My Background

Welcome here!!

This is a private blog to enable me to get connected those people who are in stock investments.

Just a few words about myself and what I do. I had ‘retired’ from corporate world a few years ago, and I am now a full time trainer in financial literacy related programmes. For adults related courses, I focus mainly on stocks investments. I teach students how to select and invest in stocks based on the fundamentals of companies.

I am also an active trainer for financial literacy programmes in academic schools. Of course, I do not teach stock investments to school students who are most likely in their teens. My focus for schools lies mainly in financial literacy programmes to enable students become more financially savvy to prepare them adult life.

If you wish to know what we do, please do not hesitate to look into our website:

A little bit about my history

I was born to a big family. I have 7 brothers and sisters. My mum was a housewife and my father was a sole bread-winner of the family at that time, taking home about $300 per month. We were staying in a one bed-room flat renting from HDB at a monthly rental of $57.50. Needless to say, with a meagre income from my father, our lives were very difficult. Our toys were either handed down from the older ones or we simply pick from the streets. As far as I can remember, I did not buy any text book during my primary school. Most of my brothers and sisters borrowed from our schools under the free-text-book scheme. As one could possibly imagined, the conditions of those text-books were horrendous. The books were often without front covers or had already lost a few pages. To make ends meet, my mother had to supplement the family income through jobs, sometimes doing 2-3 part-time jobs at one time.

One day, my father came home with an injured ankle. He was hit by a crane hook and was medically unfit for 10 days. Being a daily-waged worker, our family‘s taking for that month was affected.  Worse still, that year happened to be during the oil crisis, and inflation was sky high. It was then that I realised the importance of money, and how bad life could be without money.

From then on, I began to think of ways to save and make money. Frankly, I did fairly well. In my school days, I made some money through hard labour by helping my mother in doing domestic jobs for small businesses brought in by her. During my army days, despite that I was from a full-time operational unit, I managed to give part-time tuition and saved a bulk of it. As such, by the time I entered the university, I was able to pay for all the tuition fees for my whole university engineering course. Unlike many students today, I completed my university degree without having to take a single cent of study loan. Basically, I was debt free when I left the university and that had laid an important foundation in my road to financial freedom. By today, this self-imposed rule still plays an important role in my investment philosophy –

 (1) I will never gear up to invest and

(2) I will invest with money that I can afford to lose.

In hindsight, that actually explained why I did not invest in property at all, other than the matrimonial HDB flat that I am staying now. Even that, I made the shortest possible time to pay up the HDB loan in a matter of less than 7 years although I was able to stretch the loan for at least another 18 more years or so. From an investment perspective, this may not be the wisest thing to do, but my background had moulded me as such, and I would feel extremely uneasy if I were to be in debt. That also explained why I never roll over my debts on my credit cards. In fact, I always pay my credit card bills in full before the due date. As far as I am concerned, a credit card is meant for my convenience, and not an avenue for me to borrow.

How did I get into stocks?

After I graduated from NUS as an engineer, my first work place was in Paya Lebar, and I was then staying in Clementi West. The MRT line from Clementi to Paya Lebar was yet to complete, and I had to make several bus changes to and from work. Comparatively speaking, I would consider the transport fare to be high, having to spend more than $2 one way. That would mean that I have to fork out at least $100 to $120 per month just for going to and from work alone. If I were to go out for other social functions or during the weekends, it might cost me another $30-$50. At that time, I found that that there was a way out. If I were a shareholder of Singapore Bus (a predecessor of Comfort Delgro), I would be entitled to buy a monthly stamp, which would enable me to make unlimited trips on SBS bus for the cost of $40. At that time, the share still come in paper-scripts and was denominated in scripts of 500 shares each. To buy the monthly stamp, I needed at least 1000 shares, and that meant to hold at least 2 paper script under my name. I did not have a broker at that time and I had to go to Phillips Securities personally to look for one. (At that time, stock broking was a highly sought after profession. You need to go and see the brokers and seek their permission to be their client. Only when they like you and after going through your credentials, then they consider to sign you up as a client.) To cut the story short, I managed to get one and she helped me purchased 1000 Singapore Bus shares at $3.08 per share, costing me somewhere between $3,100 and $3,200, including brokerage. Basically, I had used up the first two months of my take home pay to buy  my first stock counter – The Singapore Bus.  That year was 1988, and little did I knew that several months before I graduated, NYSE had experienced the Black Monday on 29 October 1987. On that very day, NYSE fell 21% within one single day. The stock markets in Asia, whether Nikkei, Hang Sheng or STI,  also suffered the same fate. At that time when I bought the SBS Bus shares, about 6 months after the Black Monday, stocks were actually climbing up albeit gradually.

