134 Liquid emergency fund—case for a coma person

Liquid emergency fund—case for a coma person	紧急基金—昏迷患者的个案
Mr Y, a sole breadwinner, suffered a stroke recently. After a few operations, he is now in coma state. His family has put him into a care center. At the moment, his family cannot claim any insurance, provident funds, socso because a medical report is needed. It can take quite some time for the report. In the meantime, the family needs cash for daily expenses and Mr Y's medical and caregiver's expenses.	家庭经济支柱的Y先生不幸发生中风。经过几轮的手术后，如今陷入昏迷状态。他的家里人把他安置在护理中心。在医生开出医药报告之先，他的家里人暂时不能索赔任何保险、公积金或工作险。等待医药报告旷日费时。家里人目前必须解决的是生活费以及Y先生的医药费的看护费。
This is where we see the importance of liquid emergency fund. In wealth planning, we always talk of putting aside at least 6 months of cash for emergency fund. In this case, 6 months buffer can provide enough time for family to adjust emotions, lifestyle, look for jobs, waiting for report and various claims.	这就让我们看到紧急基金的重要。在理财规划里，一般建议存取6个月的现金作为紧急基金。在这个个案里，6个月的备用基金刚刚好足够让家里人调整心情、生活方式、找工作、等待报告以及各项索赔。
Where can we keep the emergency fund? The first place is certainly some money in joint name savings account with ATM facility. Bank is the safest to keep money and ATM is the most convenience method to make withdrawal. However, make sure the ATM card is available and the pin is known to the spouse. The amount is probably 1-3 months expenses.	备用基金该存放于何处呢？首先可以是有提款卡的联名储蓄户头。银行是存钱的最安全场所，而提款卡是最方便的提款方式。当然必须确保找得到提款卡，配偶也知道密码。这里的数目可以介于1-3个月的费用。
Second could be a joint name fixed deposits account. Fixed deposit provides higher interest rate and easy withdrawal. The amount is perhaps 3-6 (or up to 9-12) months expenses, with different tenures.	其次是联名的定期存款户头。定存可以给予较高的利息，也相对容易取款。这里的数额可以介于3-6（甚至9-12）个月的费用。最好可以有不同的期限。
Third option could be a living trust. If the family has some assets that provides regular incomes (e.g. rentals from properties), they can move those assets into a living trust and structure that the trust will payout certain amount of money monthly. This type of trust can also protect those assets in case of insolvency.	第三的方法是设立生前信托。若是家族拥有若干可提供固定收入的资产（如产业租金收入）的话，家族可以考虑用该些资产来设立生前信托，让信托把租金收入每月给出一笔固定收入。这类的信托还可解决资产因破产而被冻结或拍卖。
Fourth options can be an endowment plan that pays out annual income. Endowment plan normally will pay out some money either by the end of first year, or maybe after 6 or 10 years depending on the term. The catch is if the premium has not been fully paid, the family still need to service the premium until they get the medical report.	第四可以通过储蓄保险的每年派出。根据所买的保险种类而定，储蓄保险可能会在隔年或者6、或者10年后每年派出钱。这里必须小心的是如果保费还没完全缴清，家里人还是必须暂时缴付保费直到医药报告出笼为止。
Fifth is keeping some money at home. I think most people practice this, although we all know it is not the safest. Most won't keep much money at home anyway.	第五就是收点钱在家里。虽然我们知道这不是最安全的做法，我想这是大多数人还是会做的事。其实一般人也不会收太多钱在家吧。
How then do you plan your emergency fund?	你如何规划你的紧急基金呢？

