Buy and hold - but not for too long

(22-08-2011, 09:20 PM)Behappyalways Wrote: One should monitor the flow of funds. If funds are coming in, general stock market will rally and your individual stock counter will most likely to follow. And vice versa. When general market comes crashing down, most stocks will fall no matter how fundamentally sound or whatever term you name it.

Sounds like a sure winner, an answer to every retail investor's search to make money in equities.

Seems easy enough just following the flow of funds.

How does one go about following the the flow of funds?

Anyone can help in this?

(21-08-2011, 07:08 PM)orang Wrote: Is there really such a thing as Buy and Hold?
Hold for how long?
Not too long?
How long is not too long?

So it comes to when to buy
You probably need a crystal ball to find an answer

Maybe what to buy
Probably
Or is it?

At the end of the day it is a question of what you want
Unless you are a headless chicken
Most would agree to get more than what pittance the banks offer

One need not go far for such a simple need
Take e.g. Singtel
At current price it offers around 5% yield
Certainly the risk is there. Any stock for that matter
Can we say there is a margin of safety at this level

What strategy?
Alternatively you can wait for the price to drop to a 6% yield

Now to the question of 'hold how long'
Until the yield drops to 4%
Or 3%

This time is different?
No!
Every time is different

When I refer to BAH - its not so much of the time frame involved. Rather, we base it on whether we think a company is under or overvalued based on what we think is the intrinsic value of the company rather than the number of years.

As to whether there is sufficient MOS depends on too many variables like the stability of the earnings, type of company etc so it's different for everybody.

(23-08-2011, 08:16 AM)orang Wrote:

(22-08-2011, 09:20 PM)Behappyalways Wrote: One should monitor the flow of funds. If funds are coming in, general stock market will rally and your individual stock counter will most likely to follow. And vice versa. When general market comes crashing down, most stocks will fall no matter how fundamentally sound or whatever term you name it.

Sounds like a sure winner, an answer to every retail investor's search to make money in equities.

Seems easy enough just following the flow of funds.

How does one go about following the the flow of funds?

Anyone can help in this?

Behappyalways's method is called 'following the smart money'. I do not know of any free source that gives such information. But i would like to think that 'following the smart money' is self destructive - ie. the more ppl get onto it, the harder it is to use it to make $ anymore..

Personally as a long term investor, i use the VIX index (fear indicator) to gauge the general mood of the market (when to buy). I also gauge the mood of amateur investors around me to understand when there is exburance (when not to buy)

When i started investing in 1988, i adopted an investment principle of buying in the Bear market and selling in the Bull market. And i intend to follow this Bear/ Bull cycle of investing with my whole life. i called this my life's cycle investing. i have no choice because i am not smart at reading Company's Annual Reports. i also always have my doubts about GAAP type of Company's report. Companies have to much "freedom" in this accrual type of reports.
So i am not sure whether my investment style is considered "BUY & HOLD" or "HIT & RUN". i suppose it depends on the period of each BEAR/Bull cycle.
i only know this cycle is getting very much shorter, lately.
i am not sure, this is beneficial to me or not?

Please comment, we are all here to share.
Thanks.

(28-08-2011, 02:38 PM)weijian Wrote:

(23-08-2011, 08:16 AM)orang Wrote:

(22-08-2011, 09:20 PM)Behappyalways Wrote: One should monitor the flow of funds. If funds are coming in, general stock market will rally and your individual stock counter will most likely to follow. And vice versa. When general market comes crashing down, most stocks will fall no matter how fundamentally sound or whatever term you name it.

Sounds like a sure winner, an answer to every retail investor's search to make money in equities.

Seems easy enough just following the flow of funds.
How does one go about following the the flow of funds?
Anyone can help in this?

Behappyalways's method is called 'following the smart money'. I do not know of any free source that gives such information. But i would like to think that 'following the smart money' is self destructive - ie. the more ppl get onto it, the harder it is to use it to make $ anymore..

Personally as a long term investor, i use the VIX index (fear indicator) to gauge the general mood of the market (when to buy). I also gauge the mood of amateur investors around me to understand when there is exburance (when not to buy)

Thanks Weijian for responding.

I am inclined to go along with the thinking that 'following the smart money' may not be a smart thing at all. More because of the dependence on such source of information as some sort of crystal ball to decide 'when to buy' and 'when to sell'. The thought itself frightens.

Is not the use of VIX index the same as following smart money?

At the end of the day I would probably stick to a no-brainer system of just getting a decent returns on my money like buying Singtel when the dividend yield is say around five percent (when to buy).

The yield at the moment is around 4.5%. Most people would agree it is not time to sell.

