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2800 or individual shares?

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  1. #11

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    Quote Originally Posted by cendrillon:
    Your post made it seem like you're really happy with 700 and inclined to hold it, since it went up, and unhappy with 2888 and inclined to sell it since it went down. All you need to do is sell your loser (2888) and put the money in your winner (700) and this is exactly buy high, sell low.

    Human psychology is extremely poorly equipped to deal with investing. If you start making active investment choices you can fall into many traps. This is why 95% of actively managed funds underperform the index, and those are the 'professionals'
    Lol, I said "I may sell off a bit of Tencent though." But yes, I agree this chopping and changing isn't going to help me "grow" my wealth.
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  2. #12

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    Quote Originally Posted by pin:
    Lol, I said "I may sell off a bit of Tencent though." But yes, I agree this chopping and changing isn't going to help me "grow" my wealth.
    I think as humans we are pack animals. It was useful when we lived in the jungle because being in the middle of the pack helped us to survive and as the descendents of those who survived it's now programmed into us. The problem is that those instincts are exactly the opposite of what you should do when investing.

    Buffett said something quite profound on this

    I will tell you the secret to getting rich on Wall Street. You try to be greedy when others are fearful. And you try to be fearful when others are greedy
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  3. #13

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    Original Post Deleted
    JR I understand your concern about not getting enough diversification with HSI but in terms of risk somehow I find holding HSI at a PE ratio of 15 more comforting than S&P 500 at 25. What are your thoughts on this?
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  4. #14

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    Original Post Deleted
    To clarify, these are stocks I have owned and have done so for quite some time (some of them going back several years), so not really initial. As you all know I'm re-evaluating many things and one of these things is should I hold on to these or sell them.

  5. #15

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    Original Post Deleted
    I've been thinking about this quite a bit lately. As you said conventional wisdom is to put about half of your stocks in the index of the country where you live and the other half in an international index. The point being that your cost of living is highly correlated with the economy (and in theory the stock market) of the country you live in.

    I buy into this to a point. If the HSI takes a big drop bankers aren't getting huge bonuses, Chinese investors aren't as flush with cash and so on.

    However since I own the property I live in that cost is already hedged out. I'm also a pretty frugal so my other major costs are food and clothing, who's prices are probably more correlated with the cost of oil than the HSI.

    With all that said the HSI seems much better priced in terms of PE ratio than the S&P 500 and the tax situation with dividends is much better as well.

    What's your approach ?

  6. #16

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    Original Post Deleted
    Has anyone actually backtested this 'strategy' to see how it performs historically in terms of risk normalised return?

    My guess is people do this kind of stuff because it sounds good not because there's any principled study behind it.

  7. #17

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    Original Post Deleted
    Thanks. This is really insightful and very helpful.

    Out of interest, the following comprise around 80% of the HSI by weight. Do any of these fit in your utter dross category?

    Tencent
    HSBC
    AIA
    China Mobile
    CCB
    ICBC
    Bank of China
    CKH Holdings
    HKEx
    Ping An
    CNOOC
    CK Property
    SHK Ppt
    Sinopec Corp
    CLP Holdings
    China Life
    PetroChina
    Hang Seng Bank
    Link REIT
    Power Assets
    HK & China Gas

    Thanks!
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  8. #18

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    Original Post Deleted
    Yeah, this is spot on. This devolves into a stock picking game very quickly. If you take the mindset that stock picking is to be avoided, then index picking is just as bad.

  9. #19

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    Original Post Deleted
    - punts just for fun would probably the best way to describe them. Well that's how they started.

  10. #20

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    Original Post Deleted
    If you own stocks of companies that serve an international market I don't think currency risk is an issue, its hedged out. For example whether you own HSBC stock in HK, London or the US doesn't really matter, even though the stock is listed in 3 different currencies. In fact, in the event of a brexit hard landing I'd rather own a London listed stock that serves an international market than say a US listed stock that primarily serves the UK.