Wednesday, May 30, 2012
If I were you
"If I Were You"
You seem to find the dark when everything is bright
You look for all thats wrong instead of all thats right
Does it feel good to you to rain on my parade
You never say a word unless its to complain
Its driving me insane
If i were you
Holding the world right in my hands
The first thing I'd do
Is thank the stars for all that i have
If i were you
Look what surrounds you now
More than you ever dreamed
Have you forgotten just how hard it used to be
So whats it going to take
For you to realize
It all could go away in one blink of an eye
It happens all the time
If i were you
Holding the world right in my hands
The first thing I'd do
Is thank the stars above
Tell the ones I love that i do
If i were you
So whats it going to take
For you to realize
It all could go away in one blink of an eye
It happens all the time
If i were you
Holding the world right in my hands
The first thing I'd do
Is thank the stars above
For the ones I love
Take a breath and enjoy the view
Live the life that I've wanted to
If i were you
It is still a very nice song ... I like it very much. As long as I appreciate lives and those around me, I am thankful. I have no intention to change anyone around and I do think we all live our lives the way we wanted too. So, I will not say ... "If I were you" as I will never be you or anybody. I am born to be me ... myself. I have never wanted to change whatever happened in the past ... or wishing for things to be happened differently. Being a positive thinker ... pushing myself(not others) to improve while appreciate the happenings(good or bad) ... thanking God for giving me "ME" ... that is the way I want to live.
Anyway ... there are always negative people around us, those who see darkness in a bright day. Those always complain about how unfair lives are ... those who will find faults in anyone ... let them as they are. You can't change them ... you dont wish to be 'them' ... they are un-happy lots, un-grateful with abundance ... taking things for granted. Just let them be ...
For one, we should mix with more positive people, maintaining healthy environments. And for that, we should be thankful that we have the wisdom in us to see the differences ... and lead our lives in a better way.
Thanking those have helped me directly, indirectly ... for being supportive. Thanks many more positive readers and appreciative ones.
Thanks.
TEH
p/s : Today is a state holiday in Sabah, a harvest festival(psstt ... time to buy Harvest? hehe).
Comment : Trading as a main income
I was reading what Conrad's writing "Trading as a main income".
http://www.conradalvinlim.com/2012/05/trading-as-a-main-income/
Note that the title is “Trading As A Main Income“, not trading to get rich quick or trading for a million bucks.
Now that we understanding what the title is implying let’s discuss it as realistic, mature and serious traders who are looking to turn trading into source of income. In a sense, trading for a living.
THE HYPE
Through the years, trading has always been a pipe dream for most who wanted to get filthy rich. With the advancements in technology over the last decade, this pipe dream has been brought closer to home than ever before. Today, it is a very accessible dream to anyone and everyone. All you need is a computer and an Internet connection.
And of course, you need the right kind of market.
This is where the hype starts. We have been over-exposed to all sorts of advertising and promotional rah-rah that make us believe that it is actually possible to make that fortune a reality. We see ads with winners making really fantastic profits from a single trade and we hear of friends who make a living from trading and living the good life. We see the rich and famous on TV that had made fortunes in the market. We read about people making fortunes from the comfort of their homes.
We believe we can be one of them. Worse, we believe it is really that easy.
TEH : I have mentioned MANY of times ... those in KLSE or markets are NOT realistic people. How do you justify that 80-90% of them lost money and STILL losing money? NO COMMON SENSE. People talk about trading and investing like ... those talk-show ... just go to forums, u will know what I mean ... and believe me, chances are SO HIGH that majority of them are just talk-talk ... just as I said, for fun and waste away their time. It is to fill their TIME and boost their egos. Nothing concrete about learning ... about checking their mental states and no one talk about planning. Heck, throw in a few more indicators, everyone can trade! Haha ... explain WHY hundreds or thousands of them paying THOUSANDS of $$$ to attend some trading courses or buying those softwares. NO COMMON SENSE again.
Look, if I want to be blunt ... we need to be REAL ... a REAL person, take the REAL trade and check the market pulse and gain experiences. Heck ... since when trading is reading of books? Reading is encourage and good ... but NOTHING beat common-sense ... as majority in markets do not have much.
Sorry for being blunt and truthful. I do not need to be so-called tactful in my own blog, should I? Imagine this again ... you go to UNI ... 3-5 years, paying SO SO much of money and used so much of time studying, passing exams ... to get a cert. WHAT makes you think that you do not need education in trading markets? THINK deeply about that ... pause a while ... splash some cold water in bathroom ... and promise yourself to QUIT or LEARN.
BEING REALISTIC
There are many stories in the market, especially by those selling the dream, that you can make millions of dollars through trading and investing. There are testimonials from those who have made a year’s salary in only two weeks and some who have turned a small account into a million bucks.
I am sure there are truths behind those stories but the one truth that is never told is whether that success story continued and how it ended. Most end in tragedy. Poor financial management, complacency, reckless overtrading and inconsistency usually plague such successes. The reason those successes don’t last is because it is not really success – it is pure luck.
And luck always runs out.
The truth is that it takes money to make money when you don’t have luck to make you a million.
TEH : Yes ... I like what he wrote ... REALITY. I am not exposing those hype or those advertisements telling us stories about how he 'has done it'. Haha ... allow me to laugh. The next time you want to pay those thousands of dollars for a trading class, think again. How about pay me a fraction of that and I teach you the school-of-hard-knock way of trading. Yes, I do not invest any of those indicators ... it is there. But, how are we going to know what to use and when to use them ... if you are NOT a REAL trader? I am talking about real trading ... real pain of losing or missing boats!! Only real pains could teach you some lessons(if you want to learn).
Let’s get real, shall we?
Real trading is about creating a proper and sustainable income based on being realistic, pragmatic and consistent. I always tell my students to aim to make $50 to $300 a day. That is realistic, pragmatic and it can be a consistent income that pays handsomely by the end of the year.
Almost all my students don’t even have a $200,000 capital to begin with. Beginners almost always start out with $5,000 or $10,000. For a 5% gain, you should aim to profit at least $250 from a $5,000 trade or $500 from a $10,000 trade. That’s realistic and doable on a regular basis. Sometimes you will get lucky and the market may handout a little more than 5%.
If you are able to take an average of $300 off the table a day, you’re looking at a $1,500 weekly wage or $6,000 monthly income. Even at a $100 a day, you’re looking at a monthly income of $2,000 which works out to $24,000 annually. Now that is what trading is really about.
If you can’t achieve that humble level of success, don’t even dream about the big money.
If you can’t handle small successes, you won’t be able to manage a windfall.
TEH : We do not grow our investment over night. Tell me ... how long do you plan to be in market? How much could you sustain ... losing more than profitting? How long will it takes for the market to punch you and then you will say ... I quit?! I want to emphasize the word CONSISTENT. I do not care if you told me you have made a 'killing' in trading a speculative XYZ as I do know ... in long run, the so-called LUCK factor will not be on our side. It is not 50-50 ... I told my new tratles that day ... 80-90% of them losing money, you all sure want to be in the market? I have a few total newbies in this new cohort-6. Very discouraging ... but that is the truth I am sharing. I do not want the group to talk about those speculative empty-shells stocks. I will get upset ... and place that as one of the main rule it the group. Trade at your own risk ... and be serious in trading.
A WINNER IN A SEA OF LOSERS
It is a well documented fact that in the world of Trading, there is a small percentage of winners and a disparagingly disproportionate percentage of losers. It is also common to hear about many small time traders losing thousands of dollars to a few winners who make hundreds of thousands and even millions of dollars. The obvious truth is that there are a small number of traders making lots of money from a huge pool of traders losing their capital.
Why the imbalance and why is it so unfair?
In actuality, it is not unfair because those who are successful at it have done all it takes and more to get to that level. They are a dedicated and disciplined bunch of people who have the values that most people dislike; they are Patient, they Work Hard and they Practice their craft. It takes a very special person to have those qualities and to live out those values every day. It demands Discipline, Dedication and Determination which most people don’t possess.
Most people would prefer to have easy money without having to work for it, wait for it or practice to get it. They lack the determination to learn how to do it, they are never dedicated to earn it and won’t have the discipline to keep it.
TEH : He has written is very well ... taking words out of my mouth. Lee Chong Wei does not becoming champion in a year or two ... he practised hours per day for years ... since young!! The determination ... the dedication ... and the discipline. Yes, the 3-D ... which I will certainly write more about it. Nothing comes easy ... and since I am only 4 years in markets ... I am still very much a novice, whether you want to believe or not. I should know better where I want to be ... and yes, give me another 5 years of DAILY practising ... I might be a good trader, one day. I will still be here writing this blog ... but I m not sure if you(readers) will still be in market or reading my posts? I m getting my cohort-6 moving, by then ... I hope to reach cohort-50 ... will you be still interested or still dreaming of becoming a trader?
