Merry Xmas! As we approach end 2019, most market strategists are putting their market estimates for end 2020. Although I do not profess to be in the league of these market strategists, just for fun, I am expecting STI to head towards 3,390 in 1Q2020. STI closed at 3,222 on 24 Dec 2019. I have outlined my basis and the risks involved.   Factors for my bullish basis a) Chart looks positive after bullish break Based on Chart 1 below, STI has staged a bullish break above its flag formation on 12 Dec 2019. Notwithstanding below average volume for the past couple of weeks (perhaps due to holiday period) and low ADX, STI’s indicators are slowly strengthening with rising OBV, MFI and RSI. The bullish break on 12 Dec points to an eventual technical measured target of around 3,389, probably in th

An individual can invest for a variety of reasons.  However, at the crux of the matter, we all invest for two key reason – to beat inflation and to create a secondary income source. I previously wrote an article on how inflation erodes your savings. Creating a second income source When we were young, we were told to study hard so we could get a good job. That was the role our education system played to ensure we could find a career of our choice or expertise. Our education enabled us to work in our chosen field of specialisation. While this is a good and necessary start, it often takes up a lot of time usually requiring between 10-12 hours a day. With so much time taken up at our primary workplace, we are usually highly dependent on the income we make from the job to support us

In a construction project for a huge mall, the foundation needs to be piled in first so that the structure is stable. Thereafter, the construction for the rest of the building can take place. In investing, something similar should also occur. Investors need to lay their investment foundation first before embarking on the construction of their portfolio. A strong foundation would include a compelling and coherent investment philosophy and also guidelines on how to select companies. Armed with a proper foundation, investing would end up being smooth-sailing, rather than fraught with peril. Take inventory The first step in laying a good foundation involves asking a series of questions about past investments, a list of profits and losses made, as well as a complete history of investment behav

Kingsmen Creatives Limited (SGX: 5MZ) is a leading communication design and production group with a network of 21 offices around Asia. The group has four main divisions – exhibitions and thematics, retail and corporate interiors, research and design and alternative marketing. Some of its clients include global brands such as Chanel, Gucci, LVMH Group and Tiffany and Co. Kingsmen was started 43 years ago in 1976, and though its business has remained relatively unchanged during this time, the group had encountered numerous challenges along the way. It has had to adapt and evolve over time in order to remain relevant and has also managed to refresh its management team as the two original founders, Benedict Soh and Simon Ong, take on consulting and strategic roles. I felt it would be in

Delfi Limited (SGX: P34) manufactures and distributes branded consumer products that are sold in over 17 countries including Singapore, Malaysia, Indonesia, Hong Kong, Australia and Thailand. Delfi was formerly known as Petra Foods Limited but changed its name in May 2016, and has a portfolio of established brands such as “SilverQueen” and “Ceres”, which are household names in Indonesia. While Delfi has a long operating track record and a strong portfolio of brands in Indonesia, the consumer goods market’s fortunes are tied to the economy and the industry itself is also fragmented, with many local and foreign players jostling for a piece of the pie. A company’s reputation and branding will determine if it attains dominant mind share when consumers shop

Here’s yet another three biases and fallacies taken from the book “The Art of Thinking Clearly” by Rolf Dobelli. Investors need to be always alert for such biases as they can screw up your investment thought process and cause you to make costly mistakes. The problem with averages We all have to be very careful when dealing with averages. There is no such thing as a “normal” average, as each data set is unique and may be vastly different, making them incomparable. Also, if there is an anomaly or an outlier (i.e. a statistic which differs greatly from the norm), this will skew the average significantly. An example would be the comparison of dividend yields in a data set of 10 companies within an industry. Nine of these companies may have dividend yields ranging