well it's the start of a brand new year

happy New Year happy 2024 start of a new

investing year a lot of people would ask

how do I plan my year ahead so in this

video I'm going to show you the thought

process I go through to decide on what

stocks to buy you know when do I buy the

stocks and what percentage allocation

should I add into my

[Music]

portfolio

first a quick recap about my performance

in 2023 now if you guys recall about a

year ago I shared my performance in 2022

which was a bare market and at that time

my portfolio was down

30% and this was actually followed by

three great years 2019 2020 and 2021 and

at that point of time I said that as a

an investor no matter how great you are

draw Downs are inevitable you know you

you can't go in one straight line your

portfolio will go through ups and downs

but the important thing is that when you

go through a draw down how do you manage

your psychology how do you hold on to

great companies cut the lousy ones and

add more to the good ones and if you

stay the cost you would make back the

temporary draw downs and your portfolio

will reach new highs so one year later

what has happened well so one year later

you can see 2023 my portfolio is up

48% on this portfolio and

43% point8 on this portfolio so take an

average of about uh 45% right basically

making back the draw Downs of

2022 and um total gains in terms of

dollars would be about $2 million total

gain so if you take a 5year time frame

you can see my portfolio performance

versus the market the S&P 500 uh that's

my portfolio in blue over there and you

can see that my portfolio went through a

draw down in 2020 uh during the covid

crash again a draw down in 2022 but

again it always goes higher eventually

as long as you hold on to great

companies that will beat the index so

that's versus the S&P 500 and overall

I'm up

145% over the last 5 years now given the

fact that the last 5 years we went

through two bare markets covid pandemic

a banking crisis

a recession and uh two Wars in Ukraine

and the Middle East um having a 145%

return is not too bad it is acceptable

the good news is I expect the next 5

years to be a lot more bullish and a lot

more profitable than the last 5 years

and let's see how that turns out so that

brings us to the topic of our video

which is how I plan my investments for

the year ahead so I'm here to share with

you my thought process that I go through

every single year so step one is to

decide how much cash you want to put

into the market for the coming year so

for me what I do is I will calculate a

percentage of my income that I plan on

saving that I'm going to invest into the

market now it's different for different

people but I would suggest at least save

10% of your income to put into the

market every single year remember

investing is not a Sprint it's not a

onetime Allin and then pre is going to

go up no investing is a marathon a

marathon that you do consistently over

many many years so every year you want

to put a bit of money into the market to

allow it to compound and grow and again

at least 10% of your income could be

more could be 20 30% depending on uh how

much you can save so I always tell

people that the first rule before you

even invest is to manage your money well

and the first key to money management is

to spend less than you earn earn so you

have a surplus to put aside to grow your

wealth okay so that's step number one

let me write it down for you uh let me

just open up this canvas over here so

step one is

to

um

plan your

cash allocation how much you intend to

put into the market for the

year right so for argument sake let's

say you know you want to put in um I

don't know let's say you want to invest

you know

$10,000 into the market for the coming

year right could be 100,000 10,000 50

Grand and depends on your situation okay

so that's step number one uh so that's

what I do so step number two is to

divide that cash equally by the number

of stocks in your portfolio as equally

as possible so what do I mean so it's

all about diversification so for example

if your portfolio you have for example

well let me just write this down

diversify the capital that you want to

invest as equally as

possible across the stocks in your

portfolio within your portfolio so for

example if you have uh 10 stocks in your

portfolio then you want to divide your

Capital by 10 so that would roughly be a

10% allocation per

stock

but if you have 20 stocks in your

portfolio or you plan to have 20 stocks

in your portfolio then each stock would

have a 5% allocation and so on and so

forth all right now for me currently

I've got about 40 stocks in my portfolio

right sorry 40 stocks so you take 100%

divided by 40 then roughly each of my

stocks should have a

2.5%

allocation got it now this of course if

you're starting a portfolio from scratch

now now for someone like me who already

has an existing portfolio the cash I

want to invest will not be divided

equally and the reason is because I in

my my portfolio I've got certain stocks

that already have more than the plan

allocation and I've got certain stocks

that are below the plan allocation so

let me give you an example like I said

I've got about 40 stocks in my portfolio

and some of my stocks have a much bigger

than 2.5% allocation now when I first

bought them they were a small allocation

but they grew organically as a share

price increase so for example let me

just show you some of my stocks in my

portfolio over

here there we are so I've got I own meta

and you can see mattera makes up

6.5% of my portfolio which is a lot more

