Today I am trying to evaluate my portfolio with a good friend and he pointed out my portfolio is risky as Singapore is experiencing slowdown. Almost 90% of my stocks are in Singapore. Furthermore, my portfolio is already 10% below original value. I was thinking of a strategy to either sell all my OCBC and ThaiBev shares and reallocate them to IBM. IBM has been upgraded and target to increase from present share price of 138 by another 8-10%. I was thinking of taking a bet and maybe will bring my portfolio back to original value. Common stocks are subject to recurrent and fluctuations in prices, the possibilities to profit are way of timing and pricing. I should remember that an investor should not believe the day to day prices to make him rich. When you buy the company share, you own part of the business. From the fundamental analysis viewpoint, I need to understand the intrinsic value of the stock and constantly follow the quarterly results. In addition, I need to forecast the future earnings of the stocks. The most important fact about investment is investor is never forced to sell his shares. I should not be anguished by the fact that shares are dropping but rejoice that I can accumulate more at a lower price. I should concentrate only on my portfolio but not how much my friend has made. I should consider both the dividends and long term value of my portfolio. I should think for myself and not let others or market fluctuations tell me. I am in control of my emotional life and decide the based on the market price whether it is to my advantage to act on them.
Conclusion I will continue to hold on to my present portfolio and trim down on GLP and Singtel, I will start to pump in future money on a monthly basis into IBM. In addition, I will set aside $1,000 each with my wife to purchase MTR for our baby’s future education fund.