133 The three musketeers of wealth accumulation: Time, rate of return, and the amount invested

The three musketeers of wealth accumulation: Time, rate of return, and the amount invested	累积财富的三剑客：时间、回报率、投入资本
There are three variables that impact wealth accumulation: time, rate of return, and the amount invested. Of the three, two are within our control—time and amount invested. At least we can control when to start, and with how much. However, we like to focus our attention on the uncontrollable—rate of return. Investors like to look for the target of investment that can give superb rate of return. However, a rate of return higher than inflation rate is good enough for most of us.	共有三个变数会影响财富累积，它们是时间、回报率和投入资本。这三个当中，时间和投入资本是我们可以控制的。或至少我们可以决定何时开始、数目多少。可是，我们总是喜欢注重那不受控制的回报率。投资者总是喜欢寻找那可以给予超高的回报率。其实，对于一般投资者，一个比通胀率稍高的回报率已经足够了。
To illustrate the case, let's do some simulation. We will use financial calculator found in http://www.calculator.net to do some calculation.	让我们做点模拟看看。我们会用http://www.calculator.net里的理财计算机。
Safe to say almost everybody has roughly 25 years to save for retirement. So, let's say we can save RM500 per month for the next 25 years, at a rate of return of 8%. We can see that, the future amount is RM454K.	可以说一般的人都大约有25年的投资期限。让我们试算在25年里每月投资RM500于给予8%回报率的投资。我们可看到未来数是RM45.4万。
Now, what if another investor think 8% is not attractive enough and delay his investment. He may leave the RM500 per month in his savings account (and hoperfully he doesn't spend the money). How much would he get after 25 years? He would have RM154K 25 years later. How sad.	但如果投资者认为8%太低了，于是拖延不投资。他可能会把每月的RM500存入普通储蓄户头（还要希望他不花掉）。25年后，他会有多少钱呢？他共会有RM15.4万。好可惜。
Next we look at whether 8% rate of return is within reach. We will get the data from Morningstar (http://my.morningstar.com). Out the universe, I will use data from "Malaysia - Large Cap". Why? Large Cap is suppose to see less volatility, and particularly many investors are so fed up with large cap stocks because of their non-performance over the last 3–4 years. We can see that there are funds that can do 8% returns.	接着让我们看看8%回报率是合理的吗？我们从Morningstar （http://my.morningstar.com） 查找资料。我会用Malaysia - Large Cap这个类别。为什么呢？大资本股的波动一般比较不大，在加上近3-4年大资本股没什么表现，让许多投资者伤心呐。我们可以看到是有些基金能够给予8%回报率的。
OK, the questions will be whether RM500 per month is affordable. Of course, it may sound too high for those newly in job. So, he may start with a smaller amount. However, as he get more senior, he should get more increment. He should commit to a bigger amount. The important thing is he should not refrain simply because amount is small. Investing is a habit, and it's a marathon.	那，接着的问题就是每月RM500负担得来吗？当然对初入职场的新鲜人来说，这数目可能会稍高。所以，他可以以较低的数目开始。随着他的职龄增加，薪水也跟着水涨船高。到时，他就能负担更大的数目。重要的是别因数目小而不投资。投资也是一种习惯，而且更是马拉松长跑。

