Two weeks into the new year I have read about four books to prepare me for the year ahead. I had the privileged of sitting by the pool in warm volcanic island of Lanzarote to recollect my thoughts and review the failure and performance of 2017.
By performance, I have managed to surpass the mighty Dow Jones Index (DJI) in my overall portfolio by 3-4% for 2017. With the time and effort, I have contributed it would have been easier just buying the DJI. However reading my previous year new year resolution my goal was to balance and diversify my portfolio with good quality long-term shares. If the stock market took a dive I am confident my portfolio will survive better.
The first book I took time reading was the legendary, ‘Intelligent Investor’ by Benjamin Graham. After the book I reflect at my balance diversified portfolio; I was not well proportionate. Back in the early 20th century, it is not wise to go 100% stock and that was class as the high-risk profile. A good mixture of bonds or majority bonds was always a smart educational move. However with the world of increasing interest rates it was not a good time to be buying bonds. So my first financial objective is double my investment savings (deployable Cash) by saving more and faster
For 2018, Double my investment savings (deployable Cash) by saving more and faster.
This shall provide me flexibility to buy shares at a discount in the next correction which never really occurred in 2017. These cash shall be sitting in fix income or very short-term bonds which I could easily have access. The core fundamental rule of investing is buying shares when they are undervalued as the future growth and profits is what you paid for in the beginning.
Now let me share my personal favourite 2018 recommendations provided by some of the best investment bloggers world-wide.
These seven are my favourite article in the first two weeks of the new year because I agree with most of the contents. Most of them focus on Asia and the UK economy which I feel are still are good value. The US shares are very much overpriced and overvalued in bubble territory. Most of the US stocks are already pricing in at least two excellent financial quarters.
Among the lot, I am keeping a close eye on the following stocks.
- Undervalued National Grid (NG.L) shares sitting at 840gbx
- Huge growth prospects of Legal and General (LGEN.L) which is priced at around 270gbx.
- The Hong Kong Hang Seng Index.
- Japanese funds and index trackers.
After a 3 months dilemma at the end of 2017, I am steering away from Cryptocurrency investing. Everyone at work (from the security guard, cleaners, movers to engineers and managers) trades or invest life savings into crypto currencies (not just BitCoin). Like Warren Buffett’s famous quotes [When the bell boy and the shoe shining boy are dishing out wall street tips, it’s time to be fearful and leave!]. I am actually understanding what the Oracle of Omaha is explaining.
The second book which fascinates me is the, ‘Snowball Effect’ by Alice Schroeder. One key point which I would like to share from the book is that Warren Buffet made his millions at 30 and he never invested in the major Nasdaq. He was always investing in small caps shares and undervalued companies. He was buying a lot of the shares when is confident. With this strict philosophy he succeeded. Therefore my next 2018 goals would be finding the undervalued company globally (i.e. Emerging Markets and UK Small Caps) in the world of a thriving synchronise economy.
Therefore my next 2018 goals would be finding the undervalued company globally (i.e. Emerging Markets and UK Small Caps) in the world of a thriving synchronise economy.
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Let’s get richer in 2018!