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Margin lending as wealth creation tool
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Livermore
Master |
29-May-2006 22:33
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Yes, margin trading can be risky if misused. I can understand some of the comments made. Although I trade in margin, 90% of the time, I hardly borrow. I use maybe only less than 50% of my limit most of the time. Even when I cross over to the "borrow stage", it is also very marginal. It is also usually done on "averaging up" in steps as the earlier lots bought are "covered" i.e in paper profit. Margin trading if done should be done when your "positions are covered" (earlier lots in paper profit). Hope this helps with anyone keen on margin trading. |
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teeth53
Supreme |
29-May-2006 21:08
Yells: "don't learn through life, learn to grow with life " |
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Ya lor 95% will lose money, 5% will win but not B4 taking lesson from losing money. I think every one of us have lost before, a lesson to be learn here. How to recover lost money b4 actually recovering it back. Books and research won't help much, believe oni painful lesson can help (don't try with what ever mean to win back what is lost) lesson, after lesson never been learn, we R after all is human and human make mistake after mistake. |
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geojam
Member |
29-May-2006 11:40
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I always measure how much one make on a yearly basis.So the year 2006 is not over yet.I am not a trader,so what happen in one day trading or one week trading does not count.I only count my loss or profit on year basis. Every investor has a very different profile.Some take more risk than others.There is no rite way or wrong way to buy and sell shares.at the end of the day,the rite way is one that make more money than the wrong way. U may not have to lose alot of money b4 u make money.These days the are many books and research u can read and learn from other mistakes. At the end of day,one has to find their own way of investment and be comfortable with it. BTW,statistics,show that only 5% of share players make money.The other 95% either quits or lose. |
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teeth53
Supreme |
29-May-2006 00:22
Yells: "don't learn through life, learn to grow with life " |
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Since Jan 2006 run up till today. how many make $$$ ??? many rite !! and then sudden just one one day, S$16 billion gone liao, just one day How many lost $$$ many ppl rite !!, any one know or knew what can happen tmr ? no risk , no gain, the more calculated risk, the more one can gain, so how many thousand lost $$$ and how many win, afew. maybe U R d one which is exceptional, may the force be with U. Borrowing $$$ from banker to invest in shares and stocks is a no no for me. maybe in good time like in IPO stocks yah..margin lending and/or trading is good for a stag. |
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teeth53
Supreme |
28-May-2006 21:27
Yells: "don't learn through life, learn to grow with life " |
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well, well said, expensive lesson to be learn here. |
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robinpang
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28-May-2006 21:13
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i havent met a person who minds having a million dollars extra. I dont have any experience in margin trading, yet. But all i know is that if can make millionares, but before they become, they lose alot of money 1st. So if you wanna margin, make sure u can afford to keep losing alot of money first and become a bankrupt. And if you do learn something along they way, and not repeat your mistakes, then you will be able to recuperate those losses and continue making more profits. But i am sure you get the point by now, you need to lose money first, and still stay in the game after losing money. ..... |
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geojam
Member |
28-May-2006 20:18
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There is no secrets.Only take calculated risks. I do not reside in Spore. I do not know how to get in touch with u. Let me know a good way to be in contact. |
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caspergal
Member |
28-May-2006 20:02
Yells: "Arrgh!!!!!!" |
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Hi Geojam, i am really interested.... can you share your secrets? thank you! |
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geojam
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28-May-2006 19:55
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being a share market player like all of u,I am sure u have heard about a"good" debt vs a "bad" debt. A good debt is where one borrow to invest for the long run and gets dividends to help pay for the interest expense. A bad debt is one where u borrow to buy cars which is a depreciable asset or debt for spending lavishly on wedding etc... I have used margin lending since 1994 and it works well for me. If anyone interested to know how i do it,let me know. I am glad to share it |
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scotty
Senior |
28-May-2006 18:12
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thanks everyone for clarifying for me. wow... it really sounds like dangerous tool to play around with. robinpang, you sound like you very experienced in this? how is your track record on this? |
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robinpang
Member |
28-May-2006 16:08
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there's no better way than to experience it yourself! Sure it will make you a millionare, like Jesse Livermore. But if you do do it, make sure you got the money the pay the debts when they start to pill up! To make money, you must have the money to lose first. |
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Livermore
Master |
28-May-2006 14:34
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Margin trading is a "double edge sword". But I believe if you play it the smart way, you can make money. Although I use margin trading, most of the time I hardly cross over to the "borrow stage". The interest is quite negligible. Let's say is 6% interest per annum. If you put in S$10000 capital, you could buy shares up to $30000. Let say you borrow $20000 for a month, the interest would be only ($20000 x 6 x 1/12)/100 = S$100. You should only start leveraging when you are in "profit region" i.e average up as the earlier lots you bought at lower price have been covered. It might not be a good idea to use margin trading to average down too much but maybe very minimal lots to "corner" the share price. Marging trading gives you much "more room" to play as long you don't go "overboard" with it. The "leverage tool" can help you to make good gains but it can also ruin you. Do be careful. |
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teeth53
Supreme |
28-May-2006 12:35
Yells: "don't learn through life, learn to grow with life " |
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Margin lending or call it margin trading usually it is mend for the rich who can play with money, win big oso lose big, big in ten of thousand of dollars. If within a day or within contra period, then it's ok (no payment is require) if it ia out side the contra period, force selling come in, if not pay up with what U hv commited in buying, so if mkt is down by 200/300pts. U still pay to pick up the losing stocks, plus pay for interest U borrow, plus what ever house, property, car, blus chip stocks and etc that is pledge will be in the hand of d banker,, if like today mkt is down and so uncertain. One can lose all mentioned above and be a bankrupt. |
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clauswu
Member |
28-May-2006 10:08
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Banks and stock broking houses define margin lending as "buying power" which is supposed to help you add to your portfolio and create wealth. A margin loan allows you to borrow money to invest so you can access more investment capital and magnify your opportunity for growth. Remember that it works both ways, a margin loan can also increase your losses.
To use a margin lending facility you will need capital of your own - either cash, shares, managed funds or another deposit with your bank/stock broker. Most allow you to borrow up to 3 times (75%) the value of your security to purchase shares from a selected list of stocks. Too risky for me. F |
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scotty
Senior |
28-May-2006 08:05
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what is margin lending har?? |
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geojam
Member |
27-May-2006 16:25
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Anybody subscribe to my theory that using margin lending is a way to create wealth? |
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