Barely one month after I crossed the hundred thousand networth threshold, my networth has taken a hit and is not below the two hundred thousand mark.

I advocate the advise of “put all your eggs into a few basket and watch them carefully”. I have put all my eggs into a single stock. Unfortunately, this company has performed badly in the last quarter and the stock has taken a beating since it released its latest quarterly earnings.

So, if I put my eggs into few baskets, then my portfolio will have higher risk. If I spread my eggs into many baskets, then the risk is lower but I would also have less chances to outperform the market.

And, how do I prevent this bad experience from happening again in the future?

I closed my futures trading account last month. It was getting difficult to interpret the FBM KLCI trend. The best times to start trading futures is at the beginning of a bull or bear market, not now when the market is trending sideways.

The W-shape recovery is gaining traction. By early next year, many unemployed Americans will run out of unemployment benefits. With domestic consumption declining, another round of fresh layoffs is not impossible.

Countries relying on exports to the US market could face demand cuts. The domino effect could be far reaching.

So, the million dollar question is “When’s the stock market going to dip?” If the stock market is 6 months forward looking, then the market should have dipped a couple of months back. But this hasn’t happened. Then,.. is it dipping now?

I started buying unit trust with EPF money in June 2009. Yesterday was my second time withdrawing money from EPF to buy unit trust. According to the guidelines, a contributor can withdraw once every 3 months from EPF to invest into approved unit trust funds.

This time, I was recommended by the unit trust agent to buy the Public Islamic Equity Fund. The sales charge is 3%. According to the agent, this 3% is capped by EPF. I wonder if I could get a lower sales charge if I buy directly over the counter without going through the agency or agents.

It will be interesting to see if this managed fund can outperform my index fund (UOB-OSK KLCI Tracker).

My next withdrawal should be after the Chinese New Year, perhaps sometime around March 2010.

It baffles me. The US unemployment rate hits 10.2%, worse than the expected 9.9%. And guess what? The stock markets around the world rally for the second day in a row. What is going on? Has the investor gone mad?

The people have to realize that, more and more consumers are becoming jobless. Consumer spending will reduce. Corporate revenue will reduce. And so will earnings, unless these corporates initiate another round of layoff to save on administration expenses.

Can someone enlighten me as to why the stock markets are rallying in the face of this worse than expected unemployment news?