Interview with b0rderc0llie
Investideas: You have a very special nick. What is b0rderc0llie?
Border collie is a type of dog breed:- http://en.wikipedia.org/wiki/Border_Collie
InvestIdeas: How long have you been investing / trading ?
When I was 21 years old, my grandpa gave me some shares and told me just to keep it. It was a sizeable amount, but I was not really interested in money at that time, and I had no knowledge of finance, so I just let it be.
I was studying computer science and was interested in the theoretical stuffs like algorithms and articifial intelligence. The engineers build the hardware, the programmers build the software; what I was interested in was not the hardware nor the software, but something more abstract, something which will never change with time, the basic principles of computing.
One day, a relationship manager in DBS approached me and asked me to invest in something called the Horizon Investment Programme. It is a unit trust, but I did not know what it was at that time, so I declined. However, it sparked my interest in investment, as I thought it was pretty cool to be able to generate returns like 10% on the principal sum, as projected by the fund.
So, when I wanted to further my studies, I found something interesting called financial engineering which is supposedly a combination of computer science, finance and mathematics. I did the course to get my grounding in finance, and also learnt to apply techniques in mathematics and computer science to model situations in the financial world.
I learnt things like option pricing, structuring products using derivatives, quantifying risk etc. I was pretty comfortable with computer science and mathematics where things are black or white, true or false. In finance, I find many situations grey and unfamiliar. After I learnt about the models they use to model the financial world, I was not convinced that they fit the real world. The financial world is a combination of human behaviour, and trying to model it is like quantifying human behaviour.
InvestIdeas: What are your favorite books on trading / investing?
During that time, I was reading up on investment books on Buffett, Philip Fisher and many others. I found it more interesting than my studies, and those ideas from the books formed the basis of my investment ideas.
InvestIdeas: What are your investment vehicles ?
I started with the 2 stocks that was given to me. Currently, I have diversified into about 6 stocks without touching any of the original. In May 2007, I started my experiment on options in the US market, and soon expanded into experimenting on futures and the options on futures as well. Also, I built up a portfolio of US stocks too.
I use the US market as the different instruments are readily available there and within easy access. However, I treat that as my play account, and cap it at at most 20% of my total portfolio. My main portfolio comprises of Singapore stocks, which I buy into “monopoly” companies and hold for the long term.
I use a dynamic asset allocation strategy for investment. ….
Continue reading at the forum to find out more about his use of options and how it is part of the dynamic asset allocation strategy.
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