Family Money: When is ‘The Right Time’?
Managing director of Westminster Portfolio Services (Thailand) Ltd.
A wise philosopher a couple of centuries ago said:
“The best time to invest is when blood is running in the streets.”
More recently, the internationally-renowned financial
manager Dr Mark Mobius has said, “The best time to invest is always
But many folk only want to invest when there’s peace
in the world and they see their favoured markets rising steadily for a
period of time - but never when they’ve fallen.
This often reflects a fundamental fear of what they
don’t fully understand - just like some people are irrationally afraid
of thunder. If you hear the thunder, the real danger - the lightning - has
already come and gone!
Of course market timing matters if you’re looking to
invest a sum of capital. Common sense (which is a surprisingly rare
commodity) tells us we should buy cheap and sell dear. But few investors
follow this maxim. They are motivated not by common sense or understanding
of fundamental investment strategy: they’re driven simply by the twin
emotions of fear and greed.
This leads them to hesitate before buying in (no matter
whether it be a stock or a fund) until they have seen price gains which
indicate they would have made a profit. Then they finally buy in,
expecting prices to continue rising and produce them a profit. If you stop
to think about it, this argument is totally fallacious.
The investment which has already gone up in fact has a
greater chance of reversing as shrewd investors take profits.
On the other hand, a stock or fund which has dropped
recently may have a fundamental reason for its fall (accounting
malfeasance, financial difficulties, or a slump in that market sector), or
it may be temporarily out of favour, or inherently volatile because of the
investment sector it concentrates on. It may be a potentially very good
investment, or it may be a lemon - you have to do some research and
objective appraisal to determine which.
But this assumes you are looking for short-term gains
rather than adopting a longer-term investment strategy. This style smacks
of speculation rather than strategic investment, and tends to be very much
driven by those two twin emotions mentioned earlier: fear & greed.
One way to even out the bumps is to invest regular
amounts into your chosen fund or (better) basket of funds.
As you buy units from month to month, over time you
will have actually paid an average price for them; it really won’t have
mattered too much whether the unit price went up and down in the meantime.
What is important is the price when you come to encash those units. So
even if the unit price slumped in the middle of the program (when you were
able to buy lots of cheap units for the same amount of money), if the
price at encashment is higher than the average you paid over time, you
will have made a profit.
Of course, the corollary is also true, so you
shouldn’t encash your units until the price has risen above the average
you paid for them.
This relieves an investor of the natural psychological
concern as to market timing. When the market is up, you buy fewer
expensive units; when the market’s down you acquire more cheap units for
the same amount of money.
You are doing automatically what all wise investors
should do - buy less at top and more at bottom.
Few investors are consciously willing to make that
decision, however, because of the psychological pain and fear in a falling
market, and the euphoria of greed in a rising one.
This principle is clearly demonstrated in the following
In our example, Fund #1 is a good, stable performer.
The price of units rose steadily throughout the contributory period, so
the same regular contribution bought progressively fewer increasingly
expensive units as time went by. Our investor paid an average price of
$1.62 for his 30,933.46 units, which at the final price of $2.85 at
maturity were worth $88,160.35. If he encashes them, he will have made a
profit of $38,160.35.
The more volatile Fund #2, however, enabled our
investor to buy lots of “cheap” units when the fund performed poorly.
Thus he paid an average price of only $0.73 for his 68,603.67 units, which
at their maturity price of only $1.33 were worth $91,242.88. Although Fund
#2 performed relatively poorly, his gain of $41,242.88 at maturity was
greater than in Fund #1!
What does this tell us about portfolio selection for a
savings program? Is it so vitally important to constantly monitor your
portfolio’s performance, calculating its value every month or so? Is it
necessary to switch out of a fund immediately it performs poorly for a
period? In the case of a contributory savings plan, the answer to each of
these questions is clearly “No!” At the risk of repeating myself,
provided the price at encashment is higher than the average price paid for
units, an investor will always gain.
It is worth remembering however that Unit-Cost
Averaging does not apply to lump-sum investments, where all the units are
bought at one time and for the same price. Appropriate portfolio selection
and market timing then become much more critical issues, and a strategic
balance of “good performers” more appropriate.
