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A Newbie Guide to Investing
15-06-2012, 12:53 PM.
Post: #1
A Newbie Guide to Investing
Hi all experienced forumers

I am thinking of starting a thread to put in some sources where newbies to investing/trading may refer to time to time.
I am open to trading as well so I hope the mods will give chance to those who might have different points of views. Shy

To all, please feel free to share the links, books or courses which you think is beneficial and cost-effective to your learning experiences so far.
Perhaps you can share why you think this book or weblink is good for you.

May I have the honour to start the first shot.

(PS: Mods, Admin. If you guys think this is a good link, please sticky it as well. Thanks.)

Links:
www.investopedia.com
A general free website that covers alot of investing ideas and has a comprehensive dictionary of investing terms. What interest me is the tutorials it has within that even goes through different levels of experiences one possessed.

www.marketwatch.com
www.cnbc.com
www.reuters.com
Some general websites that most traders and investors look at. But dun be misled by the news within.
Caveat Emptor - you will notice 90% of articles will tell you to buy than to sell or hold bcos these websites have vested interests to ask ppl to buy from fund mgt companies or investment firms.


Books:
[Image: 41VDsJf2QtL._BO2,204,203,200_PIsitb-stic..._OU01_.jpg]
The Five Rules for Successful Stock Investing: Morningstar's Guide to Building Wealth and Winning in the Market
http://www.amazon.com/Five-Rules-Success...322&sr=8-1

I like this book for the fact that its explains things in a layman terms rather than in some abstract PHd level financial terms.

I am also including a free ebook I got from Vanguard couple of years ago. If mods think copyrights is an issue, pls take it down.

.pdf   The Elements of Investing.pdf (Size: 1.16 MB / Downloads: 337)
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15-06-2012, 01:52 PM.
Post: #2
RE: A Newbie Guide to Investing
Hi Arthur,

Good effort on your part, thanks. I've stuck the thread and others can build on it.

BUt may I request that since this is predominantly a value investing forum, that we keep discussions on trading/speculation to a minimum. I understand there are different methods and styles but utilmately they should all hinge around the central tenet of capital preservation through fundamental analysis. Sorry if I sound anal but this is in keeping up with the spirit of the original Wallstraits Forum back in 2002-2003. Smile
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My Value Investing Blog: http://sgmusicwhiz.blogspot.com/

http://sgmusicwhiz.blogspot.com
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15-06-2012, 02:02 PM.
Post: #3
RE: A Newbie Guide to Investing
(15-06-2012, 01:52 PM)Musicwhiz Wrote: Hi Arthur,

Good effort on your part, thanks. I've stuck the thread and others can build on it.

BUt may I request that since this is predominantly a value investing forum, that we keep discussions on trading/speculation to a minimum. I understand there are different methods and styles but utilmately they should all hinge around the central tenet of capital preservation through fundamental analysis. Sorry if I sound anal but this is in keeping up with the spirit of the original Wallstraits Forum back in 2002-2003. Smile

Noted. Smile
Actually I would suggest to keep discussions on strategies on other threads as they may overwhelm this thread instead.

My intention is just to provide a source for newcomers to read, learn and ultimately, find their investing style.

Come on guys, put in something. My freebie alrdy got downloaded 8 times. Dun tell me u all only want freebie only nia? Undecided
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15-06-2012, 03:57 PM. (This post was last modified: 15-06-2012, 04:08 PM by Temperament.)
Post: #4
RE: A Newbie Guide to Investing
(15-06-2012, 02:02 PM)arthur Wrote:
(15-06-2012, 01:52 PM)Musicwhiz Wrote: Hi Arthur,

Good effort on your part, thanks. I've stuck the thread and others can build on it.

BUt may I request that since this is predominantly a value investing forum, that we keep discussions on trading/speculation to a minimum. I understand there are different methods and styles but utilmately they should all hinge around the central tenet of capital preservation through fundamental analysis. Sorry if I sound anal but this is in keeping up with the spirit of the original Wallstraits Forum back in 2002-2003. Smile

Noted. Smile
Actually I would suggest to keep discussions on strategies on other threads as they may overwhelm this thread instead.

