Thursday, 14 November 2019

The Peril of Investments.

If you were to invest for a long term horizon,

You will be interested to ask,

"Is my investment safe and how much is the return?"

The truth is that there is no safe investment and the return is variable except for government bonds which are relatively safe as it is tied to the local currency.

In the long horizon, our investment is affected adversely by:

1. Political,

2. Economical,

3. Technological or

4. Managerial changes

that would render a good investment in the past worthless.

Therefore, we must be ready for the wind of change.


Moral of the story: The only constant is change itself.


Be Bless,

Dr. Lion

Investment vs Speculation.

There is a great difference between investment and speculation.

In order to know about investment, we must know what is speculation.

Speculation is a gambling process whereby, we need to know the hot stock at the moment and be at the right stock at the right time.

Honestly, I find it to be difficult to be at the right stock at the right time as my trading skill and time factor are not by my side.

Investment, on the other hand, is about finding the unpolished gems and give time for the unpolished gems to be transformed into a diamond as every stock will have its day.

An investor's perspective, the lower the share price, the better it is.

As time is a friend of a good business and enemy of a mediocre.

The time to sell the unpolished gems is when:

1. The reason you buy is not there anymore

2. Changes in the economic or political scenarios or

3. There is another better investment, whereby, we trade for something more valuable.


Moral of the story: Stock is a voting machine for the short term, while, in the long term Stock is a weighing machine.


Be Bless,

Dr. Lion. 

Saturday, 9 November 2019

Death of Currency sooner or later

There is no currency that survived beyond a century.

Let the encyclopedia of currency be our judge.

The life span of a currency is around 80 years old.

Why is this so?

This is because currency is printed and controlled by central government.

When the central government is weak or corrupted they will use the printing press to print our currency into oblivion as the printing process is not based on valuation of gold or other tender asset but is based on legal tender of the central government that print it.

That is why currency now is only legal tender in a certain country and not worldwide accepted.

If a certain country economy weaken, they will resort to devaluation or quantitative easing to boost their economy, killing their currency in the process.

Moral of the story is Death of Currency due to government meddling.

Be Bless,

Dr. Lion