high lately. Nasdaq topped 5,000 level for the first time since Mar 2000. Apple’s
market cap hit US$775 billion. The Dow and S&P 500 also routinely hit highs
for the past year. The Japanese Nikkei average closing above 19,000 for the
first time since April 2000. Over
at Britain, the country’s benchmark FTSE 100 index also surpassed the peak set
during the height of the dot-com bubble. Back home, STI crossed 3,400 points
since the start of the year, something rare since GFC.
Of course back in 2000, some companies in Nasdaq had ridiculous PE of 100x, but today stocks are expensive but not outrageous. E.g. Apple is only trading at ~17x, holding on to US$175 bil of cash. In Singapore STI is trading at undemanding of ~14x.
I am sitting with more cash than usual now. Stop envying…haha…its not a lot! I
know many bloggers already have their warchests stock up anticipating the crash. I do not have a warchest, just a POSB bank account with little money.
excess cash or not? There are different school thoughts as follows.
because over long term, the stock markets will beat inflation, bank deposit or
bond rates return, as proven historically. Afterall, from 2004 to 2014 (with
dividends reinvested), the STI ETF returned >8% and last year’s returns
it’s time to be patient and build up your “war chest” ready to be deployed
during a “bear period”. They also says, not only is the market expensive now, there are so many
problems mounting in the world. Oil crisis, Greece at verge of exiting
Eurozone, Fed to further increase interest rates, China slowing growth etc
“Whack” During Bear Market – So Easy?
bear, so that we can “whack” your life-time savings, war chest, rainy funds,
cash whatever you call it, into the stock market.
sounds simple. Is that so simple?
a crisis, my portfolio is likely to suffer a great decline. Still feel good? Still have guts to dump all my excess money into the already plummeted stocks?
I really know when is the trough stock curves? When is the time to buy?
is the time it will recover? Am I ready to wait for 1 year, 5 years or even
more than 10 years? What if it never recover?
stocks, funds or index to buy?
Please also read a wonderful written post by LP – Unactionable advise
no Guru…I am not a Gu Shen…I am only talking to myself…
opinions. I will keep it brief since “no one shirt
will continue to invest, but less allocation of monthly investment funds
compared to last year.
will be more selective. Select stocks with strong balance sheet, high cash generating,
less leverage, good track records to tide over past crisis, non-cyclical nature
etc Sounds easy, but in most case, these stocks are usually more expensive than the rest already.
still unsure, take a Holiday Break and Do nothing! Don’t think so much…
Anyway, I am just back from Bali, a yearly tour
routine location for me. The sun, sea, sand, delicious food, nice restaurants, cafes, bars,
friendly people, reasonable pricing …