There are many misconceptions in this topic such as its high risk, speculative, easy to lose money, gambling if you will, and some think that it's for those going into retirement or older people. Majority have the perceptions that you have to be wealthy (extra cash) to start investing in stock market. Hence, many failed to take advantage of the power of stock market to boost their wealth over time. Isn't it amazing if you can grow your money and seeing how quickly it could grow with the compounding effect.
First of all, I would like to take this opportunity to thank all our readers (friends, family members and new readers) for taking the time to read our posting. We started this journey in Jan'19 and we have achieved the 1st 2000 views after 3 months. Best of all, the feedbacks that you are making positive returns is something that we are happy to hear. We hope that our journey is also your journey as well - finding the TIME with your loved ones as well through trading/investing in stock market. We all have our own full time job and different roles in our life, hence, different objectives when it comes to investing - time, approach and capital cost. Personally for me, I am not into the type of sitting in front of PC chasing and monitoring my positions. That defeats the meaning of this journey.
A recap of our stock picks since January based on aggressive trade setups and last price on 19-Apr for open positions (yellow - long term holdings):
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| Stock pick performance as of 19-Apr for both open and close positions |
Average returns yielding 11.28% with the highest return on AZRB (53%) and lowest of 6% for Genting. The open position highlighted in yellow are meant for longer term and it is still manageable. The reason for sharing this is to support the objective of this article - possibility of growing your money. Throughout this journey, I have been stressing on managing risk/reward and following your rate of returns. I have shared before this (My Experience with Profit Target) whereby as long as your trading return is higher than fixed deposit, it is a good return as it is per trade instead of per annum. Below is a quick projection on what it meant if we were to use a 8% rate of returns for trading stocks and with a starting capital of $10000.
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| Simple Compounding Effect with 8% rate of returns |
Based on the projections above, one can see the difference in terms of compounding 8% returns comparing to fixed deposit return of approximately 4% per annum. Alternatively, one can also choose to build a portfolio of dividend stocks yielding 6% which can also be served as passive income. There are many ways to build additional income through the stock market. Anyone can invest in stock market and if you still think that it is only for the wealthy, I would suggest that you should seriously reconsider your thoughts on this although last 4 months stock picks is no guarantee of future performance. 😉
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Enjoy your weekends and all the best!!!
Fully agreed with you. It required discipline to achieve it
ReplyDeleteThank you @virtual real estate entrepreneur. Indeed it required discipline and effort.
ReplyDeleteThe reason for sharing the compounding effect is also to serve as a reminder to everyone. Often, we will be faced with recency bias whereby we may have exited the position too early. Such recency bias will then lead us to using our previous experience instead of the trading plan and holding it longer and only to wipe off the gains. Such repetition will then ended up causing confusion and destroy the confidence in your own trades.
The journey in investment should be something that is fun and filled with learning instead of just numbers - entry and exit.
Good luck and all the best!!!