Investing – To Hold or Follow the Crowd?

The last few months had been a huge roller coaster ride when it comes to investing in stock markets. The increase in Covid-19 infection rate together with the economic conditions have such profound effect on the stock market that making a profit is a hit or miss.

Investing in stock market has its own inherent risk. One one hand you can earn some great money if you made the right choice. On another hand you can easily lose everything if you made the wrong choice.

If you follow my earlier posts, my investment strategy is a mix. I have a diversified portfolio to reduce the risk of losing all my investment. Besides investing in well known stable companies, I also invest in bonds and stocks. I only invest less than 30% of my assets in volatile stocks.

Here is what I noticed on my portfolio for the last 2 months. The stable companies such as Microsoft or Apple continue to do well. Stocks that pay dividends are also stable and had very little volatility. In fact I did not lose any values on these stocks, bonds and ETFs.

On the other hand, the stocks that go up and down the most are those that do not fall into any of the categories I noted above. Stocks such as meme stocks or those that do not pay dividends. Some of the stocks that I own are Pinterests, Snapchat and pharmaceutical companies. These stocks continue to lose value as more investors continue to buy and sell at higher volume. In total, my portfolio for this portion of the stocks did not do as well as I hope.

Luckily I diversified my portfolio that the risk for it to lose is minimal. In fact, I learned that by holding onto the stable stocks, I continue to make capital gain on them. Unfortunately, some of the value was negated by the volatile stocks.

Here is what I learned since I started investing actively. Sometimes it is safer and more profitable if you just invest in stable stocks and hold them forever. The value of these stocks continue to increase while stocks that are being bought and sold tend to lose value at a higher rate.

If you are interested in investing stock market, I highly recommend that you do some research on the stock market and the companies that you plan to invest in. Do diversify your portfolio to minimize the risks and finally if you want to “follow the crowd” do put only a small percentage of your portfolio on risky stocks.

Simple 10 Minutes Lunch

One of the biggest challenges working remotely is to make lunch everyday for the family. There comes a time when I just run out of idea.

Here is an idea if you run out of options. Simple, inexpensive and just take 10 minutes. Baked ham and tater tots, a mini croissant, sweet corn with light butter, an over easy egg and home grown fresh cucumber. And finally a cup of Earl Grey tea. Believe it or not, this is quite fulfilling and not heavy.

Why We Decided to Own a Dog

Today’s post is a little different from my normal subject. However, it does relate to mental health indirectly. This post is about a new member in our family, Tofu, a small Havanese puppy.

When I was growing up in Malaysia, it was quite common for every family to have a dog or two. All of the dogs were either stray or mixed. My family owned several dogs of which some were docile and some were difficult. So I had my fair share of dogs.

After moving to the US my family had no urge to own any dogs because we were having difficulty adjusting to the life in the US. Plus, dog’s life in the US is very different from those in Asia. Dog’s life in the US is like heaven because they are pet and pampered, and not to mention very expensive. On the other hand, dogs in Asia serve a purpose. They are used to guard the properties. None of the dogs that my family had were pampered nor treated like pets; they were used as tools.

The past week was perhaps history in the making because we decided to purchase a dog for ourselves. Now that my children are all grown up, I feel that it is the perfect time to add this new family member. I understand that taking care of puppy is a lot of work but the family is ready to put their efforts to make this a successful journey.

The question is why would we own a dog?

Quite simply the reason we are getting the dog is to help my daughter getting over her anxiety attack. After speaking with her and understand her feelings a few weeks ago, I felt that there could be more things I could do to help her to overcome her trouble. One of method is to encourage her to love someone or something and share her feelings. A puppy could be the best remedy because a dog will love you back unconditionally if you treat it well.

So what has changed in the past few days after we brought the puppy home? My daughter is now spending more of her time outsider her bedroom. She also has become more jubilant as well. I also observe a markedly improvement how she carries herself.

Tofu is considered a toy dog, but she has her own adorable behavior as well. There are goods and there are a few bad with the tiny puppy. One of the things that we are learning is how to teach her to behave. Unfortunately, dogs are animal and they do not understand human language. With practice and some positive reinforcement I believe we can teach Tofu to behave. Only time will tell. Just like life – there are ups and downs; with enough practice and patience we shall overcome the difficulties in life.

