Tips from The Intelligent Investor

Re-reading The Intelligent Investor by Benjamin Graham.

His most famous protege is of course, one Warren Buffett. 

Thought it will be apt as the market undergoes volatility to pick the brains of one of the best investors minds.

Here's one from the book:

"The intelligent investor realizes that stocks become more risky, not less, as their prices rise—and less risky, not more, as their prices fall. The intelligent investor dreads a bull market, since it makes stocks more costly to buy. And conversely (so long as you keep enough cash on hand to meet your spending needs), you should welcome a bear market, since it puts stocks back on sale."

Follow with care. 

Asia Investor Sentiment Buoyed by Equities and Mutual Funds

Asia Investor Sentiment Buoyed by Equities and Mutual Funds -- Manulife Survey

• Rising optimism seen in Malaysia, Indonesia and China
• Hong Kong and Taiwan sentiment also improves, but still in negative territory
• Drivers include China stimulus, Indonesia election fever, pre-tax consumption in Malaysia
• Family, friends and colleagues the main influence on investor decisions

Investor sentiment across Asia rose in the first quarter of 2014, buoyed by equities and mutual funds, along with a rise in optimism among investors in Malaysia, Indonesia and China, according to new research from Manulife.

The Manulife Investor Sentiment Index* for the region rose from the fourth quarter of 2013 (+2 to 24), driven mostly by sharply higher sentiment towards equities (+7 to 16) and mutual funds (+13 to 21). The improved sentiment in these sectors offset modest declines in attitudes towards property.

The higher sentiment was driven upward mostly by China, Indonesia and a surge in investment optimism in Malaysia. In Malaysia, investor sentiment rose on stronger economic growth and the belief that market conditions are improving. Investors there share the top spot with the Philippines as the region's most positive.

Investors in Hong Kong and Taiwan remained negative -- but there was an improvement on the previous quarter, with Hong Kong at -11 (+2) and Taiwan at -6 (+5). In only three markets did sentiment fall: Japan, the Philippines and Singapore, albeit in each case remaining positive.

How to spot overseas property scams?

How to spot overseas property scams?

Yahoo carried an item guest contributed by Mr Getty Goh, "the co-founder of CoAssets, a spinoff company from Ascendant Assets Pte Ltd, and Singapore and South East Asia’s first real estate bulk purchase and crowd funding site". 

Read it at: http://sg.finance.yahoo.com/news/spot-overseas-property-scams-131730522.html

Recently, a mainstream newspaper wrote about how some dodgy foreign property investment schemes were recently sold in Singapore. Being a co-founder of CoAssets, Singapore and South East Asia’s first real estate bulk purchase and crowdsourcing portal, I have come across my fair share of dodgy investments. Hence, I thought it would be useful for me to share some of the tools I use to help me discern whether a deal is genuine or a scam.

Looking through the news article, the deal was eerily similar to something that I came across just a few weeks ago. Some of the similarities are (1) the project is located south of Batam and (2) more than 1,300 units were sold for $70 million.

The business model of CoAssets has been likened to that of SouFun, a Chinese listed company that provides targeted ad solutions for property developers by aggregating demand (i.e. bulk purchase). Hence, we were approached to get aggregate bulk buyers for this Indonesian project. After careful consideration, we turned the collaboration down and we found two key red flags that made us cautious.

Red Flag #1: The numbers did not add up

One of the main things that made my team wary was that the projected numbers did not add up. In another news article, it was reported that the developer was planning to sell 900 units at US$90,000 (about S$117,000). There were different units and the smallest unit was about 60 square meters (about 646 square feet). Of the 900 units, 200 were already sold at a special pre-launch price of about US$30,000 (about S$39,000), which meant that a deep discount of about 66% had been given to the group of early buyers.

Developers are after all in the business of making money through the selling of properties; hence the question we wanted to answer was whether a discount of 66% was reasonable.

When it comes to development, one key component is construction cost. To find out how much it costs to build a residential property in Indonesia, construction cost estimates for 2013Q3 from Rider Levett Bucknall (RLB), an internationally renowned quantity-surveying firm, were used.

