Saturday, November 7, 2015

Best Time for Investment

Do you know what is the best time to invest?

I started to invest in stock market in the early of year 2009, when the market was just started to recover. In fact, I did not really meet any serious bear market yet by then, except the recently black August where the KLCI index has drop more than 15% and MYR currency has depreciated against USD more than 27%.

In these 7 years of investment experience, I learned that the best time to invest is the worst period. Sorry to tell you the same thing again from what other experts told you before.

Warren Buffet said, be fearful when others are greedy, be greedy when others are fearful. This is a golden rule in stock market, or any investment. But what did normally people do and practice? They follow the crowd. When others started to make money, we observe. When others made tonnes of money, we started to follow. When we make some money, we sleep into it. We are part of the greedy crowd and eventually we donated our hard earn money to the market.

No doubt I have been making growing profits from year 2009 till 2013. Nonetheless, I started to make loss last year, and this year. Partly due to did not spend much effort in analyzing the company fundamental, and partly I have invested some companies that are already in the end of the cycle, such as plantation, O&G and property developer.

Anyway, that's not the point and they were just part of my mistakes and failure experience. I also caught the right trend before, such as rubber gloves and technology companies that brought me handsome profits.

From the black August few months back, my total stock investment has made paper loss of 10%. Actually it is much more worse as few of them are dropped more than 30%. The loss is mitigated due to 50% of my portfolio are investing in REIT and high dividend companies. I tried to control my emotion but eventually I disposed most of the heavy losing companies. Then I swift part of the extra funds to go for those export manufacturers which earn in USD.

No doubt, within 2 months time, I made handsome profit of 20-40% from few companies. Unfortunately, I just swing part of the extra funds to invest. And also due to the heavy loss earlier, I'm still making minor loss for this year in overall.

By in conclusion, I realized it really can make handsome profit during difficult time, during the time when everyone is disappointed and away with the market. Like the expert shared, when you feel like you are afraid and worrying when you click at order butting, that's the right time to buy! Not the time when you feel excited. I totally agreed with this experience.

Since the market has recovered more or less for now and KLCI index has already shoot back up to 1,700 points, perhaps we will have to wait for the next round of serious correction or bear market.

1 comment:

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