The First $100,000

After 4 years and 4 months (I just checked) of stock-picking and being invested in the stock market, I find myself with a portfolio valuation that just passed the $100,000 mark. This comes in spite of the huge crash earlier this year, and me pouring in another $15,000 just the month before the crash. My lesson from that crash was to grit my teeth, knowing that the fundamentals of my stock picks were not changing drastically (yet) and I suppose the past 2-3 months have shown that they have indeed recovered.

Surpassing the $100k mark

But let’s be real. It’s not like I made $100,000 in profits. Truth be told, since my first day of trading, I have a capital inflow of $75,000, with $25,000 split between $16,000 in actual returns (i.e. closed transactions + dividend payouts) and $9,000 in paper gains. Digging deeper, I tend to compare my time-weighted returns (TWR) against the ES3 and SPY, which track the STI and S&P 500 indices respectively. This is reasonable since I am holding onto both SG and US stocks and if I cannot outperform either of these, then it means I might well be better off just investing in these indices instead.

TWR of 61% is not too far off from SPY’s 69%, but we should aim to do better than that.

My portfolio TWR was constantly performing before these indices up till mid-2018, where I made a drastic shift in my portfolio by selling some SG stocks to invest in more US stocks. And that’s where the portfolio slowly picked up and rode the wave of the US market to where it is today.

I must say that I am still on this learning journey. I know many people say making the first $XX is the hardest, and intuitively it makes sense because there should be reinvested dividends should yield higher returns. But I think the bigger gains comes from time in the market, experiencing the highs and lows and learning how one’s emotions respond to the market and how one should practice emotional restraint and not be too quick to buy or sell just based on what is trending. So it will be interesting to see how long I take to make the next $100,000 and whether it will indeed take me shorter than another 4 years 4 months. Hopefully with more knowledge of the markets and the businesses I am invested in, I will gain more confidence and trust in my stocks picks, alongside my other forms of investment tools.

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