Seriously, I do not really 'dream' to be a trader ... I just continue to work hard ... to improve myself, increase my knowledge. I was handicapped as I have zero-knowledge about finance, accounting, economics, businesses ... plus markets ... I learnt them by myself, in daily basis ... for average 4-6 hours ... for 4 years now. How am I doing? Good? Not really ... I m always dissatified with what I m achieving as my benchmark is to better MYSELF ... no one else. It is ME and I. I respected so many who have 'done it'(I m talking about REAL investor-traders again) ... and yes, I respected Conrad. I read his books ... I asked my tratles to buy his books and more. I could only guide ... but I could NEVER be able to ask them to do what I have done ... it is crazy, to think of it. Haha.
This is typical of life. The few who are rich are those who have worked for it, experienced failures and earned it the hard way. The many who are poor work for the rich to make them richer. The same can be said of the market. Those who learned it and earned it the hard way will always make losers of those who are ignorant and foolish enough to believe that the market is easy money.
The losers are the ones who believe that the market can get them rich quickly. They treat the market as if it is a system to be beaten. They also use the market to gamble their hard earned money away. In short, they don’t take the market seriously and don’t respect the market as a serious, highly qualified and professional financial business.
If it were that easy, then why would Wall Street Traders need to go through years of university education and more years in mentorship before they become the best in the world? If it were so easy, why do we keep hearing so much about so many people wiping out their accounts in the market instead of hearing more about those who have become enormously successful? The success stories are far and few between but the woeful stories are plenty and common.
TEH : Yes ... taking gambling habits to market .... again, you could read some posts in forums, you could only shake your head. Are they real? One good trade could get you rich? Some bet so huge in XYZ because of some so-called sifu given them tips about buying ... with target 200% by end of the year? Who are you kidding, man?
Being realistic ... if one do not lose money(breakeven) in first few years ... congrats, you must be doing something right. If one has cultivated good trading habits, getting good trading systems ... putting with right mental for trading, it is the ONLY way to be successful in trading ... consistently.
ONE HARDWORKING WINNER AGAINST TEN IGNORANT DREAMERS
In the movie, “In Pursuit Of Happyness“, Will Smith’s character, Chris Garder struggled in life as a medical machine salesman looking for and dreaming of that “next big thing“. Cutting the story short, Gardner becomes a trader on Wall Street after a lot of reality checks, struggles, sacrifices, trials and failures. The sacrifices were not his own alone but that of his family and more famously, his son who kept his faith in his father’s pursuit for happiness.
We know today that he is a successful and well known figure on Wall Street.
It didn’t happen overnight. He didn’t get rich quick. And he certainly didn’t attend a three day workshop to learn how to trade.
If there was one element missing from this rags-to-riches story, it would be how Gardner still had to continue to work his ass off as a trader before he made his first million. He had learnt what the pros did and how they did it . And it took a lot of hard work, patience and practice.
I’d like to share with you a simple fact that seems to have been missed by everyone who chases their dream of becoming successful – have you noticed that there are many movies and books about successful people and how they struggled, failed and struggled some more before eventually finding success … but there are none about people who became successful overnight or got rich quick?
This is because it is a reality of life – true, lasting success doesn’t come easily and those who have it had to work for it. Nothing comes easy.
TEH : I bought this DVD(original, ok?) ... I do not watch movie much(no time) but I searched for this one. Yes, it is related to hardship and success. I do not really see myself successful but I am currently building the foundations needed to reach my goals. Again, I do not bother much if anyone is going to tell me I am successful or nor successful. It doesnt matter much to me. What matters to me ... is how I feel about what I am doing!! I admit I have struggled pretty much in the initial stage of learning ... but believe me, it is good and invaluable.
Yes, nothing comes easy .... if attending those 3-days or 4-days courses could make you a trader, you are such a naive dreamer!! So, I m making my trading course in alternate Saturdays and more meetings with daily sharing in my group through facebook and blogs. NOTHING comes easy ... so, many of my tratles ... keeping very quiet now. I dont even know if some of them still in markets. That is how difficult I want to make it to be ... travelling all the way to attend my long-winded 3 hours talk!! Haha ... believe me, if there is a good talk in Penang or Spore, if I am available, I will travel there ... pay money for it and attend the talk. I have travelled to market-talks and such whenever I am available. Have you seen me stop writing a post or not checking on markets for a day? I dont waste time ... as I do not have the time!! Time = money to me!!
WHAT I DO AND WHY I DO IT
Real trading is all about making a steady income. I don’t boast about being a big time trader. Those who know me will tell you that I don’t trade big time. I don’t make tens of thousands a day or even in a week. The trades I make have a humble profit objective of $100 to $300 for every $5,000 to $10,000 capital outlay. I frequently do make a higher average than that, often between 3% to 5% and on the occasion, more than 10%. But it all starts with a humble 2% to 3% target.
At that level, you still can make a million starting with a $10,000 account but it will take around eight years if you have the luck of the right market;
A $3,300 capital should return you around $100 on a single trade which works out to around 3%. Thus three trades for a total capital of $9,900 should get you a minimum of $300. If they were inter-day or intra-day trades, you’re looking at $300 a day averagely. That works out to around $72,000 a year.
But that’s a minimum, meaning to say that anything less literally tells you that you’re not trading well. You need more practice or you need to find out what real traders do and how real traders do it.
A $10,000 trading account yielding 3% daily means that on a monthly basis, its actually turning around $6,000! But let’s keep it real and say that you’re only half as good and there were some losses too … let’s say half … you’d still be making $3,000 monthly. This is still $36,000 a year – a really good side-line income for any trader who is starting out.
Now consider that with more practice and experience, you’re able to increase your trade sizes and thus increase your profit margin over the next few years – $36,000 turns into $54,000 the next year. Now you have a capital of $90,000. In the subsequent six years at the same growth rate you raise your account worth to $135,000, then $202,500 and in fifth year, your account grows to $303,750. By the sixth year its grown to $455,625, year seven its up to $683,438 and on the eighth year, you finally break a million at $1,025,156.
Somewhere in those years, you might take a hit and you might get extremely lucky. With proper financial management and discipline, you will keep the losses small and let the luck ride big.
But that is only if you know what real traders do and how they do it.
So why, after reading this, are you still thinking that you can get rich quick through trading?
TEH : I m not dreaming of getting rich, I dont have the amount in my head ... as I remind myself to improve my trading system, be humble to listen to others .. in order to learn from many. I never see myself any better than other traders, but I do know that I need to continue to focus in my trading. At times, I got carried away, at times ... I do blunders and also many mistakes along the way. In my ups-downs, I maintain my focus ... and I am no longer alone, I have a whole group with me. So, I have greater responsibilities of educating and sharing with them ... what I have learnt and my mistakes too. By admitting wrongs, correcting them ... by sharing and reflecting .. that is called maturity. Yes, we do need maturity to be in markets.
I have chatted and known many 'immature' traders/investors ... those young and egoistic ones(in fact, I kicked one person from my stock-watch last month) ... and making sure the group maintain focus in their tradings. Otherwise, it will be just one of those noisy forums where you could easily lose focus.
I will continue to teach .... holding to my full-time job, giving tuitions and teaching some basic tradings. I never claim myself as sifu or good. My tratles knew me in person ... they know better.
One day ... perhaps 5 years later, I might quit my full-time job .... getting out as full-time trader. Perhaps, one day ... I will feel my own success ... as even if I fail, at least I have tried.
It is 12.30 am ... time to rest after 7 hours of class yesterday.
Today, I am 45th. :)
TEH
http://www.conradalvinlim.com/2012/05/trading-as-a-main-income/
Note that the title is “Trading As A Main Income“, not trading to get rich quick or trading for a million bucks.
Now that we understanding what the title is implying let’s discuss it as realistic, mature and serious traders who are looking to turn trading into source of income. In a sense, trading for a living.
THE HYPE
Through the years, trading has always been a pipe dream for most who wanted to get filthy rich. With the advancements in technology over the last decade, this pipe dream has been brought closer to home than ever before. Today, it is a very accessible dream to anyone and everyone. All you need is a computer and an Internet connection.
And of course, you need the right kind of market.
This is where the hype starts. We have been over-exposed to all sorts of advertising and promotional rah-rah that make us believe that it is actually possible to make that fortune a reality. We see ads with winners making really fantastic profits from a single trade and we hear of friends who make a living from trading and living the good life. We see the rich and famous on TV that had made fortunes in the market. We read about people making fortunes from the comfort of their homes.
We believe we can be one of them. Worse, we believe it is really that easy.
