Investing in 2016 – Stay calm

Back in 2008 when we were in the thick of the Global Financial Crisis (GFC), the Straits Times Index (STI) lost about 50% (dropping from 3,482 points to 1,750 points).

My Singapore equity portfolio was down 17.8% in 2008. This was not unlike last year (2015) when my portfolio for Singapore stocks was down about 19%. I am seeing a bit of history repeating now.

History told us that the STI gained back some losses in May 2009 to 2,238 points, a jump of 28% from end 2008. Currently, it was at 2,882 points as of last year (2015), another jump of 28%. If one did not panicked in 2008, you would have done all right by staying invested.

What would I do in 2016?

I would probably hold onto my Singapore equity and not to sell off everything. Most stocks owned are STI component stocks and STI ETF. I do not trade on margin and I shy away from small-cap and Catalist stocks. I do not own China stocks also. These were volatile and I do not do research on these stocks.

I would not be putting fresh funds into new investments this year, conserving my cash balances to ride out 2016. There is still too much uncertainty in the global economies.

What I would do is to constantly review my entire portfolio of investments throughout the year and see whether there is a need to re-balance the investment mix. I may take some losses to clean up my balance sheet. But all these require one to be calm in this difficult period.

Copyright © 2016, limkimtong for Living Investment

The material presented is intended to be general and written in layman’s language as much as it is possible. The author shall not be liable for any direct or consequential loss arising from any use of material written. Please seek professional advice from your financial advisor or financial institutions on material written covering financial matters.

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One Response to Investing in 2016 – Stay calm

  1. apenquotes says:

    Thank you for your thoughts.
    Agree with what you have said.

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