Review (2018)

Stocks (2018 Review)

I expected this year’s market to be poor and highly volatile, and I did not think I would be able to respond actively while keeping up with my main job. So late last year, when people were even talking about the KOSPI reaching 3,000, I liquidated my portfolio (cumulative return from 2016.12.01. to 2017.11.30.: +88.59%, outperforming KOSPI by +59.18% and KOSDAQ by +63.74%). I have not made a single transaction this year.


Real Estate (2018 Review)

For quite a long time, my view of real estate—rooted in my legal-philosophical and political-philosophical instincts—was that a house should never be seen as anything more than accommodation. The fact that I moved back and forth between Korea and the United States so often probably played a part as well, since it made me think of illiquid assets such as houses and cars not as things to own, but as things to utilize. As a result, although I did have my own views on the Korean real-estate market, I treated it as completely irrelevant to myself.

Polarization of the Koreal Real Estate Market (2015.08.28.)

I scoured old posts whether I had ever written anything on real estate, and sure enough, I did back in August 2015.

Outlook (2019)

Bull markets are born on pessimism,
grow on skepticism,
mature on optimism,
and die on euphoria.

The time of maximum pessimism is the best time to buy,
and the time of maximum optimism is the best time to sell.

― Sir John Templeton

Around this time last year, when the coin frenzy was in full swing, I saw middle-aged men and women on the subway staring at Bitcoin charts. A female music student standing nearby, sheet music tucked under her arm, was looking at Bitcoin charts too. Then a cook who had spent his entire life in kitchens started telling me about the paid group chat he had joined and said he was thinking of quitting restaurant work altogether. That was when the old saying came back to me: “When shoemakers and taxi drivers start talking about stocks, it is time to sell." So I strongly urged everyone I knew to sell all their Bitcoin before the year was out, no matter what.

Virtual Money and Crypto Currency (2018.01.18.)

That cook I mentioned listened to me, sold out completely around KRW 25 to 28 million, and bought a home in Seoul.

Stocks (2019 Forecast)

If you judge only from news headlines, the stock market appears to be in a state of near-panic selling. From a fundamental perspective, an entry point is gradually manifesting. However, three more years of this Arduous March are still remaining. Given the extreme susceptibility of the Korean market to foreign shocks and domestic policy maneuvers, I confess to some uncertainty…

Buying is technique,
and selling is art.

― Market proverb

At a moment like this, when domestic and international politics and economy have made market timing much harder to read, all I can recommend is, “Stay cautious unless you have enough spare cash to invest in the very long term.”

The price of a stock with sound intrinsic value shall surely rise, though it may fluctuate;
but of that day and hour knoweth no man:
neither the buyer, nor the seller,
but only Mr. Market.

― ECK (2018)

For a value investor, the current climate presents an exceptional occasion to accumulate equities of high quality stocks at demonstrably depressed valuations. It is definitely one of the rare, significant valuation dislocations in recent cycles.


Real Estate (2019 Forecast)

During the Roh Moo-hyun administration, I was a student and lacked a direct sense of the real estate market. However, experiencing the Moon administration as a taxpayer—coupled with the accumulated accounts of the Roh regime from older generations—led to a paradigm shift: real estate can also serve as an investment asset.

In my limited view, the Seoul housing market will rise further, provincial housing markets will be hit hard, and wealth polarization will become even more extreme. With capital increasingly flowing into real estate funds and public funds gradually gaining traction as well (for now, private funds account for 97% of the entire real estate fund market), I would recommend gaining overseas exposure through REITs or real estate funds if you don’t have enough capital to buy an additional home in Seoul.