TEH : I have mentioned MANY of times ... those in KLSE or markets are NOT realistic people. How do you justify that 80-90% of them lost money and STILL losing money? NO COMMON SENSE. People talk about trading and investing like ... those talk-show ... just go to forums, u will know what I mean ... and believe me, chances are SO HIGH that majority of them are just talk-talk ... just as I said, for fun and waste away their time. It is to fill their TIME and boost their egos. Nothing concrete about learning ... about checking their mental states and no one talk about planning. Heck, throw in a few more indicators, everyone can trade! Haha ... explain WHY hundreds or thousands of them paying THOUSANDS of $$$ to attend some trading courses or buying those softwares. NO COMMON SENSE again.
Look, if I want to be blunt ... we need to be REAL ... a REAL person, take the REAL trade and check the market pulse and gain experiences. Heck ... since when trading is reading of books? Reading is encourage and good ... but NOTHING beat common-sense ... as majority in markets do not have much.
Sorry for being blunt and truthful. I do not need to be so-called tactful in my own blog, should I? Imagine this again ... you go to UNI ... 3-5 years, paying SO SO much of money and used so much of time studying, passing exams ... to get a cert. WHAT makes you think that you do not need education in trading markets? THINK deeply about that ... pause a while ... splash some cold water in bathroom ... and promise yourself to QUIT or LEARN.
BEING REALISTIC
There are many stories in the market, especially by those selling the dream, that you can make millions of dollars through trading and investing. There are testimonials from those who have made a year’s salary in only two weeks and some who have turned a small account into a million bucks.
I am sure there are truths behind those stories but the one truth that is never told is whether that success story continued and how it ended. Most end in tragedy. Poor financial management, complacency, reckless overtrading and inconsistency usually plague such successes. The reason those successes don’t last is because it is not really success – it is pure luck.
And luck always runs out.
The truth is that it takes money to make money when you don’t have luck to make you a million.
TEH : Yes ... I like what he wrote ... REALITY. I am not exposing those hype or those advertisements telling us stories about how he 'has done it'. Haha ... allow me to laugh. The next time you want to pay those thousands of dollars for a trading class, think again. How about pay me a fraction of that and I teach you the school-of-hard-knock way of trading. Yes, I do not invest any of those indicators ... it is there. But, how are we going to know what to use and when to use them ... if you are NOT a REAL trader? I am talking about real trading ... real pain of losing or missing boats!! Only real pains could teach you some lessons(if you want to learn).
Let’s get real, shall we?
Real trading is about creating a proper and sustainable income based on being realistic, pragmatic and consistent. I always tell my students to aim to make $50 to $300 a day. That is realistic, pragmatic and it can be a consistent income that pays handsomely by the end of the year.
Almost all my students don’t even have a $200,000 capital to begin with. Beginners almost always start out with $5,000 or $10,000. For a 5% gain, you should aim to profit at least $250 from a $5,000 trade or $500 from a $10,000 trade. That’s realistic and doable on a regular basis. Sometimes you will get lucky and the market may handout a little more than 5%.
If you are able to take an average of $300 off the table a day, you’re looking at a $1,500 weekly wage or $6,000 monthly income. Even at a $100 a day, you’re looking at a monthly income of $2,000 which works out to $24,000 annually. Now that is what trading is really about.
If you can’t achieve that humble level of success, don’t even dream about the big money.
If you can’t handle small successes, you won’t be able to manage a windfall.
TEH : We do not grow our investment over night. Tell me ... how long do you plan to be in market? How much could you sustain ... losing more than profitting? How long will it takes for the market to punch you and then you will say ... I quit?! I want to emphasize the word CONSISTENT. I do not care if you told me you have made a 'killing' in trading a speculative XYZ as I do know ... in long run, the so-called LUCK factor will not be on our side. It is not 50-50 ... I told my new tratles that day ... 80-90% of them losing money, you all sure want to be in the market? I have a few total newbies in this new cohort-6. Very discouraging ... but that is the truth I am sharing. I do not want the group to talk about those speculative empty-shells stocks. I will get upset ... and place that as one of the main rule it the group. Trade at your own risk ... and be serious in trading.
A WINNER IN A SEA OF LOSERS
It is a well documented fact that in the world of Trading, there is a small percentage of winners and a disparagingly disproportionate percentage of losers. It is also common to hear about many small time traders losing thousands of dollars to a few winners who make hundreds of thousands and even millions of dollars. The obvious truth is that there are a small number of traders making lots of money from a huge pool of traders losing their capital.
Why the imbalance and why is it so unfair?
In actuality, it is not unfair because those who are successful at it have done all it takes and more to get to that level. They are a dedicated and disciplined bunch of people who have the values that most people dislike; they are Patient, they Work Hard and they Practice their craft. It takes a very special person to have those qualities and to live out those values every day. It demands Discipline, Dedication and Determination which most people don’t possess.
Most people would prefer to have easy money without having to work for it, wait for it or practice to get it. They lack the determination to learn how to do it, they are never dedicated to earn it and won’t have the discipline to keep it.
TEH : He has written is very well ... taking words out of my mouth. Lee Chong Wei does not becoming champion in a year or two ... he practised hours per day for years ... since young!! The determination ... the dedication ... and the discipline. Yes, the 3-D ... which I will certainly write more about it. Nothing comes easy ... and since I am only 4 years in markets ... I am still very much a novice, whether you want to believe or not. I should know better where I want to be ... and yes, give me another 5 years of DAILY practising ... I might be a good trader, one day. I will still be here writing this blog ... but I m not sure if you(readers) will still be in market or reading my posts? I m getting my cohort-6 moving, by then ... I hope to reach cohort-50 ... will you be still interested or still dreaming of becoming a trader?
Seriously, I do not really 'dream' to be a trader ... I just continue to work hard ... to improve myself, increase my knowledge. I was handicapped as I have zero-knowledge about finance, accounting, economics, businesses ... plus markets ... I learnt them by myself, in daily basis ... for average 4-6 hours ... for 4 years now. How am I doing? Good? Not really ... I m always dissatified with what I m achieving as my benchmark is to better MYSELF ... no one else. It is ME and I. I respected so many who have 'done it'(I m talking about REAL investor-traders again) ... and yes, I respected Conrad. I read his books ... I asked my tratles to buy his books and more. I could only guide ... but I could NEVER be able to ask them to do what I have done ... it is crazy, to think of it. Haha.
This is typical of life. The few who are rich are those who have worked for it, experienced failures and earned it the hard way. The many who are poor work for the rich to make them richer. The same can be said of the market. Those who learned it and earned it the hard way will always make losers of those who are ignorant and foolish enough to believe that the market is easy money.
The losers are the ones who believe that the market can get them rich quickly. They treat the market as if it is a system to be beaten. They also use the market to gamble their hard earned money away. In short, they don’t take the market seriously and don’t respect the market as a serious, highly qualified and professional financial business.
If it were that easy, then why would Wall Street Traders need to go through years of university education and more years in mentorship before they become the best in the world? If it were so easy, why do we keep hearing so much about so many people wiping out their accounts in the market instead of hearing more about those who have become enormously successful? The success stories are far and few between but the woeful stories are plenty and common.
TEH : Yes ... taking gambling habits to market .... again, you could read some posts in forums, you could only shake your head. Are they real? One good trade could get you rich? Some bet so huge in XYZ because of some so-called sifu given them tips about buying ... with target 200% by end of the year? Who are you kidding, man?
Being realistic ... if one do not lose money(breakeven) in first few years ... congrats, you must be doing something right. If one has cultivated good trading habits, getting good trading systems ... putting with right mental for trading, it is the ONLY way to be successful in trading ... consistently.
ONE HARDWORKING WINNER AGAINST TEN IGNORANT DREAMERS
In the movie, “In Pursuit Of Happyness“, Will Smith’s character, Chris Garder struggled in life as a medical machine salesman looking for and dreaming of that “next big thing“. Cutting the story short, Gardner becomes a trader on Wall Street after a lot of reality checks, struggles, sacrifices, trials and failures. The sacrifices were not his own alone but that of his family and more famously, his son who kept his faith in his father’s pursuit for happiness.
We know today that he is a successful and well known figure on Wall Street.
It didn’t happen overnight. He didn’t get rich quick. And he certainly didn’t attend a three day workshop to learn how to trade.
If there was one element missing from this rags-to-riches story, it would be how Gardner still had to continue to work his ass off as a trader before he made his first million. He had learnt what the pros did and how they did it . And it took a lot of hard work, patience and practice.
I’d like to share with you a simple fact that seems to have been missed by everyone who chases their dream of becoming successful – have you noticed that there are many movies and books about successful people and how they struggled, failed and struggled some more before eventually finding success … but there are none about people who became successful overnight or got rich quick?
This is because it is a reality of life – true, lasting success doesn’t come easily and those who have it had to work for it. Nothing comes easy.