To return to our example, for a lump-sum investor Fund
#1 would have been a better choice, as it put on 185% over the 10-year
period. Over the same period Fund #2 would have gained only 33%, and given
a capital investor a lot of heartache along the way!
The Doctor's Consultation by Dr. Iain Corness: Aspirin? The Elixir Vitae?
I suppose we are all looking for the elixir of life in one
form or another. I know that I am enjoying life too much to want to see it
curtailed by such trifling things as getting older. No, give me the elixir of
life. No ice thank you, I’ll drink it straight!
Now all this came to mind following the visit to Thailand
last week of Dr. Corness junior, who came to pay his respects on his way
through to taking up a posting in the UK for a couple of years.
Dr. Jonathan grew rather vertically when younger and is now
a strapping 6’6" (nearly 2-metres) tall. While this does give him a
decided advantage in changing light bulbs and getting an uninterrupted view at
the movie theatres, it produces its own unique problems as well. One of these
is plane travel. Try folding 6’6" into a Z shape and getting it into a
standard plane seat.
Now the airline companies do keep the emergency exit row
seats for these giant basketballer type people, but only if you get to the
airport early enough to reserve them. So far Dr Jonathan has found that three
hours wasn’t early enough! Return to the cramped Z scenario.
I have written before about the “economy class
syndrome” where there is a (theoretical) risk of blood clots when flying
cramped up with legs at peculiar acute angles (and not so cute also). For
people like my son, the risk does increase, and he was aware of this; however,
rather than buying a business class ticket, his Scottish heritage came to the
fore and he went for the economy seating, but spent a few baht on the
Yes, good old aspirin, one of the earliest effective drugs
known to mankind, a drug which is still amazing us all with its abilities. Let
me assure you that aspirin is much more than a headache killer.
In therapeutic doses to stop the throbbing head or settle
throbbing joints, we are looking at something between 300-600 mgms four times
a day for most people; however, at that dosage you run the risk of upsetting
your stomach, to actual bleeding and ulceration. There are also people who
show allergic reactions to aspirin, from asthma right the way through to
anaphylactic shock and death! Yes, this is potent medicine.
However, there are other conditions for which aspirin is
the drug of choice, and not in the big doses either. We are talking here of
100 mgm doses taken once a day only. This way the chances of allergy/asthma
and gastric bleeding are greatly reduced. The condition treated here is
aggregation of platelets. This is where the red blood cells sort of form into
clumps and these are the start of the Deep Vein Thromboses (DVT’s). And this
is the real cause behind the Economy Class Syndrome.
Now Dr. Jonathan, being a good lad, also suggested that Dr.
Iain should take 100 mgm of aspirin a day - not because I am flying bent up
triple, but medical science has found that by taking 100 mgm of aspirin daily
you lower your chances of heart attack, something much higher on my personal
risk table than Economy Class Syndrome.
So I am listening to the new young bloods of medicine, and
swallowing my medicine every morning. I hope it is the Elixir of Life!
Here’s some good news for a change. Four years ago I
wrote and asked you for advice. I was to become a father for the first
time, at 48 years of age and my Thai girlfriend only 21 years old, pretty
scary! You gave me good advice and anyway, here I am still in Thailand. I
set myself a target to lose no more than 50,000 pounds (hard earned
previously in a very savage world) and am happy to report that yes I
married, yes I remain happy with my projected 50,000 loss which is now a
gain of an extra 200,000 pounds and I have a baby daughter. I left the
bright lights and moved to my wife’s poor provincial rice farming
village where I spent 12 months along with 22 villagers building a
beautiful house on 80 rai of land, where I also overlook rice production.
Now 80 rai of rice should seem viable? It is and it isn’t. Totally
dependant upon workforce and weather, both totally undependable! So I
began a little business, “Village Home Stay.” This is for anyone
wanting to have just the briefest insight into real Thai people (who are
really honest, proud, caring and loving people) and who want to see real
life, beautiful countryside, amazing temples and historic sites. Nothing
here is set up for tourists; here it’s all real, from people making silk
from the worm to the cloth. There are no entrance fees and open and closed
signs. Here we are surrounded by genuine beautiful young and not so young
Thai village folk. Their smiles are not to sell you more beer, just seeing
you, a real foreigner is reward enough. If you or your readers fancy a
break just phone me or go to Khorat and ask for Jimmy the Welsman. We’re
75 kilometres from the city but someone there will point you towards our
village. It’s easy to find - it’s the only one with 300 villagers and
one Welshman. No go-go’s, no bars, but there is beer and I give cookery
lessons in egg and chips. Sorry no internets or email here. Normal
communication is quite simple - you just shout loudly to each other!