132 China A-shares vs H-shares, which is cheaper?

China A-shares vs H-shares, which is cheaper?	中国A股及H股，何者较廉？
On 11/4/18, I attended a market outlook talk. Fund house A came to talk about China market and one of their China fund that can access to China A-shares market. The presenter said it is a good time to consider China A-shares because they are at a discount to H-shares peers.	于11/4/18出席一市场前景讲座。A基金公司来讲解中国市场及其可投资A股的中国基金。讲解人提到此时正宜考虑中国A股因为它们正比H股便宜。
His statement came a surprise to me. I had just finished reading a few China and Hong Kong value investors' / fund managers' on their investment strategies. They said since H-shares is cheaper than A-shares, apparently it makes sense for them to buy H-shares.	这话有点儿让我惊讶。我刚读完基本中国及香港价值型投资者或基金经理的书。对于两地上市的公司，他们的分析是“同股同权，应买较便宜的”。既然H股较A股便宜，他们买的是H股。
So, I immediately google it up. In Financial Times (https://markets.ft.com/data/indices/tearsheet/summary?s=HSCAHPI:HKG), it is shown that A-shares is about 23% premium over H-shares. The data is for 5 years.	所以我马上谷歌一下。在Financial Times (https://markets.ft.com/data/indices/tearsheet/summary?s=HSCAHPI:HKG)， 可以看到A股对比H股有23%的溢价。这里有5年的资料。
This morning, I googled again since I want to note down in this blog. In investing.com (https://www.investing.com/indices/hs-cahpi), I can see a longer data, as far back as 2006. So now I can see somewhere between 2007 to 2010, A-shares was at premium to H-shares, with its peak at 2008. Then A-shares were at a discount to H-shares in between 2010 to 2015, before they became at a premium again.	今早，我再次谷歌，因为要在此处留个记录。在investing.com (https://www.investing.com/indices/hs-cahpi)，我可以看到久至2006年的资料。资料现实在2007年至2010年期间，A股对比H股有溢价，且在2008年达到高峰。接着的2010年至2014年之间，A股对比H股是出现折价的。2014年后，A股再次出现溢价。
Although there is a premium, but when we refer to data in Fundsupermart Malaysia (https://www.fundsupermart.com.my/main/research/-View-Market-Valuation-as-of-16-April-2018-9662), the three stock markets at Greater China area are still quite low in valuation when compared to their fair value PE multiple. So, to invest or not to invest in A-shares, solely depends on individuals.	虽然出现溢价现象，但参照Fundsupermart Malaysia （https://www.fundsupermart.com.my/main/research/-View-Market-Valuation-as-of-16-April-2018-9662） 的资料，大中华两岸三地的股市本益比仍然是较合理估值低的。所以要不要投资A股就看各位看官了。
Personally, maybe I still do not dare to go into A-shares. Maybe I was influenced by those books, that China market is still a relatively young market, the investors there still have not treat stock market in a more rational manner. Herd mentality is still a common phenomenon.	就本身而言，可能我还不敢参与A股。当然A股里最近出现了几只回报标清的股票如贵州茅台。或许是被那几本书影响，中国股市毕竟历史较短，股民还没有理性的看待股市，常常出现跟风现象。

131 Biblical-based Investing

Biblical-based Investing	符合圣经的投资
