Many years ago, I jump into market just to INVEST, and the horror is without a single knowledge of Fundamentals or TA or reading any annual reports or anything required one to be in market. I jump in as I seen my mom happily investing and earning money in the market. Thats the year of 1990s, where our Malaysia market is having some bulls. I earn some money then and those paper loss I keep as I was told that one day the price will come back to my purchase price or higher. Then came 1997, the market crash, I got burnt as I was still holding on to those paper loss company.
From 1999, there is a mini bull run, I again without learning jump into the wagon again to TRADE this time, again still without any TA or FA knowledge, just purely RA (Rumours analysis), haha , this time I got smarter, I just got out before the dotcom bust with some profit though still not recovering the 1997 lost !!!
My point here !!!
If you earn money in 1 year or even 2 years in the market, can you say you are SMART and are those in the 10% group that earning money in the market and not those 90%? Lets see... I did earn money from 1994~ 1996 (3 years), that time I thought earning money in the market is easy as long as you have the patience and holding power. Then came 1997, my profit was wipe off and also my savings, some stocks was delisted !!! See, one cannot give a conclusion that he/she has the knowledge to earn money from market even he consistently profiting for a few years. If someone tell me that market is a risky place to put my money during 1996, I will tell him , are you nuts ? see my record, 3 years in the market and still earning money. Its also same for other investment, be it property, trading business or even manufacturing. So, in order to be success in the market and be the 10%, one need to profit enough money keep back your capital in the FD and only use those profited money in your portfolio for investing or trading. No matter how things turn out, you are still the winner as you will not lose your capital (As Warren Buffet rule#1, DO NOT LOSE MONEY).
STRATEGY ! STRATEGY ! STRATEGY !
During 1999, I got a good friend told me a story of his friend, he use all his savings and even mortage his house to INVEST in the market that being badly beaten around 1998. He put the money there in some CI stocks and dont even review or monitor them. He then started to monitor his stocks only after 1 year (1999), imagine, his wealth has DOUBLE UP !
I did not involve much in the market during 2000 ~ 2008, as I still have the heart pain of 1997 loss. So, came again the crash in 2008, this time I told the same 1999 story to my colleagues, but non of them believe is workable and I got hesistated. So, I decided to use my 1999 strategy (IN OUT, IN OUT) to play the bull run that started 2009. This time, I told myself EDUCATION/KNOWLEDGE is important, so I pay to go for CNX course (a pure Technical Analysis) course beginning 2010. The course did help me a lot in my money management & timing my purchase (though only 60~70% success rate).
During 2009 & 2010, I did earn some money but I still find that one of my weak point here is I do not have a CONCRETE STRATEGY to build my wealth ! as I only learn to gain small profit of fast in fast out of a market. 2009 & 2010 is another once in a decade for people to DOUBLE UP HIS WEALTH, I miss the 1998~1999 and now I miss the 2009~2010 run !!!! Really get frustrated with myself. No choice, everyone here has an itch fingers nowadays to IN OUT IN OUT of a stock , then life only is FUN. The other thing is I'm lack of fundamental knowledge that will help in giving me confidence to keep my good stock during these 2 years bull run. Example, if one has bought PBBANK during 2009 (around RM7) and KEEP till now, your wealth is still near to DOUBLE. Even with this recent BIG CRASHES, you still can sold off half at your own sweet time and keep your capital (Preserving capital is important , right ?) and let the remaining in the market earning 5% dividend every year till you retire. Imagine this is what I call PASIVE INCOME.
So, I keep telling myself, I need to come out with a strategy that have a portfolio that consist of VALUE INVESTING (for building PASSIVE INCOME) and MOMENTUM PLAY (for my itch finger and also can gain faster if luck is with me). Note: momentum play need TA knowledge with LUCK okay! I have the TA knowledege though not expert and now I need the luck ! Everyone likes thrill and fun in short term, so momentum play is fill with THRILLS !!!
Have you plan out a Wealth Building strategy ?
I have made my own strategy which is 90% as a Value Investor and set aside 10% for momentum trading as to polish the TA skill.
ReplyDeleteI've been in out for 2 years starting 2009 and though I'm still in profitable region, however, it is way too far to achieve my Financial Freedom goal. So enough is enough, I've come out the strategy and I'm going to adhere and abide by this rules strictly..
Good, when there is a strategy, there will be actions. Strategy will leads to significant wealth increase is important ! Lets achieve our Financial Freedom goal the soonest :).
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