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things every retail investor/trader should know

http://elfinchilde.blogspot.com/2008/09/importance-of-backers.html

oops. paiseh. the proper link. if it doesn't work, just scroll and find my latest post. especially for ppl who are struggling with what to buy, what to play etcetc. just a *sense* of possibilities for you guys.

You'll havta do the work and hunt it down yoruself though. hehehehehe.

 

something which i've been dying to do but didn't dare to on SJ (cos open forum). http://elfinchilde.blogspot.com/2008/09/importance-of-backers.html  

sure to send people into a tizzy.

and yes, it's a real counter, and yes, like black swans, such things do exist, and no, i will NOT name it.

elfin mischief on a dull day.

 

 

yah. pay per view as soon as i figure out how.

http://elfinchilde.blogspot.com/2008/09/market-update-for-day.html updates for some of the counters today. (for rapids only). capland very funny. buyer and seller fighting. lol.

 

Elfinchilde :

Congratultions on ur blog ! 

Best of Luck !



 

 

yayyy, elfin now owns a blog =) ... made my way to the blog to read up on the subprime entry. Very interesting read indeed, and might I say, quite different perspective on what you might read on the media. Thanks for sharing =)

 

pay per view

elfinchilde      ( Date: 22-Sep-2008 16:32) Posted: ok! i've gots a bloggie! finally! http://elfinchilde.blogspot.com/ purely for trading/investing stuff. am calling it The Money Plant. double meaning. As plants, since the money plant is a plant that can survive the toughest conditions of drought and no sun. Plus, money generator. will in future be posting the longer analyses and readings there. some will be here as well of course, but i thought it's better to have one source for everything together. i need to keep track myself. besides, with some of the stuff i'm posting, better not get SJ into trouble. cheers!

 

cool,! elf.,

your blog does give me some pointer.  

you have a big heart.!!!!  for sharing

 

 

belated notes:

expected trading direction for this week is sideways with downward bias.

be careful of a burn the shorts phenomenon. all depends on who took more positions which way. if locals start shorting too much, don't be surprised if foreigners buy up the STI instead. Equal likelihood however that it may just go back down. Likely to be mixed, as i'm seeing some divergence amongst the blues. key STI resistances at 2,570 then again at the psych level of 2,600. Pullbacks should pref not go below ~2,450.

watch the blues as weathervanes: capland and the banks.

i've been getting questions by quite a lot of folks seeking to understand the entire subprime crisis and how the banks could topple overnight. The Straits Times had excellent articles on it on sunday. But if you prefer tracking it by the global flow of money, what really happened, i've written up the brief explanation on my bloggie, so feel free to take a look. http://elfinchilde.blogspot.com/2008/09/short-chronicle-of-collapse.html. 

May hopefully give some who're still scratching their heads the idea of how money is interlinked, and the real things that happen are never quite reported in the media.  

Pls note that whatever's in my blog is entirely my PERSONAL opinion. I'm writing things that you'll likely never find in the accredited media, so it's important for me to emphasise this; don't wanna get SJ in trouble.  

But really. I don't expect you guys to just read it and agree with me. We all have our own minds, and i'm sure we all are capable of assessing situations and facts. So read it, look at the facts of what has happened, especially, the charts and data; and see if, to you, it makes more sense than what analysts and the media have been saying. In a nutshell, collapses do not happen overnight.

 

ok! i've gots a bloggie! finally!

http://elfinchilde.blogspot.com/

purely for trading/investing stuff. am calling it The Money Plant. double meaning. As plants, since the money plant is a plant that can survive the toughest conditions of drought and no sun. Plus, money generator.


will in future be posting the longer analyses and readings there. some will be here as well of course, but i thought it's better to have one source for everything together. i need to keep track myself.

besides, with some of the stuff i'm posting, better not get SJ into trouble.


cheers!

 

Hi Elf, I must admit I'm an ardan fan of this thread. I'm greatful to all you guys whom are always willing to share your knowledge and experiences to small fries and noobs (like myself) I really appreciate all the information and teachings here

It always intrigue me how you can tell which BB plays the stocks, especially how you can tell ML shorted specific counters. Care to share this knowledge? I know you may not want to go into specific details (you mentioned before that you don't want to get killed by the BBs..which I can understand) how abt some subtle hint?