than 2.5% why because mattera over the

years has increased in price so it's

grown organically to more than my normal

allocation so as I mentioned in previous

videos when when a stock grows

organically do I sell the excess to

bring down the allocation back to 2.5%

no I don't because that's called cutting

the flowers right you don't want to cut

the flowers as long as it's a great

business the business is growing it

continues to be undervalued or not too

far birth intrinsic value I hold it and

let it compound and compound over time

so would I add more money to matter this

year probably I won't because I already

have a pretty big allocation make sense

right but I've got certain stocks like

for example lvmh Louis Vuitton which I

bought the US listed ADR shares tick a

symbol LV mui so for this stock you can

see that currently I only have a .5%

allocation whereas I want to have at

least 2.5% right 2.5% is the usual

allocation so for this stock would I

want to allocate more cash to buy the

stock more this year yes in order to

bring it up to at least

2.5% okay then I've got another stock

for example you know S&P Global which is

one of the top Financial companies I

have a uh 2.99% allocation which is

again above the 2.5 because it's grown

organically but if I've got ex excess

cash to put in I may put in more to that

so the whole idea is I'm I'm planning

okay so for this stock I'm going to add

more cash this stock not so much so that

I balance it as uh equally as possible

but for stocks that have really run way

above the allocation I leave it I don't

sell it hey if you want to join me at my

Market Outlook event 20124 live in

Singapore you'll be at the Marina Bay

Sands on the 20th of January from 9:00

a.m. to 6:30 p.m. where I'll be joined

with bang and Elson where we'll be

sharing with you our in-depth analysis

into the year ahead as well as the

sectors and stocks and trading

strategies we're looking to use to

really get another great profitable year

ahead you can click on this link above

the link is also in the description box

below to purchase your tickets seats are

very limited it's 18 Singapore dollar

that's just 13 plus US Dollars just to

cover the cost of the venue and of

course the knowledge and content you're

going to learn is going to be Priceless

to your portfolio now do I plan on

adding new stocks to my portfolio to

increase the number of stocks maybe if I

find new stocks so every year my

priority is to always buy more shares of

existing stocks first that's always the

priority and then the secondary

objective is to add new stocks if I find

there are stocks that are even better

than the ones I already own I remember

many many years ago a famous quote by

Peter Lynch he said that the best stocks

to buy are the ones that you already own

because if you already already own great

companies just keep adding to those

shares but if you find another type of

stock that is just as good or even

better then sure then you could add that

in into your portfolio so every single

year I'm always looking out for better

companies I'm putting them through my

screening process to make sure they meet

the criteria of being a great business

as you guys know I'm very strict I only

invest in the top 1% of stocks in the

entire market so in the US market there

are 6,000 stocks so 1% % time 6,000 is

60 stocks so the most I can buy will be

60 stocks because if I buy more than 60

stocks then I'm I'm more than 1% and and

I don't want to go outside the top 1% of

high quality stocks and of course those

of you have taken my value momentum

investing cost you learn my screening

process of how I select these high

quality companies companies that are

very predictable that are very

consistent that are very resilient

they've got consistent growth in Revenue

profits and free cash flow companies

that have a sustainable competitive

Advantage a wide economic mode ideally

companies that you know ideally are

buying back shares reducing their shares

outstanding companies with high return

on Capital companies with conservative

debt so I'm always looking out for these

companies and again if you subscribe to

my uh ultimate investors Playbook I

share you every month what are some of

the best companies in the market we do a

deep dive research and if we find one

that is compelling at the right price we

added into our portfolio as well now

sometimes may I sell certain stocks in

my

portfolio to give room for new stocks

yes so within the stocks I already own

if I feel that you know one of them is

not as great a business anymore but it's

an okay company but you know I think

there's a even better company I I could

sell that and replace that with another

company so I do that as well so as you

guys know last year I decided that

Disney uh it's a stock which I own I

decided that you know what I think I can

they are much better companies out there

than Disney I'm not saying Disney is a

bad company but there are better

companies more predictable more

resilient I sold Disney I sold tensent

as well because tensent again I'm not

saying it's a bad company but I can find

a lot more predictable companies that

have got less risk of regulations

affecting their business model so I sold

10 cent I sold Disney and I'll replace

them with even stronger and better

companies so once I've decided How much

money to allocate for each stock for

example I may say okay I intend to uh

invest 10,000 into lvmh I intend to

invest another you know 8,000 into spgi

another 10,000 into you know Home Depot

whatever it is right so once I have

planned how much to allocate then I'll

