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Rejoice in a Stock Market Correction
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TradeChancellor
Veteran |
21-Aug-2007 16:46
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Thanx Mani! ok, i'll go get that book too. I have to resolve to not be lazy when comes to investing my $. |
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Manikamaniko.
Master |
21-Aug-2007 16:41
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Why waste time?... Just digest and internalise (like Singaporegirl did) Larry William's excellent guide, "Long-Term Secrets to Short-Term Profits"... This book will see you through thick and thin...  |
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TradeChancellor
Veteran |
21-Aug-2007 16:34
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<chancellor bows before the great Elf.> i'm looking for a tuition teacher to help me in 2 aspects of the stock market: 1) strenghten my FA knowledge and lift my horrendously poor TA knowledge and 2) Trading operations. I've attended Victor's seminar and realised that I need more guidance. READing books and internet would help but still need some tuition to clear misconceptions and address more queries. I am not soliciting as we are not allowed to solicit in sharejunction ;) ok, need to work on my discipline and knowledge as they are at a dismal level :(... risk - i'm a bit of a risktaker but not sure if its a 10yet |
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DnApeh
Master |
21-Aug-2007 16:23
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If I were your boss, I will fire you straight away and then re-hire you as an in-house trader, like that company make more money. cc. your boss |
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Manikamaniko.
Master |
21-Aug-2007 16:23
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The real problem right at this time is people treat a bear market as a "correction"... While this may be correct in the very, very long term (say 5-10 years), to treat a full-fledge bear market as merely a correction is courting one's own financial ruin... that's disastrous!...  |
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elfinchilde
Elite |
21-Aug-2007 16:19
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oh goodness, so sorry for that one paragraph mess. bleeping net restrictions... lemme emphasise here again that the method i'm talking about is VERY RISKY and not for all. I concur fully with manikamaniko on the importance of knowledge and education in the market: one can't just follow tips all the time. and i also agree with livermore that most ppl actually make more if they just buy a good stock and hold long term, rather than trading. it's entirely a personality thing. DnApeh; don't actually have to really monitor since i have the tech tools; it's just waiting for lines to cross each other to buy/sell. if it is a true breakout, it'd last for a few days. if it is a momentum scalp, yes, you can close it in 15 min, but likely you have longer since the momentum upward is there. actually, ideally i'd like to quit and trade full time. realise i make more when i'm on leave than when i'm at work hahahahahha! :P |
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DnApeh
Master |
21-Aug-2007 16:15
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Hey Elf, you mean you are able to work full time and still monitor so many things? red1721, thanks for caution. No, I don't trade with CPF funds. Especially since cheng hu is giving me 1% more. |
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Manikamaniko.
Master |
21-Aug-2007 16:10
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Elfin... :) Wow! truly solid stuff!... where did you get all that time to write such meaty stuff? Guess you are in MLM too like Warren Buffet... so have lots of free time ... hehehe...
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elfinchilde
Elite |
21-Aug-2007 16:07
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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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red1721
Senior |
21-Aug-2007 14:43
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DnApeh, watch it when you invest using cpf funds. Unlike cash trading, there is a markup by banks for your trade...so in the end, you not only pay your broker $$, you have to pay your bank $$ too, unless the profit margin is substaintial, you might just end up paying all your profits to these trading fees or in worse case have a negative return. So do check with your bank properly when trading using cpf. Cheers. |
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Manikamaniko.
