Financial Advice

[Guest]

No problem at all!

Just out of curiousity, where's your old country? Always good to learn something new!

[Guest]

No problem at all!

Just out of curiousity, where's your old country? Always good to learn something new!

Based on his football postings, I'd say Oriental is a Great Dane.

[mslise]

Hi Mark,

Could you PM me? Aparently I'm too new to PM anyone yet!

I'm an adviser in Australia and I'm interested in hearing a bit about working as an adviser in Singapore.

Thanks,

Lise.

[ksl]

The nominal value of a share is almost meaningless. Dividend yields always relate to market value.

I guess that is why invest in stocks myself, rather than having anyone else managing my money! I like the idea of locking in profits on the way up.
Personally my best advice is for individuals to do their home work and learn how to invest directly in the market, something i neglected to do for most of my life, but when i finally did start, I never looked back, of course there is a learning curve, so only invest what you can afford to lose. Decide which is high risk and low risk industries.

First of all do a risk assesment on oneself, if you find you are within the well balanced range, go for it, if you have risk aversion like my Mrs, then maybe (msekree) is a better choice.

But basically why pay extra costs and get lower returns? If I'm going to lose money, or make money, then i would rather have the fun doing it.

Stock market is not that difficult for people that can manage money. So its better to lock in profits after the first 10 to 14% rise rather than be greedy and guess the peak, especially in high tech stocks. The problem with the stock market is that foreign investors and institutions deal in millions of shares, when they come in the market, they push the price up, when they pull out, the price drops.

If you can get used to monitoring the big boys, you can lock in and get out. even if you miss the drop, you haven't lost until you sell, and most of the markets are cyclic, so they are up and down all the time.

I was actually reading an artical on the net how fund managers, follow eachother most of the time, many of them cannot beat the market, but providing they stick with the flow, they keep there jobs. If for some reason a fund manager is down on his portfolio, when most are up, he would be replaced fired!!

The guy on the street can do just as well! Keep the money working guys, good luck

[msekree]

Well said KSL.

I believe that if I wasn't a financial adviser (and in fact before I was) I would be in a similar position. If you enjoy managing your own money, have the time to do the research, enjoy it and can accept the risks then this is the way to go with part of your money.

In defence of funds though:

They are a great way to gain access to a wide range of investments, not just shares, without having to know too much about them- you have a manager to pick when and what to buy and sell day-to-day for you.

Each fund tends to hold at least 30 different shares and so you get the benefits of diversification (in short, reducing the risk to your investment from one or two shares doing unexpectedly badly). It is very expensive and time consuming for individuals to manage such large portfolios and it is not until you reach about 30 different shares that you get the full benefits of diversification.

They are a good way to gain access to markets you are unfamiliar with. While it's relatively easy to research and trade UK listed shares if you believe that the UK in general isn't going to do so well and you'd rather invest in, say, Korea or the world in general then you're going to find it harder to get good exposure to these markets without using funds (unless you have A LOT of time and money to invest).

Funds can be as entertaining as shares. There are hundreds to choose from in different regions, sectors and markets. Each have reasons to invest in them and some have proven themselves to be stars. With the ability to switch for free (rather than having a bid-offer spread and dealing charges) you can find them every bit as fun as shares if you want to 'play' while being able to leave them to look after themselves if you wish, or get an adviser to keep on top of your portfolio for you.

What KSL says about some funds just tracking their index is often true, but certainly not always. This is why it's very important to research and choose the right funds, either on you own or with the help of an adviser who has the advantage of seeing all the market and fund research.

It's also true about most markets being cyclical and why it's very important to be able to keep a cool head if you see markets going down. If you don't have the temperament to accept this you should think seriously about being in such investments in the first place.

Good comments. Any other questions?