Also, some knowledge of how and the ways the BB plays the stocks will also be useful.. can quote some generic examples, what kind of 'patterns' to look out for will do

It always occurs to me that one has to have insider knowledge or info to know these kinds of stuff.. but maybe there do appear to be some other ways/observation to gather these info?

Thanks! And keep up the good work (or should I say..teachings) for the education of the forumers here

elfinchilde      ( Date: 17-Sep-2008 16:15) Posted: two what?? the big 5 were (in order from 1 to 5): Goldman sachs, morgan stanley, merrill lynch, lehman brothers, bear sterns. The last two have collapsed, ML sold itself to BoA. Left standing are GS and MS. The first, especially, by virtue of an exceptional team of prop traders. can't beat them on the markets. Note that MS and GS control the ICE exchange (which trades oil). GS' balance sheet is better than MS, because they wisely side-stepped the subprime loan. Essentially, these 'investment' and 'wealth management' banks generate income by massively overleveraging and in essence, punting on the global markets. Which was why i had said that to put out fires in their own backyards, they short Asia. Easiest way to make income. imagine: they have billions, we have millions. Queues are thin. Who wins?   So of the foreigners eventually left to play the game: GS, MS, UBS and Citi. Good. because ML is one of the biggest shortists around. They were one of those who tanked cosco to its pitiable state today. The less of these big guns there are, the better it is for real investors. Plus the lesson to them should make them more wary of overleveraging now, which is why, i suspect, once all this is over, you'll find more stable markets since less foreign BBs to rampantly and blatantly short/ramp up counters.   at least, i should hope so.

 

notes for the day:

be careful of window dressing. today-wed is not the time to buy.

those in commods to beware: Lehman bros has massive long commods positions; when they unwind for bankruptcy, it may cause a drop in the global commods market. esp be careful if you suddenly see a rash of buy calls from global analysts.

fyi only; usual caveat applies.

 

well, with the current market turnabout, me guess i don't havta say anything, eh? hehe.

this is why it's always important to keep cool and to keep rational. if you don't personally have the stomach for risk---as those of you who were enveloped by panic the past week should know by now--then, simply, DON'T take that risk.

Put it this way: if you watched the market from monday to friday, you'd have seen it tanked from ~2570 to lowest ~2301 and back to 2559. Heartstopping rollercoaster ride, likely to induce panic and mistaken buy/sells.

BUT if you were a longterm investor? Last friday, 2570. Yesterday, 2559. (i can't rem the exact figures). What's the change? -11.6pts only. So where's the panic?

Frankly, if you ask me, most singaporeans, even though they love gambling, aren't suited to be shortterm traders. They're better suited to be longterm holders. Just ask a couple of questions and you'd know already.

1) If your friend asks you, "let's go for a weekend holiday in malaysia next week and go bungee jumping and skydiving!", do you go "Yes, let's! " or do you go, "eh, you siao ah?!! " 

2) Do you play 4D, ToTo, horse racing, soccer betting (without hedging. you guys should have seen my analysis sheet for the world cup  ) etcetc gambling?

If your answer to (1) is the former and to (2) a "no", then, you're likely suited to be a trader. If you're of the "eh, siao ah!" and "yes, buy 4D/Toto/etc" camp, then, you may not be suited to trading.

those wondering when market will recover, the answer is: not so soon.

but has bottom been reached? my personal opinion is that it's in the process already. now we wait for the TA signal: a higher low to be formed.

That is the earliest sign of a reversal of the downtrend.

oh, and the USD must strengthen and hold.

if above criteria is fulfilled, we have an up in the works! (of coure, not a straight line up).

cheers!

 

Don't think too much.... just recall back 1997 how bad is the share price ?? Enter at the level now you will never wrong... the most depreciate a little bit more or stuck for few years . But don't forget when BULL return the rewards can be double or triple as long you hold it long enough !

 

care to share your strategy/ideas?
I thought following the trend is correct. Sail with the wind as the Chinese Proverb says.

iPunter      ( Date: 18-Sep-2008 19:09) Posted: What if the trend is still intact? I thought the trend is your friend?...

