Author Archives: Tyrone Solee

stock broker

Sell in May and Go Away: A Stock Trading Strategy

Thursday, 28 April 2016 | Written by
stock broker

stock brokerApril is about to end and the month of May is fast approaching. How are your stock investments doing so far?

While it’s hard to predict the markets, when it comes to the month of May, one thing is for certain: You probably heard someone say, at least once, “sell in May and go away.” The cliché, which suggests that smart investors should sell off their portfolios in May and only re-enter the market in the fall, has long been part of Wall Street culture, but where does it come from? And why it is called such?

Sell in May and go away is a well-known trading adage which warns investors to sell their stock holdings in May to avoid a seasonal decline in equity markets. The “sell in May and go away” strategy is that an investor who sells his or her stock holdings in May and gets back into the equity market in November – thereby avoiding the typically volatile May-October period – would be much better off than an investor who stays in equities throughout the year.

Also known as the Halloween indicator, this trading strategy assumes that the period from November to April has significantly stronger growth on average than the other months. In such strategies, stocks are sold at the start of May and the proceeds of it are held in cash only to reinvest again by November.

This saying dates back to old England, when the stock brokers would go on summer vacation in May and not return until September. The original saying was, “Sell in May and go away, do not return until St. Leger’s Day. The final horse race of the season happened on St. Leger’s Day and the old time stock brokers didn’t bother getting back to work until the racing season had ended. The market in those days was pretty flat over the summer months.

Historically, according to the Stock Trader’s Almanac, the Dow Jones Industrial Average in the US has had an average gain of 7.5% during the November through April period and a gain of only 0.3% over the May through October period, going back to 1950 and there is a good correlation between US and Philippine stocks.

Over the years, During the May to October period, a major non-recurring event occurs that creates market uncertainty. The events happen when large institutional investors and traders are on holidays and liquidity in equity markets is diminished. Hence, stock prices are low.

The Philippines will be having its Presidential Election on May 9. The Sell in May and Go Away strategy might not be relevant this year. Investors and businesses with interests in the Philippines are following this presidential race closely, as the Philippines remains one of the fastest growing Asian economies. Regardless of which candidate is elected, investors face uncertainty. There is no ironclad guarantee that candidates will follow through on their campaign promises, honor the government’s contracts, or continue President Aquino’s so far effective economic policies and anti-corruption measures.

According to a poll released by Bloomberg, Grace Poe and Mar Roxas were selected by analysts as the most credible candidates. However, depending on the winning President, it might have an effect on stock prices.

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Photos from Pixabay. Public domain.
checklist

Things you need to do before investing

Monday, 25 April 2016 | Written by
checklist

https://pixabay.com/en/write-plan-business-startup-593333/We all want to invest. We all want to grow and multiply our money. We want our money to work for us. However, investing always involve a risk and reward. Risk because you might lose the money you invested and reward because you can make your money work for you. So before you invest your money, here are the things that you need to do. Continue reading

spending

Bad Spending Habits of Most Filipinos Today

Sunday, 27 March 2016 | Written by
spending

https://pixabay.com/en/wallet-cash-credit-card-pocket-1013789/Most of us Filipinos just want to enjoy ourselves. We want to experience what life has to offer. We want to buy things that make us happy. We want to experience things that will satisfy our belongingness. Some say that you cannot bring your wealth to your grave when you died and that is why Y.O.L.O or You Only Live Once became one of the phrases common to us. Continue reading

game of money

The Game of Money (Part 2 of 2)

Sunday, 21 February 2016 | Written by
game of money

Part 1 here.

https://pixabay.com/en/euro-bill-currency-ball-about-447209/Much like in the game of basketball, Kiyosaki referred to after the second quarter as ‘half time’ because you are in the middle quarter of your life already before retirement much. This is sometimes called as “mid-life crisis”. It is now the time to examine yourself. You are not getting any younger anymore. Do you have enough savings to cover for your future? What did you accomplish in your life so far? What are your goals going forward? And what actions will you take to accomplish those goals? Continue reading

game of money

The Game of Money (Part 1 of 2)

