System's SG Portfolio Currently 100% Cash. Bracing for Possible Storm.

After selling off my TEE Land (SGX:S9B) for a small profit of 2.89%, the system's SG portfolio went into 100% cash as the overall market's upward momentum weakens amidst the escalation of the Wuhan virus outbreak in Singapore. Currently there are already 40 confirmed cases of the virus in Singapore with 4 in critical condition. The figure will definitely rise in the coming days. The DORSCON level has already changed to orange on Friday.


The system's MATA component which tracks the percentage of total rising stocks in SG market fell from 39% to 34% in the past 3 weeks and the system's outlook was downgraded from Bullish to Neutral. If the market continues to weaken as investors react negatively to the escalation of the outbreak, the system's outlook will likely turn Bearish in the coming days. I'm glad that the portfolio is already 100% cash and if the market situation worsens, I am spared the onslaught.

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Of course, as usual, whenever I talk about being 100% cash it will stir a lot of opinions especially among the value investors. Do remember that our style of investing is different. Value investor buys when things are cheap, my system buys when things are trending. In addition, capital preservation is a priority to reduce the portfolio beta. Hence, my old adage still remains: If it looks like it is going to rain, I will carry an umbrella. It may not rain eventually but if it does, I will not get wet." Trade with caution and stay safe.


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