---

(28-08-2011, 04:32 PM)Temperament Wrote: When i started investing in 1988, i adopted an investment principle of buying in the Bear market and selling in the Bull market. And i intend to follow this Bear/ Bull cycle of investing with my whole life. i called this my life's cycle investing. i have no choice because i am not smart at reading Company's Annual Reports. i also always have my doubts about GAAP type of Company's report. Companies have to much "freedom" in this accrual type of reports.
So i am not sure whether my investment style is considered "BUY & HOLD" or "HIT & RUN". i suppose it depends on the period of each BEAR/Bull cycle.
i only know this cycle is getting very much shorter, lately.
i am not sure, this is beneficial to me or not?

Please comment, we are all here to share.
Thanks.

Very focused. Very simple.
Maybe can name your style as UPHILL & DOWNHILL, yah?
Any landmarks along the way to indicate the momentum?

(28-08-2011, 04:32 PM)Temperament Wrote: When i started investing in 1988, i adopted an investment principle of buying in the Bear market and selling in the Bull market. And i intend to follow this Bear/ Bull cycle of investing with my whole life. i called this my life's cycle investing. i have no choice because i am not smart at reading Company's Annual Reports. i also always have my doubts about GAAP type of Company's report. Companies have to much "freedom" in this accrual type of reports.
So i am not sure whether my investment style is considered "BUY & HOLD" or "HIT & RUN". i suppose it depends on the period of each BEAR/Bull cycle.
i only know this cycle is getting very much shorter, lately.
i am not sure, this is beneficial to me or not?

Please comment, we are all here to share.
Thanks.

hi temperament,
As long as your system fairly accurate flags out your buy/sell timing regardless of the frequency, i reckon it is ok.
But the bottomline is, regardless of the investment style/method, as long as it is proven to make money, u have competency and it suits your temperament/character, stay the same!

(28-08-2011, 05:34 PM)orang Wrote:

(28-08-2011, 02:38 PM)weijian Wrote:

(23-08-2011, 08:16 AM)orang Wrote:

(22-08-2011, 09:20 PM)Behappyalways Wrote: One should monitor the flow of funds. If funds are coming in, general stock market will rally and your individual stock counter will most likely to follow. And vice versa. When general market comes crashing down, most stocks will fall no matter how fundamentally sound or whatever term you name it.

Sounds like a sure winner, an answer to every retail investor's search to make money in equities.

Seems easy enough just following the flow of funds.
How does one go about following the the flow of funds?
Anyone can help in this?

Behappyalways's method is called 'following the smart money'. I do not know of any free source that gives such information. But i would like to think that 'following the smart money' is self destructive - ie. the more ppl get onto it, the harder it is to use it to make $ anymore..

Personally as a long term investor, i use the VIX index (fear indicator) to gauge the general mood of the market (when to buy). I also gauge the mood of amateur investors around me to understand when there is exburance (when not to buy)

Thanks Weijian for responding.

I am inclined to go along with the thinking that 'following the smart money' may not be a smart thing at all. More because of the dependence on such source of information as some sort of crystal ball to decide 'when to buy' and 'when to sell'. The thought itself frightens.

Is not the use of VIX index the same as following smart money?

At the end of the day I would probably stick to a no-brainer system of just getting a decent returns on my money like buying Singtel when the dividend yield is say around five percent (when to buy).

The yield at the moment is around 4.5%. Most people would agree it is not time to sell.

---

(28-08-2011, 04:32 PM)Temperament Wrote: When i started investing in 1988, i adopted an investment principle of buying in the Bear market and selling in the Bull market. And i intend to follow this Bear/ Bull cycle of investing with my whole life. i called this my life's cycle investing. i have no choice because i am not smart at reading Company's Annual Reports. i also always have my doubts about GAAP type of Company's report. Companies have to much "freedom" in this accrual type of reports.
So i am not sure whether my investment style is considered "BUY & HOLD" or "HIT & RUN". i suppose it depends on the period of each BEAR/Bull cycle.
i only know this cycle is getting very much shorter, lately.
i am not sure, this is beneficial to me or not?

Please comment, we are all here to share.
Thanks.

Very focused. Very simple.
Maybe can name your style as UPHILL & DOWNHILL, yah?
Any landmarks along the way to indicate the momentum?

Landmark:-

Well, we all know most people consider the beginning of a Bear Market, when DOW JONES IDX. drops below 20% from the most recent high. i use to start average down when my current portfolio is only about 30-40% of my investment $fund. From experience, i always found i average down too early.
Now, i think i will start buying only from 25% - 30% onwards. i usually average down all the way till all my investment fund is used. And the proverbial falling knife still has some distance to fall.
This time, i am going to try average up. Or more accurate and picturesque-pyramid-up. Which most financial books recommend and disapprove of pyramid-down. Besides, pyramid up is "safer" :- 4-3-2-1 instead of 1-2-3-4. The tricky part is when to start pyramid-up.