Saturday, 20 February 2016 | Written by
game of money

https://pixabay.com/en/euro-bill-currency-ball-about-447209/Life is like a game of chances. In some days, you win. In some days, you lose. Every day, we are faced with challenges, which can either lead us to become a winner or a loser. Learning financial literacy is essential to increase your chances of winning the game of money and in essence, the game of life. Continue reading

valentines

How to Save Money on Valentine’s Gifts

Friday, 12 February 2016 | Written by
valentines

https://pixabay.com/en/piano-rose-red-flower-love-571968/In a couple of days, it will be Valentine’s Day once again. It’s probably the most exciting day for dates most especially for lovers. As such, as early as now, a lot of us are looking for potential Valentine gifts that we could give to our special someone. Continue reading

investment

Battle of the Managed Funds: UITFs vs. Mutual Funds

Wednesday, 21 October 2015 | Written by
investment

https://pixabay.com/en/shopping-cart-basket-604007/Nowadays, more and more people are becoming financially literate. With a lot of financial literacy advocates reaching more and more Filipinos around the world, more and more investments are pouring in to stocks,  bonds, money markets, mutual funds and unit investment trust funds or UITFs. Continue reading

wallet lock

Frugal Tips in the Office

Tuesday, 25 August 2015 | Written by
wallet lock

wallet lockOur office is home for many of us, or at the very least, our home away from home. As most of us are employees, we spend a significant apportion of our time daily in the office to work in a corporate set up.

Being frugal in the office is quite hard. You’ve been so disciplined all week with your spending, you’ve kept to your budget and you’ve even resisted buying that new thing you wanted to try. You are actually on target to meet your savings goals for this month, and then suddenly your colleagues at work invited you to the steakhouse around the corner for a tasty meal and maybe even have a drink after office.

We all have our reasons for being frugal, but one thing is often true: no one wants to be known in the office as the office cheapskate. The one who rarely spends money eating out but is always the first one in line for free food? The guy who conveniently forgets his wallet for the third time when it is his turn to buy coffee for the team?

Here are some of the tips on how to be frugal at work:

Pay yourself first. Most of the employees have a mentality of spending first before they save. That is every time they get their salaries, they spend first before they save what is left. What is worst is they spend like there is no tomorrow by buying gadgets, dining out in expensive restaurants, engage in clothing shopping spree, etc.

If you want to truly budget your money, instead of using the equation ‘income less expenses equals savings’ which most of us implement, use the equation INCOME less SAVINGS equals EXPENSES. That is, every time you receive your salary, pay yourself first by setting aside at least 20% of it to your savings before spending.

Take public transportation. Going to work is one of the daily routines of an office worker. Do some research to find out the cheapest route you can take going to the office. You may need to get up early so you can plan your day ahead and fall in line to a public transportation just to get a ride and not be late in the office. Alternatively, ask your officemates or search online for carpool services.
Share costs with a roommate.  If you are renting your place, consider getting a roommate. This will cut down on your rental costs dramatically. For the most benefit, ask your roommate to split all bills with you, including electricity and water. In this way, they will also be respectful about their usage.

Cook more meals at home. Eating out is definitely a drain on your budget. Instead, cook more at home and bring packed lunch to eat in the office. Aside from the guaranteed freshness of your food, it will also save you a lot of money.

Look for bargains. If you work in a business-casual or business dress setting, there may be expectations about how you look that will require you to invest some amount of money in your wardrobe. Search for sale at your major retailers in the malls or visit your nearby thrift stores to get savings when buying clothes. It does not have to be the expensive brands as long as it fits you well.

Go for water. Occasionally, you may need to give in to your office colleagues’ invitation to dine in at restaurants. Instead of ordering soda, juice, iced tea or any beverage, consider getting service water for the drinks. Flavored beverages are mostly full of sugars that may just add unhealthy fat to your body. Also you just excrete these beverages through your urine shortly after a few hours of dining.

Give up on expensive coffee habits. Do you frequently buy at expensive coffee shops such as Starbucks every now and then? Consider cutting this habit. Buy coffee sachets instead at your favorite grocery stores. With the cost of Starbucks coffee equivalent to a full meal already, you are better off buying a full meal than spending your money on a single cup of coffee.

Frugality in the office is really a must. After all, we know how hard we should work in order to earn that money from our salaries.

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Photo c/o Pixabay. Public domain.

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