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things every retail investor/trader should know

oh and i still think that if SGX was really concerned about "market openness and a fair playing ground", then they should take a leaf out of the US right now and ban naked shorts.

You can be sure more than half the vol of SGX will be gone. which is precisely why they won't do it.

haha.

cheers!

 

oh yea. the trend is your friend indeed.

the trend not only of the market, but of your own personality.

look closely at the market: the STI is down, that's for sure. Most stocks aren't done downtrending yet. But are all stocks down? Are there some which have consistently resisted their bottoms, even and especially today?  The trend is not only the general market's trend.

Bear markets are approx two years on the STI. The depth is in the middle. If we count Oct 07 as the start of the bear, where are we now at?

But of course, follow the trend. Don't second guess. A support's a support if and only if price pings off the line. If not, it's just another blip on the chart. You wait.

It pays, however, to know what you are waiting for, and when, and why.

"The best time to buy is when there is blood on the streets."  

til then, it's  time for the elf. when ppl are panicking and running about like headless chickens, why do you join them for? Waste of energy.  

 

What if the trend is still intact?

I thought the trend is your friend?...

 

dun only relax, open ur eyes for good deals, and swop them up =)

 

was out today. just reposting here from the capland thread, where there was an ongoing discussion about banks collapsing and stocks going down to zero cents etc.

just for the nervy people. ...pls, when market is panicking and the alarms are going off and everyone is going die, die, die, the ONE thing you need to do: KEEP COOL.

don't throw the baby out with the bath water. geez. relax lah.  

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erm. i think you guys need to properly understand the concept of 'banks'....

s'pore banks are deposit-focused. They have capital requirements and stringent rules. Eg, foreign banks operating here are required to ring-fence their money from their overseas branches.

investment banks--like MS, ML, Lehman, GS--derive most of their money from shareholders. What they also do is to provide 'soft' services, like financial advisory etc. But most of their income is from one source: proprietary trading. 60% of their income is from there. So they have a pool of shareholders giving money, they take huge leverage on that, 200x, 400x, and they play the markets (yen carry trades sound familiar to anyone?). Essentially, they're big time gamblers.

Straightaway: is that a sound business model?

And then: are asian banks the same?

Are other counters here the same? You really think a company with solid NTA can go to zero the way these fellas did?

Judge for yourselves. This is FA.

When markets are irrational, all the more ya gotta keep cool. If you really know your work, you shouldn't be panicking.

 

hi folks. what would be your  view on sg bank's counter. like ocbc. dbs .for tomorrow trading or even the following week .  thanks.   

 

pardon me for not asking in full. ..however  your second post , gave me the answer.

 

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.  

 

yo. elf. .you name two . one more is ???

 

macros

so of the 5 biggest banks, 3 have collapsed. There is left Goldman Sachs, and Morgan Stanley. A large reason why these 'banks' collapsed is because they overleveraged. Essentially, they were the biggest traders globally, and they lost, because they did not manage their risk.

Should offer comfort to the small fries: if even these 'Big Boys' don't know better, how about retailers? hehe.

The interesting thing is forward looking. What are the implications then, for the STI/Asia?

Note that more than 60% of their revenues came from trading, and not 'investment', as they always like to claim. So with 3 of the biggest gone, if i may venture a guess, it is this: you'll see more stable trading ahead, since there are only a couple of foreign BBs left (aside from hedge funds); which means the local BBs--once they recuperate--will likely rule the roost.

What this means for traders: more predictable patterns, and more volatile, contained spikes. You'll likely see the pennies and second-liners, especially the ones favoured by local BBs--'decouple' from the main STI.

So value hunters should stick to the blues.

When all bad news are out, and everything is oversold and everyone is saying "doom doom die", it can only mean one thing: markets are close to the end of pessimism. And hence, the chance to buy for longterm is good now. After all, if you look long term: in end-2009, 2010, to 2012. Where do you think the market will be then? Everything moves in cycles. What's oversold will become overbought; what's overbought will become oversold. Go slow and go small, though. Always have more bullets, always have an exit plan.

 

What it means is that in a competitive society, everyone is clamouring to be rich...  

 

Does it mean that i can afford oni HDB flat and think that ppl are snobs if they splurge on condo?

 

But the urge to get rich and richer  is very real...

That's why many are only too willing to 'splurge' when 'buying' shares... (pure snobbery!)

Many look down snobbishly on those who can only play and trade 'tikam-tikam' for peanuts...  

 

True, I agree with you

stupidfool      ( Date: 16-Sep-2008 12:34) Posted: It is also important that at the end of the day one is happy and comfortable with their investment. Maximising profit at great risk may not be suitable with everyone.   Livermore      ( Date: 15-Sep-2008 21:35) Posted: Maybe Ipunter means no point making a point to win argument but better to increase one's profit. At the end of the day whether value stocks, growth stocks or high yield dividend stocks, the objective is to maximise profit.

 

It is also important that at the end of the day one is happy and comfortable with their investment.

Maximising profit at great risk may not be suitable with everyone.

 

Livermore      ( Date: 15-Sep-2008 21:35) Posted: Maybe Ipunter means no point making a point to win argument but better to increase one's profit. At the end of the day whether value stocks, growth stocks or high yield dividend stocks, the objective is to maximise profit.

 

Livermore... :)

I want you as sifu because of your great and humble approach,... not what you said right ot wrong.

Anyway, your views are mainly right as far as I can see... hehehe...

 

I am not a sifu ya. In this forum I try to highlight things based on my experience. I have made mistakes. The important thing is to learn from it. But to me it is not easy when you try to put a important point across when some may not see the point. But it is ok.  At least I tried. 

iPunter      ( Date: 15-Sep-2008 23:16) Posted: Livermore... :) Looks like I've found one more sifu... it's my pleasure to have you as sifu too... hehehe...

 

Beginning of financial impact felt from sub-prime???

 

Livermore... :) Looks like I've found one more sifu... it's my pleasure to have you as sifu too... hehehe...

 

elfinchilde thanks....  :D ......shit google chrome does not support the smilely face.... :(