From safety to greed

It is amazing to experience the roller coaster ride from a credit induced recession.

Investors sentiment went from concerning return of capital to chasing return on capital again mere 18 months after the arguably most servere economic downturn of all time.

Many simple lesson can be learnt during the process:

1. How quickly people can forget about all the gloom and doom in the midst of the global financial crisis.

2. Unlevered investor has the upper hand to sit out the trough during recession when market goes into disarray while the levered ones do not have such luxury

3. No asset class price can continue an upward trend indefinitely and vice versa regardless of the fundamentals.

4. The entry price remains the single biggest determinant of the resulting return on asset.

5. Market can stay irrational longer than one can stay solvent.