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Rejoice in a Stock Market Correction
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CWQuah
Master |
22-Aug-2007 09:09
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Elf, Given your trading style, you should seriously consider forex trading once you're pretty much done with stocks (but I doubt that would be the case seeing how much fun you have with stocks heh). A dream market for TA purists, and way much more liquid in nature. Only catch is, fundamental news can cause big whipsaws as Kilroy pointed out previously. The trading style that you described is pretty much what I'm trying to become more competent in. Need to work harder though  ! For this trading style, there is a need for more stringent risk management tactics, e.g. tighter stops, hedging (call/put), very clear profit taking points (target & next lower profit pt in case the trade doesn't fully bear fruit) must be established AND diligently executed and not looking back even if the trade gives even more profit after the position is closed.
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TradeChancellor
Veteran |
22-Aug-2007 00:33
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Thanx for the tips Tiandi! I'll try to absorb these bit by bit. Good nite! |
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tiandi
Senior |
22-Aug-2007 00:30
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TradeChancellor; Yes : CONFESSIONS OF A TECHNICAL-ANALYSIS PURIST
Contributed By
singaporegal |
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TradeChancellor
Veteran |
22-Aug-2007 00:21
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Thanx Tiandi! Is it the article dated 25Nov 2006? |
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tiandi
Senior |
22-Aug-2007 00:09
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TradeChancellor, here is the link for you to read singaporegal's article in SJ 's Research ( see your left hand side panel on this SJ website) javascript:openPopWin("http://www.sharejunction.com/Articles/singaporegal.htm", 640, 600, "toolbar=no,location=no,directories=no,status=no,menubar=no,scrollbars=yes,resizable=no", -10, "cen") |
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TradeChancellor
Veteran |
22-Aug-2007 00:00
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Thanx for the tips Elf! ok, will find out what those terms mean. Will buy u coffee/tea/drinks if u attend one one of the seminars like wat Victor (aka victorian) organised. heheh... i bit scared lah... down here open forum, what if some "siao on" and "concern" citizen call 1800-ABC Agency then will be big problem. |
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elfinchilde
Elite |
21-Aug-2007 23:31
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dang. lost my post. argh. see if you can find singaporegal's article on TA on the SJ archives or something. it gives a very good intro to the indicators. poems, i go to LP2. but i use SJ and my own trading acct's charts. all free heehee. :P but roughly, since you're in it long haul, use MACD, a/d, chaikin, rsi/williams. MACD: when it's all above the middle line, => long term uptrend. all below, => long term down trend. basically, you buy when red is below the black (SJ charts). your buy signal is when the lines cross. playful amphibians, which you can't name. o_0 newts, salamanders? aw c'mon, curiosity kills an elf. besides, i'm giving out TA info here. gotta give back ya know. :P |
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TradeChancellor
Veteran |
21-Aug-2007 23:19
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For me, I like to look at the financial reports, quaterly, half yearly and annual. Also will read analyst report if there is any. Currently, I'm holding onto 25 lots of LMA (cash), 5 lots of Asiapharm(cash) and 15 lots of Cambridge REIT (CPF). Just sold off my Global Voice 30 lots(cash) during this subprime thingy and lost $1700 cause didn't have good vibes about it. Bought it on impulse. I used reports to buy LMA, AsiaP and Cambridge. Hmm... problem is i don't know about TA charts- is it the chart when i click at "LP1" at POEMS and go to "last 1 year" to look at price history and volume. But don't know how to use the "candlesticks" "bar" and "ticks" I like to use the LP1 function to supplement my FA. I used my cash sales from global voice to top up my LMA and Asiapharm by 5lots and 4lots respectively to the current above number. They are amphibians, very cute and playful :)... |
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elfinchilde
Elite |
21-Aug-2007 22:58
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eh. don't bother so much about the time period. in a bull market, everything compresses together; in a bear, it undulates and stretches out. it's more the style i guess. how do you pick your stocks, what is the thing you instinctively look at, charts or P/E, ROE etc? anyway, dun gotta be so obsessed about style (this is what i think only...), as long as it works for you, and it makes, doesn't matter. look at nickyng. hehe. now that's an original. invertebrates then, i take it? class reptilia? or amphibia? o_0 |
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elfinchilde
Elite |
21-Aug-2007 22:50
