4Q 2021 passive income: Don't lose hope!

My last quarterly update was late by a few days.

So, I am compensating by being a few days earlier with this one.

Also, several things which will need my attention in real life have popped up next month in January.

Unfortunately, they are likely to be very time consuming.

As I still want to spend much of my time in virtual worlds, I might not have much time left in January for blogging.

Neverwinter is launching a new module, Dragonbone Vale, on 11 January but until then, I will be busy in the worlds of Black Desert Online and Genshin Impact.

I am really enjoying Genshin Impact and can imagine losing myself in that world for some time to come.

I blogged about retiring in 3 virtual worlds a few months ago and that included Guild Wars 2.

Genshin Impact has replaced Guild Wars 2 for me.

The 3 virtual worlds for me are now Neverwinter, Black Desert Online and Genshin Impact.

I wish I have many more hours in a day but, sadly, I don't have enough hours each day for more than 3 virtual worlds unless I abandon the real world.

See:
Dividends and retirement in 3 virtual worlds.

This short video clip provides a peek into the world of Genshin Impact.

Anyway, this is going to be a shorter blog as nothing really earth shattering happened in this quarter.

Well, at least I don't remember anything impressive.

If you would like a more detailed update regarding my investments and if you missed my last quarterly update, read:

3Q 2021 passive income: Better days ahead?

OK, on to the numbers.

Total passive income received from my investments in REITs and non-REITs in 4Q 2021:

S$ 21,283.82

Total passive income received for the whole year of 2021:

S$ 171,854.30

This is more than the S$ 120,000.00 that I need per year.

So, 2021 has turned out to be pretty good for me.

However, this number includes a one time distribution made by Accordia Golf Trust which is not going to be repeated.

Everything being equal, therefore, 2022 could see my passive income lower.

I am crossing fingers that 2022 will be a better year than 2021 for me.

Centurion Corporation could pay dividends again while ComfortDelgro and Ascott REIT-BT could pay their investors better in 2022.

Of course, with the Omicron variant of COVID-19 now running amok, things are more likely to get worse for some time to come.

Still, we must never lose hope.

To end this blog, I am leaving a link to a blog which did particularly well this quarter.

If you missed the blog, you might want to read:

Retiring by 40 is a fantasy for most and AK talks to himself.

Regular readers know what I am going to say.

It's still the same old phrase.

If AK can do it, so can you!

Wishing everyone good health and good fortune in 2022! 

Happy new year!

Cut loss on Alibaba or buy more for a Merry Christmas?

I did not plan on blogging again until the new year when I would share my 4Q 2021 results.

I would also probably have blogs about the CPF sometime in January.

However, the reader who wrote to me about his purchase of Alibaba shares at $220 a share after reading blogs by a local blogger left me another comment.

For those who are clueless as to what I am talking about, read:

Invest in Alibaba Group? High risk, high reward?

Anyway, after reading the reader's latest comment, the blogging bug bit me and the result is this blog.

Alibaba's share price continues its slide and the downtrend is pretty much intact.

It should be obvious even to those who are not technically inclined that the downtrend is pretty persistent.

Many have been cut very badly by falling knives and some have had their fingers or hands cut off.

There are many who are still holding on in the hope of a reversal so that they could make a lot of money eventually.

However, they should bear in mind that there are many stale bulls who are waiting for a lift in prices so that they could sell to break even or to reduce their losses.

It is only reasonable to expect some strong resistance or those holding on could be setting themselves up for more disappointment.

So, investing in Alibaba Group now is to invest in a downtrend and to hope for a reversal that is likely to be full of obstacles.

It is definitely not for the faint hearted and those who do not have deep pockets.

This is especially the case when Alibaba does not pay dividends.

So, to say nothing of the capital loss, the opportunity cost for investing in Alibaba is pretty high.

Alibaba's investors are not being paid to wait for things to get better.

What to do?

If the ever widening paper loss is making us lose sleep, it is probably a good idea to reduce exposure.

Using money we cannot afford to lose or borrowing money to invest in such a situation is probably a sure way to get insomnia.

Those with anger management issues could even see familial and social ties affected.

What about those who have used money they can afford to lose?

Well, they are more fortunate because they only have to ask if they are willing to lose the money invested in the worst case scenario? 

Now, to answer the reader's question in his latest comment, whether to cut loss now or to hold on, is there another question he should ask?

Yes, there is one more.

If he did not invest in Alibaba Group at $220 a share so many months ago, would he invest in Alibaba Group at $117 a share today?

Why should he cut loss now if the answer is "yes?"

Of course, in such a case, it would mean that the time to cut loss has come and gone for him.

If he wouldn't invest in Alibaba Group even at $117 today, it probably means that his opinion of the investment has shifted so much that a much lower price is needed to entice him.

In such a case, cutting loss and buying again when a reversal is in place might be a better idea than simply holding on and possibly losing his mind.

We should bear in mind that share prices flow down a river of hope in a downtrend.

Low could go lower.

The time to buy is probably when share prices move lower in an uptrend (i.e. buying the dips) or even when share prices test supports in a rangebound situation.

Investing in Alibaba Group now is to buy the downtrend but if you are a billionaire like Charlie Munger or if you are investing with only a small fraction of the money you can afford to lose, you probably don't have much to worry about.

Having said this, we can never make all the money in the world and there are more important things in life than money.

Peace of mind is priceless.

I will end this blog with a screenshot of my house in Black Desert Online which has been nicely decorated for Christmas.

Merry Christmas!

Related post:
Investing with some common sense.