Thank you for the letter (which I had to chop down,
Petal, sorry). Your story is lovely and shows that if you keep your head
on straight and take things slowly in this country, you can find your own
paradise, as you have with Lamai and baby Lizzie. Some of you who have
gone rushing blindly into relationships should think about this. Now I
know that this column is not really for advertising, but your story was so
touching, Jimmy, that I have included your telephone number if anyone
wants to contact you further. Readers please note that this is not an
endorsement, as I have never visited the Village Home Stay. However, you
do sound like a nice couple. Jimmy and Lamai’s telephone number is 01
Is it possible to meet a Thai girl who does not want to
drive a snow plough through your wallet? Every time I think I have found
“the one” it ends up that I will be lucky if I have one baht left in
the bill-fold. They start out alright, looking after you very well, so you
keep going back to the bar, then you make the big decision and take them
away from there to give them a better life and everything is rosy for a
while, then comes the hand out for this and for that and a new fridge for
her mother and then a big lick to pay off father’s land mortgage. It
doesn’t end till the money ends, then they’re gone! This has happened
to me three times so far and I have been so badly burned I don’t think
I’ll bother trying again. Do any of your readers have a suggestion, or
perhaps even you yourself Hillary?
The Burn Victim
Dear Burns Victim,
I do feel sorry for you, Petal, but there’s a very
basic fact that you seem to be missing, especially since you have gone
down this road three times already. Why are you continuing to go to the
same places looking for a long-time mate, when you are lining up at the
short-term holding pens? You are going to the marketplaces where they sell
affection but you are looking for enduring love. You are trying to buy a
Mercedes in the motorbike shop! Unfortunately for you, there is no
“marriage market” even though there are places that seem to promise
this. Love and affection are never sold. Start looking elsewhere, Burns
Victim, and you will find there are some wonderful girls out there, hoping
to meet a nice man like you to fall in love with - not to fall into bed
with. Get the message, Poppet? Perhaps you should read Jimmy’s letter
above so that you can get some hope again. Stay away from the meat markets
and you won’t have to end up in the burns unit again.
Camera Class: Being framed - or it’s a frame-up!
If you’ll pardon the pun, framing your photographs is an
art. You can spoil a brilliant shot with lousy framing, and you can salvage an
ordinary “record” shot by brilliant framing. Now, get a brilliant subject
and brilliant framing and what a picture! A prize winner.
I have spoken before about the Rule of Thirds, and quickly
recapping, put the subject of your photo at the intersection of thirds if you
can possibly do it. In other words, one third in from either side and one third
down (or up) from the top and bottom. This “off centre” approach does make
for a more interesting photograph. Now that’s easy!
The next item to make your framing up more interesting is
what we call the Frame within a Frame approach. Take a look at the photograph
with this week’s article. It says something. The man is framed by the patio
opening, and you straight away wonder “where” this is and “who” this is.
Note that his head is one third down from the top and one third in from the
right, so there’s the classical placement again. To get this type of shot,
find the window first and walk in close enough to get the window frame within
the edges of the photo itself. In other words, leave a little on all four sides,
then just position the subject within it. No magic, but you’ll get a magic
shot. (By the way the picture was taken at Greg’s Kitchen in Pattaya, and that
is Greg the proprietor.)
In the frame-up above, the subject is actually inside the
frame, but there also is the situation where the frame is in the foreground and
the subject is some distance away. This frame within a frame will pull your eyes
deep into the photograph, giving it much extra depth. The second photo is a
classic example of the “Frame within a frame” technique when applied to
distance shots. The archway on the chedi I was standing in frames the next chedi
in the line. You see a repeat of this archway on the distant one. You
immediately know there are more than one of these structures and by looking
“through” the first arch you have given a 3D effect to a two dimensional
Now, let me assure you that the chedi’s did not line
themselves up in this order. Producing this shot required some input from the
photographer! It was a case of prowling around the site and seeing what was
available. This frame-up did not happen by accident, I was actively looking to
produce such an effect, and in fact, attempted this shot on three occasions with
other chedi’s before I got the one I wanted. As I have said many times, good
photographs do not “happen” - they are made! And YOU, the photographer, make
Now there will be times when you would like to improve the
shot by framing, but there is no handy archway, window or whatever. This is
where you have to be even more creative. Look around for overhanging trees or
ground bushes that can be used as “frames” to hide some part of the shot and
thus accentuate your subject matter. A little hidden area always heightens the
curiosity of the viewer, and just by doing that you have produced a better shot.