TEH : I bought this DVD(original, ok?) ... I do not watch movie much(no time) but I searched for this one. Yes, it is related to hardship and success. I do not really see myself successful but I am currently building the foundations needed to reach my goals. Again, I do not bother much if anyone is going to tell me I am successful or nor successful. It doesnt matter much to me. What matters to me ... is how I feel about what I am doing!! I admit I have struggled pretty much in the initial stage of learning ... but believe me, it is good and invaluable.
Yes, nothing comes easy .... if attending those 3-days or 4-days courses could make you a trader, you are such a naive dreamer!! So, I m making my trading course in alternate Saturdays and more meetings with daily sharing in my group through facebook and blogs. NOTHING comes easy ... so, many of my tratles ... keeping very quiet now. I dont even know if some of them still in markets. That is how difficult I want to make it to be ... travelling all the way to attend my long-winded 3 hours talk!! Haha ... believe me, if there is a good talk in Penang or Spore, if I am available, I will travel there ... pay money for it and attend the talk. I have travelled to market-talks and such whenever I am available. Have you seen me stop writing a post or not checking on markets for a day? I dont waste time ... as I do not have the time!! Time = money to me!!
WHAT I DO AND WHY I DO IT
Real trading is all about making a steady income. I don’t boast about being a big time trader. Those who know me will tell you that I don’t trade big time. I don’t make tens of thousands a day or even in a week. The trades I make have a humble profit objective of $100 to $300 for every $5,000 to $10,000 capital outlay. I frequently do make a higher average than that, often between 3% to 5% and on the occasion, more than 10%. But it all starts with a humble 2% to 3% target.
At that level, you still can make a million starting with a $10,000 account but it will take around eight years if you have the luck of the right market;
A $3,300 capital should return you around $100 on a single trade which works out to around 3%. Thus three trades for a total capital of $9,900 should get you a minimum of $300. If they were inter-day or intra-day trades, you’re looking at $300 a day averagely. That works out to around $72,000 a year.
But that’s a minimum, meaning to say that anything less literally tells you that you’re not trading well. You need more practice or you need to find out what real traders do and how real traders do it.
A $10,000 trading account yielding 3% daily means that on a monthly basis, its actually turning around $6,000! But let’s keep it real and say that you’re only half as good and there were some losses too … let’s say half … you’d still be making $3,000 monthly. This is still $36,000 a year – a really good side-line income for any trader who is starting out.
Now consider that with more practice and experience, you’re able to increase your trade sizes and thus increase your profit margin over the next few years – $36,000 turns into $54,000 the next year. Now you have a capital of $90,000. In the subsequent six years at the same growth rate you raise your account worth to $135,000, then $202,500 and in fifth year, your account grows to $303,750. By the sixth year its grown to $455,625, year seven its up to $683,438 and on the eighth year, you finally break a million at $1,025,156.
Somewhere in those years, you might take a hit and you might get extremely lucky. With proper financial management and discipline, you will keep the losses small and let the luck ride big.
But that is only if you know what real traders do and how they do it.
So why, after reading this, are you still thinking that you can get rich quick through trading?
TEH : I m not dreaming of getting rich, I dont have the amount in my head ... as I remind myself to improve my trading system, be humble to listen to others .. in order to learn from many. I never see myself any better than other traders, but I do know that I need to continue to focus in my trading. At times, I got carried away, at times ... I do blunders and also many mistakes along the way. In my ups-downs, I maintain my focus ... and I am no longer alone, I have a whole group with me. So, I have greater responsibilities of educating and sharing with them ... what I have learnt and my mistakes too. By admitting wrongs, correcting them ... by sharing and reflecting .. that is called maturity. Yes, we do need maturity to be in markets.
I have chatted and known many 'immature' traders/investors ... those young and egoistic ones(in fact, I kicked one person from my stock-watch last month) ... and making sure the group maintain focus in their tradings. Otherwise, it will be just one of those noisy forums where you could easily lose focus.
I will continue to teach .... holding to my full-time job, giving tuitions and teaching some basic tradings. I never claim myself as sifu or good. My tratles knew me in person ... they know better.
One day ... perhaps 5 years later, I might quit my full-time job .... getting out as full-time trader. Perhaps, one day ... I will feel my own success ... as even if I fail, at least I have tried.
It is 12.30 am ... time to rest after 7 hours of class yesterday.
Today, I am 45th. :)
TEH
Tuesday, May 29, 2012
Moving to HKSE
If I am in Sabah now, tmr is a state holiday. Yes, just another reasons, on top of the many, why I would love to go back to Sabah ... once I retired from many of the things I am doing now and my responsibilities done with. I do have small beach-apartment(vacant ... anyone travelling to KK can rent my place, ya!) ... with nice furnishing and my vacation home at the moment. It will be a nice place to retire ... I like beaches ... not bitches, ok? Haha
HKSE : Let me check my HKSE's babes ... ZJ bought at HKD9, now at HKD9.40, Qinfa bought at 1.25, now at 1.30 and my most recent babe is CNOOC, bought at 14.18 and now at 14.60. Doing good. What I missed was Geely ... eyeing at HKD2.50, missed the queue ... now at HKD2.90. Ouch.
Anyway ... I still have one more HKSE's babe to buy ... thinking ... what's next?
Due to the political risk in Malaysia, with sodomy-news as the mother of all jokes here ... KLCI could not go any much more(tho I do expect it to break new high at 1620 before the whole collapse again) ... moving myself away to HKSE is my choice. I have told my whole group last year that they should consider HKSE too but majority are too new to trading and markets ... HKSE is a totally new playground. For me, I hv been familarising myself with HKSE for the past two years.
In fact, I m thinking of sharing many of my HKSE's stocks I am looking into, but it did not attract any much interests from my tratles or my stock-watch groups. We are more familiar with KLSE ... so, it is obvious that the fear(risk) of unknown ... giving us the fright!!
Imagine the liquidity in HKSE ... imagine those huge-cap stocks(unfortunately, 80% are owned by China's gov) ... imagine the cheap valuations(many trading in single PER, ok?). Imagine the growth stories in China. Imagine the huge population with increasing purchasing power, imagine ... Malaysia 10-20 years ago, where cars was a luxury, handphones are new gadgets ... computers only for those 'elite' ones ... imagine the technologies transfered from the western ... of coz, imagine the 'cloning' could be done ... imagine the amount of energy-power needed to run the whole country and the demands ... imagine the huge reserves which the diversification of their USD into commodity will only help to boost the prices of commodities. Imagine too .. the un-imaginable ... and imagine these glutton Chinese, punting away in ... the largest casino ... HKSE.
I am buying Jim Roger's stories about emerging markets, particularly ... China. So, I hope I am smart enough to buy more HKSE's stock this year and next(till the next collapse).
We just need to be patient to wait for correction ... we do need to know what we are buying. I am checking more on HKSE recently due to better valuations there and less political risk(no political-sex news to excite us).
So ... I will form a group ... for HKSE. Anyone interested?
7.30 pm : It is not even in my planning yet to form a HKSE-group as I do not really think so many will be interested. It is just a thought ... then only plan ... and to see if it works. Thanks for few responses to join!!
Qinfa : Bought at 1.25, closed at 1.36 ... 8.8%, way to go.
Cnooc : Bought at 14.18, closed at 14.72 ... 3.8%, way to go.
ZhaoJin : Bought at HKD9, closed at 9.63 ... 7%, way to go.
All the above bought less than 2 weeks ago.
TEH
HKSE : Let me check my HKSE's babes ... ZJ bought at HKD9, now at HKD9.40, Qinfa bought at 1.25, now at 1.30 and my most recent babe is CNOOC, bought at 14.18 and now at 14.60. Doing good. What I missed was Geely ... eyeing at HKD2.50, missed the queue ... now at HKD2.90. Ouch.
Anyway ... I still have one more HKSE's babe to buy ... thinking ... what's next?
Due to the political risk in Malaysia, with sodomy-news as the mother of all jokes here ... KLCI could not go any much more(tho I do expect it to break new high at 1620 before the whole collapse again) ... moving myself away to HKSE is my choice. I have told my whole group last year that they should consider HKSE too but majority are too new to trading and markets ... HKSE is a totally new playground. For me, I hv been familarising myself with HKSE for the past two years.
In fact, I m thinking of sharing many of my HKSE's stocks I am looking into, but it did not attract any much interests from my tratles or my stock-watch groups. We are more familiar with KLSE ... so, it is obvious that the fear(risk) of unknown ... giving us the fright!!
