but I was watching this news for for like two days fascinated by by the event it's like all the stars are align for the the bull market to continue yeah if you love something let it go if it's yours it will come back to you appes in relationships and in the stock market so in fact I told my daughters for two of you don't diversify 22% analyze for five years triple Q also has this kind of returns why not just buy some simple ETF and be done with it welcome back to another episode of the back holder part and in to this's special episode we have Adam cool back on again so I think the previous round that we had Adam on was around one and a half years ago was near the end of 2022 and back then we still remembered that we were talking about the bare market and then um Adam was telling us how you should reframe your perspective and true enough I think after the one and a half years we are in one of the most incredible runs again from this whole AI semiconductor let rally so I think just to Kickstart the entire discussion um I think Buy has evident from his his Zoom background I buy has a few questions for Adam so maybe I'll get buti to get the ball rolling yeah thanks a lot so I have a chance to ask Adam questions must ask the good one right so the first question right will Market go up second half of this year the reason I asked that is because uh people are asking me say oh you see there's all these elections uh upcoming so election usually is good for the stock market right now I'm passing this questions to you as since you are the guru here okay so I always start off by saying no one can predict the short-term direction of the market with absolute certainty because there are too many moving parts right uh however of course we can always say what's the probability is it higher probability to go up or or to go down uh so of course the probability is that the market will uh gain in the second half for a few reasons okay so number one is the technical probability which is look at the charts so the charts are clearly on an uptrend right so higher high higher lows when a price on an uptrend the probability is that prices tend to move higher so that's that's the first thing then number two if you look at again historical uh patterns election years are bullish generally election years are very bullish regardless of who wins yeah and normally in the election year what happens is second half of July there should be a dip yeah August a rally then September October a bigger dip of Correction so maybe it could be five or 10% down in September October and then November to December Hallelujah uh and the first half of the year we were up more than 10% which is which is quite rare if you go back to 1950 to now I think they have been about if I'm not wrong 12 or 14 years where the first half was very bullish and in 83% of the time uh the second half was bullish as well with an average gain for the whole year of about 20 plus per. So based on probability we should end the year up over 20% again that's probability we know that anything can happen if suddenly the aliens land on Earth and you know uh assassinate someone uh head of state or Russia launches a nuclear weapon then of course everything is off the table right but based on probability that's it then of course we have got the macro part where the US economy is like again in a goldilock scenario where it's uh still growing economy is still growing jobs are growing but not overheating and we've got inflation coming down we've got the FED already hinting very strongly they will cut in September so everything it's like all the stars are aligned for the the bull market to continue yeah actually ad I think the one common questions that we kind of get right is that some people look at this whole Rally from the Spy which is the S&P and then they say that it's up like 16 17 18% in the first six seven months of this year and a lot of people are kind of putting away their money they they're putting off investing because they think that they might be the sucker that buys at alltime high and then they have missed this entire rally for the whole of 2024 because they are always waiting for the correction so I just wanted to know if let's say you are put in that specific position as well how how would you not necessarily advis but what would you do if you have so if I'm someone who has not bought anything yet yeah since 20 let's say late 2023 or the start of 2024 I didn't buy anything okay so the first thing I'll do is I'll ask my wife to give me one tight slap on the face that's the first thing I'll do okay then what will I do okay so again you have a choice you either buy the ETF or you buy individual stocks so although like I said I'm bullish for the rest of the year but will I buy the S&P ETF now no because as you know my investment and trading decisions have nothing to do with where I think the market is going to go so whether I think the market is going to go up or go down the next six months or one year does it influence my investing or trading decisions that's what I always tell my students the investing and trading decisions are based on my rules all right and one of my rules is always buy after a wave down after a retracement to a a level of support and I always identify at least four support levels to slowly average in my position so right now if I want to buy the S&P ETF it's at all-time high would I buy of course I won't buy right I will wait for a retracement to one of the support levels I think in my last YouTube video I did identify those four levels uh based on the historical moving averages uh and then I wait for it to retrace so again you could retrace in Late July in in September in October then I would uh Buy in but as always you never want to who all in one time right you want to average in so out of $100 I put in 20 five bucks first you know and then if the retracement