My intention is just to provide a source for newcomers to read, learn and ultimately, find their investing style.

Come on guys, put in something. My freebie alrdy got downloaded 8 times. Dun tell me u all only want freebie only nia? Undecided

Recommendation:-
1)INVESTOR’S GUIDE -(Richard Koch).
2)Reading this won’t make you great.
Extract from Sunday Times by Teh Hooi Ling

What makes someone a great investor? It’s something you have to be born with, said Mark Sellers.
Apparently, it’s not about your IQ, the education you have had, the books you have read, or the experience you’ve accumulated. “If it’s experience, then all the great money managers would have their best years in their 60s and 70s and 80s, and we all know that’s not true,” he said in a speech to a class of Harvard MBA students.
Intelligence and learning are obviously necessary too, and are sources of competitive advantage for an investor, but there structural assets some possess that cannot be copied or learnt by others. “They have to do with psychology and psychology is hard wired into your brain. It’s part of you. You can’t do much to change it even you have a lot of books on the subjects,” said Mr. Sellers.
He said that there are 7 traits great investor share that are true sources of advantage because they cannot be learned. You are either born with them or you aren’t. (Is it true or not?-Comment by me.)
The seven traits are:
1. The ability to buy stocks while others are panicking, and the ability to sell at a time when other investors are euphoric.
“Everyone thinks they can do this, but then when October 19, 1987, comes around and the market is crashing all around you, almost no one has the stomach to buy,” Mr. Sellers said. “When the year 1999 comes around and the market is going up almost every day, you can’t bring yourself to sell, because if you do, you may fall far behind your peers.
“The vast majorities of people who manage money have MBAs and high IQs and have read a lot of books. By late 1999, all these people knew with great certainty that stocks were overvalued, and yet they couldn’t bring themselves to take money off the table because of the ‘institutional imperative’, as Buffett calls it.

2. The great investor has to be obsessive about playing the game and wanting to win.
“These people don’t just enjoy investing: they live it. They wake up in the morning and the first thing they think about, while they are still half asleep, is a stock they have been researching, or one of the stocks they are thinking about selling, or what the greatest risk to their portfolio is and how they are going to neutralize that risk.
Their head is always in the clouds, dreaming about stocks. Unfortunately, you can’t learn to be obsessive about something. You either are, or you aren’t. And if you aren’t, you can’t be the next (want to be) ‘Buffett’.
3. The willingness to learn from past mistakes.
“The thing that is so hard for people and what sets some investors apart is an intense desire to learn from their own mistakes so they can avoid repeating them. Most people would rather just move on and ignore the dumb things they have done in the past.
I believe the term for this is ‘repression’. But if you ignore mistakes without fully analyzing them, you will undoubtedly make a similar mistake later in your career. And in fact, even if you do analyse them it’s tough to avoid repeating the same mistake.
4. The fourth trait is an inherent sense of risks based on common sense.

“Most people know the story of long Term capital Management, where a team of 60 or 70 PhDs (inclusive of a few Nobel prize winners) with sophisticated risks models failed to realized what, in retrospect, seemed so obvious: they were dramatically overleveraged. They never stepped and said to themselves, ‘Hey, even the computer says this is OK, does it really make sense in real life.
“The ability to do this is not as prevalent in human beings as you might think. I believe the greatest risk control is common sense, but people fall into the habit of sleeping well at night because the computer says they should. They ignore common sense, a mistake I see repeated over and over in the investment world.”

5. Great investors have confidence in their own convictions and stick with them, even when facing criticism.
“Buffett never get into dotcom mania, though he was being criticized publicly for ignoring technology stocks. He stuck to his guns when everyone else was abandoning the value investing ship and Barron’s was publishing a picture of him on the cover with the headline ‘What’s Wrong, Warren?’ Of course, it worked out brilliantly for him and made Barron’s look like a perfect contrary indicator.”

6. It is important to have both sides of your brain working, not just the left sides. – The side that is good at math and organization.

