Monday, January 25, 2010

Top 10 ways to get rid of Gen Yers in your office

Monday January 25, 2010

Top 10 ways to get rid of Gen Yers in your office

Deloitte Insight - By LIM PHUI CHENG

GENERATION Y – a perpetual hot topic. How to attract them, retain them, put up with them? Or that one solution that tempts many but no one wants to say out loud: Get rid of them altogether, and save yourself a lot of headaches.

Much research has been done on Gen Yers and what makes them tick. Using those findings as a basis, let’s look at how to get rid of them.

1. Ban Facebook, Twitter and all other social media websites. While not a panacea for clearing your office of Gen Yers, this is a good place to start. A survey done by Deloitte shows that some teens consider lack of social networking at work a significant detriment in choosing a workplace.

2. Don’t let them work from home. Or anywhere that’s not the office. Gen Ys value and almost expect flexible schedules. Not letting them work from home – or anywhere other than the office – is a sure way to frustrate them.

3. Don’t tell them why their work matters, or how it will be used. Everyone appreciates knowing the value his work adds, especially Gen Y. One Gen Y in a focus group pointed out that they are constantly “looking for a sense of the bigger picture”.

4. Give them as much mundane and repetitive work as possible. Gen Yers believe they can learn quickly, take on significant responsibility and make major contributions far sooner than older generations think they can. Personal development is usually a high priority for them. Assigning them mundane work is therefore an irritant in both the short and long term, especially if you can combine it with No. 3 above.

5. Tell them off for not working 100% of the time in the office. Technological advances have broken down the disconnection between working hours and non-working hours. With round-the-clock email and demands for answers, many Gen Y knowledge workers feel they are effectively on call 24/7.

Consequently, they believe that they need to take more breaks throughout the day, often through video games, iPods or YouTube. Tell them that they’re not paid to play around during company time whenever you see them goofing off in the office – even if they worked till midnight last night.

6. Evaluate them on the number of hours they stay in the office a day, rather than the quality or quantity of work they produce. Combine this with No. 2 and No. 5 for extra impact.

7. Never praise them or thank them for putting in the extra effort. Gen Ys are willing to work hard but within reason. Asking them to put in time and/or effort they see as unreasonable and/or unnecessary is guaranteed to irritate them. Don’t forget you can rub some salt into the wound by giving them no praise or recognition whatsoever, or acting as if their extra effort was run of the mill.

8. Give them anything but transparency. Gen Y came of age in a world of layoffs and corporate scandals, fostering a belief that businesses in general value their own financial gains above everything else, and that business talk about the importance of people is largely insincere.
One Gen Y in a focus group commented: “We are looking to be loyal to an employer if that employer will be loyal to us, but we don‘t think business operates that way today.”
Utilise this scepticism by making promises you never deliver on or even address again. If they can even tell you made any, under the layers of fluff.

9. Tell them work-life balance is a fantasy only held by the ambitionless. One survey found that almost 90% of Gen Yers have either a primary focus on family, or they divide their focus between work and family. They favour family and personal time over the rewards that usually accompany increased job responsibility.

Now, this is a golden opportunity; pile on the hours, while telling them that eventually they’ll grow up and realise that they’ll have to prioritise their career just to make a living.

10. Use these phrases as often as possible: “Do it because I said so.” “That’s the way we’ve always done it around here.” “You have to pay your dues.” “You young people don’t understand working life.”

Gen Yers hate being disrespected. They have been raised to feel valuable and very positive about themselves…and to question authority. Send them the message that you expect them to respect you due to your higher rank alone.

Once you’ve successfully cleared all Gen Ys out of your office, and hopefully deterred any other potentials from applying, sit back and relax. You’ve managed to save yourself a lot of time, trouble and headaches, in the short term. In the long term, as the workforce ages and older generations retire, you may experience a problem.

The truth of the matter is that Gen Y is simply too large to ignore, both as workers and consumers. Companies that don’t figure out how to harness this growing resource are likely to find themselves at a distinct disadvantage, not only in the talent market, but in the broader market as well.

Effectively attracting, managing and retaining Gen Y certainly poses a challenge, especially while taking care to cater to the rest of your workforce. However, research has shown that all generations basically want and value the same things.