While looking for some ETFs that invest in environment-friendly companies, I happened to know a few ETFs that invest based on Biblical values / requirements. It seems this faith-based investing is categorized in a broader socially responsible investing (SRI).	当我在搜索投资于环保公司的股市交易基金时，让我发现几个符合圣经投资法的股市交易基金。这些所谓的以信仰为本的投资法被包括在社会责任投资法领域。
Socially responsible investing is very popular in the western world, where investors who are conscious of his money to be invested in a way that benefits the environment and social. Companies that involved in tobacco, gambling, pornography or non-environmentally friendly would not fit the bill.	社会责任投资法在西方非常流行。投资者很介意他们的钱是投资在有益于环境和社会的公司。若是公司涉及烟草、赌博、色情或者破坏环境，这些公司就不符合他们的需求。
As I search, there is no such funds or ETFs in the Asia region. In terms or mutual funds, there are Ave Maria, Thrivent, GuideStone, LKCM Aquinas, New Covenant, and Steward. Unfortunately, there are only available in US. In terms of ETFs, there are Inspire, James Bible and GlobalX. These ETFs, since traded in NYSE, can be bought through local stockbroking houses that allow oversea market trading.	在亚洲，目前似乎并无此类的信托基金或者股市交易基金。在信托基金方面，市场有Ave Maria, Thrivent, GuideStone, LKCM Aquinas, New Covenant, and Steward。遗憾的是，它们只在美国出售。在股市交易基金方面，市场有Inspire, James Bible and GlobalX。此类股市交易基金，既是在纽约交易所上市，我们就可通过本地股票行开通国外交易平台进行买卖。
With this discovery, I think I can approached Christian clients whether they want to divert some capitals into such Biblical ETFs. It makes sense to me that Christian should not invest in companies that support sinful activities or business.	即由此发现，我想我可以询问基督徒顾客是否有意转移某些资金投资于此类符合圣经的股市交易基金。对我而言，基督徒不投资于那些牵涉罪恶行业的公司，是合情合理的。
Besides complying to Biblical requirements, some ETF providers may also allocate some of their profit towards charity or missionary.	除了投资选股方面符合圣经要求之外，这些股市交易基金的公司也可能会拨出某个部分的盈利来支持慈善或宣教事业。
On a separate note, although it is a good thing to know of such ETFs, we cannot ignore another basic cause of lay-investors investment failure. This basic failure is their untimely in and out of market activities. Take the recent possible Sino-US trade war scare as example. The market turned volatile. Many investors could have sold their stocks in the recent lows. Why wasn't it a buy at low? In times like this, we should remember Warren Buffett's words that market fluctuation is our friend while our personal fear is our arch-enemy.	能够找到符合圣经的基金固然是喜事一件，我们也不应忽视一般投资者投资失利的基本原因。这基本原因就是投资者总是在不当的时间点杀进杀出市场。就以今日中美恐爆发贸易战举例，股市因而波动剧烈。许多投资者或许在这几日的低点就出售手上的股票或基金。为何不是趁低进货呢？此时就该想想巴菲特说的--市场波动是我们的朋友，自身恐惧确实我们的大敌。
What follows should be to learn more about Biblical investing or wealth planning. The constraint is limited on-hand resources. Seems like I just have to learn as I go on.	接下来我要做的，应是继续了解符合圣经的投资法或理财法的整个做法。只是手上的资料有限，看来只有边学边行了。