Based on the report, the estimated construction cost for Jakarta was between RP6,161,000 per sq m (about S$62.36psf) and RP9,839,000 (about S$99.62psf). Due to the lack of more precise data for the Batam region, construction cost for Jakarta was used as an indication. Based on the estimated cost, purely for construction, it would cost between S$40,000 and S$64,000 to build the smallest 60 square meter villa. Hence, at the special price of US$30,000, the developer may not be breaking even.

Compounding to the risk, the number of people who received the special 66% discount was also unclear. The project could still be viable if the developer gave the special 66% discount to just a handful of close business associates. However, if it gave it to all 200 buyers, the total amount collected would unlikely be enough to cover the construction cost for the 200 units.

Red Flag #2: The developer did not seem to have the financial strength

Developments are generally hefty financial undertakings and many developers do it with some form of construction loans from banks. While developers may not reveal the true financial situation to the retail property buyers, they will have to show their financial reports to banks in order to secure construction loans. Hence, developers that can secure bank financing at the construction stage tend to be in a good financial position and are more secure. Conversely, developers who do not have some form of bank financing during the construction stage are not viewed to be as attractive.

The 900 units in the Batam development falls under the latter category. That is not to say that all projects that do not have bank financing during the construction stage are doomed to fail. However, for this specific case, the amount needed to build all 900 hundred units is at least S$36 million (assuming all 900 units are 60 square meter units that cost S$40,000 each to construct). When we did an ACRA check on the Singapore company, we found that the company had only a paid up capital of S$300,000 and the key appointment holders of the company stayed in public flats.

What is your financial recourse?

The Magic of Money

“Money is so elusive,” a friend once said. “It keeps disappearing.”

Don’t we all have the same feeling on occasions?

Well, I have two words for it and the first word begins with an “F”.

Financial Budgeting.

It can help us to manage our money and prevent the disappearing acts.

Of course, it is highly recommended that we should always pay ourselves first, that is to set aside money for savings whenever we get our pay checks. However, for those who feel that it is impossible, or don’t know where to start, financial budgeting can help.

Some find doing financial budgeting a painful process. A friend described it as doing the same boring homework every day.

Here are some points you may want to keep in mind to get started if you do not have a trusted financial adviser to guide you.

WPG Group, T3B, WPG Hotel Group - ask more questions before you invest

Some readers were searching for whether t3b system works when they found my blog. Of course, my previous entry was: 

Can you trust T3B Trading System, Keane Lee, WP Global Group, WPG Hotel Group ?

I think more important than whether the system works (which it doesn't work as well as claimed) is whether a company is trustworthy, reliable and honest when dealing with customers or clients.

As mentioned in my previous entry, I've made it very clear that T3B made a false statement to The Straits Times in "Sure-win schemes not a sure thing", The Straits Times, 28 Oct 2012. I've emailed Keane Lee himself, yes the "Chairman" of "WP Global", the "Group Chairman" of "WPG Hotel Group" and also the "Founder" of "T3B System" to highlight the inaccuracy and to seek clarification. Surprise.. surprise.. (or not).. he did not reply. I wanted to know whether the false statement was due to some slip up, incompetency of the person who was authorised to speak to the press and did not find out the facts of the issue, or was it simply plain dishonesty and a lie. But no reply, which is quite consistent with the delaying tactics and ignoring of emails he and T3B have responded to my queries, I guess.

More on T3B system later and how the company and Keane Lee himself suddenly stopped replying to my emails when presented with documentary proof. 

I read with interest how now WPG Hotel Group is sharing investment opportunities in Myanmar and is inviting "investors to come on a journey to

Can you trust T3B Trading System, Keane Lee, WP Global Group, WPG Hotel Group ?

If you are reading this, you are likely looking for a review as you have most probably come across T3B Trading System, WPG Hotel Group, and/or WPG Group. You would probably know that Keane Lee is the Chairman and founder.

You may have been offered investment opportunities that offer incredible returns and passive income and....... (fill in the blanks). 
And you are wondering whether that is a good investment opportunity or whether these are dubious scams. 