buy only when the share price drops to

my buy level so which is Step number

three step number three is I will

buy only when the share share

price drops to my intended buy level

which is the share price must drop

enough such that it is

undervalued it must be below the

intrinsic value before I would buy the

shares and number two it must retrace to

a to a significant support level on the

charts and as usual I never buy at one

goal I always buy in trenches so what

does that mean so for example if I plan

to invest another 10,000 into lvmh for

example and it reaches the first buy

level I would buy a quarter of that plan

allocation so I'll buy 2,500 worth of

shares first and if the price drops to

the next support level next buy level I

then buy another 25% which is another

2005 and the low it drops the more I

invest until I've got a fully allocated

position if it drops drops all the way

down to the last support level so in

other words if I plan to invest a

certain amount into the markets this

year would I end up buying everything no

for example if for the whole of 2024 the

market doesn't go down if the market

keeps going up then I may not buy

anything because the price never dropped

to my intended buy

level or if the market drops but doesn't

drop too much then I may only end up

buying half of what I intend to buy this

year but if the market drops a lot this

year Market goes down 20 30% I'll be

very happy because then it will drop to

my buy levels it gets cheap enough and

I'll put in my full position so how much

I end up buying this year depends on how

low the market goes the lower the market

goes the more I buy if the market

doesn't drop at all I end up buying

nothing and I may end the year with all

my cash and I'll just roll it over to

the next year and then maybe next year

when it crashes then I go all in for

example well not all in but I'll buy in

trenches so let me show you an example

on one of the stocks LV mui this is

Louis Vuitton which is one of the

highest quality stocks from the European

Union all right they make all these

luxury bags and and clothes and stuff

like that right so I I already own this

share but I have a very small allocation

so this year I'm hoping to you know buy

a lot more of the shares and for example

I intend to buy a about another you know

$30,000 worth of lvy for example and I

have determin that my buy levels are

148 143 and 133 now me say how did you

decide on the buy levels I use technical

analysis and I identify significant

levels of support based on uh various

time frames the monthly weekly and daily

time frames but I won't go into that

into detail because we teach in the

courses now for LV mui I've calculated

that the intrinsic value base case is

155 that's the intrinsic value that's

what the shares are worth so I only want

to buy if it gets back below 155 as you

can see it was below 155 last year and

that's why I bought a bit but it went up

too fast for me to add more so I'm

hoping that this year if you can get

back below 155 I can complete my buying

to get my full 2.5%

allocation so as I said uh I've

identified three support levels

149 thereabouts 143 and 133 and what I

do for my subscribers is that every

month I do a portfolio review of every

stock I recalculate the intrinsic value

so so they know for each stock what is

the valuation and I show them every

month what are the buy levels where I

would start adding shares right right so

hopefully hopefully if this stock can

drop to

148 then I'll buy oneir of my planned

allocation so for example I intend to

buy 30,000 worth of this stock if it

drops to 148 I'll buy $10,000 worth of

stock first then if it drops further to

143 I buy another 10,000 if it drops to

the last support level then I'm fully

in with my 30 grand and hopefully that

brings up my allocation to uh uh an

allocation level that I want in my

portfolio now what if the stock never

comes down what if just flies all the

way up then I don't buy anything so

that's the discipline so one of the

things is I never chase the girl if the

girl is running away I never chase the

girl because she will lose all respect

for you I wait for the girl to run to me

when she's scared into my loving arms

all right and if she doesn't run to me

this year she'll run to me next year

right eventually she will run to me and

again that's the discipline of investing

now having said that bear in mind that

for great companies the intrinsic value

will rise every year so I do a

revaluation so next year this intrinsic

value of 155 it may go up to 170 180

right similarly these support levels I

draw as the price goes up they will be

revised as well either upwards or

downwards so it is always a revision of

my intrinsic value of my buy levels so I

know exactly when I start buying shares

it is not based on emotions it's not

based on predictions it's based on all

these uh objective uh Technical and

fundamental rules after Rising 24% or

more than 24% in 2023 the market S&P 500

looks a bit overextended right now so

although I do expect 2024 to end with a

gain by the end of the year but I do

expect that to be at least a pullback or

correction uh soon I can't tell you

exactly when but my guess would be

probably in yeah maybe the first quarter

of the year or maybe even lasting to the

first half of the Year remember prices

don't go up in a straight line they

never go up in a straight line they go

through wave patterns right so you've

got wave up you got wave down you got

wave up you got wave down it's wave up

wave up right can't wave up forever

eventually it's going to wave W down so

