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If the fundamentals of a business are good, we would invest in the business if we could, wouldn't we?
If the share price should see a decline but the fundamentals of the business remained intact, we should increase our investment in the business if we could, shouldn't we?
I am trying to make 2 points here:
1. Declining share prices give us an opportunity to buy more shares cheaper.
2. We should always have a war chest ready to take advantage of opportunities.
People who do not know what they are investing in might worry.
People who do not have a war chest ready might feel regret.
Do the right things, don't worry, don't regret.
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10 comments:
Thanks for the reminder AK.
Don't worry.
Hi SnOOpy168,
Yes, don't.
This blog post was inspired by a conversation I had with a friend. :)
Thanks
Apart from savings, what are the other ways to build up your warchest?
I always have trouble divesting out of any investments! :)
Hi JCK,
Well, I think you have the answer. ;)
Divesting investments which are underperforming or no longer cheap is another way to build up our war chests.
Of course, income distributions from S-REITs and dividends from stocks will help as well.
a very good and timely post. there must always be a plan for the peak and valley of the market.
AK
finally got on board Yongnam at 28.5cts. I followed your strategy of using CPFIS as a warchest. I divested my soundglobal at 69 and buying back now at 52 LOL.
Hi seefei,
I thought that there could be other readers who might have the same "worries" that my friend had. Hence, this blog post. :)
My CPF-OA and SA are definitely important war chests. There could come a day when I utilise the funds for investments again.
Congratulations on your astute moves in Sound Global and Yongnam. :)
AK, frankly now a lot of stocks are trading at or near supports.
CMZ is coming back to $1 again. May not be the bottom yet but the risk reward definitely higher than say 2 weeks ago.
Just offer a price and it may be filled, as Mr Market is in a generous mood recently.
Price is what we pay and value is what we get. Buy what you need and not what you want and you wont be too far off.
Hi seefei,
Indeed, I put in so many overnight buy orders that I amazed myself. It has been a while since I have had so much in the buy queues. Hahaha.. ;p
Hi ak could you do a review on china fish
Hi Bill,
This is somewhat too complicated for me with too much going on as well with acquisitions and disposals here and there. I will pass.
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