Investment Insights

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Investment Insights

How my investing philosophy and methods evolved over my 18 year equities investor journey

My journey to investing began in the most unusual way. A university senior trying to recruit me as an MLM marketer during my final undergraduate year introduced me to the book Rich Dad, Poor Dad by Robert Kiyosaki. While Kiyosaki's reputation isn't stellar today, especially his financial status, his book provided me with the first concise concept about wealth, especially around the concept of the cashflow quadrant. In the quadrant, there were 4 ways to produce income: being an employee, a self-employed person, a business owner and finally an investor. In the first two, you produce a linear income as you are exchanging time for money, whereas as a business owner or investor, you leverage your employees or capital to your advantage. By never making the transition into the Business Owner or Investor quadrant, you will never possess the leverage needed to become wealthy.

Credit: Medium - LJ Stojanovski

That was my first "aha" moment in life, and thus began my journey of finding leverage. I started with real estate and property, as thought by Kiyosaki, but discovered soon enough that the leverage and illiquidity part was not to my liking. Thus, I pivoted towards unit trust, then eventually equity. Initially, I faltered, as I didn't know what I was doing and speculated in the market, suffering huge losses. Then in 2009, a mentor showed me the path of value investing through the greats like Buffett, Munger and my favourite, Peter Lynch. The rest, they said, was history. It was like an addiction, the more I learnt and applied, the more I fell in love with it. And to add cherry to the cake, I was meeting like-minded investors who have come before me. I listened and observed their successes and lessons learnt, which inspired me to practice even more, now with the added responsibility of my fellow investors.

When I first started investing in stocks using the value investing method, it was the philosophy of buying a good business and holding it over long periods. I focused on Malaysian stocks, due to a home-ground advantage and currency de-risking. This usually meant "cheap" or "undervalued" stocks, those trading at low P/E multiples and large cash & equivalent holdings.

For example, there was once a company that had a market cap of RM563 mil, with RM1.2 bil as cash & equivalents on the balance sheet. Yes, you read that right, the cash on the balance sheet was bigger than its market capitalisation. If you had invested in the company and held it over 20 years, your Compounding Annual Growth Rate (CAGR) return would have been a "majestic" 5.3%, better than a fixed deposit return, one would argue.

Even with those odds, I still managed to eke out a decent return for my parents' portfolio, which I was personally managing. Over a 6-year period from 2014 to 2020, right before the COVID-19 craze, one of these portfolios returned approximately 13.82% CAGR.

If you struggle to find the time to do research and structure your portfolio, and are open to someone doing the heavy lifting for you, enquire about my services via the query box below. Please help me get to know you better to see if we are a good fit for each other, before I can help on your journey to financial independence.

As I grew in experience, I've started investing in a global universe of stocks and became a buyer of high-quality businesses at reasonable prices, rather than focusing so much on "cheap" stocks. A simplified definition of a high-quality business is having a powerful "business moat" and being scalable globally. The result of this evolution brought my CAGR to 14.32% over the past 11 years, not too far off my Malaysian portfolio results; however, the caveat is that the global companies I owned are still growing and scaling despite their size vs that of the Malaysian companies, where growth has stagnated.

Malaysian Portfolio

US Portfolio

Speaking Engagements

I've been blessed to have trained/spoken to more than 7,000 individuals on topics I'm passionate about, investing & businesses. As an investor, the skillsets needed are multi-faceted, from understanding human behaviour and psychology to accounting principles, law, and even economics. Leveraging my training as an engineer, I am accustomed to systems and design thinking, which has greatly helped me develop better skills to practice investing more effectively. It also helps that the more I speak and train on the topic, the better clarity I get in shaping my investment hypothesis.

If you want me to speak at your corporate event or conference, enquire below. I look forward to working together!

My Journey...

I started my career with Shell Exploration & Production. My job involved designing, then building and commissioning (a term for "testing and starting up the plant") offshore oil and gas production facilities. It was fun to be honest, and what I missed the most was working with some of the smartest & kindest colleagues.

As I progressed in my career, I never lost sight of becoming an investor, first in real estate and subsequently in equities. At the height of my property investing journey, I owned 4 properties, but I learnt many lessons that deserve another explanation space on their own elsewhere. Lesson learnt, I sold all my properties except for the one I was residing in and channelled everything else into my equities portfolio.

The first pivoting moment happened when I walked into the branch of a very large Malaysian bank, and as soon as she found out I was a Shell employee, she tried to peddle me some financial products. "Sir, there's this fund that returned more than 200%, would you be interested in investing?". In return, I asked, "Over how long?". She sheepishly looked at me and thought my question was peculiar. Then she glanced back at the fund fact sheet and said, "30 years, sir".

For those who know how to use a Time Value of Money calculator and have tried to calculate the Compound Annual Growth Rate or CAGR for short, you will know that this return is only 3.73%, or only slightly better than your fixed deposit rate in Malaysia. I curtly reply, "Thanks for offering, but I don't have funds to invest". If the folks that sell me the product don't even understand the concept of compound, who then can I trust.

I then decided to take it upon myself to learn and understand how equity investing worked. A chance encounter with a lawyer/investor mentor turned a curiosity into a lifelong passion for equity investing.

Expertise

Private Mandate Investing

We would research, construct and monitor a global equity portfolio for you.

Mergers & Acquisitions of Businesses

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What is my WHY?

Research as a Service (StockWyse by VUCA Insights)

Managing your portfolio but no time for research? 2 global stock ideas a month.

In 2016, I pivoted out of the O&G industry and became the Chief Operating Officer at an equities data & training company. At the time, the company sold Malaysian PLC financial data. This was bundled with training programs on how to analyse listed companies in Malaysia. I was also their Master Trainer and led the IPO effort to the successful listing on Bursa Malaysia in March 2019.

In 2020, I embarked on my first startup journey with a co-founder. I bootstrapped and led it to securing sales of high six-figures and profits of exceeding six-figures within 18 months of operations, all with a starting capital of RM20,000. We were also privileged to have been the leading channel on the Malaysian stocks niche in 2021 on YouTube. I eventually sold my stake & exited to start my research firm, VUCA Insights, in 2022.

My expertise lies in assessing and evaluating businesses across different supply chains and industries. This research and insights often help my clients and me decide which businesses in the public markets we would like to invest in. I use the term "we" because I firmly believe in the philosophy that the advisor should invest alongside their clients to have aligned interests. It is disheartening that it's an uncommon practice in the finance industry, and I want to change that.

I am currently a Licensed Financial Planner by the Securities Commission of Malaysia and a Wealth Planning Director with Phillip Wealth Planners. I advise clients on building their wealth through a private mandate portfolio of global stocks.

I am also a Director at Rosewood Consulting, a boutique M&A firm that consults and facilitates the buying/selling of companies within Malaysia & abroad.

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