I'm waiting for the wave down uh for me

to start adding shares of my favorite

companies now again the question is

always you know where's the top when

it's going to come down you know we can

guess but no one knows for sure uh but

you know we can always use certain tools

to make educated guesses but again

they're not 100% they're just you know

guessing right so if I use my Fibonacci

tool

where I look at the impulsive wave up

there we are that's the wave up a to B B

to C I can project using my Fibonacci

projection tool that the possible end of

this wave up based on Fibonacci is at

4918 at the 100% projection level which

means we could wave up to there and then

we will then correct

down to maybe uh at least the 20

EMA on weekly candles which is about 4,5

right so we go up there we correct down

here and then we then continue the

uptrend now again will it exactly happen

this way of course not but this is you

know something that is just a

possibility now it's the same thing with

individual stocks for example look at

meta which was the best perform in 2023

if you look at meta you can see that uh

it's been on a very very strong wave up

pattern

and by the way if you calculate the

intrinsic value uh my valuation is about

$411 so I think that at 335 sorry 35 uh

353 my bad uh meta is still

undervalued okay so I still think it's

it's still cheap but having said that

even though it's still cheap uh it is

technically a bit overextended so again

what that what what does that mean now

if I go down to the Daily candles let's

take a closer look at the daily candles

that we are so check it out again wave

patterns right although it's

fundamentally cheap and I I I believe

that metal will keep going up in the

many many years to come but it will not

go up in a straight line you will go

through these wave patterns right wave

up wave down wave up wave down wave up

right and now it could be waving down

first right before it waves up again so

it will go through these uh ups and

downs so the important thing as an

investor is to you know when it's waving

up that's when people are all optimistic

they're chasing the stock that's when we

don't want to chase the stock never

chase the girl let it run right you need

to wait for the wave down for the Panic

the correction the bad news and then you

start adding once it has waved down to a

strong level of support which could be a

moving average or a uh support level

that you have identify a very common

question I get from people is Adam if

you think that a stock like meta for

example is you know at the end of the

wave up or near the end of the wave up

and it's going to retrace soon then

doesn't it make sense to sell the shares

when it's high and then after it drops

you buy it back again the answer really

depends on your personal situation so

what I tell my students is this I say

that if you need the cash for whatever

reason for example you need to raise

cash uh for your personal expenses like

you need to you know renovate your house

for example you need to buy a new car

then would now be a time to sell shares

of meta yes because you need to raise

the cash or if for example you don't

have extra savings to put into the

market this year and you want to buy a

stock and you don't have the cash by a

stock and you want to raise some cash

from existing stocks to buy new stocks

or to buy this stock when it gets lower

then yes it makes sense to

sell when it's near the end of a wave up

pattern or for those of you who have

bought on margin which means you bought

using B from funds from the broker and

now you you're sitting on very good

returns if I were you I would sell

everything right now I would sell in

order to bring my margin to zero it

doesn't make sense right now to own

stocks on margin for two reasons number

one interest rates are still high and if

you're buying stocks on margin you're

paying a lot of interest on your margin

account number

two when not if but when the market

corrects down a lot of your profits will

be evaporated if you're on high margin

okay so I repeat if you need the cash to

buy something or you need to raise the

cash so that when the market drops later

in the year you have money to buy or if

you need uh or if you're on margin then

yes now if I were you I would sell my

shares if not all the shares s sell 1/3

or sell half at least okay and then when

the market correct back down uh in the

later part of the year then yeah you

could you know buy it back and so and so

forth okay however if you are like me

and I donate the cash because I have got

more cash coming in from my savings to

put into the market then I'm not selling

my meta shares even though I think

there's a chance is going to go down now

you may say why why don't you sell and

buy back because over the years I've

learned my lesson that if you own a very

very good company and you know that this

good company is going to keep growing

over the years and you try to jump in

and out in the short term sometimes you

can sometimes you can get lucky and

right after you

sell right it drops down and you buy

back and it goes up and you go yes I'm

good right and and happens once in a

while you feel really good but there

were also many times in my life where I

owned great companies like apple Amazon

Microsoft and I've owned them for many

many years but what happened is after a

strong wave up I thought that hey it's

really so high and after I sold it guess

what happened it kept going high went

right and it went up another 50 100% And

I was no longer in that great business

and even though it retraced later on