I don't know which is the correct answer, but I will say think really hard before parting with your money. You may want to read "Sure-win schemes not a sure thing", The Straits Times, 28 Oct 2012.

In that article, T3B made a false statement to The Straits Times. Can you trust a company or someone if it/he gives a false statement to the media?

More information and evidence will be revealed about the false statement T3B, one of the companies under the WPG Group as listed on its website, made to The Straits Times, and how instead of answering questions and living up to their word and commitment, it has chosen a path of delaying tactics and ignoring emails.

Buying property in Singapore?

If you are a Singaporean buying property in Singapore, you would be looking at a HDB flat like about 80% of the nation.


HDB website seems user-friendly enough. 
Seems easy to navigate and clearly categorised.
You should be able to find the information you need at 
http://www.hdb.gov.sg/

More interestingly, you may want to check out the blog Housing Matters at http://mndsingapore.wordpress.com/

The blog of National Development Minister Khaw Boon Wan... to get a more detailed idea of his thoughts...


Probably one of the most significant investments most people will make...
So the more you read.. the better....

Simple way to extra money!

An entry I contributed to CDAC's blog, which I have been volunteering with (though I would like to do more than I am now)...

Here's the entry... you can check it out at also at http://cdacvolunteers.blogspot.com/2011/05/simple-way-to-extra-money.html 

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Simple way to extra money!  It is painless and anyone could do it right now – even you!

Remember the coin banks you owned when you were a kid? Mummy was right, it is important to get into the habit of saving.

 Mummy is STILL right, even now!

Saving is important and coin banks are not just for kids. If you find yourself struggling to save anything, start by saving your spare coins.

Take what I do for example:

Investment Advice from Jim Rogers

Jim Rogers - Credit below pic

1. Get out of the US dollar
2. Buy commodities
3. Invest in China

What business journalist Gabriel Chen learnt from and the insights given to him by Jim Rogers, the former business partner of hedge fund icon George Soros.


Act on your Convictions with Discipline


How Jim Rogers demonstrated that? 

Supplementary Retirement Scheme - Save on Taxes through SRS

How to save on taxes? Lorna Tan, Senior Correspondent, shows you how with her article “Saving a little today will go a long way – Supplementary Retirement Scheme lets you save on taxes while you build your nest egg” in The Sunday Times November 14, 2010.

Key points of the Supplementary Retirement Scheme as given in the article:

• Voluntary Programme ideal for middle- to high-income earners
• Retirement savings with tax relief
• Withdrawals of SRS after the statutory retirement age (at the time of contribution) comes with a 50% tax concession
• SRS withdrawals can be spread over 10 years
• Penalty for early withdrawals 100% of taxable + 5% penalty 

As read on http://www.insuranceemart.com/2010/11/how-to-lower-tax-in-singapore.html

PRUearly Stage Crisis Cover

Remember the previous entry early stage breast cancer - she has 3 policies but no coverage?
The reason was because critical illnesses or major illnesses cover in insurance policies have the same standardized critical illness definitions by the Life Insurance Association of Singapore and the General Insurance Association of Singapore.


There was always the fear that a person may a serious illness, but not serious enough that meets the common critical illness definition for a insurance payout.
Well, fret not.


Prudential Assurance  has now launched the PruEarly Stage Crisis Cover.
This insurance plan offers financial support right from the early stages of critical illnesses.

PruEarly Stage Crisis Cover

It covers as many as 70 different medical conditions! This include early stage critical illnesses such as Cancer at the non-invasive stage, chronic kidney disease, severe dementia and severe asthma.
PruEarly Stage Crisis Cover even make payouts for diabetic complications! The first of its kind in the market.


For a $50,000 cover, the insurance premiums for this plan starts from slightly above $1 a day for a 30 year old who purchase a 45 year term.


For more details, read more:


PruEarly Stage Crisis Cover

Contact me at mywealthmodel(@)gmail.com

Early stage breast cancer - She has 3 policies but no coverage

The above was the title of the article in today's The New paper - August 31 2010. This lady was diagnosed with ductal carcinoma in situ (DCIS) in her right breast which is stage zero, early stage breast cancer. The condition is considered non-invasive which does not fall into the category of critical illness. She was upset that her critical illness insurance policies did not pay out the claims.


