A REFLECTION: LET'S END THIS YEAR SPECTACULARLY

2020 will come to an end as we keep counting down the days. Can't lie that 2020 is considered one of the worst year ever for most people. The uncertainty still lies ahead mainly because of Covid-19 pandemic. It has an impact on several sectors of economy such as the increasing number of poverty, the deeper recession, and the slow down of economic activity.  

I never hope that it will go worse but we have to prepare for it. Even we have to take an advantage of it. There's still a chance despite the condition nowadays. Let's have ourselves a time for reflection on what we have done before the outbreak of Covid-19.

We can see above, a picture taken from my previous post, to buy gold last year and to hold it until today probably the best strategy to take. By Friday September 4th 2020, gold's price reached USD 1,933. That means it's a new all-time highest price record of gold. Let's get it noted that last year gold surprisingly made a record of the year and it keeps going on hitting new record. Imagine how much return you can gain if you had invested your money in gold last year.

 

image source: goldprice.org

And now, since gold hit USD 2,000 an ounce for the first time ever several days ago, it likely declined a little bit. I believe it's just a sort of correction. The price will just move no lower than USD 1,900. You may hold your gold for a while. There's no need to sell your gold too early and once it breaks USD 2,000 again, then it will form another higher level of resistance entry.

image source: finance.yahoo.com

During the outbreak, try to save your money in stock and invest it in consumer goods producer such as UNVR or ULTJ. The demand of consumer goods remains at its best though the outdoor activity is being limited. UNVR and ULTJ are still reasonable to buy especially for long term investment. Let's add UNVR and ULTJ to our watch list for the next one week and we'll discuss it later.

Read More

A NEW HIT FOR GOLD AND IDX COMPOSITE IN 2019

The beginning of 2019 seems to be a good time for Gold and IDX Composite. Gold finally comes back to 1,300 USD again! IDX Composite is in very good uptrend in fact. Go buy them if you dare!

There are some reasons why you need to buy them soon. First of all, it is because the uncertainty. This year we will face some daunting risks the uncertainty grows.

Geopolitical conditions is still in the mix. We don't really know when US-China trade war, Brexit, and US government shut down come to an end or even get worse. Yes, it is true that Mr. Trump just ended the shutdown, but it is temporary. Just so you know, according to what we read, this is the longest US Government shutdown in history.

We believe that the uncertainty won't get clearer than before even if Mr. Trump gets the money to build the Border Wall.

Financial condition is likely to affect the market the most. IMF cuts global economic growth forecast as they said at World Economic Forum several days ago. And don't forget that The Fed will slow down this year, no more raising rate. At least The Fed won't be as aggressive as last year. All of this just because of the uncertainty.

Such condition usually pushes investor to move their money to safe haven. When this happens, safe haven's demand will rise, making the price get higher. Safe haven such gold should benefit in many ways if those conditions get fulfilled.

TIPS

GOLD

Buy now! Since the price is now getting through USD 1,300 for the first time this year, that means gold breaks another resistance level. Gold attempts to reach higher considering last year's highest point is USD 1,350. Gold will play in USD 1,300 - USD 1,350 area for sure. Chinese New Year celebration on February should support gold movement as well.

We believe there will be a correction when US-China trade war talks about a new deal on March 2019. Make a good portion of your portoflio for gold before it's too late. You only have one month left to make a decision. 

IDX COMPOSITE (IHSG)

In Indonesian, it's called "Indeks Harga Saham Gabungan" or simply abbreviated as IHSG. Watching IHSG's movement can make me smile. The price keeps hiking up!

Exernal factors influence IHSG positively. Uncertainties affect foreign investors to put their money in IHSG. IHSG still moves upward at least until the end of February due to global economic slowdown.

At this time, what you need to do is to buy while you can, especially one month from now. When you buy enough, you can wait and see then. At a certain time, when commodities start to decline, you can sell when the price is still high to have a gain. Everything can happen in the future, so it's much better if protect money soon.

Next post we'll renew the correlation between price movement of commodity such gold and some variables.

Image source:

Yahoo Finance.

News source:

Miscellaneous.

Read More

PUT YOUR MONEY NOW, OR ELSE YOU’LL REGRET EVERYTHING!

Happy Investing, Happy Voting!

Why voting? 2018 and 2019 will be our country’s election year. Get prepared, Indonesia! Hope we can take the advantage of this.

We got two big issues to discuss today; The Fed rate and Election year (Indonesia). From these issues, we’ll give you some consideration to invest your money and rate of return comparison of several investment instruments so that you can “place” your money better.

Before we talk about the issues, let’s compare which haven has the better “treatment” for your money.

