My Thoughts and what next in my investing journey,

22/07/2021

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How expensive is US market?

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Shiller PE ratio are used to measure the price VS performances of S&P500. Currently the PE ratio is @38. While the historical avg PE is at 16.8. So basically we are paying double the price. Thus US market is really expensive.

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Why is it keep going up?

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We should look at the US interest rate. For the Fund Manager, who are holding on to large pool of investor money, their job is to grow the money. Which asset should they allocate to? Specifically, Equities or bond market.

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With such low interest rate, bond market become unattractive. If we want to put a multiple to the bond market is around 71. While the Equity market is only 38. The Equity market is still relatively cheap. Thus it make sense for the Fund manager to continue to pour money into the equity market.

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With all the money printing, US inflation had increases to 5.4%, ATH. Most people do not want to hold cash, instead they pour their money into stock market hope to beat the inflation.

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Will the US market crash?

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For now, US government is trying to keep interest rate low to help people and business to access to money easily, due to the pandemic.

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But in the future, to combat the inflation, government will raise the interest rate. By the time, the bond market will be more attractive. The fund manager would then move the money from stock market to the bond market, at a high interest rate environment, new bond will be more enticing.

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How should we invest?

• Passive investor: continue to DCA into an broad index like S&P500. Over long term, it doesnt matter. Because you are aiming the 7 -8 % p.a. return

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• Active investor: Remember "buy great business at great price” be patience. You dont want to buy something that is very expensive. Alternative, diverse into other sector or market, active investor must always be a cheapskate.

18/07/2021

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Investment is all about managing personal emotion, especially when you are invested in US/china extremely volatile, really need a pair of diamond hand seeing your portfolio swing wildly. For DYI-ing, new investor is still recommended to use different type of ETFs as an instrument for investing

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When stock pick, i still believe in the old fashioned way, to see the financial statement, determine the intrinsic value, apply margin of safety and use the technical analysis as a guide to enter the market. Rather then news, expectation or other people analysis. Holding great business for long term.

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Although US is the highest growth markets, it is also important to diverse into different markets. So you wont fall into the trap, “market too expensive, i am not investing”, there is always something cheap to buy.

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Review of my portfolio

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Google really done very well, among the MAGAF stocks for the first half of the years, almost doubled quietly. Microsoft is like an old man climbing up slowly but steadily. Apple have a few major up and down. And Amazon been stagnant for almost half a year then recently shoot up. Been buying TSLA on dip, but will stop buying, too much Tsla, should not be more than 20%. Make a mistake of selling Facebook, will buy it back at the next support.

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Singapore stocks had done well especially for the banks, recovery from the pandemic, The SReits are still recovering very slowly, will continue to DCA. Target to hit SGD $2000 by end of this year and i will be able to receive dividend monthly next year. I cant control the stock price, but at least i can control how much dividend i will receive.

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What Next?

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Currently china market is weak, i will continue to add $KWEB to my portfolio. Although, Alibaba is a great company but due to politic issue, i will reallocate the fund to $KWEB once it reach $300 target price. To gain exposure to china.

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I will also be looking at NVDA particularly (target ~$610) and SOXX ETF, semicon is re-tracing.

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Seem that i need to save more money and do more moonlighting, lot of things to buy.