Do you know that most investors buy high and sell low? The following are some evidence to show that investors always buy high and sell low. The bar chart shows the net equity cash flow (in USD) into mutual funds. On the other hand, the line chart is the year-on-year returns of MSCI AC World USD. The pattern shows that when the stock market was rising, many investors would buy equity funds. But … [Read more...]
Why private banking clients have no asset allocation skills?
A UBS survey among high networth individuals in Singapore and Hong Kong revealed interesting findings: 62% of investors admitted that they did not know how much to save for retirement Only 1% claimed to have begun to plan for retirement Asset allocation is the same regardless of the difference phases of retirement planning. Asset allocation is something like: 60% in stocks 40% in … [Read more...]
CPF private pension plans – sure way to lose money
CPF Private Pension Plans to be revisited? Some Singaporeans have been pressing the government to give a higher return in their CPF savings. Perhaps under pressure, Deputy Prime Minister Tharman Shanmugaratnam surprised participants[1] of the Institute of Policy Studies forum on CPF and retirement adequacy that for those who can shoulder higher risks and want higher returns, the CPF private … [Read more...]
Land banking in Singapore will go out of business
Monetary Authority of Singapore (MAS) sends shockwave to the land banking industry in Singapore by issuing a consultation paper entitled “MAS Proposes Stronger Safeguards for Investors” to regulate the largely unregulated industry. It is quite a surprised to everyone since it is assumed the authority does not want to regulate land banking in Singapore. What is land banking? The Land banking in … [Read more...]
The Tragic Liberalization of the CPF Investment Schemes
This is a very brief history of the CPF Investment Scheme. When the investment scheme was first introduced on 1 May 1986, it was known as the Approved Investment Scheme (AIS) which allowed CPF members to invest a portion of their CPF-OA above their minimum sum in stocks, unit trusts and gold. In Oct 1993, the AIS was renamed Basic Investment Scheme (BIS) and the Enhanced Investment Scheme … [Read more...]
Survey shows investors will lose money
Why engaging a financial adviser may not help?
Many people who engage financial advisers on investments have some unrealistic expectations. How well a portfolio can perform depends 99% on the investor himself. So regardless of how good a financial adviser is, if the investor does not do a proper job, it is guaranteed that the portfolio will lose money on a long run. The following are some of my thoughts speaking from real life experience with … [Read more...]
7 Tips on How to Lose Money in Investments
Actually nobody wants to lose money in investments but in my experience, majority of investors will not make money. Here are some reasons why investors will not make money in their investments: If you want to earn money quickly, you will lose it even faster. This has to do with speculation. Investment & speculation are not the same. Speculation means your desire to earn quick money. This … [Read more...]
Why most people are losing money from investment?
Most people lose money from investments because of: Speculation and investing in higher non-systematic risk Market timing such as investing when market is going up (thus buying at highs) and "cutting lost" when market is coming down which is selling when lows. High cost. High cost of investments comes from trading fees (i.e. brokerage fees), bid-ask spread, management fee, impact cost, … [Read more...]
Lessons to learn from Minibond (MiniBomb) at el
CIMB-GK Securities, DMG and Partners, Kim Eng, OCBC Securities, Phillip Securities and UOB Kay Hian announced that they may be compensating the “vulnerable” group of investors who have lost their money in structured notes linked to the Lehman Brothers. This follows after similar move by DBS Bank, Hong Leong Finance and Maybank. While many investors are happy about the outcome, there are many … [Read more...]
