Monday, December 31, 2012

How would you rate yourself in 2012?

One thing I like about blogging is you can do self reflection especially for year end now. With that, you know your progress whether you're in good or bad shape or maybe no shape at all. :)

I know sometimes it is very hard to accept the fact that you have accomplished nothing throughout the years. So, some people don't even border to write it. I have this feeling in the past too. Nevertheless, I think it doesn't really matter if we accomplish nothing. The most important thing is we're able to face it and admit it.

My Rating in 2012

I set myself the top 5 resolutions in 2012 and how did I do? Let's check it out! Overall, you can see that I didn't do that well at all. I only met 1 out of 5 goals. If these are company's goals, I'm probably being manged out already!

Improve Health (Met)

Good thing, I met this goal! My last medical report shows all positives but the next challenge is to maintain it. I shall do another medical report after 6 months to monitor the progress again.

Stock Investment (Partially Met)

Not really into stock investment this year but somehow invest in property instead. One little good progress is, I have done some basic researches on technical analysis but has not really put this into practical. I only use that to analyze my company's stock to decide my best time to sell. I would consider either I fail or partially met this goal although I met my ROI goal.

Migration to Australia (Partially Met)

Have done some researches and started the application on state sponsorship. So it is still pending on the result. The next step is only applying PR, thus I think this is still partially met. The most worry about this move for me is, can I get a job there even though I"m not choosy?

Setup Travel Blog (Fail)

Zero progress, that's why fail because it is not within my control. :) Lesson learn, try not to set goal that is beyond of your control. However, I started with a food blog instead where I just review on food that I have tried before. FYI - I enjoy food a lot and that why's it caused problem to my health. :)

Stretch goal: Become iOS Developer (Partially Met)

In fact this goal is fail but I just want to give myself some encouragements.So I rated myself as partially met then. :) It turns out that I decided to go for Android instead for various reasons. Have gone through some basic tutorials which include basic GUI programming, debugging through emulator or hardware. That is still very beginning stage, I would only consider myself successful met this goal when I have published one application in the GooglePlay store.

Unfortunately, the world didn't end. So we still need to move on to 2013. Are you ready for it? Let's review your 2012 resolutions (if any) and set a new one for 2013. I"m still in progress of making my 2013 resolutions and once it is ready, I will share with you. Good luck and Happy New Year!!!

Tuesday, December 25, 2012

Is China the Next Superpower?

This is a very interesting video to basically explain why China will NOT be the next superpower. I kind of agree with him especially on the military perspective. Don't you think United State is surrounding China somehow by helping out China's neighbors? Why do you think they want to do that? Enjoy this video...

So, does that mean US will continue to be superpower? I don't know but my experiences in China trips, tell me that the country moves a lot more faster than the people can move. It probably remains as great power but superpower will still belong to US. What do you think?

Nevertheless, regardless of whether China will be the next superpower, but I do think that it is important to learn Chinese if you want to be ready for it. One very obvious example is in today working environment, speaking Chinese has become essential especially dealing with China's customer. A smart move, is to learn Chinese (e.g. Australia has seen this, thus preparing their education for it). What about your country?

So, learn Chinese! Check out my previous post - Are you ready in 21'st century?

Merry Christmas!

Friday, November 23, 2012

Labor Law: Constructive Dismissal or Discharge

Many of you may not know about this term but this is something that must know as an employee. Before I touch about this constructive dismissal or constructive discharge - which is the most interesting one, let's look at what procedures an employer must do prior they dismiss an employee and what are the different type of workplace dismissals that we can have.

Dismissal Procedures

Employers must follow a certain process before they terminate or dismiss an employee. They should give an improvement note to the employee and if that doesn't improve, they should start giving you an written warning. If that still doesn't work out, a final written warning will be given to you which states you will be dismissed if you still do not improve in your performance.

Now the dismissal process only starts. To start the dismissal, the employers must start with a written letter to clearly stating out the charges made against the employee. After that, you as an employee can deny or accept the charges and the employers shall make the next move either still insist to dismiss you. In most of the cases, it won't happen until this stage because the employee will usually resign already. In case it does, you can bring the employer to court if you still think you're not fairly treated.

Let's look at different type of dismissals that could have...

Types of Dismissals

  • Fair Dismissal - This is the favor to the employer where the reasons for dismissal are acceptable by labor law and the employment contract.
  • Summary Dismissal - This is usually due to the misconduct of an employee such as watching pornography at office. :)
  • Unfair / Wrongly Dismissal - This is basically illegal where employer does not follow a proper disciplinary and dismissal procedures.This could be arguable because fair or unfair has its own definition in labor law.
  • Constructive Dismissal - This is the interesting one because employee dismiss themselves rather than the employer where the employee is somehow forced to leave his job.

What is Constructive Dismissal?

Well, this is interesting because you don't need to wait for the unfair or wrongly dismissal then you only bring your employer to court. As long as you're being treated as"UNFAIR", then you can dismiss or discharge yourself. A very common case of constructive dismissal is employer is trying to make significant changes to the original of your employment contract. Do you know that removing certain benefits and compensation from you can be considered a violating the employment contract?

But one thing that you want to keep in mind is the "UNFAIR" definition is different for different countries based on the country's labor laws. However before you come into this path, I suggest you is better to get a labor law lawyer for advice unless you have done enough homework and you do not need them. Some people has done that before successfully without a lawyer.

For constructive dismissal, you basically need to resign quickly with a very clear statement in your resignation letter telling that employer made your life so difficult that you have no choice but being forced to resign. Then, you should file a report to the labor law office after you tender your resignation.

After that, 3 possible outcomes can happen. Firstly, the employer will reinstate and ask you back to the office with the agreement from you (e.g. give you back whatever that you suppose to get). Secondly, they will try to compensate you without going to the court and of course get the agreement from you too. Finally, they will usually consider this route as last resource to basically settle this with you in court.

Depends on the labor law of your country, country that favors employee will usually win the court case for constructive dismissal. Good luck!

P/S: I want to write this because I want you to know your rights as an employee. Feel free to share with me if you have any thoughts. Also, if you interested in the minimum compensation for retrenchment in Malaysia, you can visit my previous post:Understand Retrenchment Law in Malaysia

Friday, November 16, 2012

Robert Kuok Hock Nien (郭鶴年) Interview - English Translation

In case you do not know, Robert Kuok (郭鶴年) is known as "Sugar King of Asia" and also involved in many other businesses such as palm oil, shipping and property which makes him the richest person in south-east Asia with estimated USD 14.7 billion of net worth (as of Feb 2012) and most importantly he is a Malaysian. Oh by the way, he is a Malaysian who currently stays in Hong Kong now.

This is an one hour interview in Mandarin and I try to translate the interview dialogue summary here especially for those who does not understand mandarin. One thing that I feel bad is during the interview, he hardly talked about Malaysia and referred China as his hometown instead. Why is this so? You may think he is not patriotic but in reality it may due to some political reasons where he was indirectly forced to leave Malaysia after many contributions that he had made.

Anyway, I'm not going to talk about those political stuff much here because this is still a financial blog ultimately. Let's watch the interview and let's see what we can learn from this "Sugar King". If you're lazy, you can read the interview dialogue that I translate from the interview.

Key Interview Dialogues Summary (Translated to English)

Q: Why invest in sugar business? Why take such high risk to put all your money into it and at that time no one is into this business in Malaysia?

Robert: Sugar is basic food necessity besides rice and wheat, thus it is very important. A child cries at night, you just need to give him/her a sweet and they won't cry anymore. That's why I see the potential to invest in this business.

Q: Did you face any roadblock in sugar business?

