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things every retail investor/trader should know
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elfinchilde
Elite |
19-Aug-2008 10:25
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notes for the day: market going down as expected. cosco with today's fall is no longer a growth stock; once it finds its balance, it'd be a range trading stock. this counter was killed not by the BBs, really but by its own inept management. A pity. jardine, SIA and a couple more of the blues still need to fall. which is where 2,680 becomes viable. Watch for bottoming in capitaland, whenever that will be. |
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jchongll
Member |
19-Aug-2008 10:21
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elfinchilde, i often heard people invest in forex but how do invest actually? my friend opened an acct in foreign currency and treat it as FD... is this what you refer to? | ||
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elfinchilde
Elite |
19-Aug-2008 10:15
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your strat is actually like mine when i started out, tradechancellor: i basically threw almost all my savings from multiple jobs (full time, part time, whatever) into the market, save for one-two months out, so yes, it's achievable. it does require a lot, a lot of discipline though, especially if you're just starting out work. Where others can go to spend, and where they spend free time, you're taking on part-time jobs (in addition to a full time one), and you need to budget very well. Not that you starve yourself or are miserly, but it has to be a practical plan. eg, start of every year, i'll do a budget, how much i can spend each mth, the categories, and for 'frills'. To invest, the first thing needed is not FA or TA, it's money management. like what they say, if you earn 10,000 a month, but spend 12,000; compared to a man who earns 2,000 but spends 1,000. who's actually richer? Think asset gain, not asset loss. Suggest you may like to "diversify" to forex as well though, if you're keen? For one thing, with forex, you can get the old risk/reward ratio of 1: 2.5. with current stock market, really, can you find a single counter which can realistically go up 2.5x for each dollar you risk now. For another, capital startup is smaller. And it's a 24 hr market. So it's good, since you can hold a full time job, and trade at night/day, depending when your job is. If yours is a regular salaried govt-type job, you can hit your seed fund quantum by age 30-32 (depending on your NS period and degree etc). If you are in a high-paying job, you should be able to hit it by 28. Bottomline: it's achievable. So don't listen to anyone who tells you otherwise. Be prepared to pay for it, however. In terms of hours, sweat, 'tuition fees' and all. |
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stupidfool
Senior |
19-Aug-2008 09:49
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Good for u....and good luck. One more qn...say $250k with a return of S$24k a year. Is $24k a year enuf to live on given that cost of living is so high in spore and seems to get higher by the minute?
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ten4one
Master |
19-Aug-2008 09:29
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Yes it is very important to involve only YOUR OWN cash that you can well afford to lose., and keep some money for emergency needs (you never know when it is needed). I quite like T'Chancellor's way of 'building up' his Capital in Investing, but 1 question : Why stop at $250k? It is no doubt good to have dreams once in a while. But, to dream everyday is a dream forever....and that is definitely a Dreamer! Cheers! |
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TradeChancellor
Veteran |
19-Aug-2008 08:33
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Hi Stupidfool, $250k would be life savings (cash),i dont have a flat, but if i had a flat, bulk of it would be paid by cpf. Yes, $250k would be after paying monthly liabilities. My strategy is not to wait until i have $250k and do a lump sum investment. I have only about $25000 cash currently in stocks, and will top up when i find the opportunity, leaving only about 1-2 month's salary in my savings account for rainy day. | ||
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stupidfool
Senior |
18-Aug-2008 22:53
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Tradechancellor May i ask if the S$250k u mention is investible $$$?That is ur house etc...are paid up and u have this $250k just for investment? |
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TradeChancellor
Veteran |
18-Aug-2008 20:33
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Thanx for the encourgement Elf. ten4one, its a risk has, but with some due diligence, we can still mitigate some risk. Basically, my aim in the future is a bit like elf, using a 2-prongged appraoch of ta and FA. As i'm still raw in TA, i'm using more of FA knowledge at the moment. I think to do well long-term, you need to actually enjoy investin in stocks and one can enjoy (I myself enjoy it) because of the following reasons: 1. Interesting human behavior - hw BBs and individuals do business and intereact with one another. 2. You are your own boss. You decide hw much to buy and sell. Nobody dictates your behavior, KPIs, quotas, OT, cover resigned staff duties etc. I love the AUTONOMY. 3. Unlike in a traditional business, there is little overheads in stock investing. That is, no high rentals to pay and no manpower to pay and manage as well. ALso little/lower risk of people cheatin your hard-earned $ too. 4. With continued homework and experience, earning are quite attractive too. 5. Able to network with like-minded people. Yeah, i look at investin as my part-time buisness, i'll do it full-time if i had more than my current capital. |
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iPunter
Supreme |
18-Aug-2008 18:49
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Good post!... |
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ed88ks
Senior |
18-Aug-2008 18:41
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just to share, An old pro trader sent in a funny story "Back in the early 90's Commodities Corporation (CC) brought a few Japanese traders in for some in-house "training". Of course the ultimate and true goal was to capture some big Japanese money. I was still in their good graces and [CC] asked me to have lunch with a couple of these gentleman. They were new to the program and I hoped to give them some insight into how I handled the process of trading. I told them they had to come up with a method or system that fitted who they were. Then I told them I thought it was great to find a mentor and I was available anytime they had questions or issues and that is still me today. I then began to discuss how important risk management was and that I was willing at that time to risk only 1% per bet in dealing with public money. I am more aggressive today but that was then. I told them that losses were part of the process in finding winners. I will never forget as long as I shall live the youngest trader looked me square in the eye and with a very puzzled look asked "You have losses?" I knew right then these birds had a very long way to go and I often wonder what happened to them." |
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elfinchilde
Elite |
18-Aug-2008 17:26
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yuppers, thanks for the additional info, CWQuah. i had considered the 2900sga too, but opted for the 3000 one instead cos it's cheaper. :P it's a perfectly valid call too. 