The difference is that priorities, expectations and behaviours may differ noticeably. With a little creative thinking, and an open mind from all employees, organisations can find solutions that appeal to all generations.

For instance, coaching and/or mentoring arrangements support Gen Yers’ desire to learn and develop, while giving older generations an opportunity to contribute and feel valued. Other programmes such as flexible work arrangements appeal to not just Gen Y, but also baby-boomers considering sabbaticals and Gen Xers who value flexitime and telecommuting.

The most important question to ask yourself is not “how should I manage Generation Y?” but rather, “how can I make my company a great place for all generations to work?”

● The writer is a consultant with Deloitte Malaysia’s human capital consulting practice

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Thursday, August 6, 2009

Information overload

You are living in a world that is exploding with information. All you need are a couple of keywords and search engines such as Google and you can have a huge amount of information at your fingertips. Information overload occurs when you have too much information but are using too little of it.

Here are some symptoms you may experience when you are overwhelmed with information:
● Stress. No matter how much research you have done, you have a nagging feeling that some vital information is still missing. A classic study at Georgetown University found that continuous stress can decrease your IQ by as high as 10 points.
● Poor memory. You cannot recall important names, dates and details.
● Worry. You worry, get distracted and daydream easily. You have problems concentrating on one task and procrastinate over your tasks.

Here is how you can manage information better:
● Decide on the purpose of the information you want to acquire.
● Plan and organise your work so that managing information is more streamlined and effective. Get rid of clutter on your table as it will distract you.
● Control the flow of information. Put aside any information that is not relevant to the task you are doing. Fight against the temptation to read everything.
● Say “no” to people who rob your of your time. These include chatlines, idle gossip and surfing the Net aimlessly.
● Share information where necessary.
● Focus on one task at a time and complete it before embarking on another.

Apart from the above, there are ways in which you can enhance the your memory powers and retain large amounts of information:
● Listen to Baroque musicThis is the music written by 17th and 18th century composers whose tempo ranges from 55 to 65 beats per minute. It has a frequency of 500 hertz that harmonises with our brain waves, causing our bodies to become relaxed and our minds alert. Composers in this musical era include Bach, Albinoni, Vivaldi, Corelli, Handel, Telemann and Pachelbel. Iowa State University concluded that listening to Baroque music alone can increase memory retention by 26 per cent. Dr Georgi Lozanov used Baroque music to induce adult learners to a state of alert relaxation.
● Use music as a memory aidRecently, the University of Leeds conducted a memory study of more than 3,000 people of all different ages from 69 countries. They were asked to recall the music of the iconic British pop group, The Beatles.
Most responses were from people aged between 55 and 65. The university concluded that music is one of the most powerful memory triggers.
● Up your reading speedAn average person has a reading speed of 200 to 250 words per minute (wpm). According to the United Nations, a literate person has a reading speed of 400 wpm. The world’s top speed-reader, Sean Adam of the United States, can read at the rate of 3,850 wpm.
Readers read for various reasons — to gather general information, to solve a problem, for study, work or leisure.
Dwight Eisenhowler, the 34th American president, could read up to four books a day. The 35th American president, John F Kennedy increased his reading speed after attending a workshop. As a result, speed-reading is a standard programme in the White House.
Research shows that slow reading is caused by three main reasons. First, people tend to read word by word. Besides causing eye-strain, it is slow and boring.
Second, some people subvocalise when they read. This reduces your reading rate to your talking rate. Also, the muscular activity tires you out.
Third, re-reading earlier sections wastes time and slows down your pace.
If you can avoid the abovementioned, your reading speed will double or treble without any loss of comprehension.

Here are four ways to increase your reading speed:
● Read groups of words. Reduce pausing as you read. Have a shorter fixation at the group of words.
● Minimise sub-vocalisation. Reading either aloud or silently to yourself is a habit which can be stopped.
● Reduce regression. When you read, do not go backwards. Keep focused on finishing what you are reading.
● Learn to concentrate and your reading speed will improve. Select the most productive time of day for reading.
Avoid reading after your meals. Organise your materials before your reading. Lastly, cultivate a positive attitude — that you will learn something after you read.

— Source: Straits Times/Asia News Network
Article by Michael Lum, who trains executives and students in accelerated learning, speed reading and memory techniques.