Robert: In general, it was very smooth. However in 1963, I'm too brave and overconfident to keep 200 thousands tones of stock because of anticipating the sugar market price will go up at that time. This can allow me to earn plenty of money. But who knows the market not only just stagnant but it went down. It almost caused me to bankrupt but luckily the typhoon hit in Cuba saved me. The incident caused tremendous damage to the sugar cane farm in Cuba (major sugar production in the world at that time) which eventually caused the sugar market price went up. So, I was really lucky!

Q: In business, do you think intelligent or luck is more important?

Robert: I think 90% should be based on our hard work and our own intelligent. We should always continue gathering information, researching on productions and consumers problems, shipping problem and etc. For example, the shipping takes 5 to 6 weeks but when a country is lacking of sugar, they basically can't wait for that long. Once this is clear, we need to have a solution and most importantly is we must act fast because other competitors can see the same thing as well.

Q: You had so many competitors at that time, how did you win all of them?

Robert: One advantage I had is I can speak English well. At that time, not many people can speak English and this impressed those business men from western countries (i.e. New York, London) and that's why it was easier for me to approach them. I visited their office in the morning and at night, I treated one of them for dinner. During the dinner, I basically try to learn and capture whatever ideas that they had in their mind. After that, I took those ideas and send back to Singapore for research.

In fact, there are smarter people than I am. However, some of them have a complicated night life. So the next morning, they can't get up early where else I can get up early every day. That's why I can run faster than most of them. :)

Q: There are so many business opportunities out there. How do you know which one is the right one?

Robert: Every business has it own risk. You need to be brave enough the grab the opportunities. If there is a risk and you scare, then you run away. If you run away and get a better opportunities, that is still okay. However, if every time you run away,  you will never be rich and successful.

Q: Are you a brave person?

Robert: We must be brave when we do business but our brave must focus on the business and not on the human.

Q: China requested your help to buy 300 thousand tones of sugar, why don't you take this opportunity to earn from it?

Robert: That's not royal to China. For example when you have agreed to help your customer, you don't try to get sideline profit.

Q: What makes you a successful sugar king?

Robert: We must focus. :)

Q: Isn't that you involve in so many business can be considered as not focus?

Robert: Well, that is not what I meant by the focus here. In business, you should always involve in few types of business because they're inter-related.

Q: Do you like being called as hotel king as well?

Robert: Yes but not the king but the "hotel"! LOL

Q: Why do you like the hotel business?

Robert: Hotel is not like the other businesses that I have. It is a service industry where the most important element in this industry is employees. You depend on them (from all levels) to take care of your customers. Thus, I told all my employees (including the executives) that the primary objective is to serve our customers.

 Q: Why invest in China in such an early stage? E.g.Open up the first Shangri-La hotel in HangZhou in 1983.

Robert: From the very early stage, I already had a feeling that tourism industry in China has a very good potential due to its rich historical relics and monuments. I believed China will become the most busiest travel industry in the world. However, the infrastructure is very bad at that time (e.g. very bad condition for staying, toilets are terrible and etc.). How can we attract foreign tourists? Thus, we need to help China's tourism industry to grow!

Q: Why you made a huge investment in 1984, committing to build the World Trade Center in Beijing?
Didn't your family member or colleague worry?

Robert: At that time, my temper is very bad and always blow up in my office. So I guess they were not dare to tell me even though they were worry. One thing that made me can't forget is when I asked who are the competitors in this investment, none of them are from China. Thus, I decided to invest in this project. We as a Chinese must be ambitious and cannot be let down by foreign countries.

Q: Why you want to take such big risk? How sure you are this project will be successful?

Robert: I"m not a great businessman because I'm not the calculative kind. Simple calculation I can do such as plus and minus. So I do not know how to calculate whether this project will be successful or not. As long as it is good for China, I will do it.

Some other key messages that commented by Robert:

  • You don't need to publicize if you help people and do not need to look for a return.
  • I'm strongly influenced by my mum. For example, she told me in business, we must follow the path of morality and not materialism, not need to leave children with inheritance money because giving them is useless if they're not capable, do not turn to the dark side (i.e. evil) businessman, be a good person, not to be greedy about money and help the poor.
His very pretty daughter (Kuok Hui Kong) commented on him:

  • My father believed in hard work and also thought me the importance of studying Chinese specifically Mandarin (not Cantonese) although we stayed in Hong Kong at that time. But, I'm glad that now I know Chinese and it is all because of him.

His handsome son commented on him:
  • He is a very strict person and he also acts very fast. So if we can't follow, he will scold us too but everyone who works with him know that he scolds for the issue not on the human.

His expectation to his children:
  • My children won't faced the difficulties that I had faced before but I hope that my children are able to accomplish something good for the company and be a good leader. 

Wrap Up

Robert Kuok is very supportive of China's development, thus he will almost invest or contribute to any development in China as long as it is for China.  That is the reason he has a very good relationship and great influence to China.

He also mentioned that many business people are very aggressive in the past and use illegal or unethical method which is very successful at that time. He knew their method but he never complained and still tried very hard to compete with them. However these business people are no longer survive today.

Finally, he also commented that he doesn't like money but would prefer his company to be profitable so that he can pay big bonus to his staff!

Disclaimer:  I may translate wrongly or have missing some dialogues here because I only translated those key messages and put those into my own words. I hope this will be at least useful for those who do not understand Mandarin and would like to know the interview content. Enjoy!

Friday, November 09, 2012

Guess who has the highest net worth?

I think this net worth comic is really very good and it reflects to reality. Credit to the comic author of this. So, let's guess who has the highest net worth here?

Yes, surprisingly the beggar  has the highest network of $2.73 cash!!! It is just like our normal life, can we really tell who has the highest net worth? Is it by the cloth they dress (e.g. dress classy like PSY)? or by the car they drive (e.g. drive BMW)? or by the house they stay (e.g. awesome renovated house)?

P/S: Hopefully we all don't fall into a trap that we just merely want to appear to be rich, thus aware of your actual net worth is essential in personal finance.

Friday, November 02, 2012

Unconventional Personal Finance Learning by LCF

It started back in 2010, when I woke up one fine morning and felt the urge to get myself formally educated on financial matters. Not that I am deep in debt or anything. If this is in the movie, Inception, you could say someone has planted this seed of an idea deep inside my subconscious mind.

See if this resonates with you - independent, no-strings attached financial advice is few and far between. If I have a general query on life insurance, I could ask an insurance agent but after that, he will probably approach me more than a few times to introduce the latest insurance product. It is the same with investment when I talk to a unit trust agent. To add salt to the wound, banks constantly use jargons and fine prints which are too complicated for the layman to comprehend.

Anyway, the very same week, I enrolled in Certified Financial Planner program at KDU Penang, determined to demystify the seemingly complex field of personal finance. I still have 2 modules left (there are a total of 6 modules) to get certified by FPAM, but the surprising part is that I got to meet classmates with engineering background like myself who are hell-bent to improve their holistic financial knowledge. I cannot claim I am an expert but truly, my personal finance learning has been snowballing since then. About a year after I started my CFP course, I started a blog to document my learning in personal finance and around that time, Personal Money magazine contacted me for an interview for the article How to Invest RM 1k, 5k, 10k and 100k in Sept 2011 issue.

In the process, I get to know authors who have been in the financial blogosphere for years. The learning you get from other financial authors is substantial but always does your own due diligence when it comes to money. Despite Gen-Yer-er having the reputation of being spendthrift, I got the opportunity to reach out to a few like-minded people who had much success in managing and investing their own money and aren't stingy to share their experience in the public domain. ChampDog is one of them, and though he refused to meet me in person (because he wants to keep his real identity more secretive than 007), I got to give him credits for all the sweat and tears he put into this blog for the benefit of many Malaysians.

