THE INVESTMENT APPROACH OF CALVIN TAN

THE IMPORTANCE OF DIVERSIFICATION (Calvin Tan) This is a 3rd posting to warn about Black Swan event November 15th, 2018 Calvin Tan

calvintaneng
Publish date: Wed, 18 Mar 2020, 01:45 AM
calvintaneng
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Hi Guys,

I have An Investment Approach I which I would like to all.

IMPORTANCE OF DIVERSIFICATION,

Ecclesiastes 11:2  ” Divide your investments  into seven , or even to eight, for you do not know what misfortune may occur on the earth   (NASB)”.

Solomon tells us 2 Important  Things In This Verse:-

No.1) TO DIVERSIFY OUR INVESTMENTS INTO 7 OR EVEN 8  AREAS.  WHY? HE GAVE THE REASON –

No. 2) FOR YOU DO NOT KNOW WHAT  MISFORTUNE MAY OCCUR ON THE EARTH.

In Other Words, Don’t Put All Your Eggs In The Same Basket. Because When The Basket Falls Down, All the Eggs Will Be Broken Together. That means Total Loss!

Image result for pictures of eggs in one basket

 

Image result for photo of diversified investment

 

Let Me Relate 3 True Stories:-

No.1) One Evening, after the plane landed at Changi Airport from Kuala Lumpur, I took a taxi home. Since the journey from Changi Airport to my place in  Jurong West takes about an hour, I decided to talk to the taxi driver regarding the latest  developement in Singapore.

As I was conversing with this  particular taxi driver I noticed that he looked different. So I said, “You don’t look at all like a taxi driver, you must have been a CEO or some  Big Time Business Man?” And I was right.

Then he shared his story. “Actually”, he says, “I am the Owner of An Import & Export Company In Singapore. Business has been very good and it’s growing bigger and bigger all the time.” “Why are you driving a taxi, then?”, I chipped in. “We recently sent a Consignment of Goods To The US. It Was One Of The Biggest Sale We Made – Worth US$20 Millions.

Then 911 STRUCK NEW YORK TWIN TOWERS. All our contacts with the Receiving Party in US were cut off, since their Office is in the TWIN TOWERS THAT COLLAPSED. We are not sure where the goods that we sent are currently located. At the same time our Creditors are chasing for payment. We don’t know what to do. At the moment I am driving a taxi to get cash  for daily expenses.”

No. 2) During the Asian Financial Crisis, everyone was trying to cut cost. Instead of staying in hotel, I moved to a house operated as a Home Stay for traveling salesman. It costs only rm30 a night with a/cond.

Here I met a young gentleman driving a gleaming Mercedes Benz. Curious I said,”You look like a well to do prosperous man of better means than to stay in this cheap place here?”. Then he told me his predicament. He shared with me that by age 22 he is already a millionaire. He started as a young apprentice doing electrical wiring for homes and offices.

One evening when his boss and colleague  had left he was still working into the wee hours of the night. He wanted to complete the job. The place was the Sultan’s Palace. When he was absorbed in his work, Datuk Ling Liong Sik walked in. Then followed by Datuk Samy Vellu. Seeing his hard work and dilligence both Cabinet Ministers gave him their Name Cards. And they told him to go to them if he needed help.

He went to see them, got some lucrative contracts and started his own company. Money just rolled in and in no time due to his hard work and dilligence he made his fortune.

However, he thought, “I only  my made my fortune by my connections. I wasn’t sure whether it was by my own ability?” So he decided to leave Malaysia for work in Singapore – where he is on his own without  any special connections. Alas! He said that the Singaporean Business men outsmarted him and he lost his entire fortune.

So he returned to Malaysia. Went for help again. This time he managed to get subcontract work for The Petronas Twin Towers In K.L.  Unfortunately, the Asian Financial Crisis Struck in 1997 and his Main Contractor ran away and did not pay him – estimated to be 2 Million ringgit. (NOTE: IN BAD TIMES THEY WILL BE MORE DEBT DEFAULT. SO MAKE VERY SURE WHATEVER YOU DO BE SURE TO GET PAYMENT. IF NOT THEN DON'T DO IT. GOVT LINKED BUSINESSES LIKE NFCP & ECONOMIC STIMULATION IS BEST. ZELAN LOST RM300 MILLIONS WHEN MEENA PLAZA WAS DEMOLISHED WITHOUT PAYMENT. THIS IS THE PERIL OF DOING BUSINESS WITH UNTRUSTWORTHY PEOPLE!)

However, his suppliers are chasing him for only RM200K worth of goods. That is the reason why he has to go into hiding. My advise was to tell him to be honest with his suppliers. After all the Petronas Twin Towers  Still Need to be completed, somehow.

I hope these two gentlemen turn out well.

3) Mr. Liew of HELANG CAMAR   hailed from Sabah. He started his Used Car Dealership in KL before the Asian Financial Crisis of 1997/98. His Used Car Business thrived in 1993-early 1997. He told me he still have half of his capital tied in the Oil Palm Plantation Lands in Sabah. He wanted to sell off his Plantation and put all the  capital into the booming Car Business. I advised him not to do it.

Then The Asian Financial Crisis Struck in End 1997. He told me his accumulated profits for 3 years were wiped out within 3 short months. And he is staring at further losses from Unsold Stock of Cars. However, his Oil Palm Fruit Bunches were fetching good prices. So his losses were cushioned by the Booming Palm Oil Prices.

By  May 2001 (4 years later) the Used Car Market Fully Recoverrd and he was doing well once again. However, Palm Oil Prices Crashed Below Production Cost!  The cost of fertilizer, worker’s wages and  overhead costs is more than the actual selling price of palm fruits. Trees were left idle, fertilizer sold back to supplier & workers retrenched. With the downturn of Palm Oil Prices he concentrated his energy on the Used Car Business.