gets deeper then then I slowly build a position actually what was the intention of like waiting for this like down uh then only to enter is it really purely uh from psychology point of view or is it really like you know that this kind of approach will really make the result better because sometimes after retrace your buy already is still come down so what what should we do right yeah then then you average down again so I mean there are many styles right so one style is you don't care about the charts you don't care what the market is you just buy then another second sty is dollar cost averaging which means you just put in the same amount every month or every three months or every six months right then the third style is you use some technical analysis where you attempt to because we know prices move in wave pattern right you know after wave up you got wave down wave up wave down this pattern always repeats because of emotions okay so since after a wave up there's a wave down and there's another wave up again makes sense to buy after the the wave down but you never know how deep the wave down will be right sometimes it can be a 5% wave down 8% you know you never know how deep so that's why you you buy in trenches right so once you get the first 5% you buy a bit another 10% you buy a bit and then you get a next wave up now in the long run 20 years from now does it really matter which method we use no whether you all in now or you dollar cost average or you try to use Tech te because in the long run there's not much difference there's really not much difference okay but in the shorter term uh there could be a bit of difference uh in the next one two three years if you had bought at slightly lower price uh then of course you're going to have slightly better games okay so I haven't finished the the answering the whole question right so that is if you buy the SNP ETF now if you're looking at individual stocks are there things you can buy right now yes because remember that although the S&P is are alltime high not all the stocks are alltime high some stocks are alltime low so there are those stocks you could buy but of course buy the high quality ones there are stocks that are down because of fundamental problems their earnings drop and all those now those I would avoid okay but I'll buy those where there's nothing wrong with the earnings earnings are growing company's doing well but the price drop for some stupid reason uh that is more sentimental base okay so I'll give you an example right good example would be the healthcare stocks uh United Health and El Health I've been adding uh I added I think about two three weeks ago I my students have all been buying as well why why why did United Health drop uh a few weeks ago nothing wrong with the company company earnings are very good because they got hit by Cyber attack right and the stock Dro uh 10 15% so those are great opportunities because those are short-term issues that will be resolved it's not a permanent problem that they facing and even within the Magnificent 7 meta uh yesterday if I'm not wrong it retraced to a support so like mattera one could add yesterday for mattera right because mattera is undervalue it retraced to the first support level could matter all right Amazon uh is also undervalued and Amazon has been retracing although not yet to a strong support it's just above the support uh so yeah you wait a while if Amazon comes down a bit more then that could be a buy as well so Adam you it seems like you keep track of all your Holdings like every day right like for me I just open up the app say oh it's green is R that's it but for you you know how much percentage how it has gone up gone down how much time you allocate to monitoring your positions every there I would say okay if I if you don't count my options trading right purely if it's investing 10 minutes and the most I give you 15 minutes okay and I guess one of the reasons why I have the discipline to do is because I have to do it because I've got so many subscribers who are watching me you know now we have got thousands of people who subscribe to my uip where they get my live buy and sell notifications so because of that I'm forced to watch it very carefully uh and be accountable to all these people so in a way it's good right so the first thing I do is when the The Market opens now when I look at a market really depends on when I'm free like right now I'm in a process of moving house so for example two days ago I was so busy moving things with my wife that I could only look at a market at 2 a.m. then I could look at the market all right but on certain days if I've got not moving my my house that day then when the Market opens then maybe 9:30 10:00 I look at it so the timing depends on when I'm free and once I look at the market I'll spend like I said 10 15 minutes and the first thing I do is I look at my portfolio stocks the stocks my portfolio I go through them I've got about 46 right now 46 stocks in my portfolio so I go through them and I'm going through all their charts one by one uh five minutes very fast right and what I'm looking for is where are they right now have they retraced to a support level uh if it has um and I don't have a full position then I'll add more shares that day all right or I will sell put options on it which is what I do almost every day I'll s put options on those stocks to earn some premium right then I'll look at my watch list then the watch list are the stocks that I have not bought yet but they have passed my criteria of a good business they look at a watch list right and that takes me another 5 seven minutes yeah so same thing if the watch list stocks is at um under under valued is at a good position then I'll buy okay or I may sell a put yeah and then the third thing I do maybe another five minutes okay is then I will run through some stocks that come out