Sunday 7 February 2016

For A Better Tomorrow

These are difficult times for investors. Even for me who have gone through several bear markets, I have felt the stress. However, it is times like these that we learn how to be better investors, building up our strengths in emotional control, investment strategies and stock-picking skills. Bear markets are very good at exposing our mistakes, and learning from mistakes is one of the most effective ways of learning the art of investing.

One key area of stress in my portfolio comes from a concentration in Global Logistic Properties (GLP), which was initiated barely 3 months ago in November. It was my first attempt in concentration. As things turn out, it is not the best of times to learn how to concentrate. At the start, a mere 3% daily fluctuation in the stock price is enough to make me worry about the outsized position. In fact, this 3% daily fluctuation can cause more concern than a 30% paper loss in a diversified collection of oil & gas stocks whose collective size in the portfolio is nearly equal to that in GLP. I told myself if I ever wanted to be a successful business investor, I must learn how to ignore this daily fluctuation and the stock price. It is certainly not easy. So far, the paper loss on GLP is approximately 20%. The training will go on.

So, do not be despair by the current difficult times. They are there so that we can learn to become better investors. It is like the young butterfly which is struggling to emerge from the cocoon. The struggle might seem overwhelming at times, but it is through that struggle that the butterfly finds the strength to soar to greater heights!

It is the eve of Chinese New Year and the time to put the stock market aside and celebrate the joyous occasion with your loved ones. I wish all readers a Happy and Prosperous Chinese New Year! 祝大家新年快乐,万事如意!

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  1. Hi Chin Wai,

    U r not alone. I am also holding GLP and looking to average down since it has drop more than 20% of my average cost!

    I try to average down only when 20% fluctuation. And each trade try to limit to below 5k.

    Anyway happy CNY. 猴年大吉, 新年快乐!!!