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Investment Strategies For Year 2015: Trade Stocks Selectively
Perspective | 02 January 2015
Related stocks:
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By: Tom K
Articles (1) Profile

It’s that time of the year once again when I review my investment portfolio for the year 2014. Year 2014 commenced with bullish analyst reports, as always for the beginning of every year (it is all about hope, I believe).

As we now see, the Straits Times Index (STI) has had modest gains for 2014. The gains registered by the STI reflected the surprises on Singapore’s stocks market, which has inevitably shaped my investment portfolio for year 2014 as well.

Compared with 2013, each of my dividends and trading profits for 2014 has increased and collectively, they have increased by around 34 percent.

During 2014, I have sold off non-performing stocks, consolidated my portfolio and entered into new themes. As for the new capital which I injected into the Singapore stocks market for 2014, it was just 33 percent of the amount injected into the markets in 2013 and this, I shall explain in a later paragraph.

Dividend Income From Blue Chips
For 2014, my dividends were actually higher than my trading profits. My dividends were mainly derived from stocks bought in previous years, which I have held since then. These are blue-chip stocks.

Though some of these stocks in this stable are now laggards, e.g. Golden Agri-Resources’ stock; I do not mind the performance as I hold a long-term view for these stocks and am thus okay with the market’s “ups and downs” for them.

Even Warren Buffet has not done well on his portfolio recently. His losses amounted in the leagues of at least US$1 billion on paper.

Though I have a thinking that the “Buy and Hold” strategy may not be as effective as before in this new era of investing, I would still want to devote a portion of my portfolio into blue-chip dividends stocks as I do not want to have all of my portfolio in non-dividend stocks, which would give me “nothing” if their stock prices do not appreciate and I have to be “forced” to hold them for some time.

Just a note, I do not really like to “cut loss” to begin with, I find that there is an intrinsic value in the stocks which I select for investment to which the stock price will correspond to in the future.

Defensive Stocks?
On balance, I am “cautious” in ensuring that I do not have too much of my portfolio in these dividend stocks. Just take a look at the effect of the low oil prices on some blue-chip oil plays and you would know what I mean.

In today’s context, I feel that there are not that many defensive stocks on the Singapore stocks market, with an increasing number of stocks in the traditionally defensive industries like telcos and food and beverages becoming more cyclical due to the companies’ overseas expansion, which subject these stocks to the global market forces.

Stocks which I trade for a consistent trading income are stocks which I have acted on upon technical analysis. The stocks which I traded this year are such that some of these “defied” even my well-thought out trading strategies.

Trading Cautiously
General sentiments towards companies well-loved by investors before, like Super Group and Osim International, changes. In particular, I am disappointed with the stream of economic data from China and this has some bearing on my stocks vested in China.

The above has resulted in my cautious “picking and entering” of new stocks, through the careful “watching” and analysis of the stocks markets: I take pride in buying only one lot of Sembcorp Marine at what seemed to be attractive price before its stock price retreated further against the backdrop of low oil prices.

I believe in “Cash is King” too and together with my cautious “picking and entering”, I have pumped in only one-third of my trading capital into the markets for 2014 compared with 2013.

Going forward to 2015, I have formulated my investing and trading strategies. I will continue to hone my trading strategies so that they will be “well-equipped” to best capture market opportunities.

Besides the upcoming interest rate hikes from the US Federal Reserves, I would still recommend investors to “watch out” for what Mr Market may toss at the stocks markets.

I will trade stocks selectively: dividend stocks will still be in my list and trading of these will be carried out at the most opportune times.

Thank you for reading this post. I wish you a Happy New Year and Success in your Investments!

Golden Agri-Resources  0.215 +0.005 +2.38%   
Business: Co is engaged in cultivating & harvesting oil palm trees, processing fresh fruit bunches (FFB) into crude palm oil (CPO) & palm kernel (PK), & refining CPO into industrial & consumer pdts.

Insight: May-19, 1Q19 revenue fell 11% due to softer crude ... Read More
Sembcorp Marine  1.190 -- --   
Business: Co is a leading global marine & offshore engineering group. [FY18 Turnover] rigs & floaters, repairs & upgrades, offshore platforms (98.8%), ship chartering (1%), others activities (0.2%).

Insight: May-19, 1Q19 revenue fell 31.3% to $810.6m due to ... Read More


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