As it was my first stock investment, I was literally tracking it almost every day on The Straits Times. (At that time, The Straits Times published all the stock prices including those in the SESDAQ, the CLOB and even the warrants.)  It was a gradual climb, alright! As my Singapore Bus shares appreciated in value, so was my confidence in stock investing. I started to buy into other counters as well in hope to get some pocket money from my stocks trading. Frankly, there was a bit of embarassment when I first received my first dividend for Singapore Bus. Before SGX introduced the electronic shares payment scheme via our bank accounts, all the dividends were paid via cheques. The cheque came in  a perforated copy made from a special A4-paper. As I did not know that it was a distributed dividend from the company, I had to approach my younger brother who was studying Business Administration at that time. It was then for the first time, I knew what dividend meant. From then on, I started to look for shares that paid dividends. Perhaps, the dividend was probably not significant (can’t remember). But, I was happy at that time because I was able to use my dividends to cover a small part of my insurance premiums. (Not bad! I was able to systemize things at that time!)

As shares generally climbed between the late 80s and early 90s, I was doing pretty ok although there is nothing really to brag about. I later found out that during this period, the STI was in a super bull run. The STI was moving up from about 1000 points in the middle of 1988 to about 2,400 points by the end of 1993. Should I have a good understanding of the mechanics of the financial market at that time, I would have made a lot of money!! Even though I was in the market at that time, I did not actually benefit from it. I was actually underperforming the index even though I made a little here and there. At that time, many brokers were making a lot…. a lot of money such that they were able to buy several private properties. (In fact, I believe the Remeiser King, Mr Peter Lim made his fortune around that time. Think about it, the brokerage for each transaction, whether buy or sell, was 1% and there was no internet plaform to trade on at that time. I remember I had bought the Overseas Union Bank some time in the mid-90s- OUB shares at about $8.40 per share at that time and I had to pay around $100 of brokerage as well as other charges. In hindsight, shares trading at that time was extremely expensive!!)

 Without understanding of the fundamentals or technicalities, I simply trade by selling for a few hundred dollars of gain and holding on to investments that I incurred losses. This carried on for a good 10 years, when the stock market was hit by the Asian Crisis. With the STI at the level of 1988 on 30 June 1997, it sank to 805 points on 4th September 1998 over a period of 15 months. In fact, from the beginning of 1994 to the middle of 1997, the STI was already in the sinking mode. It was at about 2,400 points in the beginning of 1994 and was down by about 20% to 1981 in the middle of 1997. From a portfolio of more than $100k, it crashed to about $22k in the middle of the crisis. On top of that, I was selling out my unit trusts, which were  very popular at that time, in a panic. Unit trusts that were bought at $1.17 and $1.07 before the crisis was sold at $0.46 and $0.41 respectively (more than 60% haircut). Apart from that I was also selling out my CLOB shares as they were news that Malaysia was implementing the currency control to ward off the currency attack on the Malaysia Ringgit. Imagine I had bought shares such as Maybank at more than $4 and selling at $0.79 per share on the last day before CLOB closed. On top of that I had many penny stocks such as Mulpha International, Iris…, which I do not know what they were doing. To sum up, the total loss was far too devastating. That was the bulk of my savings accumulated over the past 10 years. Think about it, from an engineer’s starting pay of nearly $2,000 per month to probably at $4,000 per month during the Asian Financial Crisis, I believe it must have taken me at least 6-7 years to save up to $100k. This was the savings accumulated in my day job as well as the money that I had saved by giving tuition at night.

The experience during the Asian Financial Crisis had left me devastated. Until today, it remains as my biggest financial setback. I was probably not the only one who suffered badly. Many investors and businessmen had suffered in various degrees of severity. Many millionaires at that time became paupers, and a lot of assets had their values evaporated within a few months. Even politicians were not spared. As far as I can remember, at least 4 countries had their leaders changed. In particular, Thailand had to change their prime minister a few times within that period. The four dragons (comprising South Korea, Taiwan, Hong Kong and Singapore) and five tigers (Malaysia, Indonesia, Thailand, the Phillipines and xx, I cannot remember the last)  in Asia became pawless dragons and toothless tigers overnight. In the end, several of these economies, namely South Korea, Thailand, Indonesia and Phillipines had to seek financial help from the IMF, while Malaysia had to apply the curreny control to ward itself off currency attack.

