Tuesday, October 14, 2014

Recent market correction = good times?

Hey, how are you guys doing? As you probably noticed, the markets haven't been doing well lately. But if you're young, trying to build wealth and have a healthy amount of cash on hand, then you should be happy that stocks are going down as you will have more opportunities to pursue. If you're a retiree that needs income and have a well-diversified portfolio of high-quality assets, then you shouldn't worry as long as the cash-generating ability of those assets is not compromised. 

I personally am getting a slight thrill every time the stocks on my watch list drop by a few percent. It kinda reminds me of my university days during the sovereign debt crisis. I would come back from dinner and sometimes find that the markets have dropped by 2 to 5 percent and that a chick or two has returned my flirtatious Facebook messages. Good times, good times.

However, I would be a fucking liar if told you that the recent stock market pullback has resulted in lots of buying opportunities. Stocks have went up so much the past few years that there still aren't that many bargains even with the recent pullback. But I am finding pockets of value here and there, so I'm still enjoying myself. Although unlikely, it would be awesome if the market would crash by another 30% this year. A value investor can dream, can't he? Anyway, thank you for reading. Take care and stay rational.

Updates on the Greedy Dragon Portfolio: As I mentioned in my annual performance article, I've withdrawn Ringgit Malaysia (RM) 50,000 in cash from the portfolio. This left my portfolio with an uncomfortably low level of cash. That's why I recently sold KLCC Property Holdings and Citizens & Northern Corporation to replenish my war chest. I also reduced my borrowings from about RM 12,000 to RM 9,000 as I have less collateral with the bank and I didn't want to risk the hassle of a margin call.      

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