20 years is a long time. This blog started in 2006. So it has been 20 years.
This blog started in 2006. Fuck. It's been that long...
In that time frame, Blogger, this platform was bought out by Google, which thrive a bit.
But thereafter it was probably de-prioritized and all you see is ads now.
In the same timeframe, a baby becomes an adult, gets to drive, drink alcohol and vote in some countries.
In Singapore, if he is a boy, he goes to the army and handle weapons. If she is a girl, she graduates from high school, goes to university, probably has a boyfriend.
It is a fucking long time.
As a long term investor, I thought 20 years was the right time-frame to think about life and investments. Well, the world has become a lot more short-term.
Tiktok is about seconds. Youtube is in the minutes. Some podcasts go on for an hour or so. Movies have ironically gotten a bit longer at 2 plus hours, sometimes 3 hours.
But years? Come on. Who thinks in terms of 20 years? Insurance agents?
In 2023, I moved my content onto substack, the new platform for long-form writing. But still, no one reads unless you know how to play the game well.
Substack winners are players who have mastered the art of writing for social media. They can grow their followers to the thousands in days. It is a skill in itself.
To give substack credit, there is a lot of wonderful content on substack. Mine is 8percentpa.substack.com. Please follow and subscribe.
The value investing world is so disconnected because we have to think in years, usually 3-5 years, sometimes 10-20 years but the world is so different today.
In the last 20 years, if you subscribed to pure value investing, you would not have bought Nvidia, Amazon, Tesla because it was impossible to justify using value investing methodologies.
But these were the stocks that outperformed the most.
We discussed a bunch of stocks here. Some were okay, some bombed.
One went to zero. Hyflux.
I came to the conclusion that for most people, by that I mean 99% of human population, should just buy risk-free assets, like government bonds, if they have the means.
If you have a bit more appetite for investments, buy equity indices, like the S&P500.
Don't bother to pick stocks. You will not win.
The investment game is like the Olympics. Only the best of the best human beings win.
But unlike the Olympics, anyone can open an Interactive Broker account and compete, thinking he or she can win.
No, you will not win. If you did, it was luck.
By winning, I mean, beating the S&P500 over 20 years.
The S&P compounds 10% per year. So over 20 years, it will almost 4x the original capital, using the Rule of 72.
If you did compound 4x your capital since 2006, you win. Was it luck or skill? Be honest.
The best investors barely beat this. It is just like the Olympics. Not physically but mentally.
The human body deteriorates after the age of 20 so it is hard for a 40-year-old to win Olympic medals.
Investment requires experience and wisdom so age becomes an advantage but still because it's the most intense mental Olympics, only the best of the best get the medals.
I found a good list here: https://fiscal.ai/super-investors/
Bill Ackman, Howard Marks, Li Lu, Stanley Drunkenmiller, Warren Buffett, you name them.
The point is, this game is fucking difficult.
If you have a day job, and you try to do this, beat the market, make outsized returns? Forget it.
Just buy the S&P500. Or the STI. Or if you are risk-adversed, T-bills.
Don't risk your hard earned money trying to pick stocks.
Okay, if you want to buy DBS, eat dividends, make some extra. By all means.
Remember, that used to be Singtel. It's been replaced by DBS.
Like the top badminton player, or top tennis star. The best blue chip gets replaced too!
Or in the global context. It was Apple, which is replaced by Nvidia.
So, buy the index. That's for folks who can tolerate some risk.
If you cannot afford to lose money, just put in the bank or buy T-bills.
Don't risk hard earned money trying to invest.
Don't listen to insurance agents or well-meaning friends who made money buying Bitcoins.
The former is trying to earn your money, the latter got lucky and have no idea wtf they are talking about.
If after all this, you still want to go down the fucking rabbit hole and understand more about investing, follow or subscribe 8percentpa.substack.com
On this substack platform, we discuss activist investing.
Activist investors try to beat the market by trying to take control of their investee companies.
Activists send people on the boards of companies to shake things up.
Warren Buffett bought Berkshire Hathaway in an activist setting in 1965.
Activist investors do beat the market although the long term positive impact is unclear.
Because after the activists take their money, the companies' share prices revert. So the verdict is unclear.
What's clear though is if you read this far, your attention span goes beyond Tiktok.
Our substack is irregularly updated but we are here for the long game.
An attempt for the author to see if he can beat the market one more time, at the PA* level.
We write about investment ideas and activist stocks that we own.