Master |
21-Aug-2007 14:36
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There is only one way to make money in the stock market... (Traders lose, and investors lose) Trade/invest with knowledge Without knowledge of the intricacies of the market, it is a sure-lose proposition, no matter how cleverly one can expound one's philosophy to others. Start to gain knowledge today... One way is to read this (click to read). |
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left_bug
Senior |
21-Aug-2007 14:29
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Ha. Ha. Yeah Elfin, enlighten us. |
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Pinnacle
Master |
21-Aug-2007 14:24
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$500 a day = approx $10k a mth (4 wks)!!! If true, we might as well quite our job and trade full time!! |
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DnApeh
Master |
21-Aug-2007 14:07
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Hi, Elfin. I read from your last post that with 50K capital, can flip $500 a day and after 1 year 100K. Can this be done consistently, year in year out? If can, then all the problem of insufficient CPF for old age already solved. If can, I certainly would like to find out how. |
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Livermore
Master |
21-Aug-2007 06:41
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This is just my opinion and from my past experience. Too much buying and selling may not be good. You don't make as much compared to someone who finds a stock with good long term potential and he holds most of the time. For every crash, I learn something. We improvise our strategy along the way. Holding long term not necessarily mean a "die die" must hold approach. Sometimes you need to sell off when necessary to get some profit or before you make a loss. Hold for long term and ignore the minor corrections but learn to sell off some shares at a profit when market is bull and liquidate most of your shares if not all when a major crash happens. Buy back when it has fallen to reasonable levels for those you intend to keep for long term. TA is a useful tool and something I shall learn. I have more to say but time does not permit. Good luck! |
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KiLrOy
Master |
21-Aug-2007 00:07
Yells: "I buy only what I can see." |
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Sigh .. typo error... cannot do two things at once... hehe. Bear also say Bull ~ hahahaha... |
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TradeChancellor
Veteran |
20-Aug-2007 23:43
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Thanx a lot Elf for the recommendation! Really appreciate ur help. Just a short intro, I'm currently working at Biopolis, in the biomed science industry. As i'm a little "slow-motion" kinda person, love water sports, thats why FA seem to fit me, lol. I only opened my investing account 3 years ago beginning 2004, invested a bit only, stopped for a while and started much action again in mid-2006. I understand that holding long term may not be good, which means I have to use lots of TA rite? But i can't spend too much time in the office looking at the screen :( $500 a day!?!, then i don't mind quitting and sit in front of my screen the whole day! even if its $250, it'll still be great at $50k a year (cause no need to deduct 20% CPF!). Can i invite you to be my fund manager then? Heheh u want some pet, my mum is intending to give my fav pets away :( Nw got to do some work for presentation.... burn some midnite oil + stay tuned to sharejunction ;) |
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elfinchilde
Elite |
20-Aug-2007 23:13
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hullo chancellor, have seen your posts about but not sure if i'm ever talked to you. so here's a formal hello! keke. there's a book you might like to check out; it's rather simple, but it puts together all the styles, plus has a personality rating scale that allows you to judge yourself so as to see which style you're more suitable for. "All about stock market strategies: the easy way to get started." by david brown and kassandra bentley. i especially like the intro where they succinctly explain how sentiment affects value stocks, and even give calculations on how you can count how much a stock will drop by due to sentiment (for FA ppl). while i like the sti following the dow (since it gives some guidance), i don't like that it overreacts! haha. as for worrying less... the only way i worry less is if i have no money in the market! haha. that's why right now, i prefer to hold nothing long term. it's just that, having spoken privately with brokers, and been with the BBs, seeing how they play, and listening to what they say, it's just very, very hard to believe in value. plus. one other calculation: if you make, say, just net $500 a day, 5 days a week. give discount, say 40 weeks in a year (12 weeks on holiday or loss haha). that's a profit of 100k a year already. in which case, why the necessity to hold long term? and flipping 500 a day is easy enough on a capital of say, 20k or so. 50k if wanna be safe. but perhaps these are just insane and naive elfin calculations. anyway, chancellor, intro yourself! hehe. elfie's running out of pets. sigh. muahahhahahahha! i want a real doggie...meh. sigh. |
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TradeChancellor
Veteran |
20-Aug-2007 23:02
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Kilroy and Elf, I enjoy reading ur postings as they are of good quality :) I'm rather new to this stock arena and have been searching the investment style that suits me. Personally, i realized that the more suitable style will tend to let me sleep better at night, as in worry less. I'm more of a FA person btw. I agree that different styles will suit different people, of course no right or wrong, heheh "doesn;t matter whether the cat is black or white, as long as it catches mice". But 1 thing's for sure, must do some homework first, whether TA or FA. I agree with Elf that because we're more globalised, that's why the STI tend to follow DOW. And this is made worst by normal investors following the DOW trend and take the cue from the latter. |
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elfinchilde
Elite |
20-Aug-2007 22:59
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ah, mister kilroy, as much as i adore plants and animals, i do believe you mean conversation and not conservation? :P hard to believe? eh. i'm very skittish. as those who unfortunately know me can testify. haha. that's why i'm an elf. but yea. more and more speculators. and doesn't help that the hedge funds don't believe or behave in the value way too. it really skews the game. ah well. if it's volatile, one just trades then. if it's stable, one accumulates for value. so what IS your objective for investing in SG stocks? mine is profit. hahahahhahahah! hm. if you feel fear in a bull market, you're one step ahead of most ppl already. me, i'm just nervy throughout. good as a weather vane tho, since i'd bail at first sign of trouble (or gain, which also explains why i tend to run too early hahahaa.) bored. i want the dang dow to go down. niama. |
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