I step out further of my comfort zone and reached out to more prominent personal finance personalities like Andrew Hallam, author of the bestseller book - Millionaire Teacher, The Nine Rules of Wealth You Should Have Learned in School. I actually had a Skype video call appointment to interview him on his money and investing philosophy. The audio interview was later published as podcast in my blog. That gained the attention of Wiley, the publisher of the book (which I already had a copy), where I subsequently requested for two free copies to be given away to my blog readers. And like what they said - if you never ask, the answer is always “No”. I got a “Yes”, and couldn’t be happier to give away books to strangers who will definitely help them in financial literacy, without having to fork out a single cent.

Eventually, I garnered the attention of Malaysia’s top personal finance blog, The founder, KC Lau invited me to guest post at his blog, which I graciously accepted. This has provided me an avenue to grow my blog readership and to reach out to more audience.

How do you know the content you pen down is well accepted by readers? By using the ultimate gauge nowadays- social media.  With close to 1,000 Facebook fans and counting, I believe I am delivering what many people are looking for - simplified, value-added contents with minimal use of financial jargons. For example, if you could explain, in layman terms, the amortization schedule for house loan and flat interest for car loan, people would have easier time understanding the difference between the interest rate for mortgage and hire purchase.

I hope my story inspires the younger generation to learn more about personal finance, and take charge of your finances. Myself is a good example, starting from zero and coming from non-financial background, but now I am currently an investment columnist in Money Compass (one of Malaysia’s premier wealth management and investment magazine).

This is a guest post by Lieu Ching Foo (LCF) who is the founder of and a firm believer of financial literacy. He is a frugal “early” Gen-Y who thinks differently from most of his peers, and has to battle his way every day from succumbing to the many temptations to part with his money.

Monday, October 29, 2012

Public Gold Does Not Belong to Public Bank

A very funny statement made by a friend and he told me that Public Gold Marketing Sdn. Bhd. ( belongs to Public Bank and it basically keeps all the physical gold that owned by public bank. Huh? Well, I don't know where he got those information.

Perhaps he made his own facts by guessing that everything starts with "Public", it belongs to Public Bank! Yeah... Maybe they do it in purpose? :D

Well, I just want to make awareness here to everyone that Public Gold has nothing to do with Public Bank nor the "Gold Investment Account" offered by Public bank as well. I can see how the confusion comes because if you visit the Public Bank website you will see this "PB Gold" in their Gold Investment Account website. This makes people or investors think Public Gold is part of Public Bank or somehow related. Again, there are 2 independent companies, please don't mix them up!

Is it safe to invest in Public Gold?

Now a million dollar question, is it safe to invest in Public Gold? Unfortunately, I do not know the answer. As you may know, the Gold scam is pretty hot these days. Public Gold is selling physical gold so I'm thinking as long as you physical gold is the real, then you're pretty safe? I don't know how the transaction works too. But I do know one thing, Gold Investment Account offered by banks such as Maybank or Public Bank is always safer comparatively. Thus, I personally do not invest other than reliable institutions or banks.

If you have concerns (you should if you're not sure), I suggest you call or email "Bank Negara Malaysia" (1-300-88-5465 or to verify whether it is authorized or have license to operate as Gold investment company. Even though they're legal, there is a risk of bankruptcy too in my opinion. Are they backed by "Bank Negara Malaysia"? I think no.

Good luck to you if you really still want to invest! But just curious, why do you want the physical Gold? Can share?

Friday, October 26, 2012

Unemployment Rate by Country - Migration Consideration?

I read a news lately about unemployment in Australia has been increased from 5.1% to 5.4% so I am just wondering how it is compared to other countries. Let's check it out the following where I get from the wikipedia but not all data are updated:

Australia - 5.4% (Sept 2012)
Brazil - 4.7% (Dec 2011)
Brunei - 3.7% (2008)
Canada - 7.3% (March 2012)
China - 4.1% (Sept 2010)
Denmark - 6.2% (April 2012)
France - 10.2%(April 2012)
Germany - 5.4% (April 2012)
Hong Kong - 3.5% (July 2011)
Iceland - 6.6% (April 2012)
India - 3.8% (2011)
Indonesia - 6.56% (August 2011)
Ireland - 14.9% (June 2012)
Israel - 7.1% (May 2012)
Italy - 10.2 (April 2012)
Japan - 4.5% (Feb 2012)
Malaysia - 3.0% (Oct 2011)
New Zealand - 6.8% (June 2012)
Norway - 3.0% (March 2012)
Pakistan - 5.7% (2010)
Philippine - 6.9% (April 2012) 
Singapore - 1.9% (March 2011)
South Africa - 23.9% (Q3 2011)
South Korea - 3.7% (April 2010)
Switzerland - 3.1% (April 2012)
Sweden - 7.3% (April 2012)
Taiwan - 5.14% (May 2010)
Turkey - 8.0% (Sept 2012)
United Kingdom - 8.1% (May 2012)
United State - 8.1% (August 2012)
Vietnam - 2.9% (April 2009)

Note: For complete and most updated list, refer to: wikipedia

You should proud to be Malaysian as it is one of the top having lowest unemployment rate in the world, but not to be compared with Singapore which is at only 1.9%. :D Hopefully these data is accurate enough. Perhaps this also explains why the're so many foreign workers these day in Malaysia?

If you're thinking to work oversea or migrate to certain country, one of the things you should consider is the to unemployment rate of that country. The lowest the unemployment rate, the chances for you go get a job there is higher.

For example In Malaysia, most people plan to migrate to Australia, United State or Singapore and minority is to China. I don't know how true this is but this is what happen in my circle of friends. Given these data, it tells you it is the hardest to get a job in United State, followed by Australia, China and Singapore. In fact, this is true based on what I heard. This also means that if you plan to migrate to United State, it is better you secure a job there first before you move. Most of the successful case that I aware of is by networking because most companies prefer locals. However in Australia, China and Singapore, the chances of getting a job is higher, you can consider to make the move first then only start looking for a job. Hopefully it is still true for Australia as the unemployment rate is at increasing trend.

P/S: Perhaps looking at the trend will have more meaningful data, I will try to get those information for my next post.

Friday, October 19, 2012

Is Malaysia Income Tax Rate Reasonable?

Malaysia has lower income tax rate if you compared to most Europe countries (e.g. look at the Irish tax scheme that I posted quite sometime ago), United State and Australia and you should feel grateful for it.

However, when you come to compensation we're at the losing side. We pay taxes but we do not get back any compensation from the government especially for the middle income group people like me. So technically speaking, our low tax rate has been offset with the compensation that western countries offer.

That is also why personal finance is more important here in Malaysia as compared to those countries! :) For instance, we can't rely on government to plan for our retirement, you can't totally rely on EPF which is not enough in most of the cases.

Having said so, if we compare to Hong Kong and Singapore where compensation is similar to Malaysia, our income tax rate can not be considered low anymore. In fact, it is pretty high comparatively. Let's see the table below where I get it from Personal Money magazine:

Hong Kong Tax Rate (2011/2012)

Income Bracket (HK$)  Tax Rate
1 - 40K 2%
40K - 80K 7%
80K - 120K 12%
> 120K 17%

Singapore Tax Rate (2012)

Income Bracket (S$) - 2012 Tax Rate
1 - 20K 0%
20K – 30K 2%
30K - 40K 3.5%
40K - 80K 7%
80K - 120K 11.5%
120K - 160K 15%
160K - 200K 17%
200K - 320K 18%
> 320K 20%

Malaysia Tax Rate (2011)

Income Bracket (RM) - 2011 Tax Rate
< 2.5K 0%
2.5K - 5K 1%
5K - 20K 3%
20K - 35K 7%
35K - 50K 12%
50K - 70K 19%
70K - 100K 24%
> 100K 26%

Well as you can see from the table above, Malaysia tax rate is higher than Hong Kong and Singapore based on the income bracket. Let's take an $100K income as example for comparison:

Income Tax Rates Comparision with $100K Income

Hong Kong Singapore Malaysia
Income HK$100K S$100K RM100K
Marginal tax rate 12.0% 11.5% 24.0%
Total tax payable HK$5.2K S$5.1K RM14.325K
Effective tax rate 5.2% 5.1% 14.3%

As I commented in my previous post on 3 thankful things of Malaysia 2013 budget, most tax scheme is progressive tax scheme:
Which means, if you earn RM50K, it doesn't mean you will get taxed at 12% for all RM50K but only RM20K. For the rest of the RM30K it gets taxed at lower tax rate than 12% based on the tax income bracket scheme.

