Today headline in Sunday Times caught my attention. 

Pay $4k for ‘get rich’ trading tips 

Do you really believe in get rich quick scheme? 

Do you really believe it is so easy to make money without putting in hard work?

If your answer is YES then i have to tell you something that really blow off your mind. 

There are no such courses or seminar in the world that give you the SURE WIN method of making money. You wont make tons of money just by attending seminars or workshop or even reading books. 

Will you be able to learn cycling just by reading books or attending cycling course without yourself riding a bike? 

The answer again is a BLOODY NO NO … So how would you be a successful trader or investor without gaining the experience you need by trading day in day out or a seasonal investor. Do you still remember the time that you fall down when you first riding a bicycle? Oh i think is yes … 

Have you ask yourself why do you need to fall before you start to learn how to cycle?

The problem with human being is we will only learn something through hard experience. This means that we WILL LOSE MONEY first before we learn how to MAKE MONEY. No doubts some of you will make tons of money at first. But i guarantee you that you will lose back all the money if you do not have the basic grounding of trading or investing. 

I have a student that make tons of money during the year of bull run which is around in the year of 2005 to 2008. He made plenty of money during that period of time. Only recently during the bear market, he lost everything back to the market + incur more loses within 3 weeks time. 

All i have to say is … Do not cheat yourself that money is make easily … and by attending some so call good course you will make money within a few days. Trading is a skill that need time to master. You can ask any musician how long did they master their own instrument. The answer will most likely be i haven’t master anything yet even though they spend years after years of practice. 

So once again do not kid yourself … 

I always wonder why when people attend trading or investing course, they will want to make money after the courses but when they attend marketing, financial and IT courses, they will not want to make money out of it. 

Aren’t it the same? You are paying a sum of money to learn the art of the game or the knowledge of a certain field. Why are there such a big different in perspective? 

So next time when you want to attend a course or even choosing a degree to learn, ask yourself if you are really interested in the topic or you just want to make money out of it. 

Ask yourself these question especially when you want to join a trading and investing courses …

Did the course teaches you the art of something? 

Did they teach you how to fish instead of giving you the fishes? 

Did you think logically before you sign up for the course? 

Did you really think that the course is so special that they promise you everything where people like Warren Buffet in trading, Thomas Edison in inventing and even Beethoven in music spend years after years to perfect their own field of art?

Think for yourself and make the wise choice … 

Fed will most likely to cut a quarter point interest rate to 2% in this coming Fed Policy Meeting. May will be a crucial month in this trading year. Will it be a bearish month as sell in May go Away ?

From the technical point of view, if Dow can break above the 13k, and May is a bullish month then the market will most likely recover in the end of the year. If May happen to be sell off, then we have to see if there are any strength in the month of October. Finally the official start to admit that US is in Recession. This will be confirm by this week GDP data. If it is confirm that US in Recession, then there will be a mini roller coaster in the market. Well when people see it as bad news and react to the FEAR, I will be sitting sideline of short a few stock down and be ready to pick up value stock as the market fall by irrational fear.

This is because the stock market already price in for the recession. Economy always lag behind the market as the market predict the economy. Well anything can happen in the market so i shall trade with cautious.

Last week when the EUR/USD make the all time high, I was shorting it. This is because the Fed interest rate has been already so low. This means that after the .25 cut in this Wednesday, the Fed will most likely to hold the interest rate and thus the EUR/USD will be coming down as the Dollar will be bottom up and stable. I will be keep on monitoring the dollar as strong dollar will also boost up the economy and in turn boost up the market.

So if you do not know what to do with your money, please to not let the so call “Pro” to handle your money. The best person to handle your money is yourself. Invest in yourself so to invest smartly. You will be able to beat the inflation rate with the right set of education. Well it is better to put your money in the FD when you do not know how to invest your money. At the very least you will not lose too much money by parking your money in the bank.

Have Fun Making your money work for YOU.

I will be starting a series of Winning Trading Habit. I always find that to be successful in trading or investing, you always need get your mindset and habit right. What really differentiate a Master Trader and a Novice Trader is their habit and mindset. Without further ado, i will present you guys the ultimate and the most important habit that needed to be successful in the market.

No 1 Winning Habit - Preservation of Capital

It simply means that you do not lose money to the market. If you did not lose money to the market, then in long run you will be able to make money from those people who lost the money. Some of the famous investors quotes are base on this winning formula.

Rule No. 1 - Never Lose Money
Rule No. 2 - Never Forget Rule No. 1
- Warren Buffett

Survive first and make money afterwards
- George Soros

If you don’t bet, you can’t win. If you lose all your chips, you can’t bet.
- Larry Hite

It is always easy to make money but to keep money is very difficult. People tend to look for entry without thinking and setting the exit. Whenever you go into a trade, you will need to have an exit price. Cut lost fast to preserve the capital. It is fine to lose a battle as long as you win a war. Look far ahead instead of near target. We will always make mistake and lose money. It is part and parcel of the game. The main thing is to make money at the end of the tunnel.

