Investment tactics

Hung Pui Ki, Majesty

2008078285

Investment Objective

1. Not to lose

2. Expected annual return at least 10%, can even as high as 50%

Economic cycle

Economic cycle

About 5 years

About a year About 3 years

Economic cycle vs long term

HSI(70s) = 100

HSI(2010) = 20000

Performance of HSIBuy at 14000Sell at 22000Annual gain >50%

Tactics

1. Not to buy at the lowest (but to sell at low)

2. Not to sell at the highest (but to sell at high)

=> Make sure you are to win

Target price

1. Buy the HSI at 20000

2. Sell the HSI at 30000

Questions:

1. Do you believe that the HSI will finally be back to 30000?

2. Then, do we stand any chance to lose?

Return

• Average time to be back to 30000 = 2 yrs• Max. time taken to be back to 30000 ≈ 5yrs

• Average capital gain: Time = 2 yrs, Buy at 20000, Sell at 30000Annual return = 20%

• Min. capital gain:Time = 5 yrs, Buy at 20000, Sell at 30000Annual return = 8%

• Risk Free return ≈ 2%

Investment Objective

1. Not to lose

2. Expected annual return at least 10%, can even as high as 50%