Do note that the critical illness definition is standardised in Singapore's

Higher bonuses for your insurance policies

Better bonuses for some insurance policyholders - Payouts from Income, AIA and Prudential up as economy rebounds (The Straits Times 23 Aug 2010)


As reported in the newspapers today, if you are a policy owner of participating whole-life insurance or endowment savings policies from NTUC Income, AIA or Prudential it is good news for you as the bonuses to be paid towards accumulating your cash values is higher due to a strong economic rebound that started late last year.


Not all companies have announced higher bonuses though, Manulife Singapore, was reported as one of the insurers that will not be adjusting yearly bonus payouts this year. 


Will this high bonus payout continue? 

China's young rich learn how to get richer

The rich gets richer? China's young rich learn how to get richer as reported in an article that appeared in The Straits Times July 28 2010. The combined wealth of the families in the class was reported to be in the region of dozens of billions of yuan.  

These children of the rich were attending courses to learn from ancient emperors' secrets on succession planning. The trainers teaching the lessons included advisers to government and top conglomerates, lecturers from China's top universities and Communist Party scholars. 

Some people are unhappy with the lessons given as they feel that the income gap is already too big and this will worsen the situation by promoting elitism as the rich gets richer.

Let us be realistic here, being born into a wealthy family sure has its privileges and attending such lessons is just one of them. You cannot stop the universities or private institutions providing seminars or talks targeted at the rich on how to grow their wealth or how to preserve their wealth.

However, does that mean that the rest of us who are born without silver/golden/diamond spoons should lose all hope? Well, all is not lost. Some of the heirs to the wealthy family businesses skipped lectures and many were more interested in talking about their luxury cars.

We just have to to be motivated and inspired to fight a lot harder and work much harder at investing, savings and growing our money through financial management. The world is not fair, we all know that. Starting the race of life at the back, we just have to run that much harder so perhaps our children can get the chance to start the race nearer to the start line.

Selecting a Financial Consultant - Debunking the Myth

Whose money is it anyway? - The Straits Times 23 July 2010. An article written by me about how you should go about selecting a financial consultant by looking beyond his marketing savvy.

Whose money is it anyway? - In choosing a Financial Consultant, look beyond his marketing savvy

I tried to make the article as easy to understand as possible and suggested the question to be asked if faced with the common claims made by Financial Consultants or Financial Advisers. Read the article for the full story.


The four main points which I highlighted in the article and the question to be asked:

1. This is the best financial product in the market.
• On what basis is the recommendation suitable for me?
2. The more awards the better. 
• How did you qualify for the awards?
3. We are the best financial services company.
• Best in what area?
4. We can source for you the best products from different companies.
• How are you remunerated for the different options listed in the recommendations? (You may want to read Independent Financial Adviser - Really Independent?)

Selecting a good financial consultant may help you a lot more than just saving some dollars and cents.

If you have any feedback or any question which you would like answered, feel free to drop me an email at mywealthmodel(@)gmail,com

Independent Financial Adviser - Really Independent?

Are Independent Financial Advisers (IFAs) really independent in Singapore? "A financial adviser who claims to be so may not be telling you everything" as reported by Lorna Tan in The Straits Times Saturday, June 26 2010 article - Excuse me, are you an independent adviser?

So, what is so special with the word "independent" before a Financial Adviser? With the word "independent", firms market themselves as champions of the consumers by recommending financial products based on consumers' financial needs and not by pushing or hard-selling financial products because of commissions. Is that really the case?


The next time a Financial Adviser tells you he is Independent or from IFA, you may want to rethink what it really means. As defined in Singapore's Financial Advisers Act (FAA), "only financial advisers who can demonstrate that they do not have financial or commercial links with product providers that could influence their recommendations should use the term "independent". Just like perfect competition in  Economics, is it really possible in the real world? The only way IFAs can be truly independent is IF they have access to all the products in the market and that is not the current situation.


Most financial advisory firms actually do not qualify as independent if the definition from FAA is strictly adhered to. So some firms skirt the issue by only saying so to their customers verbally and being smart enough not to label "independent" even on their stationery for fear of being revoked of their licenses.