I told myself years ago that I will never own a dog because I have no need for it. Now I need it to help my daughter. Will spending that kind of money to own a pure breed toy dog be worthwhile? We shall see.

Mental Health Issues Today

I have the privilege of working for a one of the major corporations in the world who cares of mental health, particularly the well-being of its employees. HSBC, is a global bank located in the UK and Asia, tackles this public issue head on.

For the past several years there is an increase concern as mental health is taking the forefront of public health issues. The pandemic accelerates this concern as majority of the world went into lock down. As of today, the pandemic continues to impact a large portion of the world. Most people will not be handle the isolation well and the pandemic causes tremendous damage to the mental health. If you do a news search today there are multiple instances where some decided to take their own life rather than be a hermit.

Most companies consider human capital as an important asset for them. HSBC is not any different. For the last several years the company pivot towards ensuring the employees’ well-being. There were a lot of internal communication on the issue and what the company is doing. Some of the things that the company offers include workshop, trainings and outside programs to assist the employees. I recently joined a program called Headspace, offered by HSBC. I haven’t had the chance to use it yet but I do appreciate what the company is doing.

Unfortunately, mental health cannot be solved if the victims do not acknowledge that the issue exists. Regardless what the company does, if the victims are not taking advantage of the options available, the problem will only get worsen. There are may symptoms of mental health. However, I’m not licensed to identify any of them but I can only provide my observations and how I personally address the issue.

Mental health issue really hits home when I had a chance to talk to my daughter recently. She has always been doing well at school. The pandemic forced the school to use remote learning. On top of some of the issue she had with a friend, she hit a wall last year. I knew she was at risk but I never knew how serious it was until I had a lengthy heart to heart talk with her. I felt I failed my job as a parent for not identifying her issues sooner. With that being said, I am spending more time with her now to ensure she feels she is being supported. It has been a week now and she is feeling a lot better. If you are interested in how I helped her in the addressing her issues, do follow my blog. I plan to share them with you.

In the meantime, take care of yourself and do seek help if you feel helpless. No one will think you are weak; admitting that you have a problem actually makes you stronger.

Should You Pay Off the Car Loan Early?

My son recently bought a car of his own so he can use it when he goes to Rutgers University. The journey began earlier in the summer when he starts hunting for his perfect car. But I brought him down to earth by explaining the process especially applying for an auto loan.

So he started applying for a pre-approval loan through several banks and he was rejected because of his lack of credit history. One bank approved a loan under pre-condition with high interest rate. He was shocked of how difficult it was to buy a car.

I stepped in and helped him to get the loan from the car manufacturer using co-signing. We were able to get the loan with low interest rate. We were quite happy with the loan condition because of low monthly payment and there is no penalty for paying off early. The car dealership finance manager asked if we plan to pay the loan off early. That is a very good question of which I’ve thought of when I had two car loans prior to this.

There are pros and cons when it comes to paying off loan early. The obvious pro is that you get to be debt free early. This is especially true for someone who hates to carry a debt. But that does not mean that you will be totally debt free because everyone carries other debts (i.e. mortgages, credit cards etc.). Another benefit of paying off the car early is that you get to own the car early and you are not required to have a comprehensive full insurance coverage, which is an added saving.

Other Obligations

Let’s address the elephant in the room. The car payment is big chunk of anyone’s budget. Besides our daily obligations such as grocery bill and fixed cost, car payments can be a big portion ofour our monthly expenses because of the condition of the loan. Unlike a mortgage which could be 15 to 30 years loan, auto loan is usually 5 or 6 years loan. That means that monthly payment could be high depending on how much you are borrowing.

You can opt to pay more every month so you can pay off the loan early. A mortgage will reduce its monthly payment when you pay more upfront. BuyAuto loan is fixed every month regardless how much you pay more. The only benefit is that it will reduce the period of repayment by several months. So paying more every month will not likely to make a dent on your monthly obligations.