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Wednesday, November 7, 2007

Importance of US Job Data Report

The US job report is most eagerly awaited by stock market investors as it is the first economic indicator that covers the month just ended. Any weak number may cause weak consumer spending and lead to poorer stock market performance.

IN THIS article, we will look at the US Employment Situation Report, which we sometimes call the US job report. It is the most eagerly awaited economic indicator as it is the first US economic indicator that covers the month just concluded.

It is published very quickly in the first Friday of the following month. For example, the US job data which was released last Friday (Nov 2) was for October. As it is released ahead of all other economic indicators, it provides the latest health check on the US economy.

The US Employment Situation Report is published by the Bureau of Labour Statistics of the US Department of Labour. It includes the monthly change in non-farm employment, the trend in hours worked, the level of hourly and weekly earnings, the part-time employment level and the level of temporary workers.

This report also includes levels of employment and unemployment broken down by gender, ethnicity, age and marital status. Besides, it shows levels of employment by sector, average hours worked as well as earnings.

This report provides the latest situation in the US job market and household earnings. Normally, if this indicator shows weak numbers, in most instances, subsequent US economic indicators would also not be good.

Hence, it has very high market sensitivity as wages and salaries from employment account for the main source of household income. Any unexpected changes in the information can have a huge influence on the stock market's movement.

Personal income is the main driver of consumer spending. It is mainly derived from wages and salaries that are reported in the US Employment Situation Report.

As consumer spending is the largest sector in the economy, a higher set of numbers in wages and salaries may imply better consumer spending in the near future. Higher demand for products will cause manufacturers to increase their inventories build up.

This will lead to higher capital spending to support higher activities in manufacturing. Coupled with better profit margins, higher corporate profits will contribute to better stock market performance. In short, the stock market is closely tied to consumer spending, where wages and salaries are the primary determinants of the latter.

On the other hand, lower employment numbers or a higher unemployment number will cause lower consumer spending as well as slower growth in corporate businesses.

Usually, it will precede an economic downturn as employers try to anticipate a recession by reducing headcount. Hence, any reduction in growth rates on consumer spending may sometimes imply the beginning of a bear market.

In the US job report, the best measurement of individuals’ unit purchasing power through wages and salaries is the average hourly earnings series.

In most instances, the real hourly wage will decline before consumer spending growth peaks as a result of rising inflation caused by strong consumer spending itself.

According to Joseph H. Ellis in his book entitled Ahead of the Curve, real hourly earnings are an effective leading indicator of consumer spending. It serves as a useful leading indicator of the direction of the stock market. According to his research, real hourly wage begins to slow six to 12 months before the peak in consumer spending growth.

The number of jobs and earnings can provide useful data to economic forecasters. However, it is compiled from surveys that may not be 100% reliable. Besides, sometimes there may be some revisions in the figures of the previous months.

Nevertheless, given that stock prices are positively correlated with job creation, the investment community pays very close attention to the employment report on the first Friday of every month.

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Tuesday, August 28, 2007

Ten-year cycle of market crashes?

In this article, we look at three stock market crashes from the recent market crash to those in 1987/8 and 1997/8

Q: Are we in the 10-year stock market cycle, pending a big stock market crash?

The market crash in 2007
The recent heavy sell-down on the bond and stock markets caught a lot of retail and institutional investors by surprise. What appeared to be a haven in investment like the bond market was still subject to panic selling from institutional investors.
We believe the crash in the bond market was mainly due to the withdrawal of some foreign funds. As a result of tight liquidity, unwinding of yen carry trade and potential high losses in some hedge funds, some foreign funds might have been forced to withdraw their investments from the Asia-Pacific market.
The plummet in our stock market was mainly due to the fear of sharp drops in the US, Hong Kong, Singapore, South Korea and Japan markets.
Even though our banking institutions were not really affected by the US subprime issues, the international contagion and fear of more crashes, margin calls and panic selling from retailers caused heavy losses on Bursa Malaysia.
Nevertheless, the magnitude of our losses was far less than those in the regional markets.