my scanner so these stocks that come out my scanner may not be very good companies but they happen to have high volatility then those stocks I would just do short-term trading not investing but short-term trading I call it my one night stand list yeah so all in all uh yeah 15 minutes hey ad you talk about buying during dips and pullback right because I watch a lot of your videos you you love to say like the stock will always brief in briefe out but recently I've been watching the Nvidia rise right then uh my wife sort of got interested they say hey this one can buy not then I say uh wait for you to pull back and and then it just keep going up uh I think there was one time it went down like 6 7% Max and then the next day the market just R back and then it just keep going higher and higher yeah so if let's say uh we are unable to catch it we don't stay up until 2 am we're not the sort would you recommend that uh we just get in like maybe 20% of how much we want to get in just get our foot in first uh I don't know I think someone actually ens spoused this is say that hey buy a little bit in first then if it comes down more to the support then you Lo in more do you think that that is a good approach to do I think the first question is if it's an investment is it undervalue that's the question you got to ask yeah you know if it's undervalued yeah but if it's not undervalue is way overvalued then why do you want to buy you know so a lot of people always get fixated oh I must buy Nvidia now because it's so hot or a few years ago I must buy Apple now it's so hot right hey there are 6,000 stocks or 7,000 St why must you fix it on that one why you know you you don't have to right I remember years ago I read about you know one of Warren Buffett's greatest uh advantages is not his intelligence although he is intelligent but there are many people who are just as smart as him but his one of his advantages is his patience and the discipline right and one of the stories that fascinated me was that for many many years he wanted to buy American Express he said I love the company I use the product every day but it so so expensive and he kept watching it he watch it watch it watch it until one day when the stock got into trouble he was sued by someone I can't remember right and the stock uh dropped something like about 40 50% and then he started buying and then eventually he made billions on American Express until today he's still holding the stock that the question is how long do you know he waited how long did he wait and watch that St every day before he bought it seven years that's his patience imagine watching a stock every day for seven years just waiting waiting for the day you get a price so that's what Buffett calls like your a baseball player waiting for that Perfect Pitch you don't just swing every day at every ball that comes your way that is the patience the man has but there will be a situation where you just wait for like six months and the stocks just like X already he wait seven years yeah no that's fine let it be you because there'll be other stuff you can buy that's why all these are emotions that oh you know if I bought it if I if I bought it I would have Trex and you cannot think that way if it's yours it's yours it's not yours it's not yours if you love something let it go if it's yours it will come back to you appes in relationships and in the stock market yeah because it's a bit harder because uh every day I see the Nvidia going up and then my wife say how come you never buy a but how come buti has a watch Adam's video that's so it's all these emotions right the fomo and and that messes us up yeah so I mean that's why Warren Buffett doesn't live in New York right he lives in Omaha with all the sheep and he doesn't get affected by all these things look at all the the greatest investors uh many of them didn't buy Nvidia and they still doing very well right yeah yeah so why must you buy Nvidia because buti has it Adam also has it right hey Adam I just have a question sorry because this now you talk about met right yeah you remember the recent episode where they had a very bad quarter and then uh Zach was saying that they'll spend billions and billions like 100 billion or something like that then the investors were all freaked out then there was a lot of uh meta investor that actually kind of panick so because they see as a structural structural thing they are going to keep burning money and I remember even the oin podcast they were talking about it they say that hey this doesn't seem to be book very well because they are spending a lot of their cash flow so I think that is when a lot of uh even fundamental investors they build out the stock so my question is if you are a longterm investor right let's say investing since like the very early days yeah then you saw that their focus is so much on this metaverse which is not taking off and is burning a hole in their pocket yeah very big hole would you actually consider selling it even if it was like a long-term investment and on what criteria would you see before you were uh demit suitable to buy back in okay so I was holding mattera all the way uh I've been holding met for many many years and I held it all the way through the 70% drop wow and I bought more yeah so okay so to answer your question now to me I was not concerned at all okay uh because when I was doing the discounted free casual valuation when I did my intrinsic value calculation I assigned zero value to the metaverse I assumed that it will not work really and even when I assumed that it was zero and I and I put in all the cost involved my intrinsic value was still I can't remember the exact number but it was still way above the current share price so that means the market how do I say it already priced in all the bad news and the market uh assumed the worst already yeah so so my assumption was