(28-08-2011, 04:32 PM)Temperament Wrote: When i started investing in 1988, i adopted an investment principle of buying in the Bear market and selling in the Bull market. And i intend to follow this Bear/ Bull cycle of investing with my whole life. i called this my life's cycle investing. i have no choice because i am not smart at reading Company's Annual Reports. i also always have my doubts about GAAP type of Company's report. Companies have to much "freedom" in this accrual type of reports.
So i am not sure whether my investment style is considered "BUY & HOLD" or "HIT & RUN". i suppose it depends on the period of each BEAR/Bull cycle.
i only know this cycle is getting very much shorter, lately.
i am not sure, this is beneficial to me or not?

Please comment, we are all here to share.
Thanks.

Very focused. Very simple.
Maybe can name your style as UPHILL & DOWNHILL, yah?
Any landmarks along the way to indicate the momentum?

Quote:Landmark:-

Well, we all know most people consider the beginning of a Bear Market, when DOW JONES IDX. drops below 20% from the most recent high. i use to start average down when my current portfolio is only about 30-40% of my investment $fund. From experience, i always found i average down too early.
Now, i think i will start buying only from 25% - 30% onwards. i usually average down all the way till all my investment fund is used. And the proverbial falling knife still has some distance to fall.
This time, i am going to try average up. Or more accurate and picturesque-pyramid-up. Which most financial books recommend and disapprove of pyramid-down. Besides, pyramid up is "safer" :- 4-3-2-1 instead of 1-2-3-4. The tricky part is when to start pyramid-up.

The maths seem a bit tricky

I am inclined to read you always start to average when your portfolio is down about 60%. Does not seem right. Too drastic

Whether pyramid-up or pyramid-down you are still in a game of probables. How much is in your kitty is definitely accurate

Maybe you should put yourself in the shoes of a EPL manager and try a 4-4-2 or 4-3-3 system or some other tactics

I think you could a new thread - say, Uphill and Downhill - as this is a Buy and Hold thread. Not very appropriate. Then we can talk about riding uphill and downhill be it on a bicycle or a car

(31-08-2011, 11:39 AM)orang Wrote:

(28-08-2011, 04:32 PM)Temperament Wrote: When i started investing in 1988, i adopted an investment principle of buying in the Bear market and selling in the Bull market. And i intend to follow this Bear/ Bull cycle of investing with my whole life. i called this my life's cycle investing. i have no choice because i am not smart at reading Company's Annual Reports. i also always have my doubts about GAAP type of Company's report. Companies have to much "freedom" in this accrual type of reports.
So i am not sure whether my investment style is considered "BUY & HOLD" or "HIT & RUN". i suppose it depends on the period of each BEAR/Bull cycle.
i only know this cycle is getting very much shorter, lately.
i am not sure, this is beneficial to me or not?

Please comment, we are all here to share.
Thanks.

Very focused. Very simple.
Maybe can name your style as UPHILL & DOWNHILL, yah?
Any landmarks along the way to indicate the momentum?

Quote:

Quote:Landmark:-

Well, we all know most people consider the beginning of a Bear Market, when DOW JONES IDX. drops below 20% from the most recent high. i use to start average down when my current portfolio is only about 30-40% of my investment $fund. From experience, i always found i average down too early.
Now, i think i will start buying only from 25% - 30% onwards. i usually average down all the way till all my investment fund is used. And the proverbial falling knife still has some distance to fall.
This time, i am going to try average up. Or more accurate and picturesque-pyramid-up. Which most financial books recommend and disapprove of pyramid-down. Besides, pyramid up is "safer" :- 4-3-2-1 instead of 1-2-3-4. The tricky part is when to start pyramid-up.

The maths seem a bit tricky

I am inclined to read you always start to average when your portfolio is down about 60%. Does not seem right. Too drastic

Whether pyramid-up or pyramid-down you are still in a game of probables. How much is in your kitty is definitely accurate

Maybe you should put yourself in the shoes of a EPL manager and try a 4-4-2 or 4-3-3 system or some other tactics

I think you could a new thread - say, Uphill and Downhill - as this is a Buy and Hold thread. Not very appropriate. Then we can talk about riding uphill and downhill be it on a bicycle or a car

i start to average only when my portfolio balance is only 30%-40% of my investable fund. I mean i still have 60% of my fund to invest during a confirmed Bear Market. A stand-by fund.
And may i know where is the advantage of 4-4-2 or 4-3-3 over 4-3-2-1. pyramid-up averaging?

For a moment, I was thinking what is EPL? What financial term is that?

Alamak! It's English Premier League.

This "Buy and Hold - but not too long thread" is like having a lively discussion OUTSIDE the bear cave what's the best way to walk-up to the sleeping bear without getting mauled. Who can get the closest wins!

The trouble is I don't even know whether the bear is in the cave! My biggest fear is that the cave is empty and for all I know, the bear is sneaking up behind me trying his best not to giggle!