The market crash in 1987/8
The market crash in October 1987 was partly attributed to strong market performance of most markets during the first nine months of the year. For example, the US market experienced more than 30% increase during the nine-month period.
However, from Oct 12 to 16, the Dow Index tumbled by 9.5%. On Black Monday of Oct 19, it plunged 22.6%, or 508 points, within a day. It was the largest single fall since 1929, in both absolute and percentage terms.
In Malaysia, the KL Composite Index (KLCI) tumbled by 12.4% on Black Monday. As a result of the overnight crash in US, the KLCI plunged another 15.7% the next trading day.

The market crash in 1997/8
The Asian stock market crash of 1997/98 began with a currency crisis in July in Thailand and quickly spread to neighbouring nations. One by one, overheated markets crashed in Thailand, Indonesia, Malaysia, the Philippines, Hong Kong, Singapore, Taiwan and South Korea. This was mostly due to the rapid industrialisation in these countries.
The US market was affected by the turmoil in Asia. Its share prices began to collapse at the beginning of October 1997. On Oct 27, the Dow Index tumbled by 554 points, or 7.2%, within a day. However, it recovered by recording a rise of 337 points the next day.
In Malaysia, the KLCI tumbled from 1,231 points in the beginning of 1997 to the low of 262 on Sept 1, 1998, representing a total percentage drop of 78.7%.
Comparing the three market crashes, the KLCI suffered its biggest daily drop of 21.5% on Sept 8, 1998. The crashes in 1997/8 and 1987/8 were also far more severe than our recent market crash.

We are not too sure whether we have seen the worst of the crash in 2007. However, the sell-down has caused a big disruption in our uptrend momentum. It appears to be quite difficult for the KLCI to touch the recent peak of 1,392 again.
Any market rebounds may prompt fund managers to continue offloading their equity exposure. Most of big losses in 1997/8 and 1987/8 happened in October.
As we can only know the actual exposure of the subprime issues for most of the US financial institutions when they report their third quarter results in early October, we are expecting some market volatility in that month.

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Thursday, July 26, 2007

Buy or Sell When Bulls Come

The Dow has hit three milestones in the past nine months: 12,000 last October, 13,000 in April and 14,000 on July 17.

If you've missed out on some of that lightning-speed run-up, you may feel one of two things:

1.Fear. You're sure if you buy stocks now, they'll tumble soon after, leaving you with a big bill and not much value.

2.Greed. You're in the camp that thinks there's still upside in the near term, so you want to make sure you don't miss the next ride up.
Your best bet: "Ignore what the Dow is doing," said certified financial planner James Whiddon, author of Wealth Without Worry and co-host of "The Investing Revolution" on Dallas-based

Older investors tend to steer clear of high-milestone markets, while younger ones tend to be more eager to jump when they see stocks moving higher, Whiddon said. But no one should be moving in and out of the market on short-term news or trends, and that includes recessions, which typically last eight- to 10 months.

With money you won't need for at least five years, "the best time to be in the market is always now," Whiddon said.

That's because trying to time the market may be more damaging to your portfolio long-term than taking an occasional bath on an investment.

If you're a bear and feel like you want to wait for cheaper stock prices, consider this: For every 20-year and 30-year rolling period since 1926, there have been more up months for stocks than down ones, according to Ibbotson Associates. And even over 10-year rolling periods, there were only two in which the months of negative stock returns exceeded those of positive ones.

Missing out on those high-return months (the timing of which you can't predict) can cost you a lot. A hundred dollars invested from 1926 to 2006 in the S&P 500 would have yielded $307,700, according to Ibbotson. But if you missed the 40 months with the highest returns you would have ended up with - no kidding - $1,823.

Granted, most people don't invest in the market for 80 years straight. But the principle holds over shorter time frames. Had you invested $100 in 1987 straight through 2006 you'd have ended up with $931. Had you been out of the market for the 17 best trading months, however, you'd have just $232.

But if you're a bull, keep in mind that the skeptics aren't crazy. If you hopped into stocks during the peak trading month right before the 1929 crash, you would have gotten a 9.4 percent annual average return through 2006, according to Ibbotson. Not bad, but not as good as the 10.5 percent return you would have gotten if you'd kept your money invested from 1926 through 2006.