even if the metaverse didn't work out even if it went to zero the shares were worth a lot more than what I could buy for it two see to me I asked myself this question okay the only time I'll sell a stock is if I feel that the business they their economic mode their competitive Advantage has been lost or is deteriorating then I'll I'll get out okay so there are two reasons why I was confident in meta the first reason is because I myself I'm a customer of meta you know as you know P profits we spend Millions a year advertising on Faceook Facebook on Google and all that okay so I asked myself a very simple question I asked my marketing team a question are we still going to advertise on matter next year yes are we going to advertise more yes right and is there any alternative that I could invest uh sorry yeah I could advertise besides matter no right so that gave me confidence because I realized that if I a customer will continue to advertise on matter more and more in the next 5 10 years the is still there because there's no alternative to matter who's the alternative Tik Tok maybe but like my uh target audience they don't really watch Tik Tok so I have to advertise on on Facebook so that's the first thing that gave me confidence right the second thing was was was the problem something that Zak could change if he wanted to that means if Zach wanted to could he say okay fine let's stop spending on maners let's uh just focus on a C Business could he have done it yes that mean it's within his control so as long as the the the the the thing to be fixed is within the control of the CEO he could change he has about to change it and the mo uh the customers are still spending what's the problem he made the own problem yeah he he he he right he he did himself so he anytime he could stop and which he did in fact right so the moment he cut his capex on the manav and stop went up right the biggest problem is our own paper hand so I I paper handed during that period and she get so smart get in that's why that's why right it is very important that you know the the big positions you have should be on stocks where you are the customer yourself because if you are the customer yourself then you really understand the business and the good thing about uh myself and uh the fact that we spend on on on ads on Facebook and and all that right is we get invited down to Facebook uh uh HQ in Singapore so we know the people working in in Facebook and we talk to them every day and we like Hey Brother how's the sales so they like s very good right and we can see for sales that their business still doing very well for this you mention about this um everyday look at the stock market for 15 minutes right so I just not to calculate it's about seven hours each month um so let's say if I am not I obviously I'm not I'm not Adam Co I have nowhere near his level of expertise right so why not just buy something like triple Q or scg and get the same returns for way less effort because that uh can show us your popular returns is I think it's about like 22% analy for five years triple Q also has this kind of returns so like why not just buy some simple ETF and be done with it can no prank yeah no but yeah true if you look at the last five years because what was driving the market the last five years was Tech all right so obviously you buy Triple Q then you'll get the same or even better you know but if you go back many many years before that it's not always Tech that leads it's not always Tech that leads right so uh like for example 2022 2022 it was a tech that had the biggest draw down and if if you were all in on te then you would have a a very big draw down by 2022 what did well it was the nonth right energy did well you had Consumer Staples that did well McDonald's yum brands all those did very well in 2022 okay so I keep telling my students and my subscribers that my objective is not profit maximization it is not it is capital preservation it's Capital preservation so if if my goal was profit maximization then I wouldn't be so Diversified you know I would like oh all in onto uh Nvidia or all in onto Bitcoin or all in to um the tech stocks but I'm not right my portfolio has got you know Pepsi I've got uh United he I'm Diversified so that I know that uh my portfolio will continue to do well under all kind of economic situations where whether High interest rate low interest rate economic growth or or recession my my my portfolio will do well right so again it depends now for my two daughters where I'm me mentoring them with their portfolio uh their portfolio is very different from my portfolio so in fact I told my daughters for two of you don't diversify don't diversify because my two daughters are only 18 20 years old their Runway is longer than mine their Runway will be I don't know 40 years right so I told them to my 2000 just go Tech just go all in Tech and because the account is relatively small it's not in the millions it's it's small so if those big draw down come they are it doesn't really matter that much actually if I can chime in here uh so when Kelvin was talking about that because they were asking right and then I think it's also part of the be the market event so the title of beat the market so they wanted to know Adam's performance and then I pulled out the record of the last five five years plus it was roughly around 180 plus per. so I I think when Kelvin asked me that question my first response was that true I think it's true that a lot of people just gotten to know about the QQQ over the last two years maybe in 2019 if you bought the triple Q yeah you also did that 180% in five years but the truth of the matter is not a lot of people knew too much about the triple qu back then and if we pull like we took a hindsight buyers thing when we look at 2019 19 and then I went to look back in time on when the que triple Q did 180% they took