Yesterday marked the end of the last trading day for the year. On the whole, it has been a great year even though the advancement of STI could not match that of the other markets like Dow Jones, Nikkei 225 or Hang Sheng Index. Still, it has been a decent climb of about 18%.
Looking back, it has been a good year in the backdrop of the stock market performance. It is also a year that 2x baggers or even 3x baggers touch-lines were crossed after having invested and accumulated those stocks for some time. Apart from the need for good stock selection, other essence such as patience and mental fortitude to act against times of adversity are also the necessary ingredients to make them happen. But again, life has not been without woes. Comfort Delgro did not perform as expected as it tussled between the bulls and bears the whole year long. The only saving grace has been that a huge percentage of this stock holding was purchased at an average cost of about $1.50 level many years ago and partially sold around its all-time high 2 years ago, thus providing a good cushion as the stock price fell from about $2.48 to $1.98 this year. Another was Midas Holding, which perhaps, was one of those things that we act out of character from time to time.
Taking a longer term snapshot of my stock investment journey, I would have considered that it has been a great blessing. Despite the close to nothing active income for the past 9 years, the stocks advancement had well-compensated for it. The focus on long-term goal has worked well for me to continue to accumulate stocks slowly. It has also taken a lot of pressure off unlike the younger days. This has enabled me to do and develop things that we do not have opportunities to lay our hands on while working full-time.
Perhaps, the generally low interest environment, coupled with the generally mild inflation, in the new millennium has benefitted stocks. By this time, many of us would have forgotten the hardy times when the fixed deposit (FD) rates of around 5% in the late 90s and around 10% in the early 80s. Going forward, I believe going back to the days of FD at 5% could still be some way off, but still, 2% or even 2.5% could be within striking distance in the next 2-3 years barring unforeseen circumstance. So, to expect the stock performance for the next 2-3 years to be as good as this year would probably be too far-fetch. It could even be down significantly if the unexpected happens.
Until today, I still lament over the first 10 years of my investing journey. It all started even without knowing that a cheque-like paper attachment on a perforated A4 paper was indeed dividend from this company call Singapore Bus (a predecessor of Comfort Delgro). Unfortunately, it had been trial-and-error methodologies that lasted a good 10 years until the Asian financial crisis struck in the late 90s. The greed in me then was trying to chase every single so-called money-making opportunity that came along, attending countless hours in seminars on Saturday afternoons and weekday evenings. Still, I did not make good money in the early nineties when the stock market was red-hot and end up incurring losses when the Asian financial crisis swept across Asia in the end of 90s. In hindsight, I could have probably done much better if I had sought proper guidance and adopting strategies that suited my personality. By today, I do not attend any of these seminars or even some annual general meetings (AGMs) anymore. I think I could have spent those times to learn and improve other skills and to develop things that I can leave a legacy. That said, that was also the time of awakening that had helped laid the foundation stone that enabled me to rely on this investment mode to this day. After all, we cannot learn how to swim without drinking some pool water or learn how to cycle without falling off from a bike. There are always learning lessons no matter where we are in this journey.
Going forward, maybe it is also time to tone down on stocks and focus on other developments as stock investing may become a weary chore.
Brennen has been investing in the stock market for 28 years. He trains occasionally and is a managing partner for BP Wealth Learning Centre. He is the instructor for two online courses on InvestingNote – Value Investing: The Essential Guide and Value Investing: The Ultimate Guide. He is also the author of the book – “Building Wealth Together Through Stocks” which is available in both soft and hardcopy.