Apart from mess created by the Asian Financial Crisis, I was allocated my first HDB flat in January 1997. It was priced extremely high at that time. In May 1996, the property index was at the highest point during the 90s. HDB flats were the ‘price takers’ following the sky high private property prices. While I was in the queue for my first HDB flat, the price for my flat type was actually going up by $10k-$20k per quarter since the time of my application in 1994. In the almost 3-year waiting period, from the time I applied for the flat until the time I got my flat, the price had gone up more than 100%. Unfortunately, since the time when I started to stay in 1998, the market price had been consistently below my purchased price from HDB, and this lasted for about 10 years. Only in the last few years did the market price went above my purchased price in my area. (No luck in properties, perhaps!!!).

Coming back to the shares market. By the time when the STI hit the lowest point of 805 on 4th September 1998, I had sold almost all the investments that I wanted to sell. But little did I know that nine months later in the middle of 1999, the STI had made a comeback with a vengence and was back at 2000 level mark. Another devastating experience – should I have done nothing at all during down cycle, and held it all the way, I would not have lost anything. In fact, instead of selling my investments, I should have bought more and I would have been very, very rich. This was a humbling experience. It added another valuable lesson to my wisdom – Never sell an investment at fire-sale price. In fact, this should be the time to buy up investments at depressed prices. (This is analous to Warren Buffet’s 2 famous quote: (1) Never lose money, and (2) always remember the first quote.)

I made my first comeback

When the STI came back to the 2000 mark in the middle of 1999, I felt like a fool. From September 1998 to the middle of 1999, I was hoping for a decent pull-back so that I can get back into the stock market, but opportunities bereaved me. The market kept going up. Of course, the financial setback left an indelible mark on my financial life that it became a stumbling block to my investment journey. With no opportunity in sight for stocks, I began to look elsewhere. I discovered that gold and oil were actually at their lows. Gold was trading at about US$250 per ounce. It had fallen for about 20 years from a high of US$800 per ounce in 1980. That was when President Nixon gave the go-ahead to unpeg gold and the US$ under the Bretton’s Wood treaty, which resulted in a gradual decline of the gold price for 20 years from a high of $800 to $250 per ounce. Oil price was also falling to something like $20 per barrel, and was at its low since the 1973 oil crisis. Nobody talk about these commodities at that time. (All the banks and financial houses were promoting unit trusts dealing with technology shares on the back of the NASDAQ raging from 1000 in the mid-90s to about 2500 in the mid-1999. Any company that has a DOT-COM was seen as a next potential Microsoft.) Meanwhile, I remember clearly that I passed several gold-smith shops over that few months period, and many shops displayed 916 gold at $16.50 per gram. Precious metals were not that precious at that time. I further read that many gold mines were closed due to the falling demand, and many central banks were trying to get rid of their gold holdings. In fact, many gold mines went bankrupt and gold miners had to seek re-employment elsewhere. This meant that if there were to be a sudden demand, the supply would be extremely tight. At that time, the only supply was due to  central banks selling out their gold hoards. That was the very first investment that I had made after falling victim to the Asian Financial Crisis. At that time, I do not know when gold price was going to go up, but I knew I was buying up something that could have a better value in future (now I know that this is what is known as value investing, which many people are trying to pursue now!). Given my earlier financial setback, I decided to invest an extremely small amount of $2,000 to buy the unit trust in UOB called Gold and General Fund. I remember when I first appeared at UOB-West Coast Branch (no longer exist) in Clementi West, the lady at the counter was extremely shock that I wanted to buy the UOB Gold and General Fund. She could not even find the fact sheets and the documents related to the fund.  Instead, she tried to persuade me to buy the Hendersen Technology Fund, which was doing very well at that time. I did not track the technology fund at that time, but I did know that NASDAQ had been performing very well, from 2800 in September 1999 to 5048 in March 2000. After a long insistence, the lady together with the branch  manager finally relented and helped me filled up the necessary papers to buy the Gold and General Fund. If I remember it correctly, the price per unit was only $0.41. more than 50% discount from its lauched price at $1 per unit. (This episode of events also provided another lesson – buy investments at steep discounts.)

