tag:blogger.com,1999:blog-28021668.post920475734734972862..comments2023-10-12T21:12:41.408+08:00Comments on Value Investment - Musicwhiz's Journey: Averaging Up or Down?Musicwhizhttp://www.blogger.com/profile/10950754156386935254noreply@blogger.comBlogger8125tag:blogger.com,1999:blog-28021668.post-28673720772577957082011-09-10T09:42:18.412+08:002011-09-10T09:42:18.412+08:00Hi Temperament,
You have a point when you mention...Hi Temperament,<br /><br />You have a point when you mention money management. For me, I'd call it "Portfolio Management", more so because you are actually tweaking weightages within the portfolio and also deciding on which stock you wish to own more of as a fraction of the entire portfolio.<br /><br />Thanks,<br />MusicwhizMusicwhizhttps://www.blogger.com/profile/10950754156386935254noreply@blogger.comtag:blogger.com,1999:blog-28021668.post-16079747095524111062011-09-08T20:06:11.014+08:002011-09-08T20:06:11.014+08:00Hi,
Thank you all for your opinions. OF course, mo...Hi,<br />Thank you all for your opinions. OF course, most financial authors favor the pyramid-up system only when "all things are being equal".<br /><br />Pyramid down or up is just a form of "money management" in buying/selling a stock because nobody really can know what the market going to do next. <br />If i know, then i will only buy at the bottom and sell at the top. Then any stock will do. <br />i will be richer than WB.<br />What a joke.<br />Ha! Ha!Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-28021668.post-60071575490446528152011-09-08T10:59:30.500+08:002011-09-08T10:59:30.500+08:00Hi Calvin,
Very nice blog you have, and your port...Hi Calvin,<br /><br />Very nice blog you have, and your portfolio contains a lot of REITs. Any reason for your heavy weightage on REITs?<br /><br />Noted too that you started blogging in June 2011. Keep up the great work! Will be visiting your blog often.<br /><br />And yes I agree. We should focus on a value buy and wait for time to realize the true value of the investment!<br /><br />Thanks,<br />MusicwhizMusicwhizhttps://www.blogger.com/profile/10950754156386935254noreply@blogger.comtag:blogger.com,1999:blog-28021668.post-76232113698191368612011-09-08T10:55:24.429+08:002011-09-08T10:55:24.429+08:00Hi Temperament,
It depends on which school of tho...Hi Temperament,<br /><br />It depends on which school of thought you subscribe to. Traders who trade on momentum tend to "go with the flow" and buy more when they spot a trend of the price increasing. I tend to frown on such practices as I believe risk increases whe price increases without any corresponding visible improvement in fundamentals.<br /><br />From an investment perspective, we should always seek to affirm our beliefs and test our judgement by assessing objectively and rationally to the best of our ability. Only then can we sleep well at night!<br /><br />Regards,<br />MusicwhizMusicwhizhttps://www.blogger.com/profile/10950754156386935254noreply@blogger.comtag:blogger.com,1999:blog-28021668.post-87232212953613386352011-09-08T10:53:35.509+08:002011-09-08T10:53:35.509+08:00Hi SMOL,
Erm....ok interesting analogies there. I...Hi SMOL,<br /><br />Erm....ok interesting analogies there. I can sense that you have a very good sense of humour and it would be a pleasure talking to you in real life!<br /><br />But just to set the record straight, an investor should not feel fearful or euphoric should the share price move up or down after his purchase. After all, if it was supported by a detailed assessment of the business in the first place, then he should just sit back and relax and go about his life without worrying about Mr. Market's manic mood swings.<br /><br />Masochism and hedonism? I guess we all have a bit of both! I can attest to that, but that's another topic! Haha!<br /><br />Cheers,<br />MusicwhizMusicwhizhttps://www.blogger.com/profile/10950754156386935254noreply@blogger.comtag:blogger.com,1999:blog-28021668.post-60353827469937326522011-09-07T21:53:18.732+08:002011-09-07T21:53:18.732+08:00Temperament, there is nothing wrong with averaging...Temperament, there is nothing wrong with averaging down when you have absolute faith in the stock and you believe in defensiveness of the stock. Most importantly you must be investing in for the long term. Such stocks could include REITs, Infrastructure, Telcos which will not be affected regardless of what's going on in the outside world. People still need to go shopping, take public transport, use the handphone etc. <br /><br />As to overall post, I don't really care about averaging up or down, I just care about getting a value buy. The truth is nobody can time the market so if you have capital to deploy and you spot an undervalued stock. You should just buy it. Stay invested for the long term and you will eventually realize your value.<br /><br />Calvin<br />http://www.investinpassiveincome.comCalvinhttps://www.blogger.com/profile/01985799987953939078noreply@blogger.comtag:blogger.com,1999:blog-28021668.post-51047012871940543142011-09-07T05:00:20.580+08:002011-09-07T05:00:20.580+08:00Almost all financial book's authors do not ap...Almost all financial book's authors do not approve of average down or better(pyramid down). They think it is a very dangerous/disadvantage practice. But they approve of average up or better pyramid up. They say when you pyramid up you are always in the money, technically speaking. So you can take profit should you chicken out or change your mind about this stock.<br />I have read this very long ago. But psychologically, it's very hard to pyramid up for we like to pay for thing getting "cheaper & cheaper" and not more and more "expensive".<br />In actual fact, we are doing the "same thing" whether pyramid down or up. But there is definitely a lot of advantage when pyramid up.<br />i want to try pyramid up after all these donkey years of average down.<br />i think i am wrong in the past.<br />May i know your opinion?<br />All opinions are welcome.<br />Shalom.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-28021668.post-53068400704605135532011-09-06T21:31:20.782+08:002011-09-06T21:31:20.782+08:00Profound and interesting post as usual MW!
Just f...Profound and interesting post as usual MW!<br /><br />Just for fun, I would like to use the Pavlov example to show we must not forget our basic instincts:<br /><br /><br />Investor A<br />-----------<br />Buy stock X at $10. Market respond with negative feedback by dropping the price to $8. Oooh. Pain!Investor A buys more. Market again punish with price drop to $5. Investor A buys more again! Pain is good! Investor A is masochistic!? <br /><br /><br />Investor B<br />-----------<br />Buy stock at Y at $10. Market rewards the decision by raising the price to $12. Hey! I am right!<br />Investor buys more at $12 and market again rewards investor by pushing the price up to $14. Bingo!Let the good times roll! Investor buys more! Investor B is hedonistic!?<br /><br />Maybe the quesiton of average up or average down may lie within us whether we prefer pain or pleasure.<br /><br />Moans of pleasure from SMOL - I love leather and steel. <br /><br />LOL!Singapore Man of Leisurehttps://www.blogger.com/profile/13774067113884418001noreply@blogger.com