INSTRUMENTS

Foreign Exchange (Forex)

It was 2008 when one USD was equal to 8,900 Rupiah (IDR), we converted IDR to USD regularly and let it “sleep”. Yes, we bought USD every month and we did it till one USD/IDR hit 9,500. Just let it sleep, guys.

That’s right! You can see that today, one USD is equal to 13,700-13,800 IDR, what a gain! Especially if you have 100,000 USD right now. So, let’s just say that we had one USD for 9,000 IDR, and now we have one USD for 13,700 IDR. That means we have 52% profit margin.

Before you convert IDR to USD, please consider the sharia law. We can't buy money for money unless you need it for export-import activity. Be very careful.

Gold

We started to buy gold around 5 years ago. Yes, it was 2013, a moment when gold experienced its biggest drop; from more than 600,000 IDR/ gram to 480,000 IDR / gram (1204.5 troy ounce).

It’s not just a decline, more than that, it’s an advantage instead. Yes, that was the right time to buy gold; Gold had never been this cheap before. We bought gold for the first time in 2013 when it cost 490,000 IDR/ gram. We bought it regularly; once in three months or once in a semester. It depended on the budget. Just like forex, of course we let it sleep.

As you can see the gold costs 625,000 - 650,000 IDR/ gram nowadays (it even hit 1,350 USD/ ounce several week ago). Let’s assume that we have 135,000 IDR profit in every single gram of gold (625,000 – 490,000), that means we have 27.55% profit margin.

Business

Such a great experience collaborating with my friends to establish a business. Cellular business exactly. It’s not a coincidence I met great partner to run a business. We knew each other well before we founded it (I actually joined them when the business had established).

The three of us put 900,000 IDR capital into business. It turned out very lucrative. Joining them in 2015, we got break event point in less than two years (I could say that I got capital gain in one year only).

Unlike two kinds of investment above, in business, you can’t let it sleep. You need to make it bigger, expand it, and manage it well of course. And today we have the fourth member to run the online business division.

Property

Putting your money in property is fantastic. It grows more than 16% just in one month. We started to buy a plot of land in February. Our smile has never been this big as we learn that the price already moved up at the beginning of March.  

Find the best payment to own a property from now, because it tends to get more expensive as the time goes by.

Stock

By the end of 2015, The Jakarta Composite Index touched above 4,500 IDR. By the end of 2017, it made a record for itself; hit 6,000 IDR for the first time. Indonesia Composite was closed at 6,304.95 at the closing of last weekend. That means we can achieve more than 30% capital gain. What a gain! 

ISSUES

Raising The Fed Rate

We still remember when The Fed raised rate by the end of 2015 for the first time in a decade, the price of gold was quite affected but then the gold kept raising until today.

Another story, it seemed that USD kept moving up against IDR. It was only 9,000 IDR for one USD in 2008 and today USD/IDR likely to drop to 14,000.

In spite of The Fed’s raise, since it is not the first time they raise rate, we believe that gold won’t sink further. There will be a correction but won’t be big. Just keep in your mind that “history repeats itself”, gold keeps moving up despite facing the raising rate several times.

On the contrary, we predict that IDR will drop deeper. IDR never gets better against USD recently. As Powell succeeded Yellen, the issue got stronger and they planned to raise rate four times this year. We can’t deny that when this happen, foreign investors will bring back the fund to the USA. It is common thing that investors expect higher return when The Fed rate gets higher as well. That’s why IDR will surely fall.

Election Year

Election campaign is inevitable. The campaign uses any means of communication. That means today is the right time to buy stock of telecommunications service. When the election reaches its climax, normally the market reacts. Or you can relate the price movement with candidates’ promises so you can choose which stock is the best to buy.

The price of property usually raises as the countdown to election begins. Who knows that the elected candidate think about a mass infrastructure development in the future. Who knows that the elected one plans to issue a policy to boost up a business’ prospect.

STRATEGY

Some investments have certain treatment. You can make gold, stock, bond, or even forex fall asleep after buying them. You can “wake them up” when you need it or when the time seems to be pretty good to sell. In business you need to always upgrade it, expand it, and manage it well. Any important issue should be watched because there is an affection for sure.

Different instrument, different issue! Some will gain a maximum profit when crisis engulf us, others will gain a profit as well as the economic outlook has a bright future.

You don’t need to be rich to invest, you need to invest to be rich! The key of investing is budgeting. Don’t spend your money, at least save it every month and start to invest. When you can save regularly, you can invest regularly then. Buy any kind of asset once in every three month and it’s much better if you can buy once a month.

Stay rational, not emotional. For beginner, you can follow the mainstream of investors’ habit. Hold your Gold and IDR until they announce the raise. Start investing now regarding the election. Remember, prediction can be wrong and therefore prepare yourself well!

Happy saving, happy investing, happy electing!

Read More