It has been a year (14/6/13 – 14/6/14) since I have started my journey in investing. During this year, I have made many mistakes and have learnt a few painful lessons.
In the past year, my portfolio has made a loss of -5.06%. I have to admit that this is a bad performance as compared to the STI index, which has increased around 4.17% in the same period. My portfolio was badly hit by my investment in Food Empire, which crashed due to the rising tension between Russia and Ukraine. That gave me a large loss of -28.95%. Another rare incident occurred to my investment in China Minzhong, in which I was lucky to escape unscathed when short-seller Glaucus Research issued a fraud report against it. The breakdown of my positions are shown in the table below.
Looking back, I made the error of investing in companies which I had no competence in understanding and committed the mistake of overtrading. In the last year, I invested in 10 companies of which I am currently only holding onto 4. My holding period was an average of 3-4 months for most stocks, which went against the principle of holding for the longer term. In addition, I was too hasty in my due diligence and followed the direction of others when I was too lazy to perform my own analysis.
In the coming year, I hope to improve my performance by trading less, preparing more and seeking a greater margin of safety before investing. Throughout the recent year, I now understand that the key in successful investment is one’s temperament. Controlling my urges and fears is one area I hope to improve on as well.