and yes, pls note the bid/ask spread: not all warrants move fluidly. if you're trading them (personally, i prefer to trade and not convert warrants), the bid ask needs to be close together--i like it 0.005 apart--and the vol must be high enough for you to throw all your lots at one shot. |
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CWQuah
Master |
18-Aug-2008 17:08
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STI calls STI2900SGAeCW081030 can also be on the watchlist. Do take note of how the warrants pricing changes with STI - is it the ask price that goes up only, or do both bid and ask prices go up when STI goes up? Makes a significant difference if one intends to trade it short term. Also note when the mkt maker stops providing bid-ask prices. Usually around 12.25-14.05; and around 1655hrs onwards. I hope to see some new warrants introduced near the end of this month. Hopefully they'll issue those calls between 2600-2700; In-the-money warrants are more valuable/worthwhile to trade. |
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elfinchilde
Elite |
18-Aug-2008 16:51
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paiseh, forgot to note: if you're lkg at the capland call warrants, pls don't buy yet. just put in watchlist only. | ||
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elfinchilde
Elite |
18-Aug-2008 16:50
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the other trading idea is for capitaland call warrants; pick those with longer exp dates and strikes btwn 4.9-5.3. fyi only. i'm right now trying to get my longterm counter; and as the saying goes, never give up longterm gains for short. now's the time to start picking up counters for longterm holding. if you look at STE now, you'll see why i had said to DCA it back those weeks ago, even when it dipped to 2.49, instead of cutting. o/w, general notes: take care on marine and prop plays. livermore is right: look for infrastructure themed. for longterm players grasping for clues: (ie, longterm not shortterm traders; specifically for div yield and insulation against global downturn) the office reits are a good bet. aussie property is insulated from the current global downturn. i like one terencefok counter, asiatic. read its AR. hehe. caveat applies to all the above, as usual. |
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elfinchilde
Elite |
18-Aug-2008 16:13
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hullo, sti call warrants, ie expect STI to go up. am personally watching two: the 2800SGAeCW081230 and STI3000SGAeCW081030. note, don't buy yet pls. wait for the kind of day when everyone just mindlessly dumps, and it seems like the end of the world and there's never going to be a return, that's when you pick up an STI call. if market doesn't break, no trade. go small, pls. and caveat applies. I'm talking forward now, not backward. Rem that for warrants, run fast and run small. oh, and don't buy more than what vol appears at the bid/ask quotes. note 2: rationale for those warrants: the strike pxes and the longer dates, which allows for the runup to the nov US elections. don't risk a fast expiry warrant at this pt in time. |
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novicex
Member |
18-Aug-2008 15:47
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hi elf, how do we buy STI call? | ||
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elfinchilde
Elite |
18-Aug-2008 15:26
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watch current market. live 'demo' of what i said earlier last week with regards to pivot levels: that 2,800 is a pivot point and market can go either way, with bias being for down. it's downing now. hence for rapid traders there presents an opportunity, which is to buy STI calls if index hits 2,680 and/or SSE hits 2,000, wherever the base is formed. keep eyes out for this trade. not to be entered yet. |
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elfinchilde
Elite |
18-Aug-2008 15:01
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yups stupidfool, investing and trading are different. the ones who can make 5 digit a month, qn first: what's their starting capital? what software do they use (they are all prob using level 2 software, which can filter out the stocks on criteria)? do they only play the spore market? can they go long and short? the reality for most small fries here is that: not on margin. can't go short. no preferential broker rates. only T+3. small capital. no specialised software. only s'pore market. that's also why, for small fries, better to go longterm, really. you need to find a mtd that best enhances your chance of survival. plus, those are full time traders. am sure most here are working day jobs: how are you going to watch each and every tick? it's not possible to. |
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stupidfool
Senior |
18-Aug-2008 13:14
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It is important to note that we are talking of LONG TERM and INVESTING. It may be true that there are pp, making 5 digits a month,bt how many? Statistics have again shown over and over many times that for small timers like ourself,nothing beat long term and having investment in mind. Cos for long term investment,one can iron out the peaks and depressed mkt conditions.And most importantly,do not play into the BB style of plays and their "tricks'. Also,with long term and buying blue chips,one has the advantage of collecting dividends.Good dividends,not just peanuts dividends that one is not interested in. And with yearly increased in dividends,one have actually increased their yield over the years. Btw,personally,i think spore mkt is too small and volume too thin to make alot even if one is trading.Just my opinion. |
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elfinchilde
Elite |
18-Aug-2008 09:57
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tradechancellor, yea, your quoted figures are highly achievable to me. (assuming blend of trading plus proper investing). cwquah/livermore, yuppers. they probably have the advanced software though, to filter out the stocks based on certain parameters. because really, if you look at it, the only real rises this past month (> than one day) were the CPOs (all at the same time) and biosensors. Most of the attempted rises failed. And having the ability to short adds power to the trader's arsenal. jj, what has being pretty got to do with it or not. Would i buy a prop last year? No. Especially not in s'pore. But this year and next, yes. Especially looking at US properties. You're a speculator, a lot of your posts keep going "has it bottomed yet/is it time to buy"; it's surprising that you'd be talking of not timing the market. :P Things are only a mockery to those who cannot conceive of it. One of the attitudes i hate about singaporeans: It's a very singaporean ethos to strike out dreams that they do not deem "realistic", and to laugh at those who dare to dream it. It's also for this reason that we need to hire foreign talent to win for us. |
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