Thanks.

Can get a free ebook from him too! Ha.

I'll ride it out with my current stock and REIT holdings. But I have stopped buying since last month, except for the Astrea IV PE Bond Funds.

For my learning, why ride it out strategy?

Not that cyclic, will drop by only x%, takes only y years to recover, hard to get in later, losses too small, extra expenses in selling and buying, etc etc?

Thanks.

You can ride it out if you buy low enough. Provide you some comfort level when stocks are falling as you are still in the green.

Ride it out as you continue to earn dividends regardless of the market. Dividend reduced but you still get paid.

That's my understanding of what he meant.

Well,... from my actions in the above, I would have destroyed my profits too,... Yeah, I would still be in the green,... but lots of "green $$$' has been wiped out by the mkt meltdown. If I had sold earlier, I would have reaped more profits,... ie, would have run away with more profits before the stock prices dropped.

Yeah, the consolation is in the continuous dividend received (provided it is not stopped).

And if we have selected good companies to ride over with, then the dpu slump, if any,... would be minimal only.

Hi bro,

Many thoughts have run through my mind when this meltdown started, and what I should do to prepare for this. The best reasons I could give for my choice of approach would be :-

1) I don't need the money, hence, I can still afford to eave them 'inside', ie invested.

2) I love the cashflow, which would supply me more bullets to take advantage of the dipped prices later.

3) I continue to believe in my counters.

Having 'declared' the above, I have to say too that I have decided to divest Keppel Corporation for now, at a profit.... The yield given by KepCorp against my Buy Price is too low, and I think the dps will drop in the coming year, FY19....

Hence, I have taken profit for Keppel Corp..

Thanks. See below.

I will share some
*** I also don't need that money but I do not want to see the value dropping by half like it happened in 2008 recession. So prefer to take it out to and park it in FD etc though the return will be lower. Growing at a slower rate is preferred than loosing half its value.
A: I welcome correction as it allows me to pick good stocks at good price. That's why I kena bash in FSM thread as I was celebrating the recent down time. If you cannot tahan seeing the value dropping, have to go for super save investment
1) FD (totally no)
2) ASNB FP
3) EPF
With this 3, you won't get heartsick no matter what happen to the market. Sometimes not getting heart sick is better. Take your time to keep cash and equivalent when things are expensive. Don't get FOMO.

Losing half it's value and not selling won't incur anything. Only if you use margin or someone force you to sell then yeah you have lock in your losses. An investor is his worst enemy.

*** I assume you meant the dividends from that shares. But won't the dividend be less during recession? Double jeopardy - reduced share price and reduced dividend?
*** If you sell before the crash, won't you have more bullets for your safari hunting after the crash? Ya ya, only if the crash happens!
A: Dividends may/may not drop depending on recession. Why do I say that? Solid companies like Nestlé, TnB won't go away in a recession. Rain or shine, people still need to eat, use electricity. That's defensive investing. If a company is only paying out <50% of the cash, dividends are more ear less assured. Just won't grow. Price drop allows me to accumulate more shares at cheap price to get more dividends.

You won't know when crash will come. You can only prepare for it by keeping cash and buying at low price. So if a crash comes along, you are prepared with cash. If you had FOMO and give chase, then you can only seat and watch sadly. Having a boatload of cash can be a good thing in times of crash (remember I am not saying bucketliad but boatload) That's why I keep cash when there's nothing to buy. So what kena eat by inflation? Inflation is slower than what I can pick up in a crash.

*** You must have done a lot of homework in that shares to have such faith in them! Ha. But companies are like any other things, they can change, some for the better and some for the worse.
A: you need to analyse your companies and make sure they can continue paying you.

Moral of my story
1. Keep cash when market is expensive. Don't FOMO. Is worth keeping cars.
2. Don't be afraid of crash. Welcome with open arms. S
3. Invest in good companies with payout of say 40-70% dividends is one criteria.
4. Invest in companies with increasing DPU
5. Invest in companies which manage to profit during 2008-2009. For those companies are more or less survivors
6. Invest in defensive companies.

the time is RIPE for crashing. sai lang all later boss.

Further opinions,....