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..eh. SJ admin. elf types very fast. is it possible to remove that 1 min no post thing? slowing me down leh... Investor Personality Quiz/Psychological Quotient (IPQ) Rank yourself on a scale of one to ten on each of the following factors. Your final personality rating should hence be 10 individual numbers, each number specific for each factor. 1 being the lowest/least, 10 being the highest/most. (eg, discipline = 5, patience = 2, etc...) 1) Discipline: refers to the ability to follow rules, particularly self imposed rules. Can you stick with your rules, or do you often find yourself rushing into decisions on impulse? (10 = most disciplined) 2) Patience: How long are you wiling to wait to reap the rewards? Immediate gratification, or willing to wait for the fruit to ripen over many years? 3) Risk tolerance: risk refers to the amount of volatility you can tolerate. If you have a high tolerance, you will not be affected by a 20, 30 or even 50% drop in the value of your stock, as long as it meets your investing goals. ie, how comfortable are you with losses? High risk is proportional to high reward, but also, high loss. 4) Reward expectation: what rate of return are you seeking? of course, everyone wants the most, but risk/reward, as per above, are proportionately linked. Hence, what reasonable returns are you expecting in proportion with the risk you want to take? (higher answer => greater reward expectation and hence, greater risk). generally, value investors do not make more than 25% pa over long term. in fact, a return of 20% pa is considered fantastic. 5) volatility tolerance: in a nutshell, how good are you at taking on the day to day rollercoasters? A ten = 'bring it on!" or a one = "eeeee....dowan!!!" 6) time horizon: how long are you willing to let your money be tied up before realising profits? higher ans => willing to have longer time horizon. 7) time commitment: how long are you willing to spend on your investments daily? 8) quantitative skill: aka, FA skills. how good are you? 9) technical/charting skill: aka, TA skills. how good are you? 10) investing confidence: how confident are you of the value of the stocks you selected, and the portfolio you hold? can you go against the market when everyone is panicking and selling, or rushing and buying, based on your judgment of its fundamental value? happy answering the quiz! will hold back the answers. muahahhahaaa. :P |
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TradeChancellor
Veteran |
21-Aug-2007 22:46
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Erm... Elf, i can't reveal too much about what they are, but no no, they do not kill, maim, spit venom if thats what u are thinking ;). Btw, just a question, if i use FA parameters like EPS, PE ratio and PTB and ROE etc etc to choose my stock and set a sell target price, say for eg rise above 20% of my buy value and sell within a few weeks when it hits target, i'm still considered value investor but not long term or short term investor? ie to say, "unclassified" whether i'm a long term or short term investor. I just sell when it hits my set target value. |
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elfinchilde
Elite |
21-Aug-2007 22:29
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bedoop! yep manikam ($ no go! hehe sorry pantang elf here :P), by charting skills i meant what you said, ie, interpretative skills. yepyep, heng2 to meeee! and to all of you too! keke. tradechancellor, what kind of pets your mama giving away, your hammies? elfie had hammies before; dun quite want new ones tho. it's so heartbreaking when they die! i kinda bawled my eyes out when each one died. and you havta see them grow old, and get furless and blind! *heartbreak* but well, i guess, at least they were once new and furry and oh so sweet. :))))) biopolis! nice place. sometimes i go there to recce for work reasons. hehe. hm. ok, mebbe i don't want a doggie then.... since we're in midst of panic....next up i'm putting the investor personality profile test for those interested to try. Hope it'll be of use to fellow SJ-ers here, to help us all better understand our own personalities, and what styles suit our personalities. pls don't take the anwers as hard and fast tho, since most likely, we're blends of each style rather than one. the following to note: the investor personality quiz requires a person to rank himself/herself on a total of ten variable factors, on a scale of 1 to 10 for each, with 1 being "least like me", and 10 being "most like me". It requires you to have a certain amount of honesty. must rem that sometimes, what we say and what we do are very different things. so perhaps if it helps, get a friend to help you? alt, be really, really honest with yourself. there are roughly four different styles an investor can be: a value investor, a growth investor, a technical trader, and a momentum trader. elfie won't give answers yet, in case you ppl start to second guess yourselves. hehe. will just give the quiz, then when you guys want the answers, lemme know. muahahahhaha. :P |
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KiLrOy
Master |
21-Aug-2007 21:18
Yells: "I buy only what I can see." |
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elfin, heng heng to you~ 
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Manikamaniko.
Master |
21-Aug-2007 20:24
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Elfin... :) Another superb, solid piece! If I may comment just a bit... Re your comment, there is no such thing as "charting skills". No one can 'chart' a stock or a market. It is the stock or market (the buyer&sellers) that produces the chart 'picture' for us to observe, study and interprete. And chart interpretation itself is an art form acquired through experience. If one sees a dismal technical picture of a market (eg. an obvious downtrend), it would take much stupidity, ignorance or pride, or a combination of these, to buy heavily into a "fundamentally great" stock! ... 
