My investments took a tumble again.
With the US imposing tariffs on trade with several countries in particular with China, the world is on edge. The Federal Reserve of US (Fed) is also increasing benchmark interest rates faster. This did not help to calm the investment community.
My Singapore equity consisting of mainly blue chip stocks of the STI component stocks declined over the past weeks. As a whole, it declined 23.6% from my costs of purchases. Some stocks were bought as far back as in 2008.
I am of the opinion that to pick stocks for investments is harder with the volatility of stock markets. After buying them, I see them declining later.
Holding cash seems to be an option for now. If inflation is benign, then cash will not be eroded due to inflation. Sometimes one wonders whether it is far better to spend money than to invest and then see one’s investments losing values. That is the stage I am at. I have no confidence in investing right now.
Some would argue that we have to invest for a secure future. I then would add that you have to look at both your current investment objectives and your risk profile to determine how you want to go about building your investment portfolio. That is theory and I know it is not easy to get it right.
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Geopolitics tussles tend to be good buying opportunities over medium-to-long term. Asia ex-Japan stocks are approaching oversold. Will be looking closely in next 1-2 months, which probably continue to remain volatile.
OTOH, asset classes like tech stocks are hitting all-time highs. I’ve been taking some profits off tech ETF in the past week. Will probably look to sell a bit more XLK tonight.
I think that is why it is important to diversify in different countries. As per recent news, SG market has declined YTD by 3.1% while US, Germany, UK, JP and HK have each returned positive gains of more than 5%. If one is concentrated in SGX, the loss will not be mitigated by price appreciation in other regions.
Hey,
It happens to everyone at some point.
Maybe you can try to structure it in such a way that you’re happy no matter what happens. eg: hold some of your money in cash, and buy more when the market falls. If the market shoots up, are you happy waiting on the sideline for a few years, while everyone else tells you how much money they made? Whats the worst that can happen? Whats the best that can happen? Look at a long term chart of the STI, from before the Asian Financial Crisis…the volatility has always been there…how could you navigate your way through it?
Take care
Thanks for your responses to my post. Such is the nature of investing. You gain and you lose, hopefully more gains than losses.To set my this post in context, I am diversified in my overall portfolio. The overall portfolio was down about 2% because of the diversification. The major laggard was the Singapore equities that I am still holding on despite the declining prices over the years. I have been reluctant to invest more in this volatile time.