In business school, I met a lot of people who were incredibly smart. But those who were majoring in finance couldn’t write worth a damn and had a hard time coming up with inventive ways to look at a problems,” said Mr. Sellers.
“I was a little shocked at this. I later learned that some really smart people have only one side of their brain working, and that is enough to do very well in the world but not enough to be an entrepreneurial investor who thinks differently from the masses.”
“On the other hand, if the right side of your brain is dominant, you probably loathe math and therefore you don’t often find these people in the world of finance to begin with.”
So finance people tend to be very left-brain oriented – and Mr. Sellers said that that is a problem. A great investor needs to have both sides turn on. He said. “As an investor, you need to perform calculations and have a logical investment thesis. This is your left brain working. But you also need to be able to do things such as judging a management team from subtle cues they give off.
You need to be able to step back and take a big picture view of certain situations rather than analyzing them to death. You need to have a sense of humour and humility and a common sense. And most important, I believe you need to be a good writer.”
He cited Warren Buffett as one of the best writers in the business world. “It’s not a coincidence that he is also one of the best investor of all time.
If you can’t write clearly, it is my opinion that you don’t think very clearly,” Mr. Sellers said.

7. And finally the most important, and rarest, trait of all: the ability to live through volatility without changing your investment thought process.
(I, believe you can perform No. 1 only if you have No. 7. - Comment by me.)
This, said Mr. Sellers, is almost impossible for most people to do; when the chips are down they have a terrible time not selling their stocks at a loss. They have really a hard time getting themselves to average down or to put any money into stocks at all when the market is going down.

“People don’t like short-term pain even if it would result in better long-term results,” he said. Very few investors can handle the volatility required for high portfolio returns. They equate short-term volatility with risk.
This is irrational; risk means that if you are wrong about a bet you make, you lose money. A swing up or down over a relatively short period is not a loss and therefore not risk, unless you are prone to panicking at the bottom and locking in the loss.

“But most people just can’t see it that way; their brains won’t let them. Their panic instinct steps in and shuts down the normal brain function.”

NB:
So you see, i am still i am as an investor since day one. Maybe a bit more KIASI LeowBig GrinTongue
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WB:-

1) Rule # 1, do not lose money.
2) Rule # 2, refer to # 1.
3) Not until you can manage your emotions, you can manage your money.

Truism of Investments.
A) Buying a security is buying RISK not Return
B) You can control RISK (to a certain level, hopefully only.) But definitely not the outcome of the Return.

NB:-
My signature is meant for psychoing myself. No offence to anyone. i am trying not to lose money unnecessary anymore.

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15-06-2012, 05:12 PM. (This post was last modified: 15-06-2012, 05:13 PM by Jared Seah.)
Post: #5
RE: A Newbie Guide to Investing
Take the time to invite two persons for coffee and "listen" to their real life experiences:

1) One who has lost most of his money in "investing";

2) another who has been richly rewarded by his investments.

Try not to interrupt or ask stock questions like found in some books. Let your "mentors" share what they want to share.

Compare what's the difference and commonality between these two individuals? And now compare your reflections with what you know about yourself Wink

Books are great source of knowledge; but there must be a reason why people are willing to bid millions to join Warren Buffet's power lunch when you can easily find tomes of books on Warren himself.
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Just google singapore man of leisure

http://singaporemanofleisure.blogspot.com/
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23-06-2012, 11:10 AM.
Post: #6
RE: A Newbie Guide to Investing
One may find this "Introduction to Investing and Fundamental Analysis" from NTU helpful.

http://www.ntu-iic.org/images/Investment...ancial.pdf
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Research, research and research - Please do your own due diligence (DYODD) before you invest - Any reliance on my analysis is SOLELY at your own risk.

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04-08-2012, 10:12 AM.
Post: #7
RE: A Newbie Guide to Investing
From SGX dated 9 Jul 12,

Comparative dividend yields of 90 Singapore Stocks
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Luck & Fortune Favours those who are Prepared & Decisive when Opportunity Knocks
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05-08-2012, 06:39 PM.
Post: #8
RE: A Newbie Guide to Investing
(04-08-2012, 10:12 AM)KopiKat Wrote: From SGX dated 9 Jul 12,

Comparative dividend yields of 90 Singapore Stocks

I had focused only on big-cap stocks previously, with a perception of big-cap stocks are safer than mid-to-small cap stocks

With more exposure, I found that the perception is flaw. If do it right, mid and small cap stocks will bring better yield, while not necessary riskier.