You'll always be better off investing when stocks have fallen. Bill Miller, manager of the Legg Mason Value Trust, told Money Magazine's Jason Zweig, "rising stock prices mean lower future rates of return and falling stock prices mean higher rates of return. So I was much happier in the summer of '02 when you buy everything on sale than I was in the spring of 2000 when a lot of things were super-expensive." (Bill Miller speaks...from Money Magazine)

But, of course, you won't be able to predict when those sale days will occur.

So whether your impulse is to throw more money than usual into stocks now or, conversely, to steer clear, this may be one time when it pays to ignore your hunch.

The better step is to make sure you're positioned to benefit whether or not there is more upside to stocks in the near-term. That means keeping your portfolio well diversified, steadily investing the same amount of money every month so you're likely to lower your average costs over time, and rebalancing your portfolio once a year to keep your chosen asset allocation on course. (Get the rebalancing equation right.)

Unless, like Warren Buffett, you were "wired at birth to allocate capital," you might use low-cost index funds to ensure you do as well as the total market over time or, if you're investing for retirement, you might invest in a target-date retirement fund. That type of fund automatically allocates your assets based on how close you are to retiring - the closer you are, the more conservative the allocation becomes

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How to Survive Stock Drops and Profit from Them

Losing money never feels good. But keep things in perspective and you can boost long-term returns.

NEW YORK ( -- You have to admit: Stocks have risen to mighty heights mighty fast. The Dow has hit three milestones in nine months - crossing 12,000 in October, 13,000 in April, and just last week, 14,000.

That was Dr. Jekyll Dow talking. But Mr. Hyde Dow was always lurking.

On Thursday, the leading stock index closed down 311 points, or more than 2 percent, the second biggest point drop this year. The biggest came Feb. 27, when the Dow fell 416 points, or 3.3 percent.

What to make of this? Stocks are volatile. Or more to the point, investors' emotions are.

It takes nerves of steel to shake off a big stock drop. But the world's best investors not only shake them off - they thrive on them. (Bill Miller: 'I'm always happier at market lows')

They know sell-offs are common, perfectly normal, and even healthy. When stocks go way up in a hurry, their prices become unsustainably high. Only by falling occasionally (and even sharply) in the short run can stocks continue to rise in the long run. Without the agony of today's drop, the ecstasy of tomorrow's good returns becomes impossible.

Consider the terrible slide of 1973-74, when the S&P 500 index lost 48 percent of its value. Richard Nixon had resigned the Presidency, oil prices had quadrupled, Cleveland and New York City were on the verge of bankruptcy, and inflation had flared up to 12 percent.

If ever there's been a good time to panic, that had to be it. But as the old saying goes, things are darkest before the dawn. If you'd sold out of stocks at the end of 1974, you would have missed 1975's 37.2 percent return and 1976's 23.8 percent gain - two very strong years for the stock market.

Even after the Dow's wrenching plunge in October 1987, remember that the index actually ended up rising 2 percent in value that year. And it took only 15 months (until January 1989) for the Dow to make its way back above 2246.73, the closing price on the last trading day before Black Monday.

In fact, there's such a thing as paying too much attention to your money. In the late 1980s, Paul Andreassen, a psychologist then at Harvard University, conducted a series of laboratory experiments to determine how investors respond to financial news.

He found that people who pay close attention to news updates actually earn lower returns than people who seldom follow the news.

When you think about this a little more, it actually makes good sense. News coverage tends to make market movements seem even bigger than they are - and to make them seem likely to persist just when they are most likely to reverse.

Take action
Fortunately, there are several simple and effective steps you can take to turn a stock market crash to your advantage.

Amp up your 401(k). Since a down market can be a great time to buy solid investments at bargain prices, contribute as much to your 401(k) as you can, because you'll be picking up more shares for the money, which will pay off when the market rebounds.

If you can't contribute the maximum your plan allows, at the very least contribute as much as is required to receive the company match. Typically, companies match 50 cents on every dollar you contribute, up to 6 percent of your compensation.

That means for each dollar you invest up to 6 percent, your employer adds another 50 cents, instantly transforming your investment into $1.50. This will not only help cushion any fall in stock prices, but it will amplify your gains once the market recovers.

Adjust your risk. A market sell-off is a good time for a gut check. Did the mutual funds you own take too much risk and fall much more than their respective indexes?

