7 years into investing stocks, what did I learn?

1. Market Timing is important.

You can't exactly time the market to decide when to enter, but you can be more patient and wait till the price of stocks falls below your average buying prices. From a retrospective perspective, I found this useful to help keep buying at cheaper price. 

2. The industry is key to long term holding.

The majority of my loss was related to investing in a declining and/or unprofitable industry. This includes the PRC related stocks, Office REIT and commercial property, Jewelry Industry, etc...

3. Contrary to the US, In Malaysia, good stocks are the one that always pays Dividend

When I started the journey, KLCI was at 1644.72 on 1st September 2012. 7 years after, KLCI ends up even lower at 1612.14. The only thing that keeping KLCI's return in positive is the dividend distributed by the companies. The dividend yield for my current portfolio average around 3.57% (include Airasia Special dividend of 90sen) and 2.47% (exclude Airasia dividends). The 2.47% mimics my average return for the past 7 years. Thus the key to beating the Fixed Deposit return will be buying into stocks with a higher dividend yield than FD. 

4. Lower Trading Fee is key to protecting your return

The estimated annualized return from KLCI (with dividend included) is around 3.34%. Imagine if you are investing in a typical mutual fund with a 1.5% fee structure or higher, 40% of your return will be taken away by your fund management. The high management fee is the reason why a lot of the investors didn't see a significant return on their portfolio for the past 7 years. I will suggest BNM start cultivates a market for index funds like Vanguard 500 index fund in the US so that individual investors can benefit from the low management fees. 

5. Good stocks selection may be able to beat the market, as shown in table below, I am actually beating the markets for the past 3 years. Let's hope it continues

	My Return	Market
Last 7 years	2.62%	3.02%
Last 3 years	5.21%	1.80%
Last 1 year	-4.98%	-8.99%

My investment record (43) August-2019

The estimated holding period return for KLCI in the  Aug-2019 is -1.09%  (with dividend included). Holding Period return for my portfolio, is -2.18%. Total holding period return for my portfolio since the inception is 19.8%, annualized to be 2.61%, this underperform KLCI total return of 23.19% (annualized, 3.02%) 

Trading Activities
1. Addition of AmBank (1015)
2. Addition of RHB (1066)
3. Addition of HLFG (1082)
The banking stocks were dumped by the investor in anticipating of another round of OPR cut by BNM, despite the fact that their earning remain strong with PE less than 10, and dividend yield getting attractive which range from 3-5%. 

4. Reduce Holding of BJToto (1562)

Stock with good dividends, however, the price at a recent peak with limited upside potential (as government reduces the number of special draws). Sell some to place the bet on alternative choices

5. Buying Heineken Malaysia (3255)

I was looking into buying some consumer stock for my portfolio, then I came across Heineken Malaysia with good dividend yield, but price cheaper compare to its rival (Carlsberg). 

6. Addition of Takaful (6139)

The good stock recently falls from its recent peak, however, bought it too soon. Should have wait till end of the month where its price dropped further. 

7. Addition of Padini(7052)
Company in a apparel industry under good management, and it seldom sell cheap

8. Buying of RCE Capital (9296)

 Although it dealing with the most riskier sector of the loan (consumer credit and personal loan), its target customer base (mainly government servant) provide them enough buffer. I continue buying at a low P/E ratio. Its recent financial performance show increasing revenue and profit, which is a good sign.