While gold price was dragging along at its low, the NASDAQ was climbing furiously, only to find itself unstable and imploded by the second quarter of year 2000. From a high of 5048 in March 2000, NASDAQ shrank to 2052 one year later, and then to less than 2000 another year later. (By this time, I learnt one more lesson – be responsible for my own investment. No one knows our finances better than we do. Anyone who tried to sell me an investment was more likely to think of his own pocket more than to take care of my financial well-being.). Should I have listened and acted on what the bank employee told me, I would have lost at least 50% of my investment.) This lesson was a very good learning value for me because as I became more established in my career, many people were offering me ‘investments’ that served me no purpose. They came with promises of high returns and very rarely able to preserve the capital – pyramid schemes, MLM, gold trading, local and foreign properties. The insistence that I will take charge of my own finances had put me in a good stead to gracefully reject investments that I do not wish to have.

After the purchase of the first tranche of the Gold and general Fund, I had made several more purchases of the fund at various prices, $0.46, $0.39, $0.42. While I did not consistently bought it every month, I was in a way practicing what fund managers described as dollar cost averaging. It was a long and boring process, especially when I have no idea when gold price is going to go up. What held me on was that I was practicing value investing because I knew that gold price would spike during times of uncertainty. Furthermore, oil price was at its low because OPEC was losing grip in controlling the oil supply. If there is a sudden need for oil, the oil price should also surge in value. So, I hanged on and continue to increase my holdings, a bit at a time. When I invested a total of about $10,000 or so in the Gold and General Fund, I stopped buying it. In the mean time, the DOT-COM bubble had burst, and I managed to avert the crisis altogether. I began to become cautiously confident again. The bad memories of the Asian Financial Crisis had by then faded enough for me to get back into stock investments, but this time a lot wiser. The so-called experts in technology are just good salesmen riding on the technology wave. That actually add another valuable lesson to my repertoire of wisdom. Unit trusts that come with a theme., eg. technology or commodities like to ride on those waves to make selling easy. However, for the fact that they become popular meant that the underlying stock prices must have been up for quite a while. Investors that went into these investments at this time were unlikely to have picked up those investments at good prices. They are just helping fund managers to increase the size of their funds or perhaps help them pay off the dues that are required to launch those funds. In fact, from my observations, many of the funds started to go underwater once the initial launch was closed.

By the end of 2001, I was back in my shares investment again, but this time, a much wiser man. For the first time after the Asian Financial Crisis, my portfolio just crossed the $100k mark by end 2001 even though there was a terrorist attack on the World Trade Centre (WTC) Towers on September 11 in that year. The financial setback during the Asian Crisis became a pillar of strength of which I could look upon in all the crises that followed. Apart from the terrorist attack on the WTC, there was also the Severe Acute Respiratory Syndrome (SARS) in 2003, the Global Financial Crisis in 2008-2009 and the still on-going Euro-zone financial crises (2011-). Instead of fleeing the stock market in panic, I began to take each crisis in my own stride. In fact, after all these life lessons in investing, I began to take crises as opportunities. These were rare life opportunities that presented themselves at fire-sale prices. The fact that I had sold investments at fire-sale prices during the Asian Financial Crisis taught me that there would likely be someone out there selling off his investment at a fire-sale for me to pick up in subsequent crises. So far, this investment mindset had not failed me.

As mentioned earlier that during the Asian Financial crisis in 1998/1999 when I almost emptied by shareholding, it took me some time to regain my confidence. I almost vowed never to be back in the stock market again just like many had done during the more recent GFC as well as the penny stock crash in October 2013. I believe my small purchase of the Gold and General Fund from UOB helped me a lot in gaining back my confidence. That was the unit trust that helped me think independently amidst all the noises to encourage me to get into technology stocks. The gradual advancement of the gold and oil price during the early 2000 all the way past the GFC and the crash of technology stocks during the DOT-COM crisis that I had avoided altogether taught me that if I have been doing my homework, I am just as good as other good investors out there.  After all, I have an engineering degree and holds an MBA, and if I am not making use of them to make independent analyses, I am not doing justification to myself. I did not managed to hold by Gold and General Fund all the way to the GFC, but that pleasant experience to be able to ride through those years was sufficient to put me back in stocks. In fact, by this time, many investors were praising Warren Buffet for not investing in technology stocks that he told investors that he did not understand. Ironically, just 1-2 years before that, he was being blamed by investors for not buying into technology stocks and that had resulted in the Berkshire Hathaway share price under performing the index. In a similar fashion, I also felt like a hero too because I had averted the DOT_COM crisis altogether just like him.