130 Performance of Magic Formula investing

Performance of Magic Formula investing	Magic Formula 投资法的回酬
Background	背景
I started my own stock investment journey about two years ago (2015). I used technical analysis in the beginning. After a year of trying, I find my result to be very terrible. Seeing my capital to reduce in size, in one time, caused me to suspect myself not cut to stock investment. Honestly, I thought of giving up DIY active investing.	我在两年前（2015）开始股票投资。刚开始时我使用技术分析。尝试了一年之后，发觉成绩惨不忍睹。看着资金缩水，让我不禁怀疑自己是否无缘投资股票。老实说，也有想过放弃自己投资。
All through the time, I have been reading blog posts in i3investor. One of the blogger, kcchongnz, has been writing actively in i3investor propagating Fundamental Value Investing. And all along, I followed his posts--but not his method (shame on me).	在那一段时间里我都有阅读i3investor里的博客贴文的习惯。其中一位活跃的博客，kcchongnz，一直鼓吹基本面价值投资法。我也一直有追踪它的贴文，惭愧的是却没有追随他的投资法。
Out of desperation, I began to re-read his posts. I found that over his three~four years of investing using fundamental value investing, he has successfully earn exceptionally returns. And I thought to myself, if only I had simply followed his method, I would be in a much better shape. It took me a while to read his posts, and to get to appreciate the Magic Formula investing he is using.	在一片茫然的情况下，我开始重读他的贴文。我发觉在过去三、四年里，基本面价值投资法让他赚取可观的回酬。我想，若是当年我就傻傻的跟着他的投资法，我就会有不错的成绩。我花了一段时间阅读他的贴文，并开始明白他所使用的Magic Formula投资法。
After a year of trying Magic Formula, I would say I am happy with the result. The most fantastic of all is I do not have to worry about daily price movements. Because I already know their financial positions.	在尝试了Magic Formula一年后，我很满意自己的成绩单。最可喜的是我再也不因每天的价位波动而烦恼。因为事先了解公司的财务状况。
Magic Formula Investing	Magic Formula 投资法
Magic formula investing is an investment technique outlined by Joel Greenblatt (JG) that uses the principles of value investing. JG published his method in his 2004 book The Little Book That Beats the Market, and later update in 2010 in The Little Book That Still Beats The Market. (Those in Johor Bahru may borrow the 2010 version from Sutera Mall Library.)	Magic Formula 投资法是Joel Greenblatt （JG）所倡议的价值投资法。JG把他的方法写在他的两本著作里，即2004年版的The Little Book That Beats the Market，以及2010年版修订的The Little Book That Still Beats The Market。（新山的朋友可以在五福城的图书馆里借到2010版。）
JG wrote the books for their children, to teach them a simple way of finding cheap and good stocks that produces excellent returns. JG also publish the returns in the books, which we shall see later. The books are rather easy to read, and most importantly, the method easy to follow.	那两本书是JG写给他的孩子们的，目的是要教导他们一个简单的方法，以便可以筛选到便宜又好的股票，从而可以提供高回酬。两本书都很容易阅读，重要的是方法容易使用。
In the pursuit of finding cheap and good stocks, value investors used many valuation methods. The most common is PE ratio and ROE. JG uses two other criteria: Company's earnings yield (EBIT / enterprise value) Company's return on capital (EBIT / (net fixed assets + working capital)).	在找寻便宜又好的股票时，价值型投资者使用许多种评估法。一般常用的是PE和ROE。JG使用另外两个方法。 公司的 earnings yield (EBIT / enterprise value) 公司的 return on capital (EBIT / (net fixed assets + working capital))
Performance of Magic Formula Investing (by JG)	Magic Formula 投资法的表现 （根据JG的资料）
For performance provided in the books, I use the data copied from oldschoolvalue.com. Over the 22 years period, the CAGR is 23.76% -- which means turning $10,000 into $1.1 mil. In most of the years, Magic Formula gives a higher returns than benchmark S&P 500.	书里所展示的回酬表现，我从oldschoolvalue的网站截取。在过往的22年里，复利回酬是23.76%，亦即把一万元的资本滚成一百一十万元。在多数的年份里，Magic Formula也获取比市场指标S&P 500更高的回酬。
Performance of Magic Formula Investing (in Malaysia)	Magic Formula的回酬（马来西亚）
I believe there are follower of the same strategy in Malaysia. Unfortunately, there is no systematic data gathering / analysis being done. I can only find one practitioner who shared his experience and results in i3investor -- kcchongnz. kcchongnz has two portfolios in i3investor, the first is created in 2013 and the second in 2016. Let's see the result with the longer investment time. Over the last five years, the portfolio returns a CAGR of 20.4%. KLCI index made a total gain of 19.9% (or a CAGR of 3.7%).	我相信马来西亚也有人使用这个投资法。问题是没有人或者学者去做系统性的资料收集。我也只能找到kcchongnz，一位在i3investor分享他的经验和成绩单的投资者。kcchongnz总共设立了两个组合，第一在2013年而第二个是在1026年。让我们来看看历史悠久的那个组合。在过去五年里，组合给出了20.4%的复利回酬。反观综合指数只给出了19.9%的总回酬（即3.7%的复利回酬）。
Conclusion	结论
We can see Magic Formula works in Malaysia market as well. I think Tobias Carlisle (if I am not wrong) also studied and found it works in Europe and Japan.	我们看到Magic Formula在马来西亚的市场也是行得通的。如果我没有记错的话，Tobias Carlisle也曾研究过、也发觉Magic Formula在欧洲和日本也行得通。
I will be very happy to achieve a long-term returns of 10%-15%. If I had followed kcchongnz model portfolio, I would have beat my target returns. Well, all is not lost. I started a year ago, practicing and learning, I will, as I progress. So, those are the performance record of Magic Formula investing I can find.	对我而言，若是我能达到10%-15%的长期回酬，我就很满意了。还好，亡羊补牢，未为晚也。我才起步一年多，我可以边学边进步。这就是我所能找到关于Magic Formula投资法的回酬记录。
Postscript	后记
oldschoolvalue has improved Magic Formula into its QVG method. Tobias Carlisle also imrpoved Magic Formula into Quantitative Value method. As I am a bit lazy to modify my spreadsheet, and there is no screener that can screen using QVG or QV method, I will skip them for now.	oldschoolvalue 改良了 Magic Formula 成为 QVG 投资法。Tobias Carlisle 也改良了Magic Formula 成 Quantitative Value 投资法。但因为懒惰修改我的试算表再加上暂时也无screener可以根据 QVG 和 QV 两种方法筛选股票，所以暂时搁下。