Diversifying my investment portfolio.

For those who have been following my investment blog would have noticed that I have been doing quite a number of transactions in the last few weeks. The reason is mainly to diversify my investment portfolio after seeing that many good stocks have fallen greatly in prices since last year.

For a summary for the changes in my portfolio, I have reduced my Singtel holdings from 72% to 50% of my portfolio with 15% diversified to SIA and 7% diversified to Singpost.

I will continue to diversify until I will not have more than 30% of my portfolio invested in one stock alone.

Do you have fear after making investment?

In Star Wars Episode 1, Jedi master Yoda once said, "Fear is the path to the dark side: fear leads to anger, anger leads to hate, hate leads to suffering." If you have followed the Star Wars stories, Anakin Skywalker’s fear of losing the ones he loves is main reason why he eventually turned to the dark side of the Force.

For investor, the fear may come from falling price of the stocks he owned. As the result, he may start to be angry and hate himself for buying in before the stock prices start to fall. Next he would be suffering for holding these stocks and eventually forced to sell them at a loss.

As a pure investor myself, I have overcome the fear of investing by taking the following measures:

1)Always have a saving that can last me for at least one year in case of any unexpected situation.

2)Always invest with the extra money that I will not be touching for the next ten years.

3)Always pay up in full for any stocks that I have bought. I will totally ignore CFDs, warrants and other leveraging investment instruments.

4)Never do shorting on stocks.

5)Always buy stocks from companies with strong fundamental.

6)Always set my own fair price to buy in stocks and be able to hold even the price might fall.

Going for Lasik treatment this December.

While I guess most of the people have decided to plan for a holiday on December, I have decided to go for Lasik treatment instead. Well I have been wearing spectacle since I was primary six and have been wearing it for almost thirty year. I feel that now is a good time to break free the pair of glasses in front of me since the Lasik treatment has become much safer, accurate and affordable.

I will be going for the new type of Lasik known as Epi-Lasik whereby the vision correction is done surface of the cornea without cutting the cornea flap. My wife did it last year and has no complains so far. For those interested, you may want to google “Epi Lasik” to find out more.

Pay increment vs inflation

This is a simple post to explain the effect on how inflation affects pay increment. I will first start with a scenario. There was a new company which had four workers. The boss of the company paid each employee $100 per month as salary.



After working for a year, four workers requested a pay raise for their hard work. The boss agreed to the request and decided to give a raise based on the performance of each employee as shown in the below table.


The question now is should all the employees be happy with their pay raise assume that the inflation rate is 5%? We can easily found out the answer by using the simple formula as shown below.

Real % change in salary due to increment and inflation =

% change in salary - inflation rate =

[(New Salary - Old Salary) X 100 / Old Salary] - inflation rate

After using the formula, the result is tabulated as shown in the table below.



For the table, well as long as % increase in salary is less than inflation rate, there will be a pay reduction in real value. Hence worker A and B in fact had their pay reduced in real value.