In 2010, I bought 10 lots of Starhill Global at $0.50 and Suntec Reits at $1.24 for divdend but was scared of the Tsunami/Nuclear crisis in Japan 2012, so I sold all of them thinking that there will be another crisis just like the 2008 Lehman Bro crisis. But the correction was short lived, I waited for further correction but it didnt happened so I waited waited and waited.
In 2014, I waited for correction but it didnt happened. I just kept on building my warchest. I am also cautious about the current SG stock market which is running high and am afraid of any correction happening in the near future. So this time I cannot tahan anymore. I bought some Global Investment. Its my first buy since 2012, haha about 2 years ago. This time I am buying for keeps.
I called it 'myCreative' to remind me of my bad move in 2008 when I bought huge amount of Creative Technology stock at sky high price $21+ when Creative was successful with its ZEN mp3 players. There was no diverisification of stocks and I put all my eggs into one basket. Its not creative at all. There was a lot of hype at that time when Creative ZEN was challenging Apple iPod. The stock at that time was highly priced and very low dividend. I add on to it and only to see this stock go lower. Now we all know the story. It is currently trading at $2.
I got my inspiration from ghchua and sanye who are constantly buying into the market now and holding on to them to collect dividend. They do have growth stock but I am going to stick to those high dividend stocks first.
In this strategy, there's no stop loss so during bad times, we have to bite the bullet and see our paper loss each day the market goes down but we shall not falter and hold on to our strategy. Try to buy different stocks each time or same stock at different time. The key is to build a diversified portfolio of high dividend stock so that we can still collect dividend during bad times and to continuously add more stocks when its cheap. In fact its going to be boring because its a buy and hold to collect dividend strategy and to be able to tahan any market correction, its going to be robust and diversified.
This is what I will do, to save up $5k of cash and invest on 1 new stock ea month (This is because of the brokerage rate of 0.28% or mini $25 imposed by broker. Not worth it if you buy 1 lot and still pay min $25). This will continue, my first target is 30 stocks. This is little as compared to ghchua and sanye as I think they hold hundreds of stocks.
Safety of a large number through diversification. Doable strategyReplyDelete
thanks for your affirmation :)Delete
Is yield your key consideration in selecting a stock to buy? Or are there further considerations? Risky if only yield.ReplyDelete
Yield is my main key. I also look at pb pe roe debtDelete
I find it hard for me to buy lower yield stocks leh
Keppel corp is very attractive at low pe. Almost push my button but it shoot up already ...
if u wanna diversify, why not use ETFs?ReplyDelete
i checked STI ETF, very low dividend 1 to 2% onlyDelete