Imagine the liquidity in HKSE ... imagine those huge-cap stocks(unfortunately, 80% are owned by China's gov) ... imagine the cheap valuations(many trading in single PER, ok?). Imagine the growth stories in China. Imagine the huge population with increasing purchasing power, imagine ... Malaysia 10-20 years ago, where cars was a luxury, handphones are new gadgets ... computers only for those 'elite' ones ... imagine the technologies transfered from the western ... of coz, imagine the 'cloning' could be done ... imagine the amount of energy-power needed to run the whole country and the demands ... imagine the huge reserves which the diversification of their USD into commodity will only help to boost the prices of commodities. Imagine too .. the un-imaginable ... and imagine these glutton Chinese, punting away in ... the largest casino ... HKSE.
I am buying Jim Roger's stories about emerging markets, particularly ... China. So, I hope I am smart enough to buy more HKSE's stock this year and next(till the next collapse).
We just need to be patient to wait for correction ... we do need to know what we are buying. I am checking more on HKSE recently due to better valuations there and less political risk(no political-sex news to excite us).
So ... I will form a group ... for HKSE. Anyone interested?
7.30 pm : It is not even in my planning yet to form a HKSE-group as I do not really think so many will be interested. It is just a thought ... then only plan ... and to see if it works. Thanks for few responses to join!!
Qinfa : Bought at 1.25, closed at 1.36 ... 8.8%, way to go.
Cnooc : Bought at 14.18, closed at 14.72 ... 3.8%, way to go.
ZhaoJin : Bought at HKD9, closed at 9.63 ... 7%, way to go.
All the above bought less than 2 weeks ago.
TEH
Monday, May 28, 2012
Punting in stock markets
One of my class cancelled(that is RM240, ok? ouch). Anyway, I still have classes till night today. That could give me more bullets collected to shoot ... hehe.
Today's topic ... how not to lose money is another COMMON SENSE which not many have in trading markets.
EMPTY ... by Click Five(I like)
Rule : Do not buy speculative, empty-shell stocks due to rumours.
Now, many or should I say ... most of the stocks traded in KLCI is manipulative and speculative. It is very quite easy to see ... they are the always in most actively traded stocks in KLCI for few days(at times, could be only for few hours!!) ... many punters talking about them in forums(most of them gamblers, uncles-aunties and those ignorant newbies). Most of these stocks are penny stocks ... and many below 20-30cents.
Let us take today .. we have SMI, Silver(PN17 also many punting, up 30+% in one day today), Abric, Emico ... and those ACE-babes such as Dscsol, AGlobal, Focus ..,
I dont know how to trade these counters. They failed most of my FA criteria and technically, it COULD not be used. So, it is pure speculating ... punting , get stuck ... dont know what to do, after dropping 30-50%, cut loss ... and repeat to gamble again.
Ingens : A weekly chart of a stock called INGENS. Hmm ... I m not sure if it is a name of a japanese cartoon character, but I do heard of it before. Where?? Yes, forum ... i3-investors, such a good platform INFESTED by punters ... talking and discussing about INGENS. Haha ... sorry, I m cynical. I do get upset if I need to probe further about its fundamentals.
It is thinly traded today at 0.075, dropped from 15cents levels ... that is 50% losses if one has punted into her during that ONE day surged(21st Mac). Game over for a time being ... till one fine day, some donkeys will make noises in the forum, and it rumours to be gorenged to 20cents again!! Perhaps, one may wait for 0.035(another 50% drop from current level) for a 'safe' entry point. WTF am I talking about? Entry-point? Haha ... I m talking to gamblers ... if one really NEED to enter ... nothing above 0.04, please. If we got stucked ... what should we do? How on earth anyone could tell WHY you entered at much higher level then? Of coz ... GREED ... today, fear? Sell for huge losses? One thing for sure ... I will NOT touch such counters, certainly will NOT average down. I will CUT-LOSS all those stupid-donkey's stocks, shake myself up ... splash cold water(soak in salt water, please) ... and making sure I will NOT be in market anymore UNTIL I get the simple definition of trading-investing right.
Ooppss ... side-tracked ... where am I?
Yes, how not to lose money? Simple tips here ... NEVER get yourself to buy through rumours, espeically those PENNY EMPTY stocks. If you dont know, ask!! Damn it ... stupid Malaysia education system, oppression of freedom of speech ... till majority of us DO NOT cultivate the good habit of LEARNING. Damn the education system, we simply DO NOT learn anything much except getting some certs to WORK. Phew ... voicing out the frustrations ... haha ... why many WILL NOT ask, queitly they will buy into Ingens, AGlobal, DVM ... AsiaEP ...
Another example : AsiaEP
Someone told me that her remisier asking her to buy AsiaEp at 0.08 ... I was like ... WTF ... shoot your stupid remisier(how he got the license, ask him) due to some rumour of 'china' ... I advised her NOT to get into such rumours. Oh boy ... the stock when up to 0.10 in few weeks time. Damn it ... I was wrong to give the advice. I m not sure if I was cursed. If you punt at 0.08, and becoming greedier ... did not sell at 0.10 ... and each time it moves lower, u will say ... it will rebound to 0.10 again ... you are proven wrong. Today at 0.04 ... shoot me, it is 50% below my cost price now, should we average down? Please ask the same remisier. He should have told you the exit point too.
It is endless ... do NOT blame your remisier, do not blame the persons posted in forums or blogs, do not blame anyone, including your dog ... blame yourself. Take it. Cry over it ... slap yourself, splash some cold water ... move on. Start afresh ... if you have the will. If not, QUIT market ... promise never to come back to stock-market anymore, it is SCAM. It is full of bull-shits ... from your remisiers, your broker reports ... those media ... just quit and avoid and accept that market is not for you.
What if ... Iris goreng again. What if KARAM-bunai or Sanichi goreng to 25cents again? What if ...
Advice : Never buy into these speculative empty stocks. It is NOT cheap. We do NOT value stock as cheap through it prices. Never to touch a stock below 50cents or perhaps below RM1. It is the tips I could share on "How not to lose money" ... in markets.
TEH
Today's topic ... how not to lose money is another COMMON SENSE which not many have in trading markets.
EMPTY ... by Click Five(I like)
Rule : Do not buy speculative, empty-shell stocks due to rumours.
Now, many or should I say ... most of the stocks traded in KLCI is manipulative and speculative. It is very quite easy to see ... they are the always in most actively traded stocks in KLCI for few days(at times, could be only for few hours!!) ... many punters talking about them in forums(most of them gamblers, uncles-aunties and those ignorant newbies). Most of these stocks are penny stocks ... and many below 20-30cents.
Let us take today .. we have SMI, Silver(PN17 also many punting, up 30+% in one day today), Abric, Emico ... and those ACE-babes such as Dscsol, AGlobal, Focus ..,
I dont know how to trade these counters. They failed most of my FA criteria and technically, it COULD not be used. So, it is pure speculating ... punting , get stuck ... dont know what to do, after dropping 30-50%, cut loss ... and repeat to gamble again.
Ingens : A weekly chart of a stock called INGENS. Hmm ... I m not sure if it is a name of a japanese cartoon character, but I do heard of it before. Where?? Yes, forum ... i3-investors, such a good platform INFESTED by punters ... talking and discussing about INGENS. Haha ... sorry, I m cynical. I do get upset if I need to probe further about its fundamentals.
It is thinly traded today at 0.075, dropped from 15cents levels ... that is 50% losses if one has punted into her during that ONE day surged(21st Mac). Game over for a time being ... till one fine day, some donkeys will make noises in the forum, and it rumours to be gorenged to 20cents again!! Perhaps, one may wait for 0.035(another 50% drop from current level) for a 'safe' entry point. WTF am I talking about? Entry-point? Haha ... I m talking to gamblers ... if one really NEED to enter ... nothing above 0.04, please. If we got stucked ... what should we do? How on earth anyone could tell WHY you entered at much higher level then? Of coz ... GREED ... today, fear? Sell for huge losses? One thing for sure ... I will NOT touch such counters, certainly will NOT average down. I will CUT-LOSS all those stupid-donkey's stocks, shake myself up ... splash cold water(soak in salt water, please) ... and making sure I will NOT be in market anymore UNTIL I get the simple definition of trading-investing right.
Ooppss ... side-tracked ... where am I?
Yes, how not to lose money? Simple tips here ... NEVER get yourself to buy through rumours, espeically those PENNY EMPTY stocks. If you dont know, ask!! Damn it ... stupid Malaysia education system, oppression of freedom of speech ... till majority of us DO NOT cultivate the good habit of LEARNING. Damn the education system, we simply DO NOT learn anything much except getting some certs to WORK. Phew ... voicing out the frustrations ... haha ... why many WILL NOT ask, queitly they will buy into Ingens, AGlobal, DVM ... AsiaEP ...
