Here are this week’s reads

Money Management, Portfolio Management

• Learning from your own mistakes, framing solutions to combat them in the future [TBP]
• Can you sum up your investment philosophy in 10 words? [WSJ]
• Health Tips for Traders [Stock Sage]

Technical Analysis, Cycles and Sentiments

• How do you know you are in a forgiving market? Be vigilant [Stock Sage]
• The 3 stages of a bull market, sentiment wise [Ivan Hoff]
• How bullish are Golden Crosses [TBP]
• S&P 500 to 1517 according to Peter Brandt [Peter Brandt]

Dividend Investing

• A good article on 12% yielding stock in Lee Metal [Next Insight]
• The 40 best dividend stocks in the world [Business Insider]
• Should large cash holdings be paid out or bought backed? [Aleph]

Personal Finance, Budgeting

• The sad plight of Singapore’s fav football son Fandi Ahmad [Singapore Mind]

General Trends, Individual Stocks and Miscellaneous

• For folks who does negotiating in their job, a list of Dos and Don’t [Inc.]
• For telecom investors – a future model:leasing phones[GIGAOM]
• SOPA is wrong – Piracy indirectly helped Angry Bird [Android and Me]
• How to be happy at work! [Inc.]
• Apple’s pricing paradox [Asymco]
• An in depth look into why clean energy is not working [Wired]
• The 3 technologies that is going to change the world [WSJ]

Don’t miss the best articles of Investment Moats (iMoat) sponsored by TradeStation

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December to March is usually the period where working people get their yearly bonuses. How do you use your bonus?

Smaller Bonus this Year

This year, most foresee that their year end bonus will shrink.

The two-day poll of 100 people, conducted in both the Central Business District and heartlands, found that the majority of Singaporeans foresee smaller bonuses this year compared to last year.

Almost 75 per cent polled said they believe their bonuses will shrink, which is a prediction seconded by human resource managers.

- SPH

Like wise, I do not expect to receive much special bonus this year. Its likely to remain lower than norm consider the firm is hit with some bad results during the quarters.

Part of the overall compensation

I do see that your annual bonus be part of your overall compensation package. And as such it should be manage as a total annual package instead of treating it as something of a windfall.

The fact is that folks that work in Keppel will get their 7 month bonus while some companies will struggle to gain any. Yet the workers in Keppel may each be paid much much less than the standard monthly pay of bankers who will not get much bonus.

Reward yourself but save up for the rainy day

I used to be in the frame of mind that you should always save as much as possible. But life goals change and for some people they really work hard for it.

Rewarding oneself by going for a good holiday, buy some gifts for parents and loved ones are good ways to recharge your batteries and share the joy around.

Sometimes share and you will received more. However, do it in moderation. For some people, they may feel that their bonus is small, but when they add up in 10 years, it may be quite a substantial sum.

Pay off debts

Some folks might be incline to put these substantial amount to the stock market, however, I would suggest assessing the debts that you currently hold to see whether you are able to reduce them.

You can take up debt clearing methodology like Debt Snowball to substantially reduce the amount of interest paid.

Your returns from the markets may not be certain, but by paying down debts, you are certain that you will be reducing your outflow, which is indirectly a gain.

Get an education before investing

Some of my friends would rather put their money into the stock market and learn from it directly. There are pros and cons to it but I do see it as more cons.

The end state is they normally do more harm themselves to their portfolio rather than good.

Why not pick up $100 worth of books or education session? treat that as a commission. The difference is that you arm yourself with something that you can use over and over again ad possibility prevent you from making bigger mistakes.

An annual dollar cost averaging

Should you make it this far and still think it’s a good idea to invest your bonus then all the best to you. My take is that you do not have to split the amount out. If your bonus is rather consistent, what happens when you dump a whole lump sum is that if you buy at the market peak your next bonus may be bought at a discount.

Why I would not invest all my bonus

I made a conscious decision not to save as much of my bonus as possible. I made a 10 year goal that I may talk about in a later article.

The truth is that your life goals change and when your income progress to a certain state, you need to set aside money for other goals and that you need to share the wealth around more.

Its not easy to adjust but 30% of it will go to my family, other objectives and higher education.

How do you guys intend to use your bonus?

I run a free Singapore Dividend Stock Tracker . It  contains Singapore’s top dividend stocks both blue chip and high yield stock that are great for high yield investing. Do follow my Dividend Stock Tracker which is updated nightly  here.

Always love to here Barry Ritholtz talk commentary because he teaches you to focus on what you should do when market goes up and down for a longer term basis.

In this video you would see a keen study of

• how past secular bear markets are formed
• what are the kind of downside risks we are looking at
• how much are we risking
• evaluating the pain you can take
• protecting with dividend growers that benefits from both scenario
• no talk about the economy and politics which are most of the time not the most important thing to look at for price movements

ST Marine’s president spoke on the importance of having both ship repair and ship building in one facility:

The ship repair generates recurring revenue, and often at better margins. But in ship repair, you need fast turnaround time, which is not just dependent on they workforce but also on the ability to get spare parts quickly. And because a lot of work has to be outsourced, it is important that a location should have other workshops or yards in existence. Few countries around the world check all these boxes.

[Drizzt is invested indirectly in ST Marine]

So I was reading The EDGE and in this article profiling ST Marine, it raised an interesting point:

“Recently, ST Engineering began building on its engineering capabilities to develop an environmental engineering business – similar to the ones that Keppel and Sembcorp Industries have.”

What I find it strange is that why does 3 Temasek-linked companies need to fight for the same pie?