Trading or investing is always related to gambling. So what is the different between Gambling and Trading? Actually there are a lot of different between the both of them yet somehow or rather they are quite similar too. Well when you do not know what you are doing, then you are gambling. This is because you enter a trade base on hope and luck. Gambling in a casino is no different as you hope that you will get the best card or the roulette’s ball will hit at your stated price.

Professional Gambler always make money from the casino. This is because they aim to make a sum of money first. Then after they have make the money, they will use the money to play which will reduce their risk as they preserve their capital. So the most they can lose will be other people money. Playing with other people money will reduce the fear in them.

It is the same concept in trading. Make use of the money that you have make from the market to grow more of it. Trading with winning money will reduce your fear. Preservation of Capital is extremely useful during the bear market as Cash is King. There will be tons of opportunity(stocks) out there for you to buy. Usually people crash and burn during the bear market, thus they fail to capture the opportunity present to them in the bear market.

There is a saying… If you stay in the market long enough, you will be lucky enough to make a sudden windfall. I have been trading for the pass 20 months, I have experience a few windfall during this period of trading. TTWO, GS, GOOG and other have already give me a surprise windfall. I almost make tons of money on BSC put just before the drop from 60+ to 2 dollars. Even in this bear market, My account still up by as high as 15% and now is ding donging at 5% to 10%.

So Trade to trade well …
Preserve your Capital …
If you don’t lose money, money will come to you …

Options can be use for many purposes. One of the useful purpose is leverage. This mean instead of buying the stock for 40 bucks, you will be able to get it for 20 bucks but the trade off is the TIME.

The steps of Options Leverage

- Pick a stock (sector rotation, upgrades/downgrades, favorites, fundamental …)
- Decide on the trend (up or down / Call or Put )
- Decide the Target Profit
- Decide on the Time to hit the target profit
- Decide on the Strike (ITM or OTM)
- Decide on the Greeks
- Theo value (undervalue or overvalue)
- Make Money $$

Whenever you enter a market, you need to have the target profit and also its stop lost. Once you have decided then you can go to find a suitable options. Never ever choose the option first then the stock. Always choose the stock to trade first then you choose the option suitable for the stock.

All the best in choosing the right options.

In this article you will learn how to put a stop lost on your options which tag along with the stock price. You also will learn how to put on the profit target. This will be done by using OCA group. This mean if the profit target get triggered, the stop lost will get cancel. This stop order will be able to prevent from the gap down effect of the stock.

Press the bid button to get the order out.

Right click on the order. Mouse over the modify to get the condition. Click on the condition.

When you click on the condition, you will be able to see the pop-up. Click on the conditional tab. Type in the stock symbol that you want to put the stop lost. Make sure your Exchange is smart and Description is Stock. Trigger method DOUBLE LAST. If you buy a call your stop lost will be <= and vice verse. Remember to put the stop price. This stop price will be the stock price. Click ok when you are done.

Once you click ok, you will be able to see the order that you created.

Once you have check the order, click on the accept button. NOT THE TRANSMIT BUTTON!!!

Change the Limit order to market order. This order will be execute by the stock price (not the option price). Therefore when the stock price hit 140, the option will be sell at the market price.

Check that the price change to MARKET. If you just want to put the stop lost, this order will be good enough. Just press T button to transmit the order. Take note: if you want to put the stop lost forever till it get triggered, remember to change the DAY to GTC (good till cancel).

This slide show you how to put the target profit and stop lost at the same time. Click on the bid column to open the order. Key in your profit target.

You have to put in the OCA group. Remember to label the order (profit target and stop lost) using same characters.

You will be able to get your OCA group under the Global configuration.

When you are done with everything, remember to press the transmit button.

Please test it out yourself at the paper platform first. Experience it for yourself then proceed on to the real trade.

HONG KONG (MarketWatch) — The Singapore government said Thursday that its economy shrank 4.8% during the October-December period from the previous quarter while the island nation’s inflation continued to grow on cost increases in health care, housing and food costs”

This is not a surprise to me. Back in last year i already tell my friend that Singapore economy will not be as good as previous year. Singapore might be affected by the ongoing credit issue, sub prime and possibilities of recession in US. Sadly many of my friends just brush off my idea. Singaporean young adult are mostly ignorant about the world economy. We always think that Singapore economy will continue to grow at a tremendous rate.

I still remember some of my friend use their CPF money to invest in Singapore Fund and China Fund. I remember telling them that the market will be coming down soon as the world economy will get affected by the US problems. Then most of my friend say, “Don’t worry Brother, Asia is growing fast, China fund is good as Olympics is coming and Singapore will be boost by the IR industry”. The fact that they didn’t know is that the market will react faster than the economy. The market react to the news. Just less than 6 months ago, Singapore Index hit a high of 3k ++, now within just a few months, Singapore index is only at 2k+. Most of the Asia market suffered averagely 20% of the high. If my friends hight my advice to wait till the economy is good then you invest, they will be a lot happier now.

Invest for long term ( 10 years ) fund/index/Unitrust sure make money.

The above sentence is only half true. Invest long term in your own country index is almost sure to make money but not fund and other products. To invest at a peak of the market will take a even long time to make money. Market and Economy always goes in a cycle. What go up have to eventually come down.