Affordability

Before going through this point, everyone should ask the question why would they need to have a new car on their driveways. Cars today rarely break down. The quality of the cars have improved dramatically that most will last 10 years before breaking down. Are you ready to absorb another cost when the benefits of owning a car rarely outweighs the costs?

If you can afford to pay for the car then the answer to paying off early makes sense. It is highly recommended that you make a proper budget to ensure you can afford the car payment. Once you are aware that you can afford an extra payment, paying more on the principal will help. However, as I alluded to above it will hardly make a difference in the long run unless you pay extra every month.

The Return

My son was able to get a good rate on the car loan. After paying off the loan in 72 months, it will only cost him $1,500 for the entire loan. If he pays off the loan early, it may lower the cost by a few hundred of dollars. However, he could repurpose the money for something more beneficial. For example, if he invest the $7,200 (assuming that he pays $300 every month for the next 2 years) with an average monthly return of 12%, he would have made a profit of about $2,000 by the end of second year. Obviously this is being optimistic but history shows that it is possible to obtain 10% return annually based on conservative stocks. Keeping the money in investment will continue to grow year on year.

However, if you have a high interest auto loan then it may makes sense to pay off the loan early. This should only be done if you can actually afford to forgo the money otherwise that you can use it for something else. Another option to minimize the cost of the loan is by taking a personal loan from a bank with lower interest rates.

Everyone’s financial situation is different. Paying off the auto loan early may make sense if you have a large outstanding debt or if you have the means to do so. It is important to consider if paying off would benefit in the long run. The best way to manage any auto loan is simply not to have it. If you can continue to use your existing car for a few more years there is no reason to obtain a shiny new car with a large price tag.

How to Channel Stress

I recently took a virtual workshop at work on the subject of leadership. One of the question that came up was how to deal with stress. I’ve never really given much thought on stress because I deal with it head-on. But as I consider the question more I realized that I have using stress by channeling it into something more production. In the workshop I remember the answer I gave to the group, “without stress, life is boring!”

So what is stress? Stress is a feeling when we feel uncomfortable when we are not able to solve the problem at hand. Or that we feel of failure if we are not able to complete the challenge satisfactory.

It is true that without stress, our life would be uneventful. Just imagine that sitting in front of TV for the entire day relaxing because we are stress free. Instead of thinking of all the things that require us to work on we just stare at the TV and not moving an inch. I don’t know about you – I know I can’t sit more than 2 hours not doing anything because I become restless and feel useless.

Stress is important and can help us if we know how to use it to our advantage. We can channel the stress and convert it into something productive. However, needless to say that if we less stress overtake our ability to handle them, then it becomes dangerous. To me stress is like the grass on my lawn. I know the lawn is pleasant to look at when it is green and lush. However, if I fail to mow it every few weeks, the grass will grow longer and weeds will start taking over.

Plan and Produce

No one in the modern society can say that they were never stressed. There is always something that would need our attention. Paying bills, getting ready for tomorrow’s project or even getting kids ready for school can be stressful. Most of us would take the easy way out by getting them done grumpily. Over time we would think of them as chores and start to hate them. My solution is plan ahead, get them done and learn from them. As an example, instead of making the same school lunch for my kids everyday I would plan ahead the night before on what to make. Instead of rushing in the morning to get it done, I would get the ingredients ready so I can jump right on to it. I challenge myself by making healthy lunch because not only my kids need it, it is also because I believe I can do it.

Keep Brain Active and Healthy

Sometimes we do feel tired after a long day of work. It is not because of all the work that we do but it is because of all the brain activity required. During my time-off I would usually spend most of my time doing housework inside and outside the house. By the end of the day my body ache because of all the physical activity involved. Even after a full night sleep my body would continue to ache the next day. However, it is entirely different when I work on my full-time job. I actually feel more exhausted at the end of day because of responding and solving problems at work. After a good long sleep I feel more refreshed because I was able to re-energize my brain. The stress of challenges at work actually help in keeping my mind healthy.