roughly since 2011 or 2012 so that took around eight years for them to do 180% and then the last five years they did another 180 so a lot of these are quite hindsight buyers and saying that oh you could have just bought the triple kill and then who knows maybe the S&P will outbeat the kill again in the next five years or so so that's why that was my my thought process back then and if you did buy the triple kill then congrats to you um especially during the draw down of 2022 hope that you didn't payer hands to and try to time for a better correction as well so there were a lot more Nuance in the discussion there so yeah that's just my my my perspective so I think we we had the honor of getting Adam on just a quick shout out so for those of you who haven't been following So Adam has been oping the S SMP for uh the last five years I think he beat them by around 1.5 to 1.8x and we are going to have a midye event upcoming on the 27th of July so if you guys are interested um the link to the event itself is below you will hear more from Adam I think he will talk a lot more about his current positions um how he look at the market how he's intending to play this entire AI with Etc yes beat the market 2024 I mean it's it's the same thing as people asking me Adam why you want to waste time just buy Bitcoin if you bought Bitcoin 5 10 years ago you would have gotten more returns than you doing all your work right but again there hindsight bias right but where how do you know where Bitcoin will be in in in 5 10 15 20 years I don't know I I don't have a clue only Kathy Wood knows you know only Tomley knows I don't know because I don't have to Value it but I know where Microsoft will be I know where Amazon will be because people will keep buying on Amazon people keep using Microsoft you know that I know you know actually on this topic of returns right I think you also did share in a lot of your YouTube videos talking about um supercharging your returns with options trading right and you do a lot of options trading yourself and personally because I got to know you better you basically guys the the the I guess the pet phrase that you have is always just sell put listen if it's a good company just sell put lights in fact so I cheing right when I was renovating my house I was thinking in terms of puts so my wife say oh Adam we have to buy this lift is 100,000 I think oh okay I have to sell 100 uh 100,000 wor of put okay uh Adam we going to you know buy this skurt is going to cost 40,000 I think so many contra so I thinking how many put options I'm a sell to pay for my house yeah so so on that note is is CSP or in in this case the selling puts really just like in a way free money or to me the way I do it is is really free money to me okay I wouldn't dare to say to anyone else to me because I know what I'm doing I know what I'm doing I've been doing it for so many years and I I did it during the 2020 bare market crash I did it during 2022 bare market crash and even during those two bare markets at the end of the year I still made over a quarter million I think more than quarter million yeah uh during the bare markets on on selling puts but then here's the thing about selling puts right so there's the aspiration date what if the stock touches your strike then bounces back when you like Miss the buying opportunity okay so for those of you who don't know uh put option the way to think of it is when you sell a put option you're selling Insurance you know every year you have you buy you you pay a lot for your car insurance for your house fire insurance for your medical insurance right and who collects all your insurance premiums the insurance company so wouldn't you love to be the insurance company collecting premiums for from so many people now once once in a while there'll be a car accident you have to pay out the claim once in a while someone go to the hospital you pay out a claim right but at the end of the day the premiums you collect are more than enough to cover the claims plus you make a profit correct so that's the insurance company business and today I see myself as the insurance company in the stock market so every day literally almost every day in the stock market I'm selling Insurance on stocks okay so that's selling put options so first of all I have to know what's the intrinsic value okay so my intrinsic value of el health is about $600 okay and now it's at 550 okay so it's undervalued now about a week ago it dropped to about 530 now when it dropped at 5:30 could I buy the stock yeah I could right but since I already have quite a bit of shares I thought I play hard to get so I sell a put I sold a put option at $510 so what does that mean when I sell a put option I'm selling insurance and I collect a premium so when I collect a premium I'm now obligated to buy El Health at 510 all right if the price stays below 510 by the expiration date okay so if elan's Health by the expiration date stays above 510 the the insurance I sold expires and I just collect the free money I get free money right but by the expiration date if it stays below uh 510 then I'm obligated to buy the shares which I don't mind because it's a very good company it's undervalued so to me it's a win-win situation I I can't lose okay now if at the last minute I choose not to buy the shares at the last minute I say I don't want the baby I don't want the baby okay still can uh go for abortion okay right uh so what I do is I buy the put back and then I sell another put we call that rolling down the put okay so in a nutshell that that's what I do if I really want to buy the shares I'll just buy it I'll buy it directly but if I'm playing hard to get it's like I am M I am M if I'm playing hard to get that means I already have the shares but I don't mind having more but if I don't have it is okay then I'll sell the put do you need a lot of cash at the sideline just