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justjoin corner
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hosayleow
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24-Nov-2013 15:51
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Yo! Bro intercept! And must be versatile to know when to run away too. For he who knows when to fight and when to close shop and run away.....................will live to fight another day. For myself, I try to reduce that " running away" bit. To run away means to cut and take that loss. Ouch! A Trading Strategy which does not require you to cut, means you will never have to take a loss. But provided one's timing is okay. Dont have to be perfect. But if " OKAY" ... meaning any paper loss is LOONable coz either further upside or downside is limited, then that is a good strategy. And such a strategy invariably requires one very important trait - PATIENCE.
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hosayleow
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24-Nov-2013 15:43
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I saw you at Sniper but did not see you post. Your account not activated? If so, can PM me and I will sms the Forum Administrator to make a duplicate key for you. Those who has the luxury of time can do forum hopping to learn from all sorts. There are MANY ways to make money from the market. Er....many ways to lose money too as well. LOL. The learning journey never ends. Never. Becoz just like the way people do business, the way people live and work do change over time, the way the stock market is manipulated also do change over time. What works now, may not work over time. Then a new way has to be found to overcome the competition to stay in this game. Learn from as many good forumners as you can. But it is important you learn how to fish for yourself. Not just wait for fish to be given to you on a dinner plate. Coz when you know how to fish, you can eat for a lifetime. Watch the market and observe how prices move. In my own experience, unfortunately, the many ways to make money from the market, cannot be found in books. But if your job commitment does not allow you to glue your eyes to your screen, then you cannot use price action observation to trade. You will have to find another way which suits you and which puts bacon on the table.
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hosayleow
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24-Nov-2013 15:30
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From my own recent survey, IG Market does offer the lowest com in town for their DMA model. Whether their platform and stock menu are the best...that I cannot say as I have not used other DMA CFD platforms. Other CFD Providers charge as much as double the com. City Index (0.08% of contract value or $10, whichever is higher) and CMC Markets (0.1% of contract value) do NOT offer DMA Model. I used City Index a few years back when they charged $10.00 com per trade regardless of contract value. When they had that, it was very good to use City Index to trade high value high beta stocks like UOB. Imagine back then I could within intraday buy 5 lots of UOB in the morn and sell it at 20 bids higher by late morn or afternoon. And my profits would be 20 cts x 5 lots = $1000 less $10.00 com per trade (x 2 trades of BUY & SELL) leaving a nett profit of $980.00. But when they scrapped the $10.00 per trade com and introduced a 0.08% com, I stopped using them and switched to IG. City Index is not a DMA CFD. One major flaw of a non-DMA CFD is you cannot participate in Pre-Opening and Pre-Closing...which is very important because that is when you can profit from the GAP-UPs or GAP-DOWNs.
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revival55
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24-Nov-2013 15:20
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Yes, therefore, need your advice to avoid further damage. thanks
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hosayleow
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24-Nov-2013 15:16
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Are you a stuckist in both counters? Sorry. I am now working on answering general questions regarding CFD and trading. More people will benefit from this and so I am according priority there. Your questions on stocks are counter-specific. If I happened to play those stocks, I can straight away offer my advice as I will be familiar with them. But if your stocks are outside my radar, I will need to check the charts first before I say anything and even then, my views will be based on charts alone without the benefit of price action observation. I would prefer to offer advice based on price action observation which to me is a far superior way to assess the immediate price direction of a stock. Hence, for advice on counter-specific issues, I will leave it to Bro JJ as his in-depth knowledge and repertoire of penny counters is far superior to mine for I generally as a rule of thumb dont play penny counters.