I had noticed YTD performance had improved significantly, after i shifted substantial fund to mid-to-small cap stocks since early of the year.
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05-08-2012, 07:12 PM.
Post: #9
RE: A Newbie Guide to Investing
(05-08-2012, 06:39 PM)CityFarmer Wrote:
(04-08-2012, 10:12 AM)KopiKat Wrote: From SGX dated 9 Jul 12,

Comparative dividend yields of 90 Singapore Stocks

I had focused only on big-cap stocks previously, with a perception of big-cap stocks are safer than mid-to-small cap stocks

With more exposure, I found that the perception is flaw. If do it right, mid and small cap stocks will bring better yield, while not necessary riskier.

I had noticed YTD performance had improved significantly, after i shifted substantial fund to mid-to-small cap stocks since early of the year.

IMO, the risk of mid-to-small caps is, they may not survive a downturn / mismanagement as well as a large caps. So, we need to be extra stringent in our screening. In my case, I'm more fearful of high gearing and low margins. I'm also mentally prepared to "run" faster if anything goes wrong...Tongue

Same here, I have also switched quite a lot of my funds here (now >1/3 of invested $$) - I don't quite like the lower market yield of many of my No / Slow Growth large caps. Yes, my YTD performance is also quite unbelievable but I'm reminding myself that STI = +15% YTD is likely responsible and aiding me considerably. The real test would be when market becomes bearish...Tongue
=========== Signature ===========
Luck & Fortune Favours those who are Prepared & Decisive when Opportunity Knocks
------------ 知己知彼 ,百战不殆 ;不知彼 ,不知己 ,每战必殆 ------------

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05-08-2012, 08:29 PM. (This post was last modified: 05-08-2012, 08:42 PM by Temperament.)
Post: #10
RE: A Newbie Guide to Investing
(05-08-2012, 07:12 PM)KopiKat Wrote:
(05-08-2012, 06:39 PM)CityFarmer Wrote:
(04-08-2012, 10:12 AM)KopiKat Wrote: From SGX dated 9 Jul 12,

Comparative dividend yields of 90 Singapore Stocks

I had focused only on big-cap stocks previously, with a perception of big-cap stocks are safer than mid-to-small cap stocks

With more exposure, I found that the perception is flaw. If do it right, mid and small cap stocks will bring better yield, while not necessary riskier.




I had noticed YTD performance had improved significantly, after i shifted substantial fund to mid-to-small cap stocks since early of the year.

IMO, the risk of mid-to-small caps is, they may not survive a downturn / mismanagement as well as a large caps. So, we need to be extra stringent in our screening. In my case, I'm more fearful of high gearing and low margins. I'm also mentally prepared to "run" faster if anything goes wrong...Tongue

Same here, I have also switched quite a lot of my funds here (now >1/3 of invested $$) - I don't quite like the lower market yield of many of my No / Slow Growth large caps. Yes, my YTD performance is also quite unbelievable but I'm reminding myself that STI = +15% YTD is likely responsible and aiding me considerably. The real test would be when market becomes bearish...Tongue
"The real test would be when market becomes bearish...Tongue"
i like to say the same.
The only problem is we will never know how the Bear comes upon us..
Sometimes, before we know it, it's declared we are in Bear's market.
This is a "Sneaky Bear" where some people may notice and get out of market at least partially.
i think the worst & most fearful type of Bear is now the so called the "Black-Swan" Bear.
No chance for anyone to do anything.
Except for the shorting specialists who will be very busy & laugh all the way to the banks.
=========== Signature ===========
WB:-

1) Rule # 1, do not lose money.
2) Rule # 2, refer to # 1.
3) Not until you can manage your emotions, you can manage your money.

Truism of Investments.
A) Buying a security is buying RISK not Return
B) You can control RISK (to a certain level, hopefully only.) But definitely not the outcome of the Return.

NB:-
My signature is meant for psychoing myself. No offence to anyone. i am trying not to lose money unnecessary anymore.

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