STI performance

In the last couple of weeks, STI had a spectacular performance. At closing, it is now near to where we had started beginning of the year 2014 by just a few points below. In this post, I want to look at how did STI compare against some of the other indexes such as Indonesia, Brazil and China. Hey, isn't this the BRIC without Russia.

Below is the chart which I had done to compare these indexes, Brazil(blue), Indonesia(orange), China(green), STI(red)

Since February, Indonesia is the strongest of the group, having rebounded strongly as shown in the chart. Brazil is the next strongest, rebounded strongly after a second correction. As compared with these 3 countries, STI has not been doing that well, mostly in the range bound and had just started trending up but not much.

In the table below, it has shown clearly how each of these market has performed for the last 6 months as compared with closing on 28Mar.

What are the factors that is likely to cause this ?

Starting with Indonesia, this is an election year for them, and as mentioned in an earlier post, this has a positive effect on the Jakarta composite index based on the last 2 elections.

Brazil has got 2 major events this year, one is the coming election. For the soccer fans, it's the World Cup in June, so will the World Cup fever spread to the stock market.

So will this trend continue ... no one knows, but remember to cut loss if you are wrong.

Disclosure - I am long on EWZ and IDX.

Related post: Where to invest in Asia

NOT to do before 35 years old

Following my previous posts of 35 and broke, I thought I will share what are the NOT to do things financially before 35. These are some of things which some of the people around me had committed, and spend years making it right again. By staying away from these, one should be fine at 35 and after.

So what are the things we should avoid?

Big Items - One's graduation is a joyous occasion, when one enters the workforce and the ability to make money and finally not dependent on allowance from parents. Some chose to celebrate this occasion with expensive Europe or Japan tour. Some of my classmates did that when we graduated, the idea being that it will be difficult to take 1 month of leave next time when one started working. I mean as long as the cost of the tour does not get you into too much of debt, why not, after all, one had studied all his life and it's not too reasonable to want to take a break. However, by not having a budget and discipline, one will find that he/she will get into huge debt even before he/she starts work. What if you cant find a job after the trip.

Small Items - Yes, everything adds up end of the day. If you stand in the middle of the Raffles place, do you noticed that every other people holds a cup of expensive coffee as they walk to their office.  By not having that $3 cup of coffee every morning, one would save about $60 a month and $720 a year. Another one  would be taking taxi going to work or home, especially after a tiring day. Most of us think that it's ok, it's just 4 or 5 taxi trips a week, does not matter much. Again, the  cost from the 4 or 5 taxi trips add up to quite an amount end of the day. If your objectives is too save very hard for the first 10 years of your working life, this is something that you can cut back on. 

Getting married - Most Singaporeans will get a house before they get married, and with 2 big items, most of our savings will be depleted badly. For the first time in your life, you never feel so empty before, I mean your bank account. Do you really need that expensive condominium or can you start with a simple HDB and then upgrade later when you build up your finances again. Most of my friends did just that and most are doing well financially. Do you really need that lavish wedding dinner or we can have a simple and yet presentable one. By making the right choice based on one's financial status, your financial standing should still be in Green even after getting married and your home.

Investments - Do not make stupid mistakes by getting into unregulated investments schemes which promises returns of 20% or even 30%, remember the gold scam, etc. Come on, even Warren Buffet's return is not that fantastic, and being an educated person, we should be able to question how this is achievable.

Related posts : Broke at 35 years old

Broke at 35 years old

My friend sent me this article from asiaone, 35 and flat broke, and we had this conversation over lunch today. He was shocked that couple earning $17,000 a month, can be highly in debt and eventually broke. Someone once said, it is not how much you make that matters, it is how much more you can save that is important. As we are going to have a new batch of graduates joining the workforce in a few months time, I thought I will share my 2 cents on this. One's financial journey starts the moment you join the workforce and if you don't make silly financial mistake along the way, you will be much better off than those characters mentioned in the article.

With the social media and internet, there are too many temptations trying to make you spent your dollar. Whenever there is an urge to buy something, have a cooling period, delay the purchase for 2 weeks and you might realized that you don't really need it after all.

Credit card is another culprit, as most of them who is in debt actually lose control over the use of credit card. It is the convenience and without realizing it, the limit has been blown. One of my colleague only has 1 credit card, and that is probably a good way to curb the urge of over spending.

If you are really in debt, you have to recognize that you have this problem and try and get back your financial to a healthy state again. Unfortunately, there is no easy way to this, and importantly to live below your means. Go read 'the millionaire next door', and you will know what I mean.