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hosayleow
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24-Nov-2013 15:06
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Yes. To trade via CFD, you MUST ALWAYS provide a buffer. One simple solution to this problem is to treat your CFD account exactly like a Cash Account. So let's say I have $100K of trading capital in my CFD Account and I am LONGing an index stock which requires 10% margin, I should buy not more than $100K worth of that stock. Let's say the stock is trading at $1.00 and I buy 100 lots, that's $100K worth of stocks and I do have $100K of trading capital. But what my CFD House will do is to set aside 10% of the value of the stock, ie. $10K as margin. This $10K margin will be deducted from my trading capital of $100K leaving me an " Available Balance" of $90K to trade in other stocks. Assuming my stock price falls to 90 cts, I would be sitting on a paper loss of 10 cts x 100 lots = $10K. My CFD House will set aside another $10K from my trading capital to buffer that $10K paper loss. At this juncture, my platform will show: Capital : $100,000 Margin : $10,000 Profit & Loss: -$10,000 Available Balance : $80,000. If I have only $10,000 of trading capital and I buy 100 lots x $1.00 worth of stocks, my entire $10,000 of trading capital will be set aside as margin for that position leaving zero dollar to buffer any possible paper loss. In such a situation, if the price of my stock falls to say 95 cts, my paper loss is 5 cts x 100 lots = $5,000. And since I have no more trading capital to buffer that paper loss of $5,000, my CFD House has the right to give me a Margin Call to top up my account by $5,000 by a specified date/time in default they will be entitled to close my losing position at the prevailing market price. Let's say they force close my position at 95 cts, I would have lost 5 cts x 100 lots = $5000 plus com + finance charges (if any). And my Available Balance which was $10K will be updated to show a reduced balance of say $4750 ( after deducting the loss of 5 cts x 100 lots + com + finance charges). And after my House has closed my position at 95 cts (which they are legally entitled to if I do not meet their Margin Call), it matters not anymore if the price of my stock rebound strongly the next day or even on that same day to close at $1.10......ie. 10 cts above my entry price. My stock having been force sold, what happens to the price thereafter is hindsight and irrelevant. To avoid the above situation, you must ALWAYS set aside capital to buffer any temporary paper loss. You musn't use up all your trading capital as margin. Having enough capital to buffer a temporary paper loss will make all the difference to your trading outcome. Earlier this month, prior to Super Group releasing her Results, I LONG her at an average price of $4.2154 x 55 lots. At one point in time, she fell to $4.00. My paper loss was $11,847. But I had enough capital to buffer that paper loss. So as far as my CFD House was concerned, this was a non-event. Super Group then rebounded to 4.45 and I started to sell her slowly (I could not sell all 55 lots at one go without crashing the price) at 4.42, 4.40, 4.39, 4.38, 4.37 and 4.36. It took quite a while to slowly unload 55 lots and I did that one day before she announced her Results. After selling all 55 lots, my profits worked out to more than $8K nett after deducting com and finance charges. Why am I telling you all this? To highlight to you all that this trade was at one time sitting on a paper loss of $11,847 + com + finance charges and that paper loss would have become a real loss if I did not have enough capital to buffer it and I kena force selling by my House. But becoz I had enough capital to buffer that paper loss, it remained only a paper loss. No more and no less. And that trade soon turned around from a possible loss of $11,847 + com + finance charges to one of real profits of more than $8K nett. In an earlier trade the week before, I made more than $4K nett from Super Group. All in, I made more than $12K from her for this round of Result Play. That earlier trade of $4K profit was also at one time sitting on a paper loss of $8400 when she fell to $3.90. Thankfully, she rebounded and that paper loss of $8400 simply vapourised and I sold her for a profit of more than $4K. The moral of the story? When you trade via CFD, never trade to the max of your capital. Always keep some money to act as a buffer for paper loss. Hopefully, your paper loss is temporary and LOONable and for that, it is all about timing your entry correctly at or near the Bottom. If you anyhow BUY or SHORT without checking where your stock is and only after you have entered that you realised you SHORT at the LOW or you LONG at the HIGH, then LOONing your paper loss is the worst thing you can do to yourself. In such an instance, no choice. CUT. And then open a new position in the opposite direction to recoup your loss.
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revival55
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24-Nov-2013 14:08
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just an additional question hope won't take much of time. What's your view on SinoGrandness & Yoma? Both vested. Thanks
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hosayleow
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24-Nov-2013 13:55
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Woaaaa !!!! So many questions!!! Hang on guys. Working on it now. One at a time. |
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cccx123
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24-Nov-2013 12:36
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In this case, which cfd platform do you think is the best for a rookie like myself who has never touched or dabbled I'm CFDs before? I had a city index account which I never used and my minimum deposit in there is just rotting away. In your experience, which platform is the cheapest? I am mainly looking into index or blue chip trading.
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myjourney
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24-Nov-2013 11:58
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Bro JJ/HoSayLeow, very impressed with all your knowledge sharing.
What is your view on SinarMas and Weiye? Thanks and happy weekend. Huat Ah!!! |
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lglg666
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24-Nov-2013 08:30
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Good pointers....esp for those trade the pennies. Got to be nimble or the coconut will land on your heads. Myself I'm not nimble due to work commitments....so I stay away from pennies most of the time, but at the moment I do have a couple eg Rowsley and Viking. I bought Rowsley when PL talked about the Vantage and RSP thingy....and accumulated more along the way till it went ex. Viking only recently. Could have made a few rounds of profit from these two but not nimble lor. I don't normally trade often...only if got opportunity ( the fall of the 3 ) or during this year-end period ( Nov to Jan ) then I'm off the radar till opportunity calls. You are right about no cut loss for certain come-back stocks. I'm a CFD trader and I used it to trade during this present period but not for pennies which I hold for long term. Thanks for sharing your experience here and it's good for all learners....me included. Btw I've been thru all the major downs too. Pan-El, Black Oct, Asia's crisis, Dot com meltdown, SARS, Lehman/US housing meltdown. The worst was the last one....knocked me back to almost the stone-age time. Hopefully no wish to go thru any more of these and that is the main reason I don't trade often now. Oh...I'm attended many courses too, most will advise to stay vest most of the time....S1, S2, S3, K-line, macam-macam predictions theories lah ( only to lose more $$$$$$ lah ). I still go hear-see some of these presentations/seminars just to stay up to date with the happening whenever time allows. Frankly fun to see these guys/gals about my kids age trying to tell how good and successful they have achieved by trading stocks, forex, properties, gold and other investment.