I accumulated the most during the 2000s

In the meantime, slowly and surely, I was accumulating another stock, The Cerebos Pacific. That was somewhere around late 2000. As I was recovering from the bashing during the Asian Financial Crisis (AFC), and had just witnessed the DOT-COM bubble, I was not ready for another high volatility stock apart from Cycle and Carriage (the predecessor of Jardine C&C), which I will talk about at a later stage. So, I was looking into more stable stocks like food and tonics. That’s was how I discovered this great stock – Cerebos. It was undergoing some corporate changes and had made some share consolidation. But by and large, it paid good dividend. And because the company paid good dividend, the drop in the share price after it went ex-dividend usually was more than the dividend itself. The down price could last for even 1-2 months because there was no incentive for investors to get in too quickly as the whole year dividend had already been distributed. (Cerebos distributed first and final dividend once a year.) This observation is valid even till today. My conclusion is that generally investors have very short-term view. Once, the dividend is in their pocket, they sell the stocks immediately. That being the case, I should buy the stocks after when the dividend was distributed, not exactly immediately but maybe one or two months after. I might not benefit from the dividend distribution, but I made up for it by buying at the much lower price. (Haha, I am starting to understand market psychology and applying contrarian view techniques in my stock investments.) The good thing (or maybe a bad thing depending on how one sees it), Cerebos was a very highly illiquid stock after all the stock consolidation and corporate changes, the parent company, Suntory Ltd in Japan was holding 85% of Cerebos leaving only 15% in the float. And because the trading volume was very small, the step jump whether up or down direction can be very significant. So, it was possible to buy the stock at significantly lower price if one has enough patience to wait. I have enough of that patience because my intention was never to sell (learning from WB). My intuition told me that one day Suntory would want to take the company private and not just leave the last 15% dangling in the float. I do not know when, but it should come one day. That few years of around 2000 to 2003 had enabled me to accumulate some Cerebos stocks at good value. Not only did they paid good dividend, the share price had been going up on the whole because the company was doing very well. In fact without fail, it paid 6 cents of normal dividend and 19 cents of special dividend  every year such that in every shareholder’s mind, the total dividend of 25 cents per share is almost a standard. And, by the time when Suntory decided to take over the company in 2012, their offered price was a whopping $6.60 per share! (This episode also taught me a valuable lesson – Don’t just invest blindly. Think of the exit plan. An investment without an exit strategy may mean that we can get stuck in the stock for a long, long time.) At that time when I started to accumulate Cerebos, I surely do not know when they are going to take the company private. The only hint that I had was there was only 15% in the float. My final plan was that if they did not take it private, I was prepared to continue to take the dividend and accumulate the stocks as long as it takes. Also, whenever the trading price fell below my average price of $2.50 per share, I shall consider to buy it from the stock market. I later learn that this strategy is called buy-and-hold strategy. When Suntory finally took the company private, my share in the 15% float was a six-digit figure. (In fact, it is also the same situation now that we do not know when OCBC is taking Great Eastern private. It had attempted twice but not successful. Right now I think their attention is more in buying China banks than to buy up Great Eastern unless the minority shareholders start to lose their patience and the GE share price falls significantly.)

