Saturday, 25 October 2014

Global market adjustment, what am I doing? (2)

In one week time, things can change dramatically. The things that I hold so tight to previously, all gone in a few days. It was so near to me, yet it is now far away from me.

Ironically, I told myself that my target price is RM 2.70 for INARI before. When it reached that price, I didn't sell.

Ironically, I sold some shares at RM 3.18 before, which at that time it went to a high of ~RM 3.30+, which I thought that I've sold it at a low price. Seriously? What happen to me, that I still crave to sell at the highest point? The tighter you cling to something, the faster it is going away from you.

It has been so ironic to me, that my final selling price is not even my target price previously. Even worse, this is not the first time I experience this (see here).

I also panic sell GHLSYS at the same day. It now seems so stupid of me, that I could have had a return of 30% a few days ago before I sold, and now it became 3%.

What am I doing? The market has not adjusted for sometime, and I indulge myself to this kind of situation, to have 100% shares at ALL TIME, thinking to grab every single cent from the market.

What am I doing? I take things for granted, as if I should always be making profit, although past experiences have taught me not to (never) take things for granted.

What am I doing? I did not let my capital to rest for even a single day. I let them to subject to the daily market fluctuation, watching the portfolio rise and down, until I lost myself.

What am I doing? This experience is similar to May-Aug 2013, of which I've written some reviews in Jan 2014. I was vindictive last year, which has cost me even more, so now I decided to rest for sometime. 

[to be continued]



Monday, 20 October 2014

Global market adjustment, what am I doing? (1)

Global markets drops consecutively in two weeks ago. As usual, Asian markets will follow the trend of western markets.  I believe these two weeks has been a turmoil for a number of investors. Unfortunately, I have to admit that I am one of them.

The first day was 7 Oct 2014.


I use the term adjustment, because at this point it is sure that this is an adjustment since KLCI index drop far below its 200MA, i.e. year line. I don't know if it is a bear or not at this point.


Small and medium capital shares adjust really a lot. In just a few days time, my buddy INARI has drop more than 30%. 



My profit has evaporated significantly. This is what happen to INARI price, and how my feeling is manipulated by the market all these days.







7-10-2014: First day drop, no feeling at all. Not even thought of selling.



8-10-2014: First day GAP DOWN, continue holding, hoping it to get back. I told myself
that if the coming rebound has no volume, I will sell it.


9-10-2014: Small rebound. It happened that this rebound did not have the volume I expected. 
Yet I convinced myself to hold. Why? I am longing it to get back to its 
"normal" position that it used to be, i.e. above RM 3.20. (mistake 1)

10-10-2014:  Second day GAP DOWN. It is painful, terribly painful. One day of plunge
can get back to the price which is 4 months ago, i.e. if I sell now, I lost 4 months of

opportunity cost. I am still too proud to lose at this point.

13-10-2014: Third day GAP DOWN. Horrible sell off. Price went back to 7 months ago.
I can assure you that seeing your profit evaporate day by day is an extreme 
agony. 



14-10-2014: Fourth day GAP DOWN, cannot tahan (stand) anymore, SELL ALL. (mistake 2)


15-10-2014: Continue going down, totally out of my expectation. Of course I felt
fortunate that I've sold it yesterday.


16-10-2014: Fifth day GAP DOWN. A total drop of 35%+ from 3.18 to today's low.
All happen in 1 week time. The opening price is RM 2.04.

Even though I know that this is a bargain price;
Even though I know that technically, the price is completely out of BB lower band 
(i.e. a rebound is very soon);
Even though I know that it will not continue to gap down everyday; 
Yet the emotional fear has stopped me from buying. I am too scared to buy in.

I guess this gives me a taste of bearish market,
that no matter how low the price is;
that previously you've thought that you would have bought in (probably all in?) at this bargain price, 
that who is so stupid to sell INARI at RM 2.04;
But the market will scare you from doing so. I admit that I am completely scared by the market at that time.
After all, seeing what happened on 15-10-2014 is that it open greenly in the morning, 
and at the end of the market it went down from RM 2.50 to RM 2.22 to close at the lowest
price. How dare for me to buy in if I see this kind of transaction?

Logic says: hey, INARI 35% discount price, when will you see this bargain again? 
Emotion argues: OMG, it has been free fall for so many days, how dare you 
catch the falling knife? never die before? 

At the decision moment, this time, my emotion won. I lost my logical
thinking seeing the market can be red like that.


17-10-2014: Strong rebound, I couldn't believe what has happened. A big slap to 

people that have sold it in the past few days.



After selling, I felt fortunate that the price continue going down.
After the rebound on 17-10-2014, what is my feeling then?

The market is controlled by big fish;
My emotion is manipulated by the market;
My decision is controlled by my emotion;

So my decision is controlled by the market, which should not be the case.


[to be continued]

Thursday, 9 October 2014

2014 Q3 Review

Return: +4.5% vs KLCI -1.9% (3 months)

Transactions: 3

 1. Sell PNE
I've been holding this share for 1.5 years. Not a bad return. Fortunately I have enough patience to wait for it. Thanks PNE. But one thing I must remember is that luck is an important factor. Who knows if it wouldn't move until 3 or 5 years? So I am really happy with this transaction.

2. Sell INSAS
This share has been grueling to me, finally cannot tahan (cannoot stand) and Sell INSAS. I don't have the patience that I have for PNE. Maybe one day in the future I will return, who knows?

3. Buy GHL
I love this transaction. This brings back me the "feeling" of short-term trading. I used to have this feeling, but the experience seems to disappear when I indulge myself too much in the stock market. Luckily I've regained this "feeling". Needless to say more, look at the chart:


9-9-2014: gap up with volume. I refrained from chasing high.

10-9-2014 to 18-9-2014: consolidation with low volume. I observed the movement. Telling myself that my target entry price will be around RM 1.05. Why? Because the closing price before gap up is RM 1.04. A "sincere" consolidation process shouldn't go below RM 1.04.

17-9-2014 already went down to RM 1.03, is in my entry price. But I did not look at the stock market on that day.

18-9-2014 I have something to do in the morning. Wait until I look at the price was already trading at RM 1.07. I didn't budge on the entry price this time. I queued for RM 1.05 and I just do my own thing. And it did match after that. I enjoyed an immediate return in a short time. What more could I ask for?

This is the trading style that I am looking at: wait for consolidation, find an entry price, do not chase high. Just let it happens its own way. If the transaction is not matched, just look for other opportunity.