Obviously you would have wished you'd known before this decline. But at least you'll know which funds you want to ride into the next one. For a good selection of mutual funds with good risk profiles, see the Money 70, Money Magazine's selection of best funds.

It's also a good time to make sure you have the right mix of stocks and bonds, which can add ballast to a portfolio during downdrafts. Even if you have a lot of years to go, a decent dose of bonds - say 10 to 20 percent - is a good idea: you'll still get a lot of the growth stocks offer without as much volatility.

Determine your deadlines. Ask yourself when you will need the money you've invested. For example, if you have a newborn child, it's a good idea to invest some money to pay college tuition down the road - and you can put most of it in stocks, since 18 years should be long enough for the market to recover from a crash.

But if you're about to make a down payment on your dream house, that money should go in a safer bucket, where a stock market crash can't hurt it; there, you want to hold mainly cash and bonds. Tuesday's drop was relatively small and you can still make those adjustments.

Spread your bets. If all you owned was U.S. stocks or stock funds, the crash has just reminded you that being diversified is the best offensive - and defensive - weapon in any investor's arsenal. Even if you're young and like to take risks, you should have some cash, some bonds, and some foreign stocks, which, over the long run, will combine with your U.S. stocks to lower your risks without crimping your returns.

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Wednesday, June 6, 2007

What triggers a downfall in the market?

AS a result of China's higher-than-expected economic growth of 11.1% and fear of possible further interest rate hikes in China, regional markets, including Malaysia, fell sharply last Thursday.

This was the second time after Chinese New Year (CNY) that a drop in Chinese stock prices rattled the markets across Asia.

According to Lee In Ho in his study on Market Crashes and Informational Avalanches, there are four stages in a market crash. They are boom, euphoria, trigger and panic.

Under the boom stage, the market will normally have a main theme that excites everyone about stocks.

In Malaysia, several positive measures under the Ninth Ma- laysia Plan got investors excited about the construction and property sectors. At this stage, this is seldom a bubble as companies continue showing good corporate results. A bubble will be created at the euphoria stage. The unjustified extrapolation of future earnings and the revision of higher target prices by research analysts can cause overconfidence in companies’ future performance.

A bubble will start to take shape when the general public reacts to this overconfidence. An irrational exuberance will occur when market prices and expectations about future values are far beyond the fundamentals of the companies.

However, no one will know when the rise will stop. A market will resume its upward trend until something triggers the downfall.

Usually, the stock prices get higher and steeper just before the market crash.

At the trigger stage, private information will reach a threshold that triggers other traders to alter their behaviour. At this critical situation, when almost everyone is at irrational exuberance, any event can trigger the market to tumble.

In January 1994, our stock market put the blame on former finance minister Tun Daim Zainuddin for saying that he had sold all his shares because prices had reached dangerous levels.

Until now, nobody can really understand the main reason behind the sharp plunge on the Shanghai Index right after the CNY.

According to some fund managers in China, the selling was mainly due to investors panicking when they noticed that their friends were selling stocks.

A famous researcher in behavioural finance, Robert Shiller, conducted a survey by asking institutional and individual investors what was in their mind during the stock market crash in 1987. One conclusion he drew was that the crash was due to people reacting to each other with heightened attention and emotion.

Investors seemed to follow what other investors were doing. As a result of action and reaction, a feedback loop was created when everyone had a simultaneous reaction to common stimuli.

A market crash is described as a process that corrects a public belief that is inconsistent with the current distribution of private information. The severity of a crash will depend on whether the market is filled by “new generation” investors or experienced traders.

“New generation” investors do not know anything about the stock market but are greedy and want to get quick money from it. A market will not crash if it has experienced traders who know how to control risk and when to cut losses.

However, if a market is filled by “new generation” investors with no holding power and do not know when is the right time to sell a stock, any sharp drop in prices could result in panic selling. At this panic stage, the fear of further drops could cause big fall in prices.

When will the stock market crash again?

My usual answer for this question is the stock market will not crash as long as you continue to worry about when it will crash. The market will crash at the time when you least expect it to happen. Investors should remember that the market always performs beyond your expectations.

We should not be too worried about when the market will crash. Instead, we should consistently review our portfolio and sell those stocks whose prices have gone beyond their intrinsic value

Source: TheStar

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