On the Cycle and Carriage (C&C) which I mentioned earlier, I bought the stock just before the Asian financial crisis. C&C used to be the sole distributor of Mercedes Benz, and probably, one or two other car-brands in Singapore.  And because it was a heavy weight stock, I remember the price at which I bought very well. It was $11.90. At that time, a board lot was 1000 shares. That was easily $11,900. With the brokerage of about 1%, I believe I must have paid more than $12,000 for the one board lot of shares. As one may have guessed it, during the AFC, the share price plunged badly. Adding to the woe was that Mercedes is a luxurious brand, and during deep crises like AFC, we should expect the share price to plunge significantly. It does not help when not long after that, C&C was to lose its Mercedes sole distributorship in Singapore. That plunged the share price further. I believe Mercedes must have compensated C&C for giving up the sole distributorship, and Phillip Eng, who was the managing director of C&C at that time made a very brave move by investing in Astra, which was a crown jewel for car distribution in Indonesia. During good times, it was unlikely that Astra share would be sold to foreigners.  But, the AFC hit Indonesian companies really hard. Imagine before the AFC Indonesia Rupiah was 2,900 to US$1 and at the peak of the AFC, it was 16,500 Indonesia Rupiah to US$1 (more than 500% depreciation). Certainly, with the plunging Indonesia rupiah, Astra’s balance sheet went into a tail-spin as it was importing vehicles in US dollars. And because of the plunging rupiah, its debt magnified many times. It was a no choice situation for Astra, that they have to sell part of the company to C&C. However, at that time, the market viewed that C&C is taking on excessive risk by investing heavily in Astra and punished the share price even further.  At its lowest, the price was $2.80 per share. (In hindsight, it was a good move by C&C. This also taught me a further lesson that the market is not always right. In fact, the market was very wrong as we know that it is now trading at more than $40 per share.) Meanwhile, the Jardine group bought up C&C shares, and hence, the new name Jardine C&C. As my stock in Jardine C&C plunged as I ride through the AFC, I was averaging down desperately, all the way down from almost $12 to $2.80. Unfortunately, my averaging methodology had been very unsystematic. Each time, I averaged down, the price went down further. At its maximum, I held a total of 15 board lots of Jardine C&C shares! Unfortunately, my mind was not to hold the stock as I never would have imagined that the stock would climb many folds to more than $40 in 8 to 10 years later. My concern was to average down whatever I could and hope that price can come up again to around $6 and I would sell the stock. I believe my average price was around $5 to $6. And as it did , the share price went past $6, I had more or less sold most of the stock. In hindsight, if I had learn how to join the dots and pieced them altogether, I could have held a big bulk of the 15 board lots. Translate to todays term, taking a share price at a nominal value of $40, it would have been at $600,000, yes $600k, no less. (I really have to bang my head against the wall!). Even by 2008, just before the GFC, Jardine C&C shares have already passed $20 per share. I had a good feel for it because when the GFC struck in 2008/2009, I actually had a second shot at this stock. I managed to pick up some when the stock sank to the lowest point of $8.00 per share. So, to summarize it all, the stock devil that had been haunting me became a stock darling especially after the GFC. Unfortunately, I was not able to fully capitalize on this situation, although I did make a bit (really tiny compare to $600k) out of this stock even till date. I learnt from this episode that we should take a long-term view of stocks. In fact, buying into Jardine C&C is one way of getting into the Indonesia market. Furthermore, Astra, which is now 50% held by the Jardine is one of the best, if not the best managed company in Indonesia! The whole problem I had was that I did not look at stocks in totality. My view at that time was to play not to lose. From then one, my philosophy is to play to win and not to play not to lose.

Coming back to technology stocks, I actually did not abandon it altogether.  Although I did not look at any stock in particular, I was actually monitoring the NASDAQ movements from time to time. When the DOT_COM bubble burst around March 2000, I thought perhaps I should look at it, not to go into it immediately, but monitor it for a while. (I later learn that this was in-line with what is known as ‘Never catch a falling knife’.). As mentioned earlier, it sank to below 2000 within the next two years or so. At that time, Singapore together with the Asian region was hit by the SARs. Most Asian economies were badly hit. Not only were tourists avoiding the Asian region, locals had been avoiding public places such as in public transports, restaurants, shopping malls and libraries for fear of contracting the SARS, which had seen death cases even among otherwise healthy people. The Singapore economy, being a very open one, was of course not spared. It came to a standstill literally. Perhaps insurance claims might have gone a bit higher but certainly not for insurance sales. To help an insurance agent friend, I bought a one-time payment insurance from him. As one knows most of the one-time insurances are investment-linked. So, in buying the insurance, I decided to choose the Prudential Global Technology  Fund as I believed that technology stocks should have already hit the bottom or somewhere near the bottom. By this time, lousy companies would have already flushed out leaving behind the good ones (survival of the fittest). So, it was quite safe to get into technology stocks. Since, I do not know any particular stock, one way is to go was to buy into a unit trust the has a technology mandate. At that time, which was about 2 years after the  DOT-COM bubble burst, the NASDAQ had sunk to below 2000. Just recently, I decided to cash out of the insurance as it was meant to serve as an investment plan and not an insurance plan. With the NASDAQ crossing the 5,000 mark, I managed to doubled my investment after a little more than 10 years. While I cannot say that it is a fantastic return, I dare say that it is at least a decent recent in view of the current business environment. This investment experience reinforced my ‘theory’ that plain-vanilla unit trusts can make money only when one way, and that is when the index that it track is moving up. Of course, the fund manager behind the fund can spice up the fund with derivatives and CFDs to capture the downside when the index falls, but that, of course, comes with a cost.