That's why if you look at the table above, there is marginal tax rate and effective tax rate. The effective tax rate is the actual tax rate. So for $100K, the effective Malaysian tax rate is 14.3/5.2 = 2.75 time higher as compared to Singapore and Hong Kong.

Also, few interesting facts that you MUST KNOW where I read an article recently from
  • Less than 10% of workforce in Malaysia pays tax
  • Number of taxpayers represent 5.6% of the population
  • 19.9% of Hong Kong population pays tax
  • 20.7% of Singapore population pays tax

These facts conclude that number of individual tax payers in Malaysia is extremely low and most importantly is:
"The burden of personal income tax is disproportionately borne by a small group"

A comment from facebook reader on the recent Malaysia 2013 budget saying the the individual tax rate is too high because the maximum tax rate(i.e.26%) is even higher than the corporate tax rate (i.e.25%).  Well, I think he has a very good point. Either we tax too low for corporate or we tax too high for individual.

So now, do you still think Malaysia income tax rate reasonable given that only 5.6% of population pays tax? Something is very wrong, in my opinion. What do you say?

Thursday, October 11, 2012

How to Use Support and Resistance in Stock Investing?

When I first come in to this term support and resistance in technical analysis, the first questions that come into my mind is "Who define the support and resistance in a particular stock"?

Unfortunately, there is no really a fixed definition because is a defined by you with your common-sense which mainly depends on how you want to draw the support and resistance lines.

What is Support and Resistance lines?

Support is drawn by connecting 2 or more troughs(bottoms) of a stock chart and resistance is drawn by connecting 2 or more peaks(tops) of the stock chart. Let's take INTC as an example below where I draw the support and resistance line by myself.

The purple is the resistance line and the green line is the support line. Resistance line acts like a temporary ceiling which prevents the stock price goes beyond this line. If the stock price goes beyond this line, it basically means it violated the resistance zone. The stock prices will continue to shoot up.

Same to support line, it acts like a temporary floor which prevents the stock price goes below this line. If the stock price goes below this line as shown in the graph (after timeline A), it violated the support zone. After timeline A, the support line becomes a resistance line.

So, what does it mean?

The support line tells you investors may buy at this point and resistance line tells you investor may sell at that point. So what you need to do is before the stock price reaches the resistance line, you sell and before it reaches the support line, you buy. Sound simple, huh?

However if it violates the resistance zone, you buy immediately. Same to if it violates the support zone, you quickly sell it because it will fall deeply and the support line will become resistance line as you see in the timeline A in stock chart above.

The support line also tells you whether the stock price is in uptrend and resistance line tells you whether it is at downtrend. From the chart above, it is at downtrend (look at the resistance line).

When the support and resistance line form a triangle shape (also you can see at the chart above), there is possible a trend reversal depends on whether it violates the support or resistance zone.


When the support zone is violated, you need to come out a new support zone. After that you can start to predict again. Similarly when the resistance zone is violated. Anyhow the most important thing that I think we must understand is the support and resistance lines are drawn by ourselves which also means that if you draw different than mine, then we may have different analysis outcome! I

I know there are many stock indicators but I think for starting, I'm going use only 2 methods (i.e. support & resistance and moving average) to predict my stocks and do some researches. Let's see how it goes.

P/S: Feel free to share with me if you have successful experience using support and resistance in your stock trading. I want to learn from you.

Saturday, October 06, 2012

3 Thankful Things of Malaysia Budget 2013

There are only 3 things that I really feel thankful about the recent budget 2013 announcement for Malaysian that I would like to share with you. I will only share with the things that is matter to me especially for personal finance perspective. For more comprehensive of Malaysian Budget 2013, you can refer to the official 1 Malaysia website for detail.

Firstly, thanks for making me proud to be middle income group. Every year I contribute to the people who really need the benefits than I do and it is in increasing trend. I'm glad that I can help others.

Secondly, thanks for giving me 1% tax reduction for the first RM50K income that I made. At least you do this for everyone and not limit to income that less than RM50K only. Thank you so much!

Lastly, you help to cool down the hot property market by increasing the Real Property Gain Tax (RGPT) to 15% from 10% for the first 2 years and to 10% from 5% between 2 to 5 years and finally after 5 years, there will be no tax which is same as previous years.

I hope you will find thankful too as I am and there must be other stuff (other then the 3 thankful things that I mentioned above) that you feel thankful about. Let's share that with me...
P/S: Malaysia Budget for previous years:

Friday, October 05, 2012

My Experiences of Making Money In Blog

I came into blogging in 2006 when a friend of mine introduced this to me as the fastest way to get rich. What I have been told at that time is you can earn around US$ 3K per month for a normal not very famous blog. So, US$ 3K is equivalent to RM 9K, then isn't that  I can stop my current full time job? So I gave it a try...

Unfortunately, this is not what I made for the past few years. In monthly average, my blog income is around US$ 120. So convert it to Malaysia currency is RM 360. So it is not a very successful case.  It is even lower than my investment return and way below my main source of income. Okay, the only excuse that I can give to myself is, I'm just doing it part time. But to be honest, even I can do it full time, I don't think I can achieve US$ 3K in a month. Perhaps I also failed to achieve the 3 steps that I mentioned in my previous post - secret to get rich quick and fast. That's why is ashamed when @lieucf said wanted to interview me. :) Perhaps also this is due to I don't really focus on making money at the first place, see my main priority in blogging below.

Here are some tips or my experiences that you may find it useful for blogging:

Tips and Experiences To Share in Blogging

  • My main priority is NOT making money in blog. My main priority is for my own reflection. I write is because I want to reflect. Secondly, I hope I can share my reflections to the rest and get feedback from all of you. So this probably keeps me blogging until today which is a good thing because I've seen many blogs cannot sustain more than 2 years.
  • Choose a simple domain name. One mistake that I made is the URL of this blog started with "FinancialIndependent". The name just too long. So if you want to start a blog, I suggest you think of a short name (as short as possible), try to have name that doesn't not have more than 3 sounds. For example, "ChampDog" is a pretty good name and easy to be remember, I think. :) 
  • Using blogspot is cool and I have no regret. But I know people said if you want to be professional, you need to have your own domain. For me, I think it depends on what you want to do. If it is mainly for blogging, I think that's fine for blogspot because what people is really interested is your ideas. In fact blogspot makes my life easier, and I just need to focus on what I need to blog. However, for setting up a company or selling certain products, I will think it is better to have your own domain.
  • Adsense is the main source of my blog income which contributes to 80%. Given the fact that I'm not a very successful case of making money in blogging, I can't give much comment here. Perhaps, you can share with me and give me some tips how you can earn like crazy in blogging? 
  • Blog frequently and consistently. For example, if you have decided to publish a post a very week, try to publish your post every week rather sometime few days and some other time more than a week. Just try to be consistent because it allows the Google search engine roughly to know when your website will be updated and it crawls accordingly. Lately, I have been using scheduled post which I find it very useful to force myself to blog consistently. Hopefully this can sustain.
  • I have never done paid post or paid review unless they allow me to write independently which means I can write bad reviews too if I think it is bad. But I don't think they allow me to do that. In short, I think paid post is not honest and defeat of my blogging purpose. Perhaps this makes me cannot earn in blogging?
  • Started guess post and having the guest post guideline too but don't think this is going good anywhere. Most authors who write guest post seem like only interested in one thing which is "link building" but what I"m looking for is "interaction" with them. Perhaps, I should just consider to stop having this guest post open in this blog anymore.

