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Ferri successively held the following investment targets: US stocks, international stocks, fixed income, real estate, and alternative targets including private equity funds and rare products. The first type: U.S. stocks. In fact, I have always felt that the author mentioned that the recommendation to invest in U.S. stocks is to avoid the exchange rate risk of the U.S. dollar. As a Taiwanese investor, investing in U.S. stocks will increase the risk of the U.S. dollar against the Taiwan dollar.
The first is the issue of overseas taxation. Taiwanese investors should consider how much tax allowances they invest in U.S. stocks, what tax rates are levied on profits from overseas investments, and how to apply for relevant tax refund information online.
Second: It is actually very simple to avoid the risk of the US dollar exchange rate. If you hold the subject matter of a different country, in fact, according to Eugene Fama’s research, the rate of return is higher than simply holding US stocks, and the risk will only increase a little.
Therefore, my personal advice to investors in Taiwan should be to invest in US stocks within the tax allowance. And the long-term pay is really good. Of course, if you don’t have an account with a US brokerage firm, you can also consider investing in a Taiwanese brokerage firm. There are also ETFs that track US stocks and even active investment funds.
Basically, the basic value of a company, that is, several points that most value investors will look at, they are:
Price/estimated surplus (50%)
Price/Net book ratio (12.5%)
Price/Sales Revenue (12.5%)
Price/cash flow ratio (12.5%)
Dividend yield (12.5%)
It can be seen here that most value investors should focus most on price/estimated earnings. Usually price/revenue is also commonly known as PE value (PE ratio), also known as price-to-earnings ratio. But it should be noted that this is the estimated revenue, which is the forward PE ratio.
And what are the growth factors?They are:
Long-term estimated earnings growth rate (50%)
Historical earnings growth rate (12.5%)
Sales revenue growth rate (12.5%)
Cash flow growth rate (12.5%)
Growth rate of net book value (12.5%)
Let us return to the so-called value stocks and growth stocks. Among these three different types of stocks, they are divided into large, medium and small.
Basically, the stock market is just like human beings. 1% of people almost control the entire market.
A large stock is defined as a stock with a market value of about the top 70%, but the number is only 5% of the more than 5,000 U.S. stocks.
The next-ranked 20% of mid-cap stocks (that is, 70%-90%), which account for about 20% of the overall US stocks
In the back 7% are called small stocks, that is, 90-97% of stocks, which is about 30%
The last one is micro-stocks, there are a total of 3400 stocks in this category, but only 3% of the overall US stocks.
The reason for this division is because the author suggests that if we invest in U.S. stocks, we should be dispersed in the small stocks and the overall U.S. stock market, and the overall U.S. stock market is mainly composed of large stocks and mid-cap stocks.
The reason for this is from a paper published by Eugene Fama and Ken Frankie in 1992 called "The Cross-Section of Expected Stock Returns".According to this paper, the rewards of small stocks are higher than the overall market, and the volatility of small stocks is not always related to the broader market, and I personally disagree with the risk of small stocks in this paper, that is, it has not been counted as bankrupt or closed. The small-cap companies that are integrated should be more risky if they are included, rather than as observed by Eugene Fama. This is the bias that I think many small-cap and micro-cap companies will make, that is, the survivor bias. error
However, the proportion of small stocks held may not be able to diversify the scale factor to a certain extent. According to the author's actual measurement, 80% of the market and 20% of the small stocks are almost the limit.
And if the proportion of small stocks in the market is only about 7%, it is always a false ratio, so exceeding too much is actually increasing the risk. At the same time, the correlation between small stocks and the overall U.S. stocks is not low during the financial tsunami in 2008.
However, holding a certain proportion of small stocks also cooperates with the investment strategy mentioned in the previous section, which is to sell the rising parts and buy the falling parts.
Can this kind of asset allocation be applied to the Taiwan stock market? I think because the Taiwan stock market itself is not a stable market like the U.S. stock market.And the risk factor is higher.
If it is my suggestion, I would recommend reducing the number of small-cap stocks in Taiwan stocks to a maximum of 7%-10% instead of 20%, and maintaining a large amount of Taiwan 50 ETF as a Taiwan stock market allocation.As for the allocation of the Taiwan stock market, I personally do not recommend the allocation of 60% of the total assets. About 40% is probably enough. Other assets with low correlation coefficients are used as allocation.
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About the game:
USA as a world power? In E-Sim it is possible!
In E-Sim we have a huge, living world, which is a mirror copy of the Earth. Well, maybe not completely mirrored, because the balance of power in this virtual world looks a bit different than in real life. In E-Sim, USA does not have to be a world superpower, It can be efficiently managed as a much smaller country that has entrepreneurial citizens that support it's foundation. Everything depends on the players themselves and how they decide to shape the political map of the game.
Work for the good of your country and see it rise to an empire.
Activities in this game are divided into several modules. First is the economy as a citizen in a country of your choice you must work to earn money, which you will get to spend for example, on food or purchase of weapons which are critical for your progress as a fighter. You will work in either private companies which are owned by players or government companies which are owned by the state. After progressing in the game you will finally get the opportunity to set up your own business and hire other players. If it prospers, we can even change it into a joint-stock company and enter the stock market and get even more money in this way.
In E-Sim, international wars are nothing out of the ordinary.
Become an influential politician.
The second module is a politics. Just like in real life politics in E-Sim are an extremely powerful tool that can be used for your own purposes. From time to time there are elections in the game in which you will not only vote, but also have the ability to run for the head of the party you're in. You can also apply for congress, where once elected you will be given the right to vote on laws proposed by your fellow congress members or your president and propose laws yourself. Voting on laws is important for your country as it can shape the lives of those around you. You can also try to become the head of a given party, and even take part in presidential elections and decide on the shape of the foreign policy of a given state (for example, who to declare war on). Career in politics is obviously not easy and in order to succeed in it, you have to have a good plan and compete for the votes of voters.
You can go bankrupt or become a rich man while playing the stock market.
The international war.
The last and probably the most important module is military. In E-Sim, countries are constantly fighting each other for control over territories which in return grant them access to more valuable raw materials. For this purpose, they form alliances, they fight international wars, but they also have to deal with, for example, uprisings in conquered countries or civil wars, which may explode on their territory. You can also take part in these clashes, although you are also given the opportunity to lead a life as a pacifist who focuses on other activities in the game (for example, running a successful newspaper or selling products).
At the auction you can sell or buy your dream inventory.
E-Sim is a unique browser game. It's creators ensured realistic representation of the mechanisms present in the real world and gave all power to the players who shape the image of the virtual Earth according to their own. So come and join them and help your country achieve its full potential.
Invest, produce and sell - be an entrepreneur in E-Sim.
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