 

elf...same over here for me...unable to sleep looking at the market...although personally paused trading for quite some time due to the volatility ...

tonight's DOW movement indeed extremely unusual in their intra-day movement...all it takes is within seconds to minutes to rocket high and next moment plunge...and the cycle continues in such a crazy momentum 

not traded...but seeing the intra-day movement situation like this ...makes me can't sleep too...only more confused..

elfinchilde      ( Date: 19-Sep-2008 02:12) Posted: i can't sleep.   am when i should be . damn it. watching the DJIA. it's hilarious. goes from -100 to positive in like, a few minutes. meanwhile, gold is shooting through the roof--largest one day rise in the past 10 years yesterday--as panicked investors pile in like mad cattle. it has moved something like 11 standard deviations out of the norm. Banks are falling over themselves to merge, and even in s'pore, we have a run on poor AIA. Certainly extraordinary conditions. For those who haven't lost their heads yet and are puzzled at all this, (alternatively you're one of those who have lost their heads and have bailed out of your insurance policy plus sold off all your counters).....what you're seeing here is pure psychology: Fear. Quite simply, people aren't thinking any more. they're just stampeding with the herd. And throwing out quite a few babies with the bath water. Above TA and FA is the factor of market psychology. In Graham's words (i can't remember the exact phrase), that "The market is a pendulum that swings forever between unwarranted pessimism and irrational exuberance." Greed, fear, blind hope. You understand these three and their dynamics, you understand the basic instincts that rule the market. So general advice to all (my mailbox is kinda swamped, apologies if i take longer to reply): step back, take a deep breath. Really--and i mean really--look at your portfolio. Are they dud stocks, or good stocks? What makes you say so? What is your plan? And if you don't have one, it's time to start devising one. When fear controls the market and everyone is behaving like mindless sheep or stampeding lemmings, the way to counteract is through pure, cool rationality. Had said many times before, that anyone can profit in a bull market. But the true test of a trader/investor is in a bear market. How cool are you in the face of mass hysteria? This is exactly what will determine your profit level. So really. Am putting out here a call for calmness and rationality. Mindless stampedes are for cattle, not investors nor traders. cheers!

 

i can't sleep.  

am when i should be . damn it.

watching the DJIA. it's hilarious. goes from -100 to positive in like, a few minutes. meanwhile, gold is shooting through the roof--largest one day rise in the past 10 years yesterday--as panicked investors pile in like mad cattle. it has moved something like 11 standard deviations out of the norm. Banks are falling over themselves to merge, and even in s'pore, we have a run on poor AIA.

Certainly extraordinary conditions.

For those who haven't lost their heads yet and are puzzled at all this, (alternatively you're one of those who have lost their heads and have bailed out of your insurance policy plus sold off all your counters).....what you're seeing here is pure psychology: Fear. Quite simply, people aren't thinking any more. they're just stampeding with the herd. And throwing out quite a few babies with the bath water.

Above TA and FA is the factor of market psychology. In Graham's words (i can't remember the exact phrase), that "The market is a pendulum that swings forever between unwarranted pessimism and irrational exuberance."

Greed, fear, blind hope. You understand these three and their dynamics, you understand the basic instincts that rule the market.

So general advice to all (my mailbox is kinda swamped, apologies if i take longer to reply): step back, take a deep breath. Really--and i mean really--look at your portfolio. Are they dud stocks, or good stocks? What makes you say so? What is your plan?

And if you don't have one, it's time to start devising one.

When fear controls the market and everyone is behaving like mindless sheep or stampeding lemmings, the way to counteract is through pure, cool rationality.

Had said many times before, that anyone can profit in a bull market. But the true test of a trader/investor is in a bear market. How cool are you in the face of mass hysteria?

This is exactly what will determine your profit level.

So really. Am putting out here a call for calmness and rationality. Mindless stampedes are for cattle, not investors nor traders.

cheers!

 

cool!!! thank elf for your generousity in sharing. have good dreams

 

......

*scratches head*

 

Ah... Elf, we could explain to MAS that by not banning naked short, the possibility of some counters in the STI component might tank, that would be more serious and frightening ! Sending some chill down their spine by such explanation might work?

 

You don't always get your ideal price. Weigh the risk and opportunity cost.