The main issue as highlighted in the article? Volume Bonuses - which can be in the millions, given to financial advisory firms as bonuses for hitting quota of sales or renewals of specific products. The even more shocking thing? Volume Bonuses may be paid in advance when financial advisory firms make commitment to the quotas they will be hitting. Failure to hit the targets will result in financial advisory firms having to repay these volume bonuses. 


As the article rightly pointed out, these financial incentives may result in not so independent advice as financial advisory firms may skew their remuneration structures to fulfill their commitment to avoid returning bonuses. What makes these firms' pro-consumers and independence stance even more questionable is that often times, these volume bonuses or commissions are not transparent and are hidden from customers.Which makes it a greater hidden danger.


Instead of basing your judgement and decision when selecting a Financial Adviser on whether they are independent or tied-company's Financial Consultant, judge them on their merits and professional advice.

Cheques in the letterbox! - Can we trust the banks to do what is right for its clients? Credit Loan Crisis in the making in Singapore?

Cheques in the letterbox! How low can the banks go? 
Not that anybody should be unhappy if we receive cheques in the letterbox. Keep them coming by all means! 
However, a reader emailed a copy of it to me and I was disgusted by what I saw and it set me thinking: Can we trust the banks to do what is right for its clients? And is a Credit Loan Crisis in the making in Singapore? 
A reader’s father received what seemed like a perfectly normal cheque, written in his name with the amount stated. Pleased that he is receiving money from the bank, he happily went to his child (my reader) to get help in depositing the cheque into his account. My reader was appalled when he saw the letter and cheque.


And the following is the reason why:

Cheque in the Letterbox from the Bank

Touted as extra cash at a special rate of 1.88% for six months with no processing fees! Doesn’t it sound like a bargain already? 
Recipients are encouraged to “take advantage of this promotion now” to “REWARD” yourself with a well-deserved holiday or “INDULGE” in something that you’ve always wanted. 
A bank asking you to borrow money for a holiday and pandering to your wants! 


Wondering what is the interest rate after six months? You have got to read through the fine print at the back to know that it is 24% per annum!
So for someone who does not understand English as in the case of my reader’s father, are there safeguards in place?


This is not to pinpoint any bank in particular. Most (if not all) banks have marketing campaigns for their credit and loan facilities. The tricky part is in finding a balance and drawing the line. 
It is a reminder that banks are not longer the service provider of just depositing and withdrawing money that we were all so used to. 
Mini-bonds and Lehman Brothers, anyone? 
As listed companies, they have profit motives and have to answer to shareholders as well. That is how the Credit Crisis happened. (Click here to watch the simple to understand video of Credit Crisis Visualized) 


Which is why, getting ourselves Financially Educated is of great importance. So we can all come to our own decisions and not have products or credit pushed to us.


More importantly, I hope it is not the beginning of us being led down the slippery slope of living on credit. I remember watching on TV about the situation in US where someone who was on the verge of bankruptcy (or already one) who continued to receive pre-approved credit card in her letterbox!


Again, it is really simple. Back to basics of Personal Finance 101 – differentiating Needs from Wants and NEVER borrow a single cent for Wants!


So next time a mail comes into your letterbox, read carefully and think twice - thrice - before taking any loan or credit!


Wealth Matters! If money isn’t coming into your pocket, money is going into someone else’s.


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Paying 85% Interest Rate on your Personal Loan?

Luckily that is not happening in Singapore. 

I do not think loan sharks even charge that much!

As read on The Sunday Times May 30, 2010 – NBA Player told to pay 85% interest (Left)

85 per cent interest charged on a personal loan from Allstar Capital is perfectly legal in Nevada.

The article carried a report on a National Basketball Association (NBA) player Eddy Curry. He has a US$60million (S$84.3million) contract that includes a US$11million option for next season. If you (like me) have not heard of this basketball player who earns this fabulous amount of money, it is totally understandable. Why? His total playing time in the last two seasons: 10 games (That’s an amazing pay for a highly paid cheerleader?)