to make yourself not become emotional because sometimes like I mean for for us maybe especially those who have smaller portfolio sometimes it's like you sell one put is already there's a stake there right so it drop you drop let say 10% it's already in the money and then we say we don't mind buy it but it's actually much bigger proportion as compared to our portfolio then we become emotional because of that down the road we might change the strategy because it's that oh it's too much for my portfolio if I want to cut loss also difficult so so do you like have students encountered this kind of problem and and how do you guide them through through all this so I so the rule I always tell people is that you should only sell a put if you really have the money to own all the shares if you don't have the money to own the shares don't sell the put because if you do that you will get again em emotionally affect affected all right and and for people of a small account they should not sell a put by itself we call it sell naked right they should sell the put and buy another put below that first put so we call that a boo put spread or a credit spread if you sell cash secure puts to me it is to me it's like almost 100% sure make money because I follow certain rules number one I only do it on very very very very safe company okay so I wouldn't dare to sell a put on Tesla or PayPal you know or even now uh although I do own a small stti in estate order I wouldn't dare to sell you on estate order because they're having some operational issues right now okay so I will only there to sell it on very safe companies that you know the earnings are growing the very strong balance sheets so your meta your Microsoft your United Health those things so I'm very selective on which stocks to sell puts on that's number one number two I only sell the put if the price is really quite undervalued is that means it's quite undervalued really and when I sell the put at a strike price it's even more undervalued so in the event that I have to buy the shares in my mind I I must feel that it is very safe read because it's a very good company is really very cheap one thing that kills people is greed okay like if you see here I I sell options okay I'm only using roughly about 5% of my portfolio to sell options only 5% I can actually go a lot higher but because I'm very conservative I just only use 5% of my portfolio to to sell options and to me the premium I collect uh of course I could get a lot more but to me it's enough I'm I'm happy with it right so I know that in the worst case scenario if we go through another financial crisis we go through another Doom crash where the whole Market dropped 50 70% I know I'm still okay because I keep my positions relatively small to my portfolio when people sell puts why they get into trouble are three reasons which is I mentioned they do the oppos number one they sell puts on risky companies number two they sell put when the price is overpriced on number three they oversell and and if the market suddenly has a 30 40 50% drop they can't hold the share they can't hold the put they get Margin Call they get wipe out I I was watching your video then you mentioned that um this 2024 is a good year okay because it's a election and it's a second year of the boo market and so on right but if we assume that this whole Trump thing he got elected um historically like 2018 was a good during his presidency was a good period because like he did all those those stuff right but he also introduced um those China tariffs then it was like 10 to 15% China tariff and back then the inflation was low but going forward when inflation is high and Trump is planning to introduce this 60% China tariff so do you think that like 2025 onwards would be a bad year bad period for the stock market okay generally the first year of a president's term which is 2025 tends to be more bearish it tends to be more bearish whoever gets elected yeah whoever gets elected but if you ask me between Biden and Trump they both have their own problems for example Biden's problem is he wants to raise the corporate tax rate quite significantly to I think over 30 or 35% so that is going to be not very good for a lot of the companies that we own because mention the tax rate go up so much their profits drop a lot that will affect the intrinsic value a lot and Biden also likes China tariffs it's not that he doesn't like he also in fact whatever tariffs Trump imposed he continue with those tariffs all right on the other hand Trump will continue with the corporate tax cuts and may even try to reduce it further so that would be very bullish for for the companies but on the other hand uh he may impose even more ter on China okay so I think at the end of the day every president they'll be Pro and conss and good and bad and net net is impossible to know what's going to happen but if you look back at history um whoever is in power at the end of the day it doesn't really make a difference if you look at how the stock market performs under Republicans and Democrats that's it's actually not that different so it's not something that I really worry about or think about any more questions for the US market if not we'll move on to the Indian market okay no don't ask me about that I only eat as okay move on okay maybe maybe not a bit too far from home right then maybe let's go back down to the Singapore Market I think in Singapore specifically a lot of people love dividend investing they like reads they like the banks and actually on our podcast we have made a three-part Series where we basically um expose the the pros and cons on both sides about um specifically reinvesting and I just wanted to get your thoughts because I do know that you'll have quite a sizable re and bang exposure in the Singapore Market as as well because a lot of people are saying that the low rates of the last