Thursday, September 12, 2013

My Current Plan 12 Sep 2013

Given that the market is looking crazy to me, I am really at a lost of what to invest my money in. I'll just spell out my plans in words out here, so when I read it, I'll know if I'm crazy or not.

DBS
This is my main TX account. All monies that come and go, goes through here. This is also the only entry and exit point of external sources. It is my current account, as well as the account that my salary (hur hur) gets dumped into.

DBS Vickers
This is really just going to be for IPOs, haha. Thanks for helping me open my CDP account DBS!

Phillip
Now, I really love the excess cash management that they have going on in Phillips. This is going to be of course, my main unit trust account. Funds here go on sale at 0.75%, with some on promotions at lower charges, some even with no charges! I can see that in the near future, almost all my money will be here, either cash idling and earning in the MMF, or working in funds.

Most likely my first few purchases are going to be into short term bond funds. I am currently in the midst of analyzing the bond fund that I've shortlisted. The list is really quite short, but I want to make sure that I totally understand my investments.

CMC Markets
Viva Las Vegas! Okay, truth be told, this is really like my antsy, gambling account. I really won't be too crazy or aggressive with my money here, but it's just something for me to do so that I can keep myself from meddling (too much) with my portfolio that I'd eventually build. My portfolio will have allocations for asset classes across various market scenarios, along with indicators to ensure that I am not being too itchy or rash, or even complacent in my portfolio rebalancing. I would like to think of it as being tactical, but operating within a clear framework with definite boundaries. This CFD account is really just for me to make money on the sidelines.

Unless the market is crashing, or some crazy shit is happening, I pledge to ensure that this account never exceeds more than 10% of my investable money. I actually would like to see myself ensure that I'm not gambling with anything more than 5%, with clear rules as to when I have to stop, when I will top up the account, cooling off period, when will I transfer out money, what are situations that call for the increase to 10%, what kind of crazy emergency situations will call for me to plow in even more moolah to take advantage of situations. I'm slowly think this through later.

SCB
Now, I never knew until just the other day that SCB has access to so many overseas stock exchanges! Honestly, this makes the appeal of ETFs a lot more attractive now, however it also does mean that I am open to also invest into individual stocks on these exchanges as well! However, as mentioned before, I'm avoiding the US markets at all costs. What appeals to me are ETFs denominated or hedged in CHF, as well as big big name dividend stocks that might go on discount when the markets there are doing badly!

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Currently, I'm only actively investing (gambling) with CMC at the moment. I've already made an impressive 140% return on my capital from when I started, so I'm feeling mighty gutsy sometimes, but I always try to make sure I'm not doing anything stupid. Stop losses for free! I'm waiting for the Fed announcement before I make my bond moves, because I hope that the announcement either a) spikes interest rates globally or b) crashes the stock market. If the stock market really does go up from the announcement, it just means that Humpty Dumpty is going to have an even greater fall the next time!

In situation a), I'll just wait for the dust to settle and the outlook for the future becomes more clear. But as long as I think I've got a clear grasp and understanding of interest rates of the future to come, I am quite sure that I will be investing a fair bit into some of my shorlisted bond funds.

In situation b), I'll be transferring rapidly all my spare cash that I have in my DBS interim account into my CMC account, and shorting hallelujah! By my count, every 100 points the S&P drops, I'm in a position to make $30k! That's a 6% drop. That's not even a correction, which is 10%. If the bear market really ensues and leads to massive panic (which I am sure it will), we might be looking at a drop of 20% within mere days, and an even more intense drop compared to the last crisis (maybe 60% :O)

Honestly, if that pans out, I'll be able to put a down payment on a luxury condo. I won't be able to afford the monthly installments yet though, so I'd have to wait until the ripple effects of the crashed US housing market and their stock markets hits us here in Singapore. Honestly, bursting their bubble could nicely lead us to burst the bubble that we have now and finally bring about a small bit of income distribution here on our little island.

Is it bad that I'm hoping for a global recession so that I can make money on the short, then pick up bargains on it's way back to recovery?

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