AAR & TOL 03 (Aug 09 - Dec 13)

[kennynah]

let's play a hypothetical game here...

supposing you had excess cash of S$100K now...

how would you invest it.... with the following assumptions :

a) no stock market
b) annual inflation rate at 3.5%

waiting eagerly to hear from you....thanks !

[winston]

Wah lao .. if there's no stock market, there would be a lot of lost souls wandering around, including me

1) Got futures market or not ? Can buy Commodities or not ?
2) Got Bond market or not ?
3) Must invest in Sin$ or can buy any currency ?
4) What is your time frame ? When do you need this money ?
5) Can build up business with the money or not ?

[kennynah]

1) Got futures market or not ? Can buy Commodities or not ? (no equities/index futures...got commodities)
2) Got Bond market or not ? (have)
3) Must invest in Sin$ or can buy any currency ? (you suka)
4) What is your time frame ? When do you need this money ? (no immediate need for this money.. can be 1 year or more)
5) Can build up business with the money or not ? (as long as it is moral business...can)


so...what would you do with his S$100K?

[winston]

At this point in time, his maximum loss is about Sin$3500 less whatever small interest that he can get at the bank. But maybe there would be deflation at the end of one year so he may not even lose his Sin$3500...

If it's my money, I would just keep it as Cash. Within the next two years, some opportunity may arise eg. stock market crash, commodity crash, bond crash etc.

At that time, I would look at the situation and then decide where to put the money. In the meantime, I would use the money to stag on some HK IPOs

[winston]

Hi kennynah,

I have been thinking about your question because I'm also facing the same problems with my own portfolio.

Everything has gone up eg. Properties, Commodities, Equities and Bonds.

Therefore, do I want to chase them and try to get a few more puff before the cigarette butt burns out ? Or do I want to wait and see what happens ?

Asset Classes cannot go to the moon in a straight line ...

1) Properties may continue to go up for 1.5 years more until the NPLs starts showing up in the Chinese banks. As it is, the leakages have already slowed down.

2) Can China continue to buy Commodities and store them for future use indefinitely ? If the intention is to convert those useless USD into hard assets, Commodities may continue to be high for the forseeeable future. However, there's also regulations coming to curb speculation and it may take the wind out of the Commodities market very quickly. However, an Iran sanctions may create a spike on oil.

3) Equities have rebounded and do you want to be buying Equities at this level ? I think it would be back to good old fashion stock-picking. There may be some bargains left but the markets have already priced in a strong economic recovery.

4) Can interest rates continue to remain low indefinitely ? When it spikes up as in Dubai, Greece and Portugal, Bonds would be hit.

In view of the above, I'm sitting on Cash while I "Swing Trade" with the rest of my money. As and when a good IPO comes along, I may also stag on it.

This wait could be as long as two years so it's not a bad idea to go back to the corporate world, build a small business on the side or to spend some time on charity and volunteer work. It's also not a bad time to pursue your passion whether it's reading, travelling etc. The wait after the Asian Financial Crisis was almost two years ...

My 2 cents after a night's sleep.

Take care,
Winston

[kennynah]

thanks W !

so what to invest in with that S$100K?

too little for properties...
too little to start any substantial revenue generating business...
equities on high side now (as you put it)
Am no Way getting into some network marketing scheme of things
shoot a film? too little money
keep in bank...pittance IR
USD currency fx play....maybe


so in the end... not much ideas generated....

[winston]

so in the end... not much ideas generated....

Cash is an Asset Class

[kennynah]

by itself...it is a depreciating asset...not wise to hoard cash in pillows....

[lithium]

How about Casino

No stock market, mai casino lor.......

[kennynah]

hahaha...how to make money from casinos....tough lah....go play and get entertained is ok.... not to gamble...