In short, can blogging really make a lot of money? At least it is NO to me. Money that I get from my blog can't able to feed me at all. Do you have anything to share or any advice for me?

Friday, September 28, 2012

Secret to Get Rich Quick and Fast

When you see the title of this blog post, the first thing that comes to your mind is direct selling or multilevel marketing (MLM) because this is what they usually promote or maybe the one who join them usually have the intention of "Get Rich Quick and Fast"? But this is not what I want to share with you.

What I"m going to share with you is the "real secret" to get rich quick and fast and you do not need to join anything. If you can do it, no matter what industry that you are in or your profession is, you will be RICH very quickly! So the secret is...

To Find Out What People Are Going to Want Before They Even Know They Want It

This reminds of in one of the Steve Jobs Interviews and he basically said that he doesn't follow the transitional way of how marketing team does which market survey is done prior to product roll out. So, he didn't do any market survey when they roll out the first iPhone because the market simply doesn't know what they really want. Thus, he needs to tell what the market wants instead. Apple is a good example and now Samsung is catching up. :)

You may think this is for business but in fact it really applies to anywhere.  For example, if you're employee, how can you get promoted fast? Of course, I assume promotion here is directly correlated with money. Same thing, you no longer can just do what your boss tells you to do. What you really need to do is to figure out things that he doesn't know that he even wants it badly. Then, you will get promoted very soon.

3 Steps to Get Rich Quick
  1. Figure out what people want in future even they do NOT realize about it now.
  2. Produce and get it for them.
  3. Influence them that they want it NOW.

I know this is simple and generic but let's think of it. These 3 steps are really what those people do to get them rich very quickly, don't you think so? So let's start from today, no matter what is your occupation, think of how to apply the 3 steps above into your day-to-day jobs.

Wish you can get rich quick and fast! 

Friday, September 21, 2012

Money Face But Partially Real Face

While cleaning up my hard drive and found these funny pictures, think this maybe good to share.When we free, we tend to be more creative! :) Agree?

From these photos, it looks like from Malaysia's company? Maybe a money charger company? That's why they have all the different currencies.

P/S: Source: Internet. By the way, just Google it around they are a lot of people doing a similar thing. Guess it is not something new.

Friday, September 14, 2012

Salary, Job, Interview and Employee Reviews by GlassDoor

I just found out this cool website (i.e. recommended by my colleague when he wanted to show me how bad our employees review our companies.

All these information in the website are entered by the employees, so I think the information there is pretty accurate. You will need to login with your facebook account to continue to view more detailed information.

What I usually do is search for the company and dig out more information from there such as salaries, jobs, interviews tips and their employees review on the company.

What you can get from GlassDoor?

  • Salary Reviews - You can see the salary range by job title. Once you know it, then you will know whether you're under paid or over paid. It depends on the company, some are divided by job grade which I think it provides more meaningful data than the job title.  One lacking is this Salary data outside of US is very limited.
  • Employee Reviews - This is the most interesting stuff because you see funny comments here. But I think what we can get out from this look at the overall company rating distributions and also other ratings on work life balance, compensations and etc. You can then compare the ratings with other companies. 

  • Interview Reviews - This is useful especially you're looking for a job. You can see the example of interview questions that shared by those interviewees who attended the interview at that company. It is always good to have a high-level sense of what is expected during the interview. It even goes to down to the detail of which position they're applying to. 
  • Jobs Availability - You can look at all the open positions in a company. It links to the company recruitment website and you can start your application there.
  • Top Companies Statistic - In terms of "Best Place to Work", "Work Life Balance", "Career Opportunities" and so on.

This website also wins the "Webby Award" for "Best Employment Website in 2012". Hope you will find it useful for researching a company. Good luck! Wish you work at one of the best companies out there! :)

Friday, September 07, 2012

Top EPF Performance Funds from Public Mutual

Just got this information from my public mutual fund agent, and I think is a good thing to share here.

This is 3-years trend for Public Mutual Funds that allowed for EPF withdrawal for investment. Click on it if you can't see it clearly.

Top EPF Performance Funds from Public Mutual
  • Public Focus Select Fund (PFSF) ~65%
  • Public Regular Savings Fund (PRSF) ~60%
  • Public Islamic Select Enterprises Fund (PISEF) ~55%
  • Public Dividend Select Fund (PDSF) ~40%
  • Public Islamic Dividend Fund (PIDF) ~40%
  • Public Islamic Equity Fund (PIEF) ~30%
  • Public Growth Fund (PGF) ~20%
  • Public Equity Fund (PEF) ~20%

Whenever we look at these numbers (e.g. 65%), don't be fooled by it because of the powerful compound interest. Yes 65% return is really not that bad but we need to translate it to annual return which is around 18%. For 3 years of 40% return, it is around 12% return in annual. For 30% is 9%. For 20% is just  6%.  So PGF, PEF and PIEF  are not really performing in my opinion.

Friday, August 31, 2012

Tips to Cure Fatty Liver and Cholesterol Problems

While having a conversation with @knowthymoney in twitter, it triggers me to talk about my health condition since about 9 months ago where I've been diagnosed with Fatty Liver and Cholesterol problems - check out my previous post: Forgotten Health Formula, Have You?

After ~9 months, my medical report shows good progress.

Not fully fixed, but now at least at the border line. LDL and HDL cholesterol are at border line but at least overall the total cholesterol has be fixed. For liver, at least SGOT(AST), and SGPT (ALT) are no longer an issue and leave only the GGT which is at border line (used to be 2.5X from the maximum range). :D Still have ways to go, wish me luck!

Here you go the tips that how do I improve my fatty liver and cholesterol conditions. I hope you may find it useful.

What did I do?

  • Eat Lipitor medicine -  Although I don't like medicine because I always think there is a long term side effect but it is a quickest way to solve this problem. So, I decided to take it. I took 20 mg Lipitor for the first 3 months everyday and I redo my medical report after 3 months. It is very effective and shows good result, and I continue to eat for another 3 months but not everyday this round but once every other day. After 6 months, I stop completely after medical reports shows good cholesterol result.
  • Exercise at least 3 days in a week - The exercise must be at least 30 minutes and non-stop or else it will be useless. Your whole body must be sweat, it will then only useful. I play badminton twice a week, climb hill once as week and swim on Saturday and Sunday. Lately, read few articles stated the best time to exercise is at late afternoon but I think that is doesn't really matter as long as you find yourself comfortable.
  • Eat Fish Oil Supplement - Fish oil is essential to our body because our liver cannot generate  the Omega-3 oil. To choose a good brand of fish oil, choose the one that have the highest % of total Omega-3 fatty acids (i.e. the sum of EPA and DHA). You will need to do the math by dividing the Omega-3 fat acids volume (in mg usually) by the total capsule volume (in mg as well). The one that I"m having is 55% which is pretty high, the higher, the better. Of course, it will be more expensive. You also need to choose the one with "Molecularity Distilled" so that the fish oil will be free from mercury toxic.
  •  Consume Olive Oil Directly - I consume 1 tablespoon of olive oil in the morning after I wake up. After that, it is better to wait for ~ 30 minutes before you start taking your breakfast. To choose a good olive oil brand, pick the one with "Extra Virgin" and also "Cold Press" and preferable those that used for salad topping rather than for cooking.
  • Eat Healthy and 70% Full - Eat healthy basically means eat less meat and less oily stuff. Cook yourself if possible because outside food is usually not healthy. Thus, I try to cook myself for dinner these days too whenever is possible. No fancy stuff, usually just cook porridge, soup with a lot of vegetables. Try to eat a much as different kind of fruits as well. Also, I used to eat until 100% full and now I"m trying to be not eat until that full. At first, it is hard but now is kind of get used to it already.
  • Eat Milk Thistle Supplement - After I stop my "Lipitor" medicine, I replaced it with Milk Thistle supplement which is traditionally used as a liver tonic which helps to cure the fatty liver. I plan to consume this for 6 months and then see the result. Now is the the third month, where the progress showing good even without the medicine. Hopefully 3 months later, all my liver medical report will be back to normal, then I will stop this. 
  • Sleep Early Before 11 PM - I used to do not believe that the liver's health has nothing to do with sleeping early until I read few articles to prove me wrong. You can do your own research and many papers talk about it. Basically, the liver starts to detox your body around 11 pm when you sleep. If you do not sleep, it won't start. Thus, the toxic will slowly accumulate in your body. So, have a good habit to sleep early and wake up early too. You will feel a lot more energetic!
  • Drink Plenty of Water - Especially at work, I seldom drink because of full concentration at work. I think this is not good. I slowly change my habit now to drink every one hour in the office. If you do not drink enough water, your kidney does not able to do its job to detox and it leaves that job to your liver. This increases your liver loads which we all want to avoid. In short, drinking a lot of water helps your liver do the detox job easier.
  • Shit Everyday in Morning - Sound funny but it is true. Shit accumulated in your intestine creates toxic to your body which eventually bad for your liver. Ultimately, you should shit at least 3 times per day but I think that is too many already. So I just changed my habit to shit every morning after I wake up. Don't accumulate your shit more than a day... lol :)
I hope this is something useful. It works for me, that's why I want to share this. Whenever we talk about health, lifestyle is important element. I think nowadays, too many of us having the wrong lifestyle. Just reminder that health is part of the wealth equation:

Wealth = Money + Health + Relationship 

Ultimately, I want to tune my body until I don't even need to eat supplements at all because I think that it suppose to be. Wish me luck and I wish you healthy always!

Saturday, August 25, 2012

Moving Average Fundamental In Technical Analysis

Moving averages are one of the most popular tools for technical analysis. Before that, let's look what technical analysis is if you have no idea what it is. But if you have no idea what what stock is at all, you can read this post first: Stock Market 101. :)

What is Technical Analysis?

Generally, there are 2 types of stocks analysis method. The first one is called "Fundamental Analysis" where you analyze the stock based on the financial data (e.g. annual report). Few popular and useful methods that I mentioned in my previous post are

On the other hand, technical analysis doesn't look at the financial data at all. It analyzes the stock based on 2 things:
  • Prices Move in Trends
  • History Tends to Repeat Itself

It basically means that there are always 4 stages of stock cycle in any time frame as I mentioned in my previous post. Because of this 4 stages of stock cycle, technical analysis can make such prediction which cycles you're at and suggest whether you should buy or sell. Cool, isn't it?

What is Moving Average?

If you look at the technical analysis chart you always see this symbol MA, it basically means moving average. There are MA 10, MA 20, what do they mean? The number refers to days and it basically means 10-day and 20-day moving average respectively.  

Example: 10-day MA for APPL

Let's look at the fundamental calculation for 10-day moving average (MA 10):

First Average X    = (Sum of Day 1 until Day 10) / 10
Second Average Y = (Sum of Day 2 until Day 11) / 10
Third Average Z   = (Sum of Day 3 until Day 12) / 10

The first average X is at Day 10 and look back to the past for 10 days. So it basically reflects to the past 10 days average at that point. When you join the X, Y, Z together, you will get a line and this line is called 10-day Moving Average (MA 10) "trend line". So, if the line is moving upward,  it is upward trend. If the line is moving downward, it is downward trend. Simple right?

The good news is you don't need to calculate your own, most online chart (e.g. the yahoo technical analysis chart) allows you to plot the MA trend line. In general, there are 10-day, 20-day, 50-day, 100-day and 200-day moving average. It depends whether you're a short term or long term investor. For example, the larger the number (e.g. 200-day MA), it is usually used by long term investors. It also means that the longer MA will move slower than the shorter MA.

When Moving Averages Crossover...

When MA is used in pair, because of one is moving slower than another, it will have a crossover at certain point. When the fast line (shorter day MA) crosses over and above the slow line (longer day MA), it indicates a "Buy Signal" and similarly if the fast line is below the slow line, it indicates "Sell Signal".

Let's look at this example for Apple share, plotting the MA 20 versus MA 50. The MA 20 if faster line which is in green and the MA 50 is slower line in red.

  • At crossover 1, MA 20 is below MA 50. Sell indicator, it tells you to sell!
  • At crossover 2, MA 20 is above MA 50. Buy indicator, it tells you to buy!
  • At crossover 3, Sell indicator...
  • At crossover 4, Buy indicator...

You will need to look at which combinations of MA provide meaningful information to you. Basically you need to try and error for each stock because it works for one stock, it may not work for another stock.


I hope this is useful for you to understand the fundamental of technical analysis. I'm not sure how practical is this as I'm pretty new to this but I at least refer to technical analysis indicator for selling my company stock but sometimes I do not wait for the crossover to sell because I have already made enough money out of it. Sometimes, we shouldn't be too greedy especially in stock investment. :)

Some fundamental stock experts do not keen at all on technical analysis but in my opinion, I think we should look at both. Feel free to share your comment here if you have experiences on using technical analysis to make your decision in your stock investment! Do you find it useful?

[Update: April 21 2014]: Another very useful technical analysis tool that you can use is "Support & Resistance", you can find more about it here: How to Use Support & Resistance in Stock Investing?

Monday, August 20, 2012

Useless Features Review on Samsung Galaxy S3

This is not really a personal finance blog post but more on a product review which I haven't done for quite some time. I'm going to share with you my review (from user and practical perspective) on the Samsung Galaxy S3 that I bought lately. You may continue to read on you're interested...

Somehow not many people talk about  the negative side of this, so I will just start with this useless features review on Samsung Galaxy S3. Of course, this is merely from my perspective.

Useless Features
  •  S Voice is completely useless. It seems cool, but I don't think it is effective for me to instruct my phone by voice as compare to conventional way. I can do it a lot more faster than not using the voice. Also, it is not practical in most of the time.
  • Pre-installed softwares cannot be uninstalled and the only thing you can do is to disable them so that they won't run in startup. For example ChatON is a useless software by Samsung where now everyone uses WhatsApp.  You can't basically uninstalled them unless you root your device.
  • Motion activation  is another cool but useless or less practical feature in my opinion. Well, the most useful motion feature is probably the "Turn over to mute/pause". if you really want to use it. The rest motion features are merely for showing off purpose.
  • Multiple burst shot is cool but I think if you can capture with single shot, the picture quality is better. Unless, you really want to capture a keep moving object, then probaly the burst mode is good.
  • Face detection to unlock screen is yet another cool but useless feature. It makes me unlock the screen slower. Guess it is another feature to show off!

What are the useful features? All the features that you can find out from web except with those that I mentioned above are useful enough. For example, the "Smart Stay" feature is pretty cool and also useful. It is very practical too!

Buy or Not Buy?

Overall, it is a good buy for me because it helps my life getting effective. Perhaps I have been outdated for too long with my windows mobile in HTC but if you really have cost concern, you should consider buying low-end Samsung smart phone which I think it serves an almost similar features. Good luck!

Thursday, August 09, 2012

Malaysia is the most Sluggish Country in Southeast Asia

I can't help myself to blog about this here when I saw this article shared from a  facebook's friend which stated that Malaysia is the most sluggish country in Southeast Asia, ranked 10th "laziest" nation in the world. The original article is here.

In summary, here is the laziest country scoring based on the survey from "The Lacent"(i.e. where the highest the percentage is , the laziest the country is. I'm not sure how they do the survey but it seems like you need to pay for it to get the data.