You see, It Is Important To Diversify Investments Since We Cannot See The Future.

Calvin comments:

1) The taxi driver looked very different indeed. He was wearing expensive high quality specs, branded clothes with the appearance and demenour of a Corporate Top Boss. That’s why he stood out. Never in my imagination one Business mistake can wipe out one life’s work and savings! I hope he has recovered since 9 11.

2) This  nice young gentleman should have taken life easier. Venturing into the Unknown (for him that was Singapore) can be risky as things there are untested. Always invest in what you know for sure. He would not have lost his fortune if he has taken the time to work for experience first and understand the Singapore market first before commiting his monies. In any case I admire his integrity and hard work. I think by now he should have found success due to his diligence and fortitude.

 

3) This is the Most Important lesson of all. Mr. Liew from Tawau bought those Oil Palm lands for only Rm500 an acre in those days. In year 1993 he sold half his plantations and moved to KL & started a Used Car Company in Kajang called Helang Camar. The timing was impecabble as he was in the midst of the GoGo Years before the Asian Financial Crisis of 1997/8.

Times were great and he was doing a roaring business. Monies kept rolling in and piling up! He was so happy with the fast pace of money making in KL compared to the slow snail and dull business of tending oil palm plantations in Sabah.

He wanted to sell off the other half of his slow moving oil palm business in Tawau, Sabah and put all his capital into KL’s Car Business. This was in year 1996 – near the very peak of the Boom!

At this time Used Car Dealers would make multiple bookings for New Proton & Perodua Cars. Some booked 50 units & some booked in hundreds. Waiting list for cars stretched from 4 months for a Proton Wira to as long as One Year wait for a New Proton Perdana!

To get hold of a New Proton Perdana then you have to pay as much as  “Rm10,000” extra! to get one. Such was the extremely over heated market of the GoGo Years.

I was happy to have warned him not to do so as the future is unknown (Asian Financial Crisis arrived in 1997 just one short year away)

And when the Asian Financial Crisis Struck! All the 3 years of accumulate profits that Mr. Liew made were wiped out in just 3 short months! At that time a Proton Iswara 1.3 worth Rm33,000 before the crisis could crash 50% to only Rm16,500 (50% Value Wiped Off in just months)

So many gone bankrupt with the twin collapse of KLSE (Crash from a high of 1332 to its lowest at 262 points) & all assets (Houses, cars, businesses – everything fell like tent pins in unison.) There was no escape but facing total lost and imminent bankruptcies for all those who over leveraged.

It was during these dark and  bleak times that Oil Palms gave him solace. And to his surprice CPO prices shot up! And lifted him from his gloom and compensate his losses in his Used Car Business.

As the US has still not resolved its problems & the world still awashed in crude  oil it behoves us to go defensive & diversify our investments as future is still unknown.

I hope all i3 Fellow Forumers will be careful with your investments.

Always remember, Return OF capital is more important than return ON capital

 

This entry was posted in Johor House For Sale
Discussions
Be the first to like this. Showing 12 of 12 comments

kasinathan

After making bankrupt stock recommendations for himself and others, now he is talking about diversification?

Guess his financial condition must be in ICU.

You should be advocated asset diversification since the first day you venturing in the investment world, not for self comfort after being eaten alive in this bear cycle!

The only real stupid is the only indulging in own self cheating. Rubbish.

2020-03-18 06:01

Beary

Typical religion people this mother fcuker calvin.

Thick face thick skin.

Go fcuk your mother lah.

Seven early eight early see your disgusting face.

Real suieh.....

2020-03-18 08:21

enigmatic ¯\_(ツ)_/¯

Beary,
Don't pollute this forum with your filthy mouth.

2020-03-18 08:25

Beary

Yes you may say my mouth is filthy.

But at the very least I don't lie, cheat and scam like MFcalvin to earn a living.

2020-03-18 08:47

calvintaneng

Beary shall get covid 19 soon

2020-03-18 13:32

Shootup

U are too late.. after market crashing to nearly 1200 fr around 1600 a month ago then u start to warn now?

Actually many good sifu had warned before crashing n during the time considered still at the first stage crash

Anyhow, calvin kept asking ppl buy n buy, esp for netx, untill 2days ago his urge turned into softer n mild in pitch n tone, seemed he began hesitate, believe the market had turned into bear.

Unfortunate, time is money in investing, market had crashed badly, stock prices mostly halved esp for calvin‘s stocks

Netx, scomies, and other so called nfcp rally stocks plunge between 50-90%, not untill this calvin had been promoting buying into nfcp stocks like netx, also scomies, recently t7global, .... all wiped off by coronavirus in a month.

Calvin, it‘s too late, u are punched heavily by the bear, but pityful is ur newbie followers

2020-03-19 07:02

Shootup

I hope u did not loan money for ur stock portfolio, n lastly take it easy, dont stop ur breath

2020-03-19 07:07

Sslee

haha,
I thought Calvin already all in NETX

2020-03-19 08:58

calvintaneng

Calvin has 2 groups of investments

1. Real estate in landed houses

2. Nfcp shares like Netx Opcom Redtone binacom and Cmsb

3. Ogse laggard like T7 global with locked in subsea jobs for 5 years

Others

So while shares price crashed Calvin can still liquidate houses to buy shares with Nfcp booster

2020-03-19 20:56

enigmatic ¯\_(ツ)_/¯

Please don't liquidate your houses to buy NETX.
A house is a real thing.
NETX is just blind hope.

2020-03-19 23:59

Philip ( Write To Me If You Need Help)

Post removed.Why?

2020-03-25 16:54

calvintaneng

No delay as Telekom Tenders still coming out for March 2020

2020-03-25 16:57

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