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How to Reduce Risks When Investing

Written by Dennis Ng on .

Welcome to the 115th Issue of Weekly e-newsletter by www.HousingLoanSG.com This week I like to share with you "How to Reduce Risks When You Invest”

 

How to Reduce Risks When You Invest?

One common question I'm asked is how do I reduce my risks when I invest?

The First thing I always share is "put your eggs in different baskets" - diversify into different asset classes. For instance, currrently, I have 7% invested into Gold/Silver, 10% in land, 10% in UK Endowment, 5% in French Fine Wine, 33% in Stocks and about 35% still held in Cash (Opportunity Fund).

The next thing you can do to reduce risks is "learn from shopping when you invest".

What do I mean by that?

 

When you go shopping, do you just buy any items at regular price? Most probably you try to look for "bargains". If they offer you 20% discount, probably you are more interested, and you will actually grab and buy if you see 50% discount or higher. Right?

If you adopt the same principle and strategy in investing, you can easily reduce your risks.

For instance, using this principle, you are unlikely to be interested if someone offer to sell you a 99 year leasehold Tanah Merah Condo at S$900 psf. Similarly, you are unlike to be interested if someone wants to sell you a 99 year leasehold condo in Ang Mo Kio for S$1,150 psf.

You will look for bargains. Perhaps, you might be interested in a condo at Bishan selling at S$900 psf instead of the Ang Mo Kio condo, becos the price is lower.

How do you value a condo? How do you come to a decision whether a property is over-priced or reasonably priced or a bargain? Well, if you don't know how, any price might be a good price for you.

What about stocks? How do you value a stock? How do you know whether a stock is over-priced, reasonably priced or a Great Bargain? Because of what I know, recently, I've been buying a stock which in my opinion, the stock (company) should be valued at least 100% to 200% above its current price....so I just quietly buy as this stock is not covered by most stock analysts. Using the same knowledge, 3 years ago I bought into Pokka at 30 cents, and eventually I got back 75 cents (or 150% Gains) 2 years later when the Japanese parent company bought back the company.

Using a combination of Fundamental Analysis (analysing the fundamentals of a company) and Technical Analysis (analysing the price/volume movement of stock and index), I decided to sell off 80% of my stocks in year 2007 when stock markets were high. This knowledge and decision helped me to lock in over 200% Gains I made from year 2002 to year 2007. If I had not sold, my gains would probably be just 30% right now.

How do you assess whether a stock or stock market is over-priced and might Crash?

I’ve begun teaching what I know through a full-day Seminar entitled “How to Save and Accumulate One Million Dollars”.

Irene Wong, one of the graduates of the seminar, said that this seminar is Better than T. Harv Eker’s 3-day “Millionaire Mind Intensive” Seminar, as I helped her to make a breakthrough in managing her finances.

 
 
Seminar: How to Save and Accumulate One Million Dollars (In English)
Date: 22 Nov 2009 (Sun) (Our apologies, the seminar was postpone because Dennis is sick).
Time: 9 am to 7 pm (Registration from 8.30 am)
Venue: SMU, School of Economics
SMU, School of Economics and Social Sciences,
Level 5,_ Classroom 5.2,_90 Stamford Road
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(Opposite Rendevous Hotel)
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If you drive, please park Rendevous Hotel, Plaza by the Park or YMCA. Car park is also available at SMU School of Business (S$3 per entry on weekends).

You can call us at 6339 8570 or 6339 9255 for any clarification or email us at info@MasterYourFinance.com

Course Fee: S$98 (inclusive of Course Materials, Lunch and 2 Tea Breaks).
Note: Lunch and 2 Tea Breaks are provided, inclusive of Course Materials of over 100 pages...

 

Note: above is just my personal opinion. This e-newsletter is not giving you advice.

We help consumers compare all the Housing Loan packages so as to help them get the BEST deal.

 

How much do we charge for our service? As we're paid by banks separately, we have decided NOT to charge a fee for our service. Therefore, this service is FREE to you and you have nothing to lose and everything to gain by engaging our service.

 

Just call us at 6737 8801 or email us at info@HousingLoanSG.com if you're considering to buy a property or refinance your Housing Loan, whether in Singapore or in Australia and you want to make sure you get "pre-approval" of loan before you commit your cash.

Cheers!

 
Dennis Ng on behalf of
www.HousingLoanSG.com- get you BEST Deal in Housing Loan in BOTH Singapore and Australia!
 
6737 8801 or 6339 9255
 
 
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