It’s that easy!
The message from today’s column is not to be satisfied by just pointing
your camera at the subject and going “click”. Look for ways of enhancing the
photo to make it more interesting. Framing up is a good start.
Recipes from Rattana: Fish fillets with garlic potatoes
This week’s recipe is for fish lovers. You can use most
kinds of fish fillets, sea bass, NZ ling or even cod. Do ensure that you very
carefully fillet the fish, or that your supplier has done so. The flavour is
quite delicate and you should be able to enjoy the garlic, both in the sauce
for the fish and through the potatoes as well.
Ingredients serves 4-6
Fish fillets 600 gm
Potatoes (steamer size) 500 gm
Garlic minced 1/4 cup
Capers 4 tbspns
Onions diced 1/2 cup
Dry white wine 1/2 cup
Butter 250 gm
Tomatoes diced, peeled 1/2 cup
Fresh parsley chopped 1 Bunch
White balsamic vinegar 30 mls
Salt and pepper
In a skillet, deglaze with extra virgin olive oil, and sear
fish on both sides until golden brown. Remove fish from skillet and place on a
draining stand then cook in 350 degree oven for 5-7 minutes.
In the saut้ pan, add 2 tablespoons of butter plus
capers, tomatoes, 1 teaspoon garlic and onions. Deglaze with white wine, add 3
teaspoons of chopped parsley. Reduce liquid by one third, add vinegar.
Prepare mashed potatoes by boiling, then add 2 teaspoons of
minced garlic during the final mashing.
Serve the fish on the top of the potatoes and drizzle the
sauce over the fish.
Garnish plate with 2 teaspoons of chopped parsley.
Dr Byte's Computer Conundrums
By Dr Byte, Citec Asia
Question: Your bi-weekly report
is interesting and informative. A question: Am I the only person in Chiang
Mai that is continually frustrated by the extremely poor Internet access? I
buy my Internet access via a pay as you go scheme and am currently using the
Inet Access Kit along with a local dial-up network Chiang Mai access phone
number. I have a direct phone line which ‘seems’ clear but I cannot
establish anything like a reasonable connection time as the line keeps
dropping out or the download speeds are really slow. The line constantly
drops out. Is this a scam to ensure I keep having to make a new connection
and therefore pay higher phone bills? Tambon Suthep
Dr Byte replies: Try other dial-up numbers for Inet
or switch to other ISP’s like CSCom or Loxinfo. It is certainly true that
different phone numbers behave differently depending on where you are in the
city. Most ISPs have a large selection of numbers you can call and changing
the number used may help. I often use Inet and have used LoxInfo’s dial-up
services and have noticed similar problems, although sometimes connection
problems can arise from the modem used (or the driver). Technical support
gurus at citec Asia and at the various ISP’s always recommend an external
modem and blame many support problems on soft (Windows) modems. So one
option would be to buy an external modem.
Question: Virus hoax? I trust you can give me advice
on what appears to be a virus but perhaps not the worrying kind! I was sent
a warning to the effect that a virus had been passed by a friend and they
thought they may have passed it onto me plus anyone in their address book.
The Virus is named ‘jdbgmgr.exe’, which is sent automatically by
messenger/address book whether or not an email is sent to the contacts. It
also has a teddy bear icon beside it. It apparently sits there for 14 days
before damaging the system! Whatever you do, you should not OPEN IT. I was
given the routine to get rid of it, which I have followed checking all
files. Yes, there it sat on my C drive. Then I eventually deleted it to the
recycle bin. Then deleted it from there as well. As far as I can tell, no
harm is apparent on my system, although when I went back to check again
later, there it was still sitting on my C drive. Have now tried a number of
times but it still remains. What I would like to know is, is it harmful and
why doesn’t it go away? Any ideas? Chiang Mai
Dr Byte replies: This is a hoax - see vmyths.com or
other similar sites which we described in the last issue. You can also just
type the name into Google and you will discover all about it.