two decades are kind of a thing of the past and maybe moving forward the new so-called New Normal might be two three% and and we might know that actually a high rate environment might not be very ideal for for rate specifically and a lot of people actually do swear by this idea of dividend investing and they say that without dividends I cannot buy the stock so I just wanted to know from your perspective do you think the heydays are over and do you think is there is there a problem with with this asset class moving forward okay first of all let's talk about Banks okay so I'm a very big fan of the three singal Banks very very big fan in fact the three Singapore Banks make up almost half of my dividend portfolio almost half uh and it provides me a very good uh passive income for a few reasons number one the the Singapore banks have relatively attractive dividend yield uh now it's come down a bit because the the bank price have gone up quite a bit but even then it's still above 5 5% if you look at the dividend growth rate like DBS they are 10e div dividend growth rate is over 12% that's very very attractive uh with a yield of now 5% for yeld 5.5% right and if you look back at history even during the financial crisis even during the Doom crash they they kept paying dividends and their dividends only drop uh marginally the only time they cut their dividends significantly was 2020 and it was not because they couldn't pay dividends it's because Mas stopped them from paying dividends but later after covid they made up for it by paying back the shareholders so if you look back history their dividend uh payout is very consistent and very predictable so I'm a big big fan of the banks right number one number two let's talk about REITs right so RS really got whack uh in the last two years now it is not because of the high interest rates that wack the uh that wack the REITs so much as the rapid rise of the interest rates so if you look back at the last 20 30 30 years history there were actually certain periods of time that when the fat raise rates and the 10year treasury U went up REITs also did very well they were many times like that so it's not the high interest rates that's best for re it's the fact that interest rates went up too fast which was in 2022 because of the super high inflation so you see as a read right when rates go up how are they affected they have to pay more interest on their debt right but if the RS own good quality property they can raise their rents to offset the higher interest cost which is what happens during past rate height cycle so in past rate height Cycles the fat raise rates their interest cost increase but they raise rents no problem they continue to do well okay but in 2022 what happened was the the the rates went up too fast that they couldn't raise rents fast enough to offset so that is what affected them okay then the second thing is of course when rates go up too fast the cap rate of the property goes up and that reduces the valuation of the rate but again that's temporary because once the Rate rates come down cap rates go down they Val a should revalue up a good example is Cromwell re which owns a lot of the European property so Cromwell re their are portfolio valuation dropped in the last two years because cap rates went up but the last quarter their portfolio valuation started going up already right so to me that's a temporary issue one of the things that I really learned from the last two years uh was you should only stick to the high quality rats so like for example in Singapore there are 40 two reads I would say only 10 or less are high quality okay and of course there are many metrics we look at one of the most important metrics is the is the gearing ratio so ideally you want the gearing ratio to be 40% or less if the portfolio value drops too much and the gearing ratio goes above 45 48% uh then the banks could recall the loans from the re and they get they could really get into big trouble yeah so stick to reads that have got low gearing ratios that have got consistently increasing dividends per share uh consistently increasing net asset value per share they've got a history of doing heel acreative Acquisitions and N active Acquisitions you should do very very well so you are saying four of us that didn't Focus too much on dividend and we still come up with videos that div dividend investing is stupid we are the one that's stupid you say stupid really we put it in the thumbnail not not really in the content in content we we make up we put put on the uh pro and con so it really depends on um where are you at your stage of life right so of of course like my for for my two daughters am I going to Mentor them to do Dividend investing at this time of course not right because you know at their age they should just focus on growing the portfolio but only when they reach their 40s their 50s their 60s then they start to shift into uh dividend type of investing reads Banks and recently I've been buying uh private credit uh assets as well private debt sorry private debt assets Adam so for your daughters right like when do you get them started in their financial Ed was it like when they were just like three years old you just like hey probably when they were in primary school when they were uh 10 11 12 I I started to in them so whenever we went out for example went to McDonald's I would say how much do we spend on our meal we spent about $15 an our meal and I asked them to count the number of people in McDonald's I say multiply that how much did McDonald's earn in Revenue within the the the the hour we are here and I asked them to roughly estimate how much you think McDonald's makes in Revenue in a week in a month in a year all right and I get them excited about that and then I tell them okay but you know they have to pay the staff salary they have to pay the rent they have to pay the