looks like have to move the % allocated.....to follow the current.

1st set the asset allocation
example
70EQ : 30FI
from this 70%...diversify to various regions....

these % of allocation are NOT fixed .......
play about in a range of 10%
if Greater china regions are allocated 20%....which means 30% when low PE and 10% when higher PE.
(just must also set how many % over the average PE then reduce and vice versa...maybe 20% over the average PE?)

so even if the PE is high the portfolio also have some allocation in there.
if it stayed high ok also
if it stayed low also ok...

so what is the optimal % for max and min variance for asset or per regions?
how much to trigger the reduction if over the average PE?


looks like the above article from FSM has suggestion for the reduction of the allocation when the mkts had done well for some few months.

I admit that's silly mistake. Because all this while I got a plan for getting manage port, besides DIY port. Moment when I ask I wasn't think much that's why.

Still remember the dca vs timing? Yea. My mind went haywire and mix it up. Chill la.

No need direct question that deep la. What do you mean paper investment haha.

We play UT also got paper gain paper loss. That's not paper investment?! AFAIK, real gain is only when you gain cash in hand that more then you buy. Well this is what they say when you into property investment.

Is the process of using epf money in fsm applied everything online itself or any physical visit to the office?

And money invested to fsm via epf, can it be cashed out or returns to epf once sold?

After applied online,
stull need to submit paperwork.
1. need to request kwsp 9N form from them, specific fund hoouse
2. Fund house transaction form
3. Fund house Account opening form.
4. IC fotostate

I been tried walk in to submit those form, but FSM office isnt that friendly for walk in Investor, better do appointment first.

Epf investment is bit troublesome. even need to submit form for swtiching and redemption.

Epf investment u will received fund house statement and annual report physically.

Service charge 1.75% or 5%+?

same as normal FSM price.
I get 0.8% top up this month.

procedures is bit longer. T+4 still not reflected in account.
T is the date the received ur documents.

found this ....it is 2 yrs old but i think the story and action are similar
What To Do If Certain Markets Are Getting Expensive?
https://secure.fundsupermart.com/main/resea...SJBlog_20150402

The thing with all these methods are it is purely numbers driven.
Without considering the human element since investors are human themselves, all these methods can be more accurate or less accurate depending on the time frame.

For eg:- Why did the tech bubble occur during the early 2000s.
In theory once valuation is high, investors /fund managers are suppose to pull away/stop investing and the bubble will never occur.

i was one....kena....
there will always some one naive, fresh, seduced by returns, hoping for a few more month of gains, etc,etc..
btw, FM are obligated by the mandate in that fund....some mentioned 90% invested .....at a particular area.

Today is the 1st of August 2017, another month has gone by.

Time for personal port review.

Last month (July 2017) was a good month. All my UTF naik naik naik. Tech fund was the best performer followed by Selina and Esther. RHB EMB & Lee Sook Yee was flattish.

Overall, port gained 1.XX% in a month. 12 mths rolling ROI is 8%. 12 mths rolling std-dev is 2.5%, making a risk to reward ratio of 8/2.5 = 3.2

Now, some of you will ask, how come only 8% p.a., but he always says his port will make 14%. That is because I DCA and I keep reserve in MMF. That is why there is a drag in performance. Which is ok, coz those who know me over the years will understand I am a kiasi investor. I take care of my risk first, return is secondary.

Xuzen

p/s If you look at my std-dev, it is darn low. I think I can afford to take more risk going forward. I may engineer the risk to reward to drop to 2.5 to enhance my ROI. It is a wonderful feeling when one is in control of the risk and reward and not vice-versa.

This post has been edited by xuzen: Aug 1 2017, 03:07 PM

in simple laymen term...how do you compute

12 mths rolling ROI is 8%.
is it variance of ROI 31 July 2016 and 31 July 2017 ?

12 mths rolling std-dev is 2.5%,
how do you calculate that?

making a risk to reward ratio of 8/2.5 = 3.2
is it ROI/std dev?



This post has been edited by yklooi: Aug 1 2017, 03:14 PM

Your fans will also in the same, DCA brings down ROI. Plus there are switching/buying service fees. So realistically can only get 7% or something thereabout.

Switching / buying sales charge is not applicable to me. Oh btw, the 8% is net of platform fee, hence my actual ROI should be 9%. Going forward, I will deploy more cash into higher risk asset class. My ROI should improve over time, at the expense of std-dev. But it is all engineered.

Xuzen

p/s Next week I will deploy more cash into riskier asset class. Will share with you good folks next week regarding my move.

This post has been edited by xuzen: Aug 1 2017, 03:25 PM

I use the Average and Standard Deviation function (fx) found in excel and let the computer do the rest.


Correct

This post has been edited by xuzen: Aug 1 2017, 03:21 PM

http://www.klsescreener.com/v2/news/view/262307

1MDB defaulted the loan as of this noon which they were supposed to pay. My stock remisier just informed me to be wary for the coming days. So how our economy will be impacted by this? I don't know honestly.

There are speculations that Malaysia equity for the rest of the year will be quite bearish, unless the GE factor or further government injection of fund into small cap could over power all these sentiment.

And hence right now, the heat is seen moving up to north asia ......

I think in normal terms, a rolling average usually means a moving average. As like in a market index chart, the moving average of 20, 50 or 200 days can be superimposed onto the daily movement.

If one is already having a matured portfolio of funds, with none or hardly any more fresh money to pour in, it would be much simpler to use the Year-to-year ROI in keeping track of the portfolio performance.

Just keep track of the ROI for each year, then it is easy to compute if we want to know the annualised ROI for the past 2-years, 3-years, 5-years, etc. etc.

Say when at the 6th or 7th year, and there was a huge negative ROI in the 1st or 2nd year, then the 5-years annualised ROI will ignore and discard the 1st 2 years ROI, and will show a higher rate of returns than a 7-years annualised returns.

Is this bluffing ownself? Not really, as over the years, one would have improved the portfolio. And the 5-years figure would give a better indication than a 7-years figure of the portfolio's future performance in the nearer future.

How relevant are all these annualised figures? Very, very relevant - especially if there is a need to decide whether to plough in more money into the portfolio. Especially, when at age 50, 55 or 60, and want to decide whether to keep the money in EPF or not.

By then, you will be much ahead of some of the folks asking in forums "Is it worth it to invest in UT funds? Can get better returns than FD, EPF and fixed priced funds, ahhhh?"

==========

BTW before, some smart aleck would say past performance is no guarantee of future performance, please keep in mind that a matured portfolio would have much higher income funds to equity funds ratio. And also that in the next several years, there would be down years as well as up years, but it can be safely generalised that the portfolio can give the indicated x% returns over a time period of 3 or so years.

How confident you are of the portfolio's future performance giving the x% returns? Well, you have been trimming it, topping it, rebalance it, switch here and there from one fund to another over the years...

gracias bro

Wah. Gone la. My hopes of changing SGD with this kind of news.

Good. Have small position only on malaysian equities. No confidence.