Although many of stocks were profitable post 2000, there were two rotten apples in my portfolio. One of the stock was Chartered Semi-Conductor (CSM). This stock was IPO in the 90s, after a huge fanfare. At that time, I did not have the stock and did not keep track of the price. However, I did hear from veteran investors that the stock price went as high as $18 per share. I did not verify or took an effort to verify because when I started to get interested in the stock it was already around $3-$4. That time was in year 2002-2003. So, more or less the stock was already sinking from as high as $18 to around $3/$4 at that time. By that time my stock investments was starting to bear fruits, and I was cautiously regaining my confidence. The danger thing in stock investment is sometimes, complacency can get a better of us. I was exactly in that kind of situation. I bought my first lot of CSM at 13 June 2002 at $3.84. It was two years after the DOT-com bubble burst, perhaps just before the SARS epidemic. I do not know exactly why I bought the stock. Perhaps, it may be because the price at $3.84 was extremely low compare to the $18 reached by the stock in the 90s. Perhaps, that was what I thought as value-investing. (This investing psychology is known as fixation. Basically, we used a historical price as a reference point thinking that it is possible for the stock to hit that price again). Unfortunately, the stock plunged further. I bought 2 more board lots on 8 Aug and then another 2 more board lots on 19 Aug at $2.78 and $2.52 respectively. My average price came to be about $2.94 after taking account of the brokerage and other charges. Unfortunately, the stock was sinking really fast. It was around $1.60 in September and $0.79 in December in that year, when I bought 5,000 lot each. I also managed to do a bit of shorting and then buying back at lower price, but it really took a lot of attention out of me. I was literally averaging down and gambling to gain back from the stock.  It was extremely lucky for me that in October 2003, the price went back to between $1.80 and $1.90, and I managed to reduce my holdings. In the years that followed up to August 2007, I managed to either short and buy back at a lower price or long and sold at a higher price. There was no consideration of the fundamentals of the company or the industry. I count myself extremely lucky to have made a little more than $3,300 after the five years. This period happened to be one of the golden era of STI Index, which advanced from around 1,300 to the all time high of 3,800. (Warren Buffet’s famous quote – a rising tide brings up all boats.) If it had been in another period, I could have lost a lot of money just because that I made a first wrong move in my purchase. Basically, the fundamental was not there. It had to keep up with the technology by continual building of larger and larger foundries to make semi-conductor wafers. Furthermore, the company was always playing catching up to the bigger Taiwanese rivals, who were way ahead technically. The investments in the foundries were not cheap, resulting in the company to incur losses year-after-year. Basically, it should not be an investible company at all. (Of course, one may argue to short the shares instead. But at that time, there was no Certificate for Difference (CFD) option and, if I have not mistaken, naked shorts was already illegal.) This episode of events taught me one hard truth about stock investing. Once, we made a wrong purchase, it is very difficult to unwind. Very often, it results in financial losses or it could affect us mentally or both. From then onwards, I start to focus more on fundamental investing. If a stock is fundamentally not sound, it is no point to get into it and suffer a long period of unwarranted headache holding the stock. Stock investing should be – once we have invested our money, we should not spend too much time and attention on it besides taking a look at it once in a while. That extra time could have better spent with our loved ones or in more productive activities.

Another rotten stock that worth mentioning was Acma. It was one of those stocks that I lost the most money and held for the longest time. Frankly, I do not think I am able to recover from this stock, but I learnt a lot from after investing in this stock starting in the 90s. In fact, the tanking of the price of this stock from $5 after a share split of 2 for 1  in the 90s to the current share price of 34.5 cents after consolidating 100 shares into one share speaks for itself. If the share consolidation did not take place, the share price would have been 0.345 cents (less than 1 cent). This means that the share had retreated 99.93%. I bought this stock when I was a rookie investor, and I am still holding it now. Due to so many problems related to this stock, I was able to draw many negative examples. To take it positively, it could also be a blessing in disguise. Due to the fact that this stock was an engineering & project related that had became a super penny stock, I managed to avert many crises related to companies of such nature. For example, I was not hit when penny stocks imploded in October 2013. I also averted the oil and gas bond crises that caused Swiber to go into liquidation and then judicial management after some consideration.  Frankly, after the lessons learnt in Acma, I was quite on guard of engineering projects and engineering stocks despite being an engineer by training myself.