Another example : AsiaEP
Someone told me that her remisier asking her to buy AsiaEp at 0.08 ... I was like ... WTF ... shoot your stupid remisier(how he got the license, ask him) due to some rumour of 'china' ... I advised her NOT to get into such rumours. Oh boy ... the stock when up to 0.10 in few weeks time. Damn it ... I was wrong to give the advice. I m not sure if I was cursed. If you punt at 0.08, and becoming greedier ... did not sell at 0.10 ... and each time it moves lower, u will say ... it will rebound to 0.10 again ... you are proven wrong. Today at 0.04 ... shoot me, it is 50% below my cost price now, should we average down? Please ask the same remisier. He should have told you the exit point too.
It is endless ... do NOT blame your remisier, do not blame the persons posted in forums or blogs, do not blame anyone, including your dog ... blame yourself. Take it. Cry over it ... slap yourself, splash some cold water ... move on. Start afresh ... if you have the will. If not, QUIT market ... promise never to come back to stock-market anymore, it is SCAM. It is full of bull-shits ... from your remisiers, your broker reports ... those media ... just quit and avoid and accept that market is not for you.
What if ... Iris goreng again. What if KARAM-bunai or Sanichi goreng to 25cents again? What if ...
Advice : Never buy into these speculative empty stocks. It is NOT cheap. We do NOT value stock as cheap through it prices. Never to touch a stock below 50cents or perhaps below RM1. It is the tips I could share on "How not to lose money" ... in markets.
TEH
Sunday, May 27, 2012
Had a nice day
Sunday ... I was busy the whole day with classes due to the nearing exams(Tuesday). Tmr I will be fully booked till night ...
Anyway, today is a very nice day for me ... I mean, I m very glad to ask my sis & hubby for dinner ... plus managed to ask my two aunties to join us!! It is indeed a nice feeling, dinner on me ... and that is the best feeling, I guess.
You see, previously ... in so many years, I never really could afford to treat my family members dinners or whatever. I was simply too financially tight myself, with my naive characters(about money) and ... I could only shallow my pride, checking that I could not afford.
Today ... I am glad ... as I could be able to ask them for dinner, and making sure they are no longer worry that I could not afford a nice dinner. I am not spendthrift ... but I am very willing to spend a little for a nice dinner with my whole family. And I want to make it more often!!
Again ... it is a luxury to me ... I worked hard these few years, I m making sure that I m focusing in the right direction and not allowing myself to rest much. I still have so much of things to do ... full-time teaching job, my tuition classes ... trading courses ... and my facebook-pages, besides this small cyber-page I am occupying. I m certainly not looking for luxurious living, I will be glad to have a simple-content lives ... but with some money in pockets, I could afford to spend on people around me, my family.
Then, my aunty(a mom to me) just bought an i-pad-3. WOW ... she said she could go online now. I gave her my site-address(haha) ... and told her my blog is very boring. I talk about nothing much, except some stocks ... strategies in trading or investing ... or some times, just a place for me to share my feelings(like now).
I dont know if she is reading these lines ... I just want to let her know that she has done so so much for me, making sure I grew-up to be a man, a useful one ... and someone she could be proud of. I have no achievement to show her ... but seeing that everyone is happy with tonight dinner(even my little girl enjoyed her spaghetti) ... making me very pleased tonight.
Kor-kor, it doesnt matter if you are reading my blog, I will still write 'independently' as I have(LOL) ... and you do not need to understand what I am blah-ing about. What is more important I would share here ... is the gratefulness I felt ... and I want to say "thank you". Thanks for being a mom to me.
Welcome to my blog ... and you are my most valuable reader!! :)
TEH
Anyway, today is a very nice day for me ... I mean, I m very glad to ask my sis & hubby for dinner ... plus managed to ask my two aunties to join us!! It is indeed a nice feeling, dinner on me ... and that is the best feeling, I guess.
You see, previously ... in so many years, I never really could afford to treat my family members dinners or whatever. I was simply too financially tight myself, with my naive characters(about money) and ... I could only shallow my pride, checking that I could not afford.
Today ... I am glad ... as I could be able to ask them for dinner, and making sure they are no longer worry that I could not afford a nice dinner. I am not spendthrift ... but I am very willing to spend a little for a nice dinner with my whole family. And I want to make it more often!!
Again ... it is a luxury to me ... I worked hard these few years, I m making sure that I m focusing in the right direction and not allowing myself to rest much. I still have so much of things to do ... full-time teaching job, my tuition classes ... trading courses ... and my facebook-pages, besides this small cyber-page I am occupying. I m certainly not looking for luxurious living, I will be glad to have a simple-content lives ... but with some money in pockets, I could afford to spend on people around me, my family.
Then, my aunty(a mom to me) just bought an i-pad-3. WOW ... she said she could go online now. I gave her my site-address(haha) ... and told her my blog is very boring. I talk about nothing much, except some stocks ... strategies in trading or investing ... or some times, just a place for me to share my feelings(like now).
I dont know if she is reading these lines ... I just want to let her know that she has done so so much for me, making sure I grew-up to be a man, a useful one ... and someone she could be proud of. I have no achievement to show her ... but seeing that everyone is happy with tonight dinner(even my little girl enjoyed her spaghetti) ... making me very pleased tonight.
Kor-kor, it doesnt matter if you are reading my blog, I will still write 'independently' as I have(LOL) ... and you do not need to understand what I am blah-ing about. What is more important I would share here ... is the gratefulness I felt ... and I want to say "thank you". Thanks for being a mom to me.
Welcome to my blog ... and you are my most valuable reader!! :)
TEH
Stock Watch(HKSE) : CNOOC, ZhaoJin and Qinfa
Qinfa : Back to HKD1.25 and grabbed at 1.25 done ... will check to sell around HKD1.50-1.60.
CNOOC : Bought 2k units done at HKD14.18. It is rebounding from support.
ZhaoJin : This is posted for my stock-watch page, slowly introducing to them some HK's stocks for trading purposes. Queued at HKD9 and it was done. Recently touched HKD8 before the rebound. Will gold prices recover from here? We shall check.
Yes, to me .. it is time to move more to HKSE as there is no election-fear in markets and more attractive valuations. In fact, volatility is what we needed ... to trade.
Happy Trading.
TEH
Saturday, May 26, 2012
Valuations of stocks
It is Sat ... I do have classes from 9 am to 11am, 11am to 12.30pm ... then lunch with some of my tratles ... before have a meeting(my cohort 5) and analysing some charts with them. When we practise in do things regularly, we could improve ... and to me, that is the only way to improve. Theories remain as theories ... without practices, it is empty.
Quote : Theory without practice is empty, practise without theory is blind.
Markets are VERY huge ... there is no way a person could claim he knew it all. Not possible. May it be FA or TA or combination of both, there are simple so much things to learn. To check on one indicator itself, back-testing our theory ... may take us months or even years(as market environment changes). So, if anyone telling me that trading or investing in market is easy ... I do wonder what he meant.
Valuation parameters
Imagine this ... many use PER as a valuation ... but it is not as simple as that. Low PE doesnt mean cheap to buy, high PE stocks are popular and hot. We have historical PER, average PER ... forwarded PER ... and if a newbie is to read those broker reports, we could easily get confused. Yes, I speaking about myself ... imagine digesting those reports, without any knowledge in accounting.
One good example of low PE-valuations stocks are those chinese-shoe-stocks. Many are trading way below their IPO and trading below PE-5. Yet ... investors shun these stocks due to fear of a/c malpratice and the 'Made in China' stigma. It is interesting to read that ... many such companies are actually empty-shells, cooking up some good accounts and beautify their annual reports.
On the other hand, we have those ACTUAL empty-shell-stocks, loss-making companies ... or with very high PER(heck ... I was wondering about Facebook, trading at PER 70+ when it was listed, tanking to USD31 today and it is still extremely expensive and ridiculous to invest in). Counters like MTronic, Harvest ... AGlobal ... these are new darlings of so-called investors in KLSE. Someone asked me(a newbie) how do we identify a speculative empty-shell stocks to avoid? Well ... how would you answer him?
Every good investor will tell you that we should NOT use PER alone as to value a company. Yes ... the leader of the sectors will have higher PER(seen as leader ma, so ... deserve higher valuations). When we compare a company to another company, we need to speak about their business ... it is apple-to-apple comparison.
Another yardstick many investors will look into is P/B ... generally the low the 'better'. So, low PE and low PB is preferred. Yet ... hhmm .. it is not really a buy?!
I used to check NTA ... and order book. Well, you know ... when an analyst want to be bullish about a counter, and placing a BUY in their reports ... they will come out with many other ways to convince you why it is a buy. So, they will even mention that the stock is trading way below its NTA(Lionind in mind) or the company has strong order-book, to occupy them for another few years!
Low PE, low PB ... high NTA ... swelling OrderBook ... is a buy? Heck ... it is still not a buy?!