even after the drop it was still above

birth where I got out and I could never

get back in again until much longer and

I missed out a lot of gains and that has

happened to me before you know I bought

Microsoft for example 15 20 years ago

and you know if I just held on to my

shares through those ups and downs today

I'll be a lot richer compared to me

selling and buying back and missing out

a lot of gains when I got out right and

there were also many times in my life

where you know I sold and sure enough

after I sold it dropped back down as go

yes I'm so smart and said I'm going to

buy it back I'm going to buy it back and

I said I'm going to buy it back when it

reaches this support level over there

but before I could buy and before it

reached a support level boom it went up

so fast that again it left without me

and it went up another 100% right so

I've learned my lesson and I learned

that if I'm holding great companies that

I know will keep growing in the long run

and I don't need the cash right now I'm

not going to sell it I'm just going to

hold it right and even if it drops you

know you know 51 15 20% you know it's

fine I'll just add more shares when it

goes down because I've got more cash

coming in but at the same time in order

to generate some additional income while

my favorite stock is retracing down or

consolidating what I do is I sell

covered call options against my position

and for those of you who have taken our

option courses you know what I'm talking

about we sell call options that are out

of the money so for example just a few

days ago I sold call options again my

meta stock at a strike price of

$380 strike price so what does that mean

let me just show you um this is my

account there so you can see that for

every 100 shares of meod that I own I

sold one contract of call options and I

sold the call options at a price of

about close to

$8 so one contract is 100 shares $8 time

100 is $800 $100 I collect in premium

from the market and I sold six contracts

so six

contracts time

$800 that's

$4,800 of free money that I'm getting by

selling these call options free money

right so but you may say nothing's free

in life there there's a catch right yeah

so what's the catch the catch is very

simple so again I sell these call

options at a strike price of 380 right I

I'm collecting

$800 of Premium per

contract I sold six contracts so I'm

collecting

$4,800 of Premium from my option sale

okay now these options will expire in

about 40 days let me just double check

that yep they expire on the uh 2nd of

February right in about yeah 30 to 40

days so what happens is in the next 30

to 40 days if matter goes

down or if it goes

sideways or if it goes

up but below 380 right stays below 380

or it may even go above 380 but by the

expiration date it goes back below 380

what happens then the call options I

sold will become worthless at expiration

and I will just keep this $4,800 of free

money so I win right but what if what if

mattera goes up above

380 by the expiration date and stays

there then what happens then I may be

obligated to sell my shares at

380 now what's the cost of my matter

shares the cost of my meta shares as you

can see over

here uh my my cost price is

169 right so if I bought meta at

169 let me write this down right if I

bought meta at

169 and now I'm selling it at

380 do I make money yes but not only do

I sell it at

380 but I also keep the $8 premium which

I sold so my net sales price will be

388 so if I sell meta at 388 when my

cost is 169 I get a huge profit which I

also win so can you see that for me it

is a win-win scenario if mattera goes up

and I'm forced to sell my shares at 380

plus $8 premium I win I make a lot of

profits but if mattera goes sideways or

goes down or goes up a bit I get get

free money so selling covered cost is a

win-win situation as long as you already

own great high quality companies now

some of you may say but Adam what if you

don't want to sell your shares now if I

don't want to sell my shares what I can

do is I can buy back the call options at

a small loss and resell new call options

for new premium at a higher strike price

at a further expiration date to pay for

the loss of the old call options and

that's what we call rolling up the call

and that's something that we teach uh in

the options course in detail so that's

really a winwin win scenario so it's

fantastic when you can combine options

with your Investments it will

turbocharge your returns now if you want

to find out my in-depth analysis into

what I think is going to happen to the

markets in 2024 what are the specific

sectors that will outperform and

specific stocks that I'm looking at that

will outperform the market in 2024 you

can join me in the Outlook 2024 event

but it's it's happening only in

Singapore it's a event that's going to

be live at the Marina Bay Sands it's a

full day event from 9:00 a.m. to 6:30

p.m. on the 20th of January so if you're

from Singapore do join us if if you're

you know overseas you want to fly into

Singapore to meet myself and bang and

Elson where they will be also joining me

on stage we welcome and we love to see

you there as well and you can click on

this link up here I'll also put the link

in the description box below where you

can click on it and you can purchase

your tickets at just $18 Singapore

dollars that's about $ 13 plus us just

to cover the cost of the venue and of

course all the knowledge all the content

you're going to learn uh that's a huge

bonus so look forward to seeing you

there if you can make the date take care

I'll see you soon