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gavinl
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23-Nov-2013 23:44
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Tks for pointers. Used to trade sia,dbs n singtel etc. You are right again. Lol, what i meant is that they move too slow for me. Lol.
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Intercept
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23-Nov-2013 21:48
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Bro hosayleow is a versatile trader, assuming the role of a battleship commander or submarine commander as and when opportunity strikes. | ||||
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Luna69
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23-Nov-2013 20:39
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Tks bro, do drop by to post n share w all of us here too! It is good to learn from examples :) mkt is so depressed n so r most people including me, the way mkt behave, see also sianz.... Can make 1-2 pips must quickly run, rally is only sporadic n short lived, to long may not see bottom yet, to short seem risky for rebound, n all the talk of worst yet to come all the way into 2014 for SG mkt... I think either must hv super holding power, switching playing style n ability to scan good stocks, else really hard to dabble at this moment... But it is really good when sifus like u who come out to share knowledge w all... Beside jj, There r also many in Sj including bro sc, ace, js, etc who r also selflessly sharing their knowledge n it benefitted us a lot too n all hv their own different style...:) just hope all of us don't lose until give up but to finally find a profit trading style that suit oneself n in which I must say is just as difficult as cutting loss ... :) very good reading n analysis bro .. Tks for sharing !
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iluvboost
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23-Nov-2013 19:18
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tks for ur info... i been using KE Cfd for telco stks n capland. agree with ur points.
btw is IG commission reasonably lowest and with good selection of counters? dont mind opening IG as a alternative platform..
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richsoh
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23-Nov-2013 19:01
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Pls do yr homework
If exceed yr trade limit u hv to top up (margin call) |
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hosayleow
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23-Nov-2013 18:08
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Not expert lah. I am also always learning everyday. The learning journey never ends. And there is always something we can all learn from each other. Er... which index stocks did you trade? In my experience, most index stocks move. Whilst most pennys dont move. Only those pennys which have a Chng Kay in the driver's seat, will move. Those without a driver, are usually stuck in the car park. I can name many. But for you to name an index stock which does not move, is tough. They all move. Its only a matter of how fast they move. But pennys...those without a driver, they can remain in the same parking lot for a long time and simply corrode away. If you are interested to trade index stocks again, I can offer you my recommendation of those which move: A. Above $10.00 Range: UOB, DBS, OCBC, SIA, CityDev and KepCorp. B. $3.00 to $10.00 Range: SembCorp, SembMarine, SGX, Starhub, SingTel, M1, SIA Engrg, SATS and ST Engrg The good thing about these index stocks are they are what I called " Never Fail To Come Back Stocks" . And this is very, very important. What it means is...you dont have to cut loss. And if your trading strategy is one where you dont have to cut loss, then you will have no loss. Afterall, when does a trader/investor incurs a loss? When he cut loss. Isn't it? So if your strategy allows you not to cut loss, it means you will have no losses. More of this in another post. It is tied with why I dont play pennys. Becoz if you play pennys, you CANNOT dont cut loss. You must cut. And that's where and why most penny traders lose money over the long term. They win peanuts. But lose coconuts. Net result is a negative Profit & Loss Account. I have been there myself too. LOL.
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hosayleow
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23-Nov-2013 17:51
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To confirm that, you need another POEMs user to do so. I do not have the answer. But I will not consider using POEMs to trade becoz I believe their com is one of the most, if not the most cut-throat in town. As a trader, the ability to run with 1 to 4 bids is VERY VERY important. More so if you trade intraday and your counter doesnt give much spread. Let's take UOB as an example again. I can run with 4 bids. Say, you need 14 bids to run. If for one whole week UOB's daily spread is only 9 to 14 bids, if I am nimble, I can IN OUT IN OUT a couple of rounds. But you, you will be sulking and frowning and paying daily finance charges and feeling frustrated about being stuck. Trust me friend. Low com giving you the ability to run with much lower bids than other traders makes all the difference to your trading outcome.
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gavinl
Elite |
23-Nov-2013 17:51
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Thank you very much for your expert view. I m a part time day trader n used to trade index stocks but stopped for past last 1 to 2 years because they seldom move n only pennies move. Thanks again
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hosayleow
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23-Nov-2013 17:41
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Yes. Index stocks are usually all there. Penny stocks are usually not there. Only selective penny stocks are there. Which is not a problem for me becoz as a rule of thumb, I dont play pennys. In another post, I will explain why I avoid pennys. But no offence to those who live and die by pennys. Back to CFD...not having the illiquid penny counters in IG's Menu may turn out to be a blessing in disguise. Becoz pennys being highly speculative can suddenly become very illiquid when the Chng Kay run road leow. Becoz of that, penny counters tend to require a much higher margin of 30% to 35%. And this high margin can eat into your limited trading capital. If you are a pure penny trader, then you may not find CFD suitable.
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