If you want to trade or invest during the turbulence time like now, the suggested investment strategies may help you to make profit. This strategy had been suggested during 2008 and early 2009.
My advise will be : get ready to invest and most of the time we won't be able to know the market can go down to which level. What we can control is our investment strategies. But before we move on to investing, it is good to know the following:
1. Know the amount that set aside for investment.
2. Know the potential risk/losses that you willing to take. (worst case scenerio, at least to hold shares for 3 years and still enjoy good dividend yield paid by the company that you choose to invest)
3. Know the number of counters you ready to invest. (also depend on your investment amount)
4. Know the number of quantity in each counters you ready to invest.
5. Use dollar cost averaging method by applying Simple Investment Method (SIM) 1-2-3
Assumption:
1. If economy continue to deteriorating, the equity market may drop up to 20-35%.
2. Whenever economy recover, individual counter tend to rebound 20-50% from the bottom.
3. Invest in Index counters or suggested fundamentally good company with reasonable dividend yield and low gearing .
Let us divide our investment amount into 6 portions:-(1+2+3=6) and only one counter is selected ( Industrial Commercial Bank of China, stock code 1398.hk listed on Hong Kong Stock Exchange. The illustration for investment strategy for SIM 1-2-3 are as follow:-
Highlight:
1. Use your own strategy which you feel more comfortable instead of trying to guess the right timing to enter market.
2.The above investment strategy allow you to exist either in 1st investment or 2nd investment whenever there is a technical rebound take place and the portfolio is still making money.