How about cashflow ... strong cash counters are always preferred. Yes, I do like cash positive counters a lot ... until a friend of mine(an accountant) told me that we need to check where those cash from?!! Arrghhh ... as newbies, we will be confused by now. Ok .... we check their debt/gearing ratio ... it simply means that if I have RM1k in hand, but I owe someone RM2k ... that is not good. But, if I have RM2k cash in hands, with no debts ... yes, that is positive pointer. GasMalaysia in their prospectus stating they are debt free. So ...apply and see can get a lot of two, if you are lucky.
Dividends do not lie ... fully agreed with this book. I like. As investors, we do look into dividends as we are going to buy-n-hold. If I m putting my money in FD, getting 3% ... it is certainly more logical to put our money in a stock which gives us more than 3% p.a. There are SO MANY of these good companies giving us such a return. If my aunties/mom know about compound-interest, and discover these good companies ... putting in FD for past 30+ years, they should be very rich now. Yes, as they save every penny, buying only during market crashing ... how to lose money, right?
I have to go ... otherwise, I would have blah-blah longer ...
Just remember, DO NOT read broker reports to buy/sell. Learn to value the companies, business-wise. Buy those blue-chips if u dont know. Buy only during market crashing.
Happy Investing
TEH
Quote : Theory without practice is empty, practise without theory is blind.
Markets are VERY huge ... there is no way a person could claim he knew it all. Not possible. May it be FA or TA or combination of both, there are simple so much things to learn. To check on one indicator itself, back-testing our theory ... may take us months or even years(as market environment changes). So, if anyone telling me that trading or investing in market is easy ... I do wonder what he meant.
Valuation parameters
Imagine this ... many use PER as a valuation ... but it is not as simple as that. Low PE doesnt mean cheap to buy, high PE stocks are popular and hot. We have historical PER, average PER ... forwarded PER ... and if a newbie is to read those broker reports, we could easily get confused. Yes, I speaking about myself ... imagine digesting those reports, without any knowledge in accounting.
One good example of low PE-valuations stocks are those chinese-shoe-stocks. Many are trading way below their IPO and trading below PE-5. Yet ... investors shun these stocks due to fear of a/c malpratice and the 'Made in China' stigma. It is interesting to read that ... many such companies are actually empty-shells, cooking up some good accounts and beautify their annual reports.
On the other hand, we have those ACTUAL empty-shell-stocks, loss-making companies ... or with very high PER(heck ... I was wondering about Facebook, trading at PER 70+ when it was listed, tanking to USD31 today and it is still extremely expensive and ridiculous to invest in). Counters like MTronic, Harvest ... AGlobal ... these are new darlings of so-called investors in KLSE. Someone asked me(a newbie) how do we identify a speculative empty-shell stocks to avoid? Well ... how would you answer him?
Every good investor will tell you that we should NOT use PER alone as to value a company. Yes ... the leader of the sectors will have higher PER(seen as leader ma, so ... deserve higher valuations). When we compare a company to another company, we need to speak about their business ... it is apple-to-apple comparison.
Another yardstick many investors will look into is P/B ... generally the low the 'better'. So, low PE and low PB is preferred. Yet ... hhmm .. it is not really a buy?!
I used to check NTA ... and order book. Well, you know ... when an analyst want to be bullish about a counter, and placing a BUY in their reports ... they will come out with many other ways to convince you why it is a buy. So, they will even mention that the stock is trading way below its NTA(Lionind in mind) or the company has strong order-book, to occupy them for another few years!
Low PE, low PB ... high NTA ... swelling OrderBook ... is a buy? Heck ... it is still not a buy?!
How about cashflow ... strong cash counters are always preferred. Yes, I do like cash positive counters a lot ... until a friend of mine(an accountant) told me that we need to check where those cash from?!! Arrghhh ... as newbies, we will be confused by now. Ok .... we check their debt/gearing ratio ... it simply means that if I have RM1k in hand, but I owe someone RM2k ... that is not good. But, if I have RM2k cash in hands, with no debts ... yes, that is positive pointer. GasMalaysia in their prospectus stating they are debt free. So ...apply and see can get a lot of two, if you are lucky.
Dividends do not lie ... fully agreed with this book. I like. As investors, we do look into dividends as we are going to buy-n-hold. If I m putting my money in FD, getting 3% ... it is certainly more logical to put our money in a stock which gives us more than 3% p.a. There are SO MANY of these good companies giving us such a return. If my aunties/mom know about compound-interest, and discover these good companies ... putting in FD for past 30+ years, they should be very rich now. Yes, as they save every penny, buying only during market crashing ... how to lose money, right?
I have to go ... otherwise, I would have blah-blah longer ...
Just remember, DO NOT read broker reports to buy/sell. Learn to value the companies, business-wise. Buy those blue-chips if u dont know. Buy only during market crashing.
Happy Investing
TEH
Thursday, May 24, 2012
Warren Buffett : Investing
Warren Buffett :" I do not look at the price first, I look at the business first".
Warren Buffett : How much it is selling for, how much do we think it worth.
PetroChina : Was trading at 35billion, worth 100billion in our valuations.
PetroChina is the second most valuable company, after Exxon.
Lady : "How do you find a report like PetroChina 4 years ago?"
W.Buffett : Everyone else reading Playboy, I read annual reports. Haha
Everyone is speaking about him when it comes to investing. We all are different, and yes he started young. When everyone else in his early teens playing games, he started to learn about investing. Can you believe that? Do you know that he is one of the richest man in the world and living an extreme 'cheap' lifestyle?
My highest respect : Warren Buffett.
TEH
Wednesday, May 23, 2012
Depressing Sector : Alternative Energy
CWP : Testing the important level of HKD 0.28 recently. PER at 5+ levels, declared dividends.
You get the picture ... one of the most depressed sector ... and it is no longer green!! Google-it ... one could discover that many solar/wind companies are getting gov's aids and as the still need more capitals to build the infra-structures ... the whole industry would bleed.
About 3-4 years ago, I read a lot about alternative energies ... and it was a very hot sector then. Today, it is abandoned. Wanna be a contrarian? A lot of work to be done ... ever since I have 'left' for greener pasture.
Worth checking ... and another collapse of the markets, we shall see these as a long term altenatives.
TEH
Call warrants : The risks
Last night I went to RHB for a talk ... about RHB's latest products(screeners) and 'Call Warrants'. The CW-talk was by OCBC, actually. They are new-kids of issuing CW with 8 listings so far.
I met : A reader, who recognised me when we took a lift together to 11th floor. Kelvin, who is attached to RHB now. JT, a real estate agent who has his own facebook page and I did not even really realised I was added in his group!! AT, my tratle(of cohort-6) and a CNX-member ... who told me that they have replaced the previous your trainer with a 'better' one recently. Well, such a place is a place to get some interactions and sharing of knowledge and ideas.
Screeners : I have to admit that RHB's latest screener is good as they placed FA and TA together. Yes, these days ... we do many traders who do look into both of the world. No longer we argued about FA vs TA. Of coz we always have people who will only preach about FA or TA, and condeming the other side(to justify that they are they best ... those egoistic and obstinate/stubborn ones). Anyway, the screener is 'free' till end of June ... and yup, nothing is free, ok?
Points: AirAsia partnering with RHB, they are giving 'hottie' points ... each time you trade with RHB, they give you points ... and after collecting the points, you can get a free AirAsia ticket. Now ... everyone can trade and fly. haha.
Undervalued : Through the screener for some fundamental's criteria, RHB is deemed to be undervalued for a long term investors. Well, RHB is being used as example ... by RHB. Ironic.
Then ... the next session is talking about 'call warrants'. There are so many of them there ... I do wonder who are actually trading/punting into these risky instruments. Let me share a little about the RISK, as most of those issuers will only tell you more of rewards. We all know why people willing to punt into call-warrants, right? Yes, the very HIGH profits ... came with HIGH risk that majority do not and could not fully understand.
There is one young guy sitting next to me and said he is 'new' to market. So, I advised him ... do not touch call-warrants, no matter how much that guy in-front promoting them. In general, do not buy what you don't know.
Risk #1 : Expiring in short period of time. Most of the call-warrants are short term ... 6 months to a year tenure. Once it expired, you will get NOTHING as almost ALL the structured warrants in KLSE is 'European style'(cash settlement). So, the risk is too high to buy-n-hold. Believe me, very likely it WONT be in money. You lose it all when it expires. That is the main risk.
Risk #2 : Many of these instruments could not be traded ... no liquidity, no volume. Yes, only you and the market-marker(the issuer). Guess what ... when market or the underlying mother share going against you, you will lose hugely as you could not be able to sell, especially when the expiry date nearing ...