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elfinchilde
Elite |
21-Aug-2007 19:44
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reposting the 1607 hr post i made so it's clearer for all to read....and in reply to those wondering out there, yes, elfie types very fast. keke. mister kilroy, my puts are up! 
and yah. rayphua's one of the best technical traders i've come across. ok byebye dinner time and then its work time! ------------- erm hang on. before everyone gets so excited.... let me clarify the DIFFICULTIES of the method. the style used is technical/momentum trading. and it is the most difficult of all the methods (value vs growth investing vs technical/momentum trading), since, on the investor personality profile, it requires a 10 in discipline, a 10 in risk tolerance, and an 8 in charting skills. (1 being lowest, 10 being highest). not very many people can actually succeed at it: which is why in some ways i do concur with livermore: the FA style is actually more 'user friendly'. to do momentum trading, it also means you have to have a very good eye for stocks on the market, you have to know your counters, you have to be able to watch the screen every second (since some trades can be closed in 15 min flat), and above all, you have to have a very, very clear mind and instinct. You need to know when to lock out and when to let it ride further. when to cut loss, and when it is actually better to let it go down and buy on dip. you also need to keep your eyes on the macro pic---ie, read widely. chaos theory: butterfly flapping its wings in new york creates a storm in shanghai. or in this current market, a US home owner defaults creates a global credit bubble that causes semb corp (a good company with solid fundamentals) to fall. haha. one literally follows the trend, nose to the screen, but your mind has to be able to see further: what's the big picture? note: i'm not saying i'm capable of all of this, since i have made losses too. and it is a VERY RISKY method. but generally, this is the style i'm personally leaning towards for now. one more thing: this style can reap you lots in a volatile market IF you choose rightly. eg, right now, i'm playing what are known as strangles in warrants. ie, i play both the calls and the puts. yesterday when market chionged, i bought the STI3000 put at btwn 11.5-12.5c. it's currently ~15c now. so assuming one buys 100 lots, the cost price is abt 12,500 inclusive brokerage both ways. locking out now reaps 2.5k. so that's enough for the week. ONE DOES NOT NEED TO TRADE FURTHER. if you're greedy, this method of trading will likely kill you. one also needs an idea of market psychology, of which counters are being punted by the BBs, how they are moving/likely to move. i'm not sure abt cpf funds tho. am playing on cash so not sure how the markup works? do find that out... and ok. for those interested. the tech tools i use: raw data: busd and market depth. MFI. intraday candlesticks and MA crosses. longer term: williams, RSI, chaikin, a/d, candlesticks, MACD, MAcross, bollingers, MFI and momentum. i don't use all for all counters tho. depends on what the counter responds to. eg, at this period of time, if you were to try candlesticks for long term, it's actually inaccurate since too volatile. hence for now, one can only use the most sensitive of indicators for most stocks: ie, williams and chaikin. MACD. If you look at these, and the actual price/vol charts, then you'll see that stocks for now have only one direction, despite yesterday's chiong: down. PS: if all this appears as one whole paragraph, my apologies, my company blocking. |
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Manikamaniko.
Master |
21-Aug-2007 18:57
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(This is the working link...) In this regard, I have come across an excellent source ...Instead of playing the market without expert knowledge, one can acquire the knowledge. (click here to view) |
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Manikamaniko.
Master |
21-Aug-2007 18:52
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BaseerAhmed... :) You are so right about the "years of honing" part... People think stock trading is easy and can be done without the requisite knowledge. But in truth, stock market education is the first requirement before anyonoe even thinks of buying any stock. As a result, they lose a lot of money and they learn the hard way (actually, they've learned nothing). In this regard, I have come across an excellent source ...Instead of playing the market without expert knowledge, one can acquire the knowledge. (click here to view) |
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baseerahmed
Master |
21-Aug-2007 18:42
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.. another young person who had quit his job to do this full time is decipher ... |
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scotty
Senior |
21-Aug-2007 18:27
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Today's market really crazy.... I think it is a punter's market now... no pun intended... hahaha... From peak to valley, its about 100 points and the direction change in minutes! |
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baseerahmed
Master |
21-Aug-2007 18:23
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just to chip in a bit .... if you remember a few months back there was this forummer in here, RayPhua ... he made calls and 99% of his calls hit the bulls eye ...i was really, and am sure alot of us too were mesmerised and awed by his calls ... at one time i was doing this mental calculation : " if you could lock in a minimum profit of , say, $500 per day ( based on a gain of 0.02 for 25 lots ) from his direction , wouldn't that be really fantastic.. " but of course he had honed his skills over more than 10 or 15yrs .... so what we saw at that time was the tip of the years of hard work and maybe lots of tuition fees behind it ... so, I think it is reasonably possible to pull off this feat ... provided u treat this as a serious business and learn all there is to learn like a neurosurgeon ...and have a level head too .. hahaha ! here's to wishing elfinchilde to her ultimate financial freedom ! Cheers ! |
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