Perhaps that is where Singapore’s ONLY capabilities lie. They can only do these kind of engineering work.

Perhaps this pie is big enough and lucrative enough to be gobbled up by all and still earn supernormal profits.

Perhaps they are given a mandate to pursue this by the government.

Another interesting thought:

How come Keppel and Sembcorp ended up being at the fore front of rig building? Why is it the shipyards in Korea, Greece and China are unable to do what we do?

Here are this week’s reads

Money Management, Portfolio Management

• 5 Traits of highly successful sales people (Inc.)
• The advantages of day trading (ppearlman)
• 20 Common Sense Investing Rules (Reformed Broker)

Technical Analysis, Cycles and Sentiments

• 5 Indicators that shows it may be a Risk On market (Ivanhoff)

Dividend Investing

• Should you pay out dividends or retain cash? How does it affect ROE? (Frankly Speaking)
• The case against using simple matrix such as dividend yield and buybacks (Aleph)

Personal Finance, Budgeting

• The megatrend seem to indicate fee based independent advisors over brokerage (WSJ)
• How an investor will rationalize his cancer treatment alternatives (Asset Builder)

General Trends, Individual Stocks

• Explanation what is LTE-Advance (Gigaom)
• Why banks and telecoms must merge (strategy+business)
• The economics of iPublishing (Atlantic)
• How France’s “Free” cell phones disrupted the market (Fast Company)
• Why Kodak went bankrupt (MarketWatch)

Don’t miss the best articles of Investment Moats (iMoat) sponsored by TradeStation

Now the crazy thing about Apple is that it started off the quarter as a megacap, juggling position with Exxon Mobil as the largest stock in the world by market capitalization. The amazing thing is that its growth rate may still be able to accelerate.

The recent initiatives to move into textbooks on iBook shows that they are building a platform ecosystems that transcends technology into a way of life.

The obnoxious thing is that it’s a closed ecosystem that Google does not want it to be.

As one tech commentator Gina Trapani says, “I prefer Google’s values over their products, and Apple’s products over their values. When either are compromised, we should worry”

Here are some crazy things about Apple

Crazy Growth Rate

- (splatf)

Basically the quarter was enhance greatly by a climbed in iPhone 4S. It vindicates the last poor quarter that people are really waiting for iPhone 5.

-(ReadWriteWeb)

More growth figures. For a megacap that is a crazy growth rate. The game has changed really, they are building an ecosystem that is mixing and meshing and giving you the iLifestyle that will just keep feeding itself! Its closed but it works!

Crazy amount of cash!

Now we know that tech companies based on intellectual properties have lots of cash. Oracle, Microsoft, Cisco have shit loads of it.

- (asymco)

Well, Apple added 38 billion out of their total 97 billion last year! How much is 97 billion? Enough to buy 474 of the S&P500 companies! Only 52 other stocks worldwide cannot be bought by that cash holding!

Conclusion

What I would really like to tap your brains is given this closed and integrated platform/network/ecosystem that feeds itself, how can the rest stop it?

This is probably the most bearish call I heard in a long time. For someone that experience to go against the market I hope he is right because he sees this rally ending soon and we may get to validate his call very soon

Here are this week’s good reads

Money Management, Portfolio Management

• Setting the correct stops (dragonfly)
• Classic Value Investing versus Buffett-Prime Investing (can turtles fly)

Technical Analysis, Cycles and Sentiments

• Trade SP500 Golden Cross. Ignore Dow Jones Golden Cross (IBC)

Dividend Investing

• NA

Personal Finance, Budgeting

• 5 Personal Money Tips for Women Owners (Inc.)
• Frugal Advices from Millionaires (GRS)

General Trends, Individual Stocks

• The next shoe to fall: Europe $39 trillion pension (Bloomberg)
• How Steve Ballmer will reshape Microsoft (Bloomberg Businessweek)
• Microsoft now makes money off 70% of Android Devices sold (Android and Me)
• Beware. Your telecom’s voice and SMS revenues are likely to plunge in 3 years (Telco 2.0)
• The coach who cut Michael Jordan from university team (SI)
• How facebook’s 100 billion IPO is broken down (TBP)

Don’t miss the best articles of Investment Moats (iMoat) sponsored by TradeStation

Money Management, Portfolio Management

• Its sometimes not how many small wins you hit but the big fat win (The Psy-Fi Blog)
• The importance of having a trading methodology (bclund)
• Protecting your equity portfolio with VIX ETFs (SurlyTrader)
• Where retail investors should put their money (the Atlantic)
• The problem when you stay 100% in cash (Reformed Broker)
• 10 ways to destroy your portfolio (Investing Caffeine)

Technical Analysis, Cycles and Sentiments

• There seem to be repeating 15 year market cycles (NYT)
• The investors that did less turn out to be bigger winners (Abnormal returns)
• Seasonal Investing. What if you invest from November to April versus May to October (TBP)

Dividend Investing

• Dividend Investing may be getting more expensive valuation wise (NYT)
• Boost your dividend returns by selling covered calls. A pretty comprehensive article (Seeking Alpha)

Personal Finance

• Can you save $4000 this year? (Andrew Hallam)
• Female oriented personal finance startup LearnVest offers low cost fixed commissioned insurance. Future model for Singapore? (WSJ)
• Insurance advisors are not listening to clients enough (I Heart Wallstreet)
• Can you retire on $500 a month? (Jet Set Citizen)

Trends

• The mobile megatrend (CDB)
• Why RIM will not be able to recover (CDB)