A judge in New York ordered Curry to pay US$75,000 a month plus interest on his personal loan and had a lender seize 3 of Curry’s car as he was late in his loan repayments.

Lessons to be learnt from this article, clichés as they may be?

It is not how much you earn; it is how much you save!

Despite his salary, this player took a personal loan of US$570,000 from Allstar Capital in 2008. He also owes a fellow NBA player Juwan Howard US$350,000.

The reasons which may go toward explaining his situation?  He has 12 cars including a Rolls-Royce (1 for each month of the year?), a personal chef that is paid US$6,000 a month, spends US$1,000 on television and satellite television and gives US$16,000 a month to his relatives (I need a relative like that!).

As the article rightly sums it up, he makes a lot, spends a lot and owes a lot.

Financial Education

Despite me jokingly saying Eddy Curry is a highly paid cheerleader by the courtside, he must be a really good basketball player to get to where he is. You may also be a really good or highly paid engineer/doctor/lawyer/singer/actor/employee (anything in the world) but your efforts may count for nothing if you do know how to manage your money.

Get educated financially (reading this is a good sign!).  I am not even talking about going through Financial Reports of companies, reading Prospectuses and all the financial jargons of Finance and Investments (*yawn*).

Start with basic Personal Finance of insurance, savings and investments. It is not that hard. Learn to budget and keep track of your expenses to know how you are utilizing your money and whether you have positive or negative cashflow. Learn simple asset allocation so you do not have all your money in one basket where a scam or financial meltdown means starting from zero. Learn to avoid falling victim to scams or unscrupulous investment/financial advisers by understanding simple finance and investment principles.

It’s about knowing that when a loan offered to you comes with a interest rate of 85%, you hold on to your wallet and dash out of the door immediately!

A-B=?

It is simple mathematics, really! Simple mathematical formula of: A-B

If “A” = Income and “B” = Expenses

Over time,

If A is greater than B              A-B = Positive = Financial Security

If A is lesser than B                A-B = Negative = Financial Worry

And it doesn’t matter if your “A” is $20,000 per annum or $20million per annum.

Keep these in mind. Keep learning. Keep growing. Wishing you every success on your Financial Journey!

If you have any feedback or enquiries, feel free to leave a comment. Alternatively, you can email me at mywealthmodel (@) gmail.com

Sites linking in to Wealth Matters - www.mywealthmodel.blogspot.com

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Top 3 readers' Favorite right now, Read them if you missed it and see for yourself maybe that's why 430,891 sites link in :


1) 0% Interest Rate for your Savings Account! 
- Understanding the interest rates given for your savings account by the banks and what it means in terms of interest earned on your capital.




2) The Crisis of Credit Visualized 
- Video explaining the Crisis of Credit in a simple to understand explanation on matters such as sub-prime mortgages, collateralized debt obligations and credit default swaps.




3) Conmen pose as landlords in Online Scams 
- Take note of property rental online scam that has been reported in the papers and what to watch out for if you are sourcing to rent.


Check back for more useful information...

0% Interest Rate for your Savings Account!

Could that be a headline we will be reading in the newspapers anytime soon?
Luckily, economists are saying that is unlikely to happen in Singapore.


Read this article in the papers today
Could interest rates hit zero? - The Straits Times May 13 2010


Apparently it has happened in Japan.


Singapore Interbank Offer Rate (Sibor), which is the rate at which banks lend to each other, has fell to a new low. Because of this fall, banks has reacted by cutting the the savings rates they offer to consumers.


Do you know the savings interest rates that the banks are offering right now? 
It is about 0.1%!!! (Click here to check the savings rates online for DBS) 
What this means is, for a $10,000 balance in your savings account that pays only 0.1%, the grand total of your interest at the end of 1 year is $10!
Even fixed deposit rates are hovering around 0.1% to 0.7% (Click here to check the Fixed Deposit Rates online for DBS) depending on the amounts and tenure you set aside.


With the what is happening with the economies of US and Europe, the rates are expected to remain this low for the foreseeable future.


Perhaps it's time to look for possible alternatives to make your money work harder for you?

Send request or inquiries to: MyWealthModel(@)gmail . com