cost of the burger what do you think is their net profit right so from from primary school I started getting them to think that every time they walk into a shop whether is it a boutique or a restaurant that business is making money I get them to think that way from very very young right and then I I I said to I said do you know that you can own McDonald's right when they walked into Starbucks when they were younger I said you know you could own startups how then I showed them the phone see you can buy the store then you own you're one of the owners of this business business so I started to to influence them since uh they were in primary school and then the moment they turned 18 which was the legal age to open the brokerage account straight away I I I taught them to open the account yeah and I was very proud of them because I started with 5,000 I give them each 5,000 I said that's it that's your seat money the rest you put in yourself and during all the school holidays they will go and find their own uh parttime job I I did push them to do it they did it themselves and I was very proud when you know they they my first my elder daughter came up to me and she says oh I just got my salary I want to put it into interactive brokers wow okay I didn't tell her to do that and then from there I said okay I match you one for one every $1 you put I put in $1 then I realized it was a bad idea because uh three weeks ago she put three million now my elder daughter said I'm putting 8,000 in this month and my second daughter I also want to pay ,000 I was like oh [ __ ] so then now I put a cap I say maximum 1,000 a month top up as my my maximum match is 1,000 anything I don't mat if I'm going to go I'm going to go later she says she found the even the better business idea which is borrow money from the friend and get 100% from there oh yeah yeah yeah your the last video right when you came on right we we actually also asked you about when you were younger and all that right then you were you were saying that that um your father he he was like quite stingy with you like he doesn't actually give you a lot of money even though you guys were quite okay well to do is that like uh also been passed down from you to your daughters like as in you you don't want to give them too much you say I give you a little bit uh the rest you have to get it yourself so that is more or less more or less uh more or less um of course my my wife SPS them a bit more uh but more or less yeah more or less yeah so and the great thing is that they don't they don't ask for a lot of things like during their birthday I asked my Elder what you want for your birthday she said I don't need anything I'm pretty happy right so they're not greedy that that's a good thing in fact the first time she she got her first salary during the part-time job and I brought her out for for lunch you know as a father you always pay right but then she oh that let me pay now so are pretty proud of that wow yeah I think they've got a good value I think they've got the right values how do you manage to train them up that way like because obviously you are a bit more well to do right then when you see people who are more well to do they their kids are a bit there's a certain kind of attitude to them but so how do you avoid well I think the the kids learn more from what they see than from what you say so they can see that I'm relatively Frugal like up to now I still haven't bought myself a car I take grab around they can see that so they won't ask me for a car because that takes the grab when you going to take the grab yourself right but they take the bus most of the time right uh same thing we don't we we don't really eat inest at fancy restaurants that often of course once in a while we do but fancy is also like Tim hoan that's fancy to us us we don't go to those like mellin star kind of place but more often than not we at Hawker centers we at coffee shops so they watch how me and my wife we live a a relatively uh simple lifestyle and uh yeah so I guess yeah they learn from what they see in you right but just like two portfolios that you show publicly also people can see that it's like you know High seven digit or eight digits come Worth right yeah how how how to tell them that actually you don't have to spend so much money it's easier let's say for the average family because you just say that oh the family income isn't is such and such so we should live a moderate lifestyle but for you you you you can afford it right how do you convince them that actually don't need don't need to convince them because I think from Young they have learned that uh we are very happy and the happiness doesn't doesn't come from a branded bag or the happiness doesn't come from uh melin Star right the happiness comes from uh the family time we spend together I think that's one of the things that theyve learned that you know buying things does not make you more happy what makes you more happy is is the the time you spend with your family and your friends the the relationships that you have and that's free last question so what's the like best financial advice you have give your daughters the best financial advice I don't think it's one I think it's a lot along the way uh and it's the it's the Timeless advice that we have learned ourselves uh from books at a time like um you know make sure that you spend less than you earn you know the same thing right spend less than you earn and then always have savings to put into the market and to only buy high quality companies okay I think I think with that that's quite a extended discussion with Adam and of course for those of you who want hit back on we need to get bigger guys so youall need to help subscribe and help spend the like button as well then maybe you can get Adam on again maybe check in in 2026 with that I think we'll see you guys in the next video goodbye