This is the best period of time to save money for the next upcoming bull run which might happen in 2 years time. Always wait till the overall economy is good then you enter the market. Read the world news everyday to keep yourself update with the economy. Invest in yourself and you will reap the rewards.

Please Wake Up Singaporean … Especially the young adults … You might find it hard to get a job for the rest of this year till next year … especially if you want to work in a banking industry. Learn to manage your CPF fund properly. Do not think that you can’t use the money now so you just mismanage it and dump it at a lousy fund or stocks. Always do your due-diligence and do your own finance. Do not be sway by the so-called professional financial planner.

Tips

Invest something that will 100% guarantee to grow your capital. Always ask the Professionals to guarantee your investment capital. If they cant means their products is not really that good. If they cant promise you a good return of 5% guarantee annually, you might as well park your money at CPF special account which give you a good rate or even at ordinary account also not bad.

Important thing is always invest in yourself …

January 22, 2008

Those of you have follow my blog regularly, you guys would have know the bear market is coming. A few months ago, I was shooting down the financial sector. I was careful on the strength of the technology sector. As i mention before, if the technology sector start to fall, the market will press the panic button.

Just some Warning !!!

Please do not catch the falling knife. This mean that if the market is falling down, please do not buy and think that it is a bargain especially if you wanna buy and hold for long term. When the market is falling down, there will be some bargain hunter and novices around to push up the downfall a bit, but the fall will be greater after the push. If you are not a day trader or swing trader, then you are most likely to be in risk.

Ride with the wave … if the market confirm to be a bear market, just shot all the way down. If you are not comfortable in shorting the stock, then park your money in somewhere safe (please do not park in gold or oil as they are already peaking) and wait till the end of bear market.

A bear market is always good for the whole economy since we already have 5 years bull market. A healthy market/ economy will go through many boom and recession.
Some sector that are recession proof are …

- Tobacco
- Health Care
- Consumer Staple
- Beverage and Alcohol

The market today is no longer investor market. It is rather a trader market with a lot of novices. Most of the big time investor either park their money in the bond, commodities or they just sitting sideline.

I suspect that the FED will cut the rate till 1% before holding the rates and eventually raise the interests rate. I will not be holding any short term trade and also stay away the market for a while.

Warning …

If you think that BLUE CHIP stock will eventually go up again … Think again …
Let say if the bear market take about 2 year to end and you need another 2 year of the bull market to make back your losses, you will need a total of 4 years. Well isn’t it better to cut losses now and ride will the bull market when it finally come .
Only loser will say that it is meant for long term investment and let their money losing value …
Take charge of your financial and admit that you have make a poor judgment and move on with it …
Only Winner will admit their mistake and use it as a strength to bounce back at a greater height.

Trade Safely and Trade well …
When is the time to Cut, Just Cut it …
The choice is with you …

Do we have to trade everyday? This question is target for day trader…

The answer is no. This is because there will be certain days that wont suit the trading system. By forcing to trade, we will actually incur loses as compare to not to trade which mean no lose no win. I guess it become part of the day trader life to trade everyday. It just like being addicted to it.

Do you feel emptiness when you don’t trade?

Sometime we just have to withdraw from this syndrome. Go out with your wife or girl to catch a movie. Trading is not like daily job which you need to work everyday. Trading is to work on the best day and shut off during the bad day. I believe different trader will have their best day and bad day.

Trade on your best day (You feel that the day is just for you)
Shut off your computer (You feel that the day is against you)

Have you ever wonder what is the best investment vehicles in the world?

Often i heard people say that real estate is the best investment because houses will always appreciate in long run. Some people say that the stock market is good as long as you buy and hold for long. Some of them say invest in commodities like gold and oil as they will always go up too. Some of them say invest in mutual fund or exchange traded fund.

I also get to hear from the other group of people. They say that invest in stock, mutual fund, real estate and other vehicles is very risky. Some of them say that they got burn from stock market and some get burn by the housing loans.

So who are correct?

Well i believe that all of them give “sound” advice. All investment vehicles in the world is good and excellent IF YOU KNOW HOW TO USE IT.

Let me give you an example…

I do not have a car license and i have not drive before except in the video game center. If you ask me to drive a real car, most likely i will crash the car. Therefore driving a real car is Dangerous to ME and also might cause harm to others.
This is very true in trading world or other investment vehicles. Car license is just like the investment education and the car is like the market. Without proper education on the investment vehicles that you are going to invest is equal to give your money away.

The Best Investment in The World IS YOU … INVEST IN YOURSELF FIRST … YOUR BRAIN …

People tends to blame the market, blame the brokers, blame the guru and blame everybody except themselves. People tend not look at themselves to realize that they are the one who call the shot on purchasing the investment.

You have to take charge of your living. Take charge of your decision. If you have no time to invest yourself then better not invest in the market. If you want to let “people” take charge of your Money then you have to prepare for the lost.

Always ask the Professional (brokers, financial planner and other gurus…) to Guarantee of the Return that they promise to you. If they are able to promise you a fix return then most likely they are good. Always do your due diligence.

Trade Safely and Invest in Yourself