Dividend vs Speculative Portfolio

[paullow]

hehe Temperament, u r rite.

these criteria are the vital signs of the company.

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i think as we become serious investors, we need to understand the factors which drive stock prices up.
external factors like overall market sentiment is one big tide which lifts most boats.
internal factors like new product/market entry by the company, increasing eps leading to decreasing pe, large intake by key shareholders, revaluation of assets, stock which just trade cum-div, etc. are some factors.
similarly there are also the reverse factors which cause prices to trend downwards.

[Temperament]

hehe Temperament, u r rite.

these criteria are the vital signs of the company.

---

i think as we become serious investors, we need to understand the factors which drive stock prices up.
external factors like overall market sentiment is one big tide which lifts most boats.
internal factors like new product/market entry by the company, increasing eps leading to decreasing pe, large intake by key shareholders, revaluation of assets, stock which just trade cum-div, etc. are some factors.
similarly there are also the reverse factors which cause prices to trend downwards.

Ya lol! most of us don't see much in F&N (me included,) until some Tycoon sees something. But i like what you say, BIG TIDE is one of the best to me.

[paullow]

Thanks paullow,
recently i also started to hv thinking along this direction.
most prob i will trim my speculative portfolio & start a new defensive/offensive portfolio

I've edited and added some points for the sake of completeness for the benefit of some forumers.

i think as we become serious investors(not speculators!), we need to understand the factors which drive stock prices up.

external factors like overall market sentiment is one big tide which lifts most boats(this is the factor which punters like!)

internal factors like new product/market entry by the company, increasing eps leading to decreasing pe, large intake by key shareholders, revaluation of assets, stock which just trade cum-div, etc. are some factors.

similarly there are also the reverse factors which cause prices to trend downwards.

Having said the above, the criteria which would be relevant in the stock pick would be the company's vital signs

ie 1 pb, 2 pe, 3 div, 4 rising nav/market cap(in case of stock splits), 5 rising dividends(cash paid out is real), 6 cash/debt per share 7 hidden gems to unlock

So careful consideration of the above factors would tend to enable one to adopt defensive stance with an offensive view.

Next would be to decide on whether to adopt a focused or diversified portfolio. Normally, the older one is, the more convervative one would get and hence the diversified portfolio might be more suitable. The younger lot 30-50years old with more time on their hands might want to take on a little more risk and go for the focused approach to increase their portfolio more aggressively.

Good luck!!!

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strange, how come the long message I typed disappeared?

Will type again when I got time.

[cyclone]

Hmm, why is the above post, post #13, empty ? Technical error ?

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N.B. : Missing closing tag [/quote]

[paullow]

Note: Expert investors might want to give this a miss.

Yes,

strange, I tried to post twice at around 8pm plus but nothing came out. ? virus ? tech error


anyway, I shall try another time now:


With regards to the dividend vs speculative portfolio, as aluded to earlier, i think the more apt consideration would be defensive(ie capital preservation) vs offensive(ie capital gains) portfolio, with defense being the priority.

Allow me to elaborate from my own experience:

Criteria of consideration (which may not be in order of importance in all cases as each and no two companies are the same. These are the criteria which personally I think would provide me with a reasonable assessment of the downside risks of a company as well as its potential upside.

1) pb ratio - personally I go for companies trading at 60% plus minus

2) pe ratio - depending on industry, but sometimes there's a premium to pay in certain cases

3) div-above 5% would be preferred

4) ascending trend of market cap/NAV(beware of splits)

5) rising dividends over a period of time (remember cash is real)

6) look at debt ratio. no/low debt is preferred

7) cash per share

8) anything gems to unlock, for eg some old land bought donkey years ago not reflected in books.

9) look out for a rising eps qoq. a consistent rise qoq even mild one, might suggest price may trend upwards(take note, this is regardless of technical analysis-I do not advocate too much emphasis on TA). A rising eps would lower pe ratio, and that might catch the eye of analysts screening out on company pe. The trick is to go in before those analysts go in and report the company leading to interest generated and price upswings. Things will happen very fast from there. It would be hard to buy as much as possible at as cheap a price as possible.

Once you get pass the company selection step, decide whether you want to adopt a focused portfolio or a diversified one. For younger people who can take a bit more risk, I advocate the focused appoach. This approach using the above criteria has the potential to create credible gains and at the same time limit the downside risks.

Personally, I take 3-6months to be completely satisfy myself that I am buying into the right company, as I used the focused approach.

Remember: a good night's sleep is actually priceless!

[FatBoi]

Note: Expert investors might want to give this a miss.

Yes,

strange, I tried to post twice at around 8pm plus but nothing came out. ? virus ? tech error


anyway, I shall try another time now:


With regards to the dividend vs speculative portfolio, as aluded to earlier, i think the more apt consideration would be defensive(ie capital preservation) vs offensive(ie capital gains) portfolio, with defense being the priority.

Allow me to elaborate from my own experience:

Criteria of consideration (which may not be in order of importance in all cases as each and no two companies are the same. These are the criteria which personally I think would provide me with a reasonable assessment of the downside risks of a company as well as its potential upside.

1) pb ratio - personally I go for companies trading at 60% plus minus

2) pe ratio - depending on industry, but sometimes there's a premium to pay in certain cases

3) div-above 5% would be preferred

4) ascending trend of market cap/NAV(beware of splits)

5) rising dividends over a period of time (remember cash is real)

6) look at debt ratio. no/low debt is preferred

7) cash per share

8) anything gems to unlock, for eg some old land bought donkey years ago not reflected in books.

9) look out for a rising eps qoq. a consistent rise qoq even mild one, might suggest price may trend upwards(take note, this is regardless of technical analysis-I do not advocate too much emphasis on TA). A rising eps would lower pe ratio, and that might catch the eye of analysts screening out on company pe. The trick is to go in before those analysts go in and report the company leading to interest generated and price upswings. Things will happen very fast from there. It would be hard to buy as much as possible at as cheap a price as possible.

Once you get pass the company selection step, decide whether you want to adopt a focused portfolio or a diversified one. For younger people who can take a bit more risk, I advocate the focused appoach. This approach using the above criteria has the potential to create credible gains and at the same time limit the downside risks.

Personally, I take 3-6months to be completely satisfy myself that I am buying into the right company, as I used the focused approach.

Remember: a good night's sleep is actually priceless!

Paullow's set of criteria also might uncover potential acquisition targets - I come across Dynamic Colours (loosely using a very similar set of criteria).

[paullow]

yes. when used appropiately, wealth creation in excess of a 20% cagr is achieveable, with the initial principle of wealth preservation borne in.