Stress Helps Us to Innovate

Stress can actually help us innovate. Think about it – stress is a result of difficulty in solving a problem. However, if we continue to solve the problem the same way we did it before it becomes a chore. Instead, we should find new ways to solve the problem more effectively. I work for the reporting function at HSBC. Every month our team must complete a series of reports within a week. Instead of doing the same thing every month, our team continues to make improvements on our process to complete the reports more effectively. We use macros in Excel to repeat the steps; we build templates to making data changes easier. In short, don’t use stress as an excuse; use it to help you to be better.

Everyone takes on stress differently. Some may deal with stress negatively and some may take it as a challenge. I am the latter. I never like monotony because life becomes boring if we repeat the tasks everyday. I have been working professionally for almost 30 years now and I have my fair share of challenges. Most of the challenges come with different level of stress. Over the years I have learned how to face the stress and I believe I have been successful in using it to help me.

Is This a Start of Another Journey?

I’m over 50 years old and I believe I have enough life experience to be a mentor. However, I consider myself as an introvert and rarely put myself in front of people and advertise myself. But my inner-self continue to nudge me to do better by helping others. With that being said, I’m on a new journey to become a Life Coach.

The bigger question that anyone who reads this may ask, “Are you qualified?” After much pondering and self-reflection, the answer is unequivocally “Yes!”

Stress and Mental Health

Mental health has become a big issue in recent years and anyone who may have experienced it continue to have lingering effects. I consider myself to be mental-health free because I love my life. I learned from experience how to tackle some of the stress away and I have a loving family to walk the life journey with me.

Career Advice

Another angle that I have expertise is my work experience in corporate America. I started as a lowly entry-level employee at Arthur Andersen. After spending over 5 years at Andersen (renamed from Arthur Andersen), I went to Citigroup where I spend 13 years going through all kinds of changes. This year will be my 7th year at HSBC and I love where I am. Over the years I learned to go through the intricacies of corporate world and be successful. Having said that, I believe I could be a great help for anyone who maybe interested in “making it” at big corporations.

Happily Married

Finally, I’m happily married to my wife of 24 years (that’s a quarter of lifetime!) There are ups and downs in our marriage but none came close to be severe enough to end our marriage. My wife and I learned to enjoy each other company and we learned to cherish each other. Without these commitments we would not have lasted so long and have 3 young adult children.

Enough of my self-proclaimed successes. Now let’s put my experience to work by helping other. As I continue to investigate how to “sell my service”, do keep a look out as I provide more tips on how to enjoy life (after all, that’s what my blog is about!) If you are interested in being my first client or if you need anything on the subjects that I noted above, please do let me know.

Let’s the journey begin!

Why Cryptocurrency Should be Killed

Overated?

If you are following the financial markets, I’m very sure you have seen or read about cryptocurrency. It is a digital currency that was created and became public available in 2009. The value of cryptocurrency is volatile and has gone up and down within a very short time period.

I’m not going to try to explain what it is because I do not have the necessary understanding how it works other than that it requires a huge amount of computing power to solve a mathematical problem. Even if I could, I would not be able to explain it in this post. For a full definition, please refer to Wikipedia on Cryptocurrency.

My career has always in banking and that means traditional ways of managing value of money. Cryptocurrency is on the other side of money where there is no value but entirely speculative. There continues to be a lot of arguments cryptocurrency is the way of future. I don’t disagree with new technology and new methods and valuing certain materials, but I do not agree with cryptocurrency and I believe it should be killed.

Before you jump on my throat in defending the existence of cryptocurrency, please consider my points below. After reading them I hope you agree with me that cryptocurrency is not an optimum solution.

Value

Cryptocurrency such as Bitcoin does not hold any value and it is entirely speculative. The value exists when the traders buy or sell at an expected value. I understand that today’s money such as US dollars no longer pegged to gold, but the value of a single dollar can be pegged to other currencies and allow each currency to be exchange with one another. If you watch the value of Bitcoin in the last several years you will notice that its “value” swing wildly. As an example, if a dealership is willing to accept a Bitcoin and sell a car that costs $20,000. The same Bitcoin coin could worth $50,000 or $50 the next day.