Global financial Crisis (GFC)

Another stock that worth mentioning is DBS. In the post SARs period, the Asian markets were quite stable, and I managed to pick at $14.80 in Feb 2004 (definitely not the lowest). In that period till 2008, the global economy was performing very well, and of course, inflation too. At that time, the commodity stocks were having a good time. It was this time that the STI rode all the way from 1,300 after the SARS in 2003 to 3800 in 2007, an increase of about 200% within 4 years. It was a relatively good period for anyone who bought ST components stocks. Certainly, DBS is no exception. If an index is moving up, when we trade up or buy and hold till the end of period, we should be able to make some money. During that period, DBS was moving around like $12 after the SARS to $25 when it was at its peak. This had allowed me to buy and sell, and then when it pulled back, to buy again and sell some time later. However, my holding remains relatively unchanged. It was only during the GFC that many financial stocks were beaten down to a great extent. The reason being financial stocks in US were at risk. Lehman Brothers was declared bankrupt. Citigroup and AIA would have gone in history if the government did not step in. Merrill Lynch was taken in by Bank of America. Consequently, many financial stocks around the world were all at risk. We do not know which bank would be the next one to fall (Just like right now, we do not which bond or note of oil and gas companies is going to default following the default of Swiber bonds) At that time, DBS stock was also beaten down badly. It was then trading below $10 during the peak of the GFC.  Of course, at that time, it was a good time to buy and accumulate this stock. The rights issued at a 40% discount at $5.42 certainly helped further.

During the Global Financial Crisis (GFC), I managed to pick up OSIM at an average price of 8.6 cents per share. The rights offered at 5 cents during the GFC was heavily undersubscribed and I managed to get the additional subscription that I need. It was a fairy tale story that it enjoyed a successful growth of 22 quarters that spanned over 5 good years after the GFC. It was either the longest growth or one of the longest growth stock in the Singapore history. At its peak, the share price hit $2.94. Thereafter, it started to raise a bond for expansion even though it does not seem to need money based on my evaluation. At about the same time, the CFO sold 1,000,000. Unfortunately, I did not followed him. The yield was too good, following the dividend distribution of 6 cents per quarter (1 cent and 2 cents for each alternative quarter). That means I recover my initial investments every 1.5 years. Frankly, I was too complacent. I had a lot of opportunity to sell, but I chose to lend out my shares through SGX shares-lending program instead. In fact, it had even dipped below $1 mark after several quarters of dwindling profit. Finally, the chairman and CEO, Mr Ron Sim, decided to take it private at a proposed share price of $1.39 per share. With the weakening sales, buy-out offer was accepted. Despite dropping from its high, I managed to fetch a multi-bagger of 16 times for this stock. In fact, I had recovered several times my initial investments from the dividends and share-lending during those years. It was one of the best stocks that I had ever owned.

Why I am in shares?

One of the key reasons why I continued in shares was that it gave me an alternative way of earning at income. Frankly, I am not maximize my returns with the smallest amount of investments. I just wanted to build an asset to can provide me an alternative income. It is like building a property portfolio and earn returns through rentals. Unfortunately. I am never rich and property portfolio has been beyond my reach. Furthermore, I do not like the idea of debts even though many people think that property debts are good debts. So, I started off with shares and am still in it.

Basically I am a one ‘lotter’ and all me stock investments start off with one board lot of 1,000 shares especially the blue chips. For the cheaper stocks, each transaction is about $5,000 in order optimize the brokerage cost. (Based on my calculation, it should be around $8,929 in order to fully optimize the $25 brokerage fee.) However, I find the amount difficult to ‘average’ down (See last chart at 5:42 on the video by clicking here) when I need so I used a lower transaction value of $5,000.

Personally, I believe I will grow old one day, and so is everybody. There will come to a time when I am not able to move my limbs to walk or use my hands to work. I believe I will come to that stage somewhere in the future that I will be wheel-chair bounded. However, so long as we keep healthy, the brain should be one of the last organ to fail. This means that I am still able to think and ‘trade’ in stocks even though my limps have failed. Like any practicing trades, there is always a learning curve. With my years of experience in stock trading/investments, I hope to share this experience with like-minded investors out there.

Thank you and I hope you had enjoyed my lengthy background. I hope you will enjoy the blogs that I put up from time to time.