Laziest Country Scoring

South-east Asia
Malaysia - 61.4% (ranked 10th in the world)
Indonesia -29.8%
Philippines - 23.7%
Thailand - 19.2%
Vietnam - 15.3%
Myanmar -12.7%
Cambodia - 11.2%

Top 3 in the World
Malta - 71.9%
Swaziland - 69.0%
Saudi Arabia - 68.8%

Rest of the Countries
China - 31.0 %
India - 15.6 %

Do you believe it?

The next question is do you believe it? Is Malaysia really that bad? The biggest slacker in South-East Asia? Ranked number 10th in the world? Can you believe it? My first impression was I tried to deny it but after some thoughts, I tend to agree with the survey based on my daily observation in my surroundings. But I could be wrong.

Here are what I observe

  • University standard is getting lower and lower. For example, a basic fundamental of digital logic question, most graduated electrical or electronic student cannot answer that. What's going on? Forgot to tell you, some of them are first class student too.
  • Younger generation cannot take pressure. They like to take short cut (e.g. expecting high increment with minimum effort). When they face challenge, they look for the way out. Is it Generation Y culture? or is it Malaysia problem?
  • Top performer in a company is not really a top performer in a company. I have seen many cases in my company that the top performer is not because they're super good, it is because the rest are too worst! Also, can't find any better than them in the market too.
  • Have a chance to talk to a first class oversea student from Vietnam who study in Malaysia. Her CGPA is 4.0 flat so I curious and  I asked how she did that. She just told me surprisingly Malaysia education standard is very low and students are very lazy, that's why relatively I'm the best. How true? But the above survey seems justify this.
  • Older generation is also getting affected by the laziness culture. Take me as an example, I started to getting to slack more already as compared in the past. This happens to the people who are the same generation with me too. So old and new generation also lazy, what will happen next?

So, what is your take on this? How far do you believe this survey is true? What do you see in your surroundings? Do you see a similar trend that I see?

Sunday, July 22, 2012

TakeAways from Private Retirement Scheme (PRS)

This post is specifically for Malaysian - our PM launched a new voluntary private retirement scheme (i.e. PRS) for all Malaysian! You can check the announcement here. Well, I think this  a good news. So, let's see what are my key takeaways from this announcement?

Key Takeaways

  • You may ask what is the difference as compared to EPF? The obvious one, EPF is mandatory and PRS is voluntary.
  • Tax relief is up to RM 3K as compared to EPF is RM 6K. Well, it is additional. What it means is if your tax bracket is 26%, you will able to save up to RM780
  • Contribution frequency is flexible where else for EPF is monthly.  I think this is very similar to mutual fund investment where you can also setup a monthly investment if you want to.  
  • You can only apply this PRS through approved PRS providers. They are AmInvestment Management Sdn Bhd, American International Assurance Bhd, CIMB-Principal Asset Management Bhd, Hwang INvestment Management Bhd, ING Funds Bhd, Manulife Unit Trust Bhd, Public Mutual Fund and RHB Investment Management Sdn Bhd.
  • You can choose what funds to invest but I guess that is still based on the term and conditions of the PRS providers above. You should check with your agents. For EPF, you only have partial freedom. Remember you can opt for withdraw the money from EPF for investing in mutual funds?
  • Withdrawal is similar to EPF, the entire fund in your PRS can be withdrawn when you reach your retirement age (55 years old - used to be 60), you die or you migrate to another country. For partial withdrawal for per-retirement, there will be 8% tax penalty. This is different from EPF where withdrawals can be made without penalty for specific purpose (e.g. pay for housing loan and education). Anyway, for detail you should check with your PRS provider to confirm. 

I believe the details on how to apply this PRS will be communicated by the PRS providers soon. For example, if you're using Public Mutual and I will expecting your agent will be contacting you about this scheme. If not, you can approach them assuming you're interested to apply.

I think I will go for this as it can help me on the tax relief. Will you? One risk that you must understand is the fund that you invest in may be losing money. To minimize such risk, I think the PRS providers will mostly offer those low risk funds rather than aggressive funds. So overall, I think this is safe to invest.

Sunday, July 15, 2012

Donate Money Can Make You Rich?

When I was young, my brother told me the secret to rich is to make donation. The more you donate, the richer you’re. So I asked him what exactly the donation that you mean? Did he mean giving advices or consultations? No, the donation is a real donation here in a physical "Money" form, he said. Huh? Is that really make sense? It didn't seem possible to me at all.

I still do not have the answer until today because he didn’t really explain that to me. Perhaps he did not know the answer himself and read this information from somewhere else but have no idea why. But anyway, I have figured out the answer by my own but still not sure if this is the real answer and let's see if my answer makes any sense to you.

Why it can be possible?

How can it be possible by donating money can make you reach? I have been thinking and I finally come to a conclusion why it can be possible. The ultimate answer is you're in control of your money by donating money.

(1) You're In Control

The first thing that you may ask, what is the return in terms of money when you give away your money? No, you don't get anything physically. However, when you are able come to a stage that willing to donate your money, it basically means that you're in control of your money. The control here doesn't exactly mean that you're good in personal finance. The "control" here  means you are in control of your  "emotion" towards your money. In other words, your emotion is NOT controlled by your money and I think that is the first thing or fundamental that everyone of us should learn in personal finance

(2) Make Better Judgement

When you're in control of your emotion, you can make a better judgement.  When you can make a better judgement, you can make a better investment. When you can make a better investment, you will get your higher return and in long term you will become rich. That sounds simply but I believe that is true. A truly rich people always have a very high Emotional Quotient (EQ). If you see those riches who have very low EQ, I bet their rich will not able to sustain and I have seen many examples as such.


In short, the fundamental of becoming rich is really on controlling your emotion! However, when you tell this to anyone, no one will get it. If this concept is easily be understood, then everyone will be good in manage their money already but this is not the case. You and I know that.

Therefore one clever fella came out this idea, instead of telling everyone that controlling emotion is the fundamental of becoming rich, he/she is telling everyone that donating your money can make you rich without telling the real intention that is when you start to able to let go the money, you're in control of your money rather than being controlled. So, people follow without releasing the fact that they're increasing their EQ and eventually they will get rich by donating.

It seems ridiculous but what do you think? The way I look at this, the only thing to argue here is do you think a person who is willing to donate his/her money means that they're better in control of their emotion? 

Saturday, June 30, 2012

My First Feng Shui Criteria Before Invest in Property

In my previous post, I mentioned that there are 4 different types of Feng Shui believer and I'm basically the "Type 3" of Feng Shui believer who makes a lot of common sense out of Feng Shui. However, regardless of you believe in Feng Shui or not, the property price will still be affected by Feng Shui. So, you still cannot completely ignore Feng Shui.

What I would like to share with you is  my first and most common Feng Shui or environmental factor that I look at before I invest in a property. Assuming I want to buy a residential property in a township, the first thing that I look at is how many different routes can enter to the township. It must have at least 2 different routes enter into your property area and the more the better. Let's see the following maps to illustrate this:

Example A: 1 route to the township

It is not good because there is only 1 way or 1 route to the township. Assuming if any thing happen that blocks the route, you have no way to go out or you have no way to go in. You basically stuck there!

Example B: 2 routes to the township

This is better than example A because there are 2 different routes to township and it is preferable at different entrance as shown. If it is a small area, one entrance is fine too. Of course, if there are more different routes and different entrances to the township, it will be better.

I'm not sure if that makes sense to you but this is the first thing how I evaluate a property before I decide to buy a property. I will usually try to avoid a property area with only one route and one entrance, and if property that has more than 2 routes entrance, I will usually give it higher weightage in my decision making.

Let me know what you think, what is your first "Feng Shui" or environmental criteria before you decide whether you want to invest in a property? What is the first thing that you look at?

Sunday, June 10, 2012

Try to Avoid Using "According To"

I attended a seminar last week and the speaker basically over used the words "According To". I think this is very bad, but of course he will disagree. The fundamental problem is you lose the accountability if you use too many other people statement to make it a point. It ends up your audience will think like this - since there are so many "according to", why do I still want to listen to you? I may as well listen to the person that you rely on.