Lack of Regulation

The regulators are slow in catching up with cryptocurrency. It is not because they do not understand or know of its existence. It is because they are no able to regulate it when its value lives in the cloud on a database. Additionally, now almost everyone can create their own currency have it publicly traded. We all know about Bitcoin. Now there is Ethereum, created by a teen as a hobby and Dogecoin as a joke. Additionally, cryptocurrency is preferred payment in the darkweb where online crimes take place.

The End of the World

Yes, you read the title right. Cryptocurrency could mean the end of the world. No, I’m not referring to how one could use Bitcoin to buy a nuclear bomb. I’m referring to how cryptocurrency could plunder the world into darkness because of the resources it uses to operate. For example, Bitcoin uses 13GW (gigawatt) of energy per year. It is as much as the entire country of Netherlands uses in a year. With the continuous stream of people jumping on the bandwagon to mine the coins, its use of energy will continue to go up to the point that it will overwhelm the power grid. The natural resources around the world are finite which makes mining of Bitcoin unsustainable in the long run.

Shortage of rare earth minerals is another concern as computers components are being gobbled up by the miners. Mining cryptocurrency requires a huge amount of computing power to solve the mathematical equation and to do that miners are using computer graphic cards to do the heavy lifting. There is a shortage of microchips and graphic cards worldwide today. This resulted in artificial increase in prices of these components. The downstream effect is a lot of consumers are having difficulty getting these items. It could mean life or death to some if the supplies of this commodity dries out.

Another shocker that I read recently of a new cryptocurrency on the block. Chia (no, not the chia pet) is a new publicly traded cryptocurrency. This currency can fill up over 3.6 EB (exabytes) of hard drive in just a few weeks. For illustration purpose, personal computers 30 years ago used to come with a 40 MB (megabytes) hard drive. It took that long for personal computers to come with 2 TB (terabytes) of hard drive today. Network servers usually contain petabyte of hard drives. Now imagine just a week to fill up 1 EB of hard drive.

I understand that how one would be interested in cryptocurrency because of its potential wealth that it could generate. However, I truly believe that cryptocurrency could be the downfall of modern society. The harm that it causes the environment alone should be the reason why cryptocurrency should be outlawed.

Anyone who is into cryptocurrency should heed the old saying that “If it is not broken don’t fix it”. Cryptocurrency is not revolution but it is a fix that no one asked for. Albert Einstein regretted his decision when he discovered nuclear energy because of its risk posed to the world. The creator of cryptocurrency, Satoshi Nakamoto, is claimed to have disappeared after he release his white paper. As of today, his identity remains unknow. Perhaps he felt the same as Albert Einstein.

Why is it so Difficult to Lose Weight

I would be lying if I say losing weight is like a walk in the park. All of us know full well the it is like putting on a battle gear and facing off a formidable giant. However, like David and the Goliath, you just need to find the achilles heel.

I have been trying to lose weight for the past several years. I am by no means overweight but I need to maintain my diet due to my overall health condition. I can tell you that it u is not easy. There are too many temptations and too many convenient food around us.

My wife is a fitness instructor for the seniors and sometimes it seems she is also fighting a losing battle. In the past year she actually gained weight instead of losing it even though she teaches virtual fitness classes. On the other hand I was able to maintain my weight even though I sit at my desk working virtually. Why?

After giving much thought I believe there are a few reasons and all of them are due to motivation and personal drives.

Sacrifice

My wife’s weakness is her love of chicken wings and snacks. Given the opportunity she could eat a few of each. On the other hand I consciously avoid eating these food because of high saturated fat and low healthy contents. While I don’t deny that I like certain foods fall in these categories I vehemently avoid them at all cost.

Activities that Pay

Once every two days I would use the elliptical machine and focus on working out my arms and abs. My wife is an instructor who mainly focus on aerobic exercises which is good for the heart and breathing. She is not strong on arms or abs. To effectively loose weight we need to have both aerobic and strength exercises.

Be Conscious of Self

Knowing that you are overweight is really the main driver in losing weight. Looking and the mirror and realizing there is a problem will help with the motivation. Some people who knows they are overweight make conscious decisions not to have mirrors in the house. I personally would use the mirror and tend to focus on getting the six pack and I realize that the journey is far from over.