Risk #3 : Lacking of knowledge and experience in trading these could created a huge emotion swing!! One day up 30%, next day up another 30%, the next few days ... no volume to trade and if you thought you are a genius to gain 60% in two days, it gaps down 50% the next week ... and slow death ... moving lower. Once you cut-huge-loss, it shot up another 40% only for you to chase ... and the emotion swing continues.
I could point out a few more reasons WHY majority in markets, especially newbies and novices should NOT trade call warrants but I think it will fall to deaf-ears. In fact, I will be seen as being jealous of their huge gains. OUCH.
I stood up to correct him during his talk when he kept mentioning of exercising your call-warrants to mother share. You COULD NOT do such ... it is cash settlement and you have to wait for the expiry date, to settle with the bank-issuer ... using CASH. These are not company warrants. By the way, if you buy a good fundamental and dividend stocks, they do not expire and continue to give you dividends. Buying these call-warrants is GAMBLING and PUNTING. Just dont touch if you dont know ... but I know many of them get too excited about the high leveraged instruments. I was a newbie and novice(still am) too before, ok?
He also used the term 'invest' in call-warrants ... it is NOT invest. We may allow the term 'trade' but I prefer the right word ... punt or 'tikam'. Haha.
He shown the basic calculations such as premium, gearing, delta ... and majority could not understand such calculations. I could recommend Alan Voon's book. Buy that ... read few times, and after 2-3 years in market ... perhaps, one may want to check on warrants? Good luck.
Yes, I am very discouraging most of people to go into call-warrants. There are simply too many things to learn about if we do not want to get badly burnt. Choice is yours, anyway.
There are only two way about it ... either you win(profit) or you lose. I have reminded many times ...in my group, that 80-90% of those in markets losing or lost money. WHAT makes you think that we could be the top 10-20% of those in market profitting? No sense ... no common sense ... going into markets without knowledge, no expreinces ... straight away want to gain hugely, punt into call-warrants ... after winning hugely, thinking he is a god-of-stocks ... and continue to gamble, and will eventually lose all back to markets and more. heard of such stories? I do.
Well, I would like to thank him for giving up some revisions on the calculation part, especially the effective gearing part. Just don't promote it to those majority. It is too risky for them ... they even lose money trading AirAsia ... how to handle AirAsia-cw?
I do hope Bursa or SC will educate more traders and investors. That is my hope ... that one day, more of those in markets could understand RISKS. Dont talk about profit first, ok?
Another example I gave my tratles last weekend ... you are new in your company. You were excited that you 'passed' the interview ... you get into your job, totally new ... and you are thinking of increments and bonuses in the first week of your job?! THINK ... dont you think so it should be ... doing all the donkey-works, extra efforts ... going extra miles, doing what others NOT doing(in a smart way), gaining experiences ... THEN only ONE DAY, we might think about rewards from the company? If you have done well and the company does not done well or did not appreciate your efforts, the experiences you gained could be taken as a stepping stones to move to a better company, right?
THINK ... as thinking needs brain. Mind you, majority of those losing money in markets DO NOT use common sense. Somehow, we are good in our jobs, we spent years in college and universitys acquiring the paper-qualifications(license to work) ... but ... well ... we do not need any qualifications to buy a call-warrant the next morning, right? Unless you are below 18?
Enough said .. need to check on markets and my open positions.
Good luck in your punting ... I mean, investing.
TEH
I met : A reader, who recognised me when we took a lift together to 11th floor. Kelvin, who is attached to RHB now. JT, a real estate agent who has his own facebook page and I did not even really realised I was added in his group!! AT, my tratle(of cohort-6) and a CNX-member ... who told me that they have replaced the previous your trainer with a 'better' one recently. Well, such a place is a place to get some interactions and sharing of knowledge and ideas.
Screeners : I have to admit that RHB's latest screener is good as they placed FA and TA together. Yes, these days ... we do many traders who do look into both of the world. No longer we argued about FA vs TA. Of coz we always have people who will only preach about FA or TA, and condeming the other side(to justify that they are they best ... those egoistic and obstinate/stubborn ones). Anyway, the screener is 'free' till end of June ... and yup, nothing is free, ok?
Points: AirAsia partnering with RHB, they are giving 'hottie' points ... each time you trade with RHB, they give you points ... and after collecting the points, you can get a free AirAsia ticket. Now ... everyone can trade and fly. haha.
Undervalued : Through the screener for some fundamental's criteria, RHB is deemed to be undervalued for a long term investors. Well, RHB is being used as example ... by RHB. Ironic.
Then ... the next session is talking about 'call warrants'. There are so many of them there ... I do wonder who are actually trading/punting into these risky instruments. Let me share a little about the RISK, as most of those issuers will only tell you more of rewards. We all know why people willing to punt into call-warrants, right? Yes, the very HIGH profits ... came with HIGH risk that majority do not and could not fully understand.
There is one young guy sitting next to me and said he is 'new' to market. So, I advised him ... do not touch call-warrants, no matter how much that guy in-front promoting them. In general, do not buy what you don't know.
Risk #1 : Expiring in short period of time. Most of the call-warrants are short term ... 6 months to a year tenure. Once it expired, you will get NOTHING as almost ALL the structured warrants in KLSE is 'European style'(cash settlement). So, the risk is too high to buy-n-hold. Believe me, very likely it WONT be in money. You lose it all when it expires. That is the main risk.
Risk #2 : Many of these instruments could not be traded ... no liquidity, no volume. Yes, only you and the market-marker(the issuer). Guess what ... when market or the underlying mother share going against you, you will lose hugely as you could not be able to sell, especially when the expiry date nearing ...
Risk #3 : Lacking of knowledge and experience in trading these could created a huge emotion swing!! One day up 30%, next day up another 30%, the next few days ... no volume to trade and if you thought you are a genius to gain 60% in two days, it gaps down 50% the next week ... and slow death ... moving lower. Once you cut-huge-loss, it shot up another 40% only for you to chase ... and the emotion swing continues.
I could point out a few more reasons WHY majority in markets, especially newbies and novices should NOT trade call warrants but I think it will fall to deaf-ears. In fact, I will be seen as being jealous of their huge gains. OUCH.
I stood up to correct him during his talk when he kept mentioning of exercising your call-warrants to mother share. You COULD NOT do such ... it is cash settlement and you have to wait for the expiry date, to settle with the bank-issuer ... using CASH. These are not company warrants. By the way, if you buy a good fundamental and dividend stocks, they do not expire and continue to give you dividends. Buying these call-warrants is GAMBLING and PUNTING. Just dont touch if you dont know ... but I know many of them get too excited about the high leveraged instruments. I was a newbie and novice(still am) too before, ok?
He also used the term 'invest' in call-warrants ... it is NOT invest. We may allow the term 'trade' but I prefer the right word ... punt or 'tikam'. Haha.
He shown the basic calculations such as premium, gearing, delta ... and majority could not understand such calculations. I could recommend Alan Voon's book. Buy that ... read few times, and after 2-3 years in market ... perhaps, one may want to check on warrants? Good luck.
Yes, I am very discouraging most of people to go into call-warrants. There are simply too many things to learn about if we do not want to get badly burnt. Choice is yours, anyway.
There are only two way about it ... either you win(profit) or you lose. I have reminded many times ...in my group, that 80-90% of those in markets losing or lost money. WHAT makes you think that we could be the top 10-20% of those in market profitting? No sense ... no common sense ... going into markets without knowledge, no expreinces ... straight away want to gain hugely, punt into call-warrants ... after winning hugely, thinking he is a god-of-stocks ... and continue to gamble, and will eventually lose all back to markets and more. heard of such stories? I do.
Well, I would like to thank him for giving up some revisions on the calculation part, especially the effective gearing part. Just don't promote it to those majority. It is too risky for them ... they even lose money trading AirAsia ... how to handle AirAsia-cw?
I do hope Bursa or SC will educate more traders and investors. That is my hope ... that one day, more of those in markets could understand RISKS. Dont talk about profit first, ok?
Another example I gave my tratles last weekend ... you are new in your company. You were excited that you 'passed' the interview ... you get into your job, totally new ... and you are thinking of increments and bonuses in the first week of your job?! THINK ... dont you think so it should be ... doing all the donkey-works, extra efforts ... going extra miles, doing what others NOT doing(in a smart way), gaining experiences ... THEN only ONE DAY, we might think about rewards from the company? If you have done well and the company does not done well or did not appreciate your efforts, the experiences you gained could be taken as a stepping stones to move to a better company, right?
THINK ... as thinking needs brain. Mind you, majority of those losing money in markets DO NOT use common sense. Somehow, we are good in our jobs, we spent years in college and universitys acquiring the paper-qualifications(license to work) ... but ... well ... we do not need any qualifications to buy a call-warrant the next morning, right? Unless you are below 18?
Enough said .. need to check on markets and my open positions.
Good luck in your punting ... I mean, investing.
TEH
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