Question: Google in Thai? Where is my Google in
English? My main search engine is google.com and until recently I was very
happy with it. The search page springs into action in English. But now
whenever I enter www.google.com I get connected to www.google.co.th and the
page appears in Thai. How can I go back to the English version? Need your
advice. Thanks. Chiang Mai
Dr Byte replies: Type in www.google.com/en into the
address bar and voila, Google in English will appear. Save this opening page
as a Favorite or open your Explorer Options and make this the default
startup page. That way, Google will always start in English.
For a while now, Google in its wisdom has been offering
its opening page in the language according to the IP address of the user.
They perform a reverse DNS lookup and can tell what country your ISP is in.
If you use a Thai-based ISP to access the web, it detects that you are from
Thailand and offers the page in Thai, although, as explained, you can
If you have any questions you would like answered, or
have suggestions you would like to make, please contact Dr Byte at Chiangmai
Mail. Next time we will be looking at tuning Windows to make it run
faster, so get in touch if you have a particular problem or question in this
Best wines of Italy’s Friuli Venezia Giulia
By Ranjith Chandrasiri
Italy’s northeastern region is barely mentioned in most
guidebooks and rarely visited even by Italians, which makes it a great place
for travelers seeking to leave the beaten path. Whether you like snow-capped
mountains, warm sandy beaches, lagoons teeming with water birds, remote
alpine hamlets, Roman ruins, palatial country villas, rocky coastal cliffs,
bustling international seaports or picturesque fishing villages, your tastes
will be thoroughly satisfied in Friuli-Venezia Giulia, one of Italy’s most
Aside from these, the Friuli Venezia Giulia is home to
one of Italy’s most famous wineries: the Vigneti Fantinel. No other wine
label from this region has achieved so much world-wide recognition than the
family-run Vigneti Fantinel.
The family estate was founded in 1969 by Mario Fantinel.
Known and admired for his long experience as both hotelier and restaurateur,
“Paron” Mario was driven by the passion of producing wines dedicated to
the conviviality of the hospitality business. The two vocations fused
together to turn the love for the land, vineyards and the wine -making art
into a single reality: inevitably so, because genuine passion wins out in
Headed by later generations of the Fantinel family, the
Fantinel S.P.A. estate has a production capacity that ranks among the most
interesting Italian wine-growing farms and extends its vineyards over 250
hectares of land. The Estate’s driving philosophy is the same as it has
always been: total quality, respect of tradition and continuous research, to
maintain and improve the characteristics of taste and genuineness that are
the mark of outstanding wines.
Tucked under its belt is the 1997 International Wine
Challenge “Seal of Approval” for the 1995 Cabernet Sauvignon. In April
of that same year Fantinel was given the “Diploma of Great Merit” for
its 1995 Collio Sauvignon DOC in the 36th National Competition of DOC ad
DOCG wines at National Wine Trade Fair in Venice.
A year after, it won the “Diploma of Great Mention”
for the 1996 Friuli Grave Cabernet Sauvignon DOC in the 32nd “Vinitaly”
International Oenological Competition, followed by another International
Wine Challenge “Seal of Approval” for the 1997 Pinot Grigio.
New York-based Wine Spectator magazine included the
Fantinel Merlot Grave del Friuli Barone Rosso in its May 15, 1998
“Shopping Guide” as “Best Purchase” with a score of 86/100. The same
issue of the prestigious magazine featured descriptions and technical
appraisals of the Pinot Grigio Sant’Helena Collio Vineyards 1997 (88/100),
Cabernet Sauvignon Sant’Helena Grave del Friuli 1996 (87/100), Cabernet
Franc Sant’Helena Grave del Friuli 1997 (85/100), and the Pinot Bianco
Sant’Helena Grave del Friuli 1997 (82/100).
Ranjith Chandrasiri is the resident manager of Royal
Cliff Grand and founder of the Royal Cliff Wine Club, Royal Cliff Beach
Resort, Pattaya, Thailand.
Email: ranjith@royalcliff. com or wineclub@ royalcliff.com