We’ve been thought that we should never fight a losing battle. However, if we equip ourselves with the right tools and with the right mindset nothing is impossible. The real question how driven are we in losing the weight.

How Do You Become Debt Free from Credit Cards

Getting in debt is as common as getting a cup of coffee in today’s modern world. The debt that most people incur continue to be increase at a faster rate that the money that they can bring it. The end results is personal bankruptcy is on the rise, especially in difficult times like these as more people are borrowing more on credit.

Increase in debt can be attributed to several factors. If we dig deeper we can all point out to the creation of credit cards as the major factor. Credit cards was introduced by Diners’ Club in the 1950. The premise of credit card is it allows consumers to purchase items by borrowing short term from the issuer of the cards with the agreement to repay back in the near future.

Most adult consumers today have at least 3 or more credit cards. If each card carries a credit limit of $5,000, a person can easily be in $15,000 debt or more easily in a very short time. The major problem with credit cards are that they allow the borrowers to carry forward the balance to future dates as long as the borrower continue to pay a minimum balance every month. The interests that credit card carry is usually high and the more the person borrow the more the person will have to pay in the future due to compounding interests.

As more and more adults continue to borrow from credit cards, the likelihood for the borrowers to pay off the debt becomes more and more difficult. This post is to touch on several strategies on how to become debt free. There are a lot of articles out there describing how one can be completely debt free in a very short time. However, I can tell you from first hand experience that this is close to impossible unless you are very discipline in your expenses.

I remember when my son was growing up he told me that we will never borrow money from the banks and will be debt free forever. In an ideal world this is possible. However, in today’s modern world, being totally debt free is a dream. Regardless how well we plan our finance, carrying certain debt is unavoidable. The question is how do we control our debt before it becomes out of control.

Get to Know Your Own Finance

Before we incur any debt, you need to be aware of your current finance. That includes if you have any outstanding debt, your current income and if you have any disposable income. Based on you current asset, you can easily determine if you are able to purchase the shiny new car you always dream off or if you can treat yourself to a vacation in the Caribbean. One way to find out if you can afford to make such purchase is by doing a detail monthly budget. Keep in mind that it is a budget and it should be used as a guide. My past experience showed that budgeting rarely work because there is always unforeseen circumstances that make sticking to the budget impossible.

Pay Off Credit Card First

Credit card debt is considered short term debt; mortgages and car payments are considered long term debt. Long term debt must always be paid off first; any leftover money that you have should go to credit card debt because they have high interest rates. The longer the debt the more expensive it is. To prevent from incurring any more debt, I recommend that you place the credit card with the highest balance in the drawer so you are not tempted to use it again. Once you finish paying off one card, continue paying off another card using the same strategy.

Consolidate Balance

One other option to managing paying off credit card is by consolidating the balances of the credit cards into one. You may consider using some of the debt consolidation services available online. Some do carry some fees so it is important to do some research and try to understand the terms and conditions. Consolidating the debt in one account allow paying off the credit card manageable. Some services allow you to negotiate a lower interest rates depending on your credit history. This will allow you to save thousands of dollars in the long run.

Use Cash Only

Credit cards are necessary evil. They are convenient especially for emergency use or if you need to purchase something very expensive. However, more and more people use credit cards to make all purchases; carrying cash around is no longer a practice. Using cash allow us to limit our purchase because we can tell how much cash we have and if we are able to afford the purchase.

Cancel the Credit Cards

Don’t be tempted by all the freebies or low interest rates that credit cards offer. They are designed to entice consumers to open an account. Instead of opening more credit card accounts, you should close or cancel the accounts as soon as you pay off the debt. Keep only one or two the most for any purchase that require a credit card. The added benefit is it allows managing monthly payment easier too.

There are a lot of apps out there which will help you manage your finance and expenses. However, I find that most require personal information and require a considerable amount of time to manage all the inputs. While they may help, I believe the time investment is too high to worth the effort.

There is no real magic bullets when it comes to managing finance. Reducing debt simply falls into two main categories, avoid temptation and be discipline in paying any outstanding debt as soon as possible.