1) "*** I also don't need that money but I do not want to see the value dropping by half like it happened in 2008 recession. So prefer to take it out to and park it in FD etc though the return will be lower. Growing at a slower rate is preferred than loosing half its value."

Well,... if the fundamentals do not change and the counter is able to survive the meltdown / recession, it will regain its glory and go back up to its previous high again, or perhaps even higher. In the meantime, I will just continue to earn the dividend, and yeah, I may need to tolerate some dips in the dividend too. But if my holdings are large enough and my Average Price is low enough, the yield would be high enough to withstand any dpu reduction. The amount wouldbe big enough for my to build my warchest.

The moment you sell, you lose many of the above characteristics when you try to buyback again in future.

2) "*** I assume you meant the dividends from that shares. But won't the dividend be less during recession? Double jeopardy - reduced share price and reduced dividend?
*** If you sell before the crash, won't you have more bullets for your safari hunting after the crash? Ya ya, only if the crash happens!"

Perhaps,... yeah, may need to tolerate some dpu dips, yeah,..but,.. please see my above explanations above size of holdings and level of Average Price.

3) "*** You must have done a lot of homework in that shares to have such faith in them! Ha. But companies are like any other things, they can change, some for the better and some for the worse."

This is my risk then,... and this is where skils of investing, for eg diversification comes into play.

Finally,... I always believed one should stay invested, but that's me,... So, rain or shine, I will find an instrument to go into throughout the different cycles of the mkt. I will not hold pure cash,....

I regard Foreign Currency FDs and PE Bond Funds as investments too.

*** It goes down by half, let it recovers after x years. I still cannot understand why is that a good strategy. Get out early and park the money somewhere first. If that company is really good, then get in again on recovery. Maybe it is easy to say but hard to do. I will be doing that soon (minus the buying on recovery). Ha.

*** See my comment above.

How sure are you can buy back at the bottom? Will the price comes back to original price? Possible but unlikely. Some stocks never come back to their original price.

What you're doing is to avoid risk. But of course, high risk, high return. Just before TOPGLOV announced their 1:1 bonus issue, their share price dipped for no reason (You can view historical prices). Probably investors were afraid. If you were one of those who sold, you would have missed out the bonus issue and a potential 10% capital gain.

Not aiming to sell highest and buy lowest. See my graph earlier - case 3 the realistic.

The bonus loss there is secondary to the main aim of avoid the big dip due to recession.

Not looking at the day to day trading here but looking from a distance at the stormy weather now for the coming HURRICANE/CYCLONE/TYPHOON/PERFECT STORM/xxx. Ha.

Your timing may be right when you cleared your stock. But it may not be right when come the time to collect. To time correctly both SELL & BUY is a difficult task that most will failed.

After you sold, you would not be able to collect dividends anymore, but of course, you may say the dividend may be totally wiped-out by the recession. Then here, we have to analyse our holdings carefully, REITs and shares,...

Secondly,... hehe, I have another saying, to time the mkt once is very difficult, but to time it twice ?? You have to be right TWO TIMES if you are to sell now and buyback later. S_Kalan said this too,.....

The market is on random walk in the short run.

What are economical/financial unsustainable that will cause hurricane/perfect storm to the market?

Recent market rout was the hurricane predicted or just uneventful/minor thunder storm?

This post has been edited by icemanfx: Nov 2 2018, 04:25 PM

I really failed in my communication. Not trying to time it down to the highest and lowest. See modified Scene 3. Added in the bold dash lines to indicate the windows available.

Not looking at the highest & lowest days. The time available to sell and buy were not just weeks window but months. Yes, this time round, it may not be a carbon copy. But I believe the general pattern characteristics will be there.

A major war (USA & China, USA & Iran etc)?

Interesting video to watch about rising power against the ruling power, last 12 wars resulted from this conflict. Catalysed by a third power. Now USA & China with N Korea as the catalyst?

https://www.ted.com/talks/graham_allison_is...ble?language=en

My gut feel is the excessive QE in the USA etc for many years will take its toll in the coming recession.

Many things are not right in the economy now and sitting on a tight rope.

My 2 cents.