You can use according to, but try to give your comment or argument towards the statement that made by another person whether you disagree or agree and also tells the reasons why. Please don't ever use that to support your idea. The even better what you can do is re-paraphrase without using the  words "according to" because somehow I just feel that the words "according to" try to push away the responsibility to someone else. Don't you think so? For example, you can said something like this: Person X says this too and I totally agree with that because [reason1], [reason 2] and [reason x] rather that using the words "according to".

Even from your day-to-day work, whenever you give a talk, speak to your clients or even talk to your boss, you should always try to avoid using "According To". This is basically to make sure all the words that come from your mouth, you're responsible for that and have 100% confident on it. Then, people will only trust you and believe in you.

So, what do you think? How often do you use the words "according to"? In fact, it is very "nice words" to use especially if you want to push away responsibility and you do not want to own your words, isn't it?

Thursday, June 07, 2012

Is Suicide Covered by Life Insurance?

I had a discussion this week after a tired badminton session with few friends of mine and surprisingly they do not aware that suicide is insured as well by insurance. So, I just share it here with you guys.

As far as I know, suicide is covered by your life insurance. However it is only valid after 1 year you buy your insurance. This basically means that if you suicide within a year, you're not insured! lol :) Having said so, some insurance policies may vary (e.g. 2 years), so you need to check with your insurance agent or read the policy carefully.

Why it is not covered within a year? 

I guess you already know the answer. This is to avoid people misused the original intention of insurance.Why 1 year? I guess that is due to statistical reason which usually people won't plan their suicide more than a year. So now you know the loophole. If you want to get the money, plan your suicide 1 year in advance. If many people are doing what you're doing, then guess what? The insurance company will then increases suicide clause from 1 year to 2 years. It is all about statistic for a insurance company so technically they will never lost! :)

Any other exception?

The only one thing is not covered by life insurance is death due to natural disaster (e.g earthquake) unless you buy specific insurance which is meant for natural disasters. 

I also brought a very interesting hypothetical example during the discussion: while you suicide during the earthquake, are you being covered? I do not really sure but common sense tell me the answer is Yes and No. Yes, if the earthquake do not cause a lot of death and No, if the earthquake is the serious one.  I imagine that if the earthquake causes a lot of death, can we still able to tell whether your death is caused by suicide? Unlikely right?

P/S: I hope you do not really want to plan for your suicide in 1-year advance. :)

Saturday, June 02, 2012

Using Return on Equity (ROE) to Analyze Stock

Using Return on Equity (i.e. ROE) is one of the stock fundamental analysis. It basically tells how good a company manage its assets (i.e. share holder capital) to generate profits. A strong fundamental company should have at least 10% on ROE per annual. Of course, the higher the better.

ROE = Net Profits per Annual / Total Shareholder's Fund

  1. Net profits can get get from the annual report or quarterly report. For quarterly report analysis, you need to get the previous 3 quarter report.  It should all based on annual if you talk about return.
  2. The total shareholder's fund is based on the average highest and lowest price of the stock during the period (e.g. annual) and multiple by the number of shares.
  3. Just get some online free statistic if you don't want to calculate your own. There are some free statistics of financial ratio that you can get online for a particular stock.

Of course the rule of financial ratio analysis is still the same which you should compare the same industry. So the 10% is just a rule of thumb. If you look at the technology companies such Apple, Google, Intel and Microsoft. They have pretty high ROE and usually is higher than 10%.

Stock 1 Year (Median) 5 Years (Median) 10 years (Median)
Intel 25.4% 16.2% 16.8%
Google 18.8% 20.0% N/A
Apple 40.0% 30.0% 22.5%
Microsoft 43.8% 44.0% 34.0%


Generally if the ROE is < 5% for a period of at least 5 years, we should be careful on that stock.

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Sunday, May 27, 2012

How to Read Candlestick Chart?

Stock charts are usually represented with Candlestick chart to show the stock price at a certain period window.

Source: Wikipedia

Black candle means the price opened at the high and closed at the low and the white candle is the other way round. So if you look at the candlestick chart and if there are a lot of the black candles, it basically means that the bears are in control. In other words, the stock trend is moving downward. Similarly if you see a lot of white candles, bulls are in control and stock trend is moving upward. So usually more white, the better!

Candle Stick Components
  • High - The highest price for the period window (e.g. 1 day)
  • Open - Opening price
  • Real Body - Black refer the stock is closed at lower. White refers to the stock is closer at higher.
  • Close - Closing price.
  • Low - The lowest price of the period window (.e.g. 1 day)

Note: The period window could be 1 minute, 5 minutes, 60 minutes, 1 day 1 week, 1 month and so on. It depends on what kind of stock traders you're. For example, 1 minutes and 5 minutes period window will be useful for day traders. 1 day period windows may suitable for traders who do not have time to monitor the stock very closely.  Weekly and monthly will be suitable for long term investor like me. :D

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Sunday, April 22, 2012

Will Property Bubble Burst in Penang Island?

People talked about property bubble burst in Penang Island 2 years ago. Some said it had already the peak and today the history repeats itself. People is still saying the same thing, the property in Penang Island is already peak and going to burst soon. So, how true is this?

You get all kind of answers depending on who you ask. :D Generally, these are the answers that you can get:

Yes, It Will Burst Soon

  • It is about supply and demand. The supply has already more than demand. You can do your own research especially at night especially for those luxury houses that has already obtained the OC. Try to count how many of the houses have their lights on. You will only see < 30% occupied on majority of the ready house development. Thus, it is going to burst soon.
[My Comment]: This makes sense but the location is the key here. Not all location have the similar symptoms and it also depends on when you do the research. A ready housing development takes 1 to 2 years to have > 80% occupations. Probably 1.5 years is a good time for you to such research. 

  • I just don’t afford to buy and I hope it will burst soon. So, I am waiting for that moment and tell everyone that the property is going to burst soon.
[My Comment]:  I guess just need to ignore this because no supporting data. Many people are telling that property bubble will burst and in reality is they “hope” it will be burst. Not a smart argument anyway.

No, It Will Not Burst
  • The property is in good shape. Generally property in Malaysia or even in Penang Island is still a lot more cheaper than our neighbor countries. Thus, it will not burst anytime soon because we have a lot of foreign investors.
[My Comment]: About 30% are foreigner investor including those Malaysian who worked out of the country. This is what the most developers told me. However, assuming if you do your own research and found out that only 30% of houses being occupied. So where does the 40% go? Yes, speculation but it still doesn’t mean the bubble will burst.

  • Penang property was undervalued in 5 years ago and  it was not appreciating as it supposed to be. Therefore, the recent past few years rapid appreciation was just catch up with the past. So, it will not burst.
[My Comment]: Yes, it makes sense but it also depends on how long the appreciation goes. If it still continue appreciate like crazy, it may burst. However, you have seen government and the banker have taken steps to control the peak by slowing it down. When it is slowing down, the burst won’t happen.

What Should I Do Now?

I know you desperate to know the answer but from my comments above, you can kind of can guess that I”m more bias towards to say there will not burst in Penang property market. In my opinion, when the supply more than demand, it will not burst but it will only be stable down for probably 2 - 3 years. This is because most investors including speculators are rich (I believe) and they will not easily to let go to sell at lower price. After the property market correction, it will then catch up again.

However from a personal finance perspective, you should always plan for the worst. You should always assume the property bubble is going to burst. Let’s say if you’re buying a $1M house, you should expecting of losing of 35%  (based on the US sub-prime crisis data – refer here: worldwide house price trend till 2010).  So, if you afford to lose $350K, then you can go for it.

P/S: If you interested on looking at the average transaction property market in other states of Malaysia, you can refer to here.

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