Saturday, 27 December 2014

Book review: The Five People You Meet In Heaven

I realize that not looking at the stock market is a good decision. Now, I don't look at it as frequently as I used to be. It has been "a while" since I don't write non-investment stuff, today I am writing a book review, a book written by my favorite author.

Title: The Five People You Meet In Heaven
Author: Mitch Albom
Category: Fiction (Philosophy)
Year: 2003
ISBN: 978-0-7515-3614-0

The first time I saw this book was in 2008, where I have a glance through the Chinese-translated version of this book. I skimmed over it very quickly, have a feeling that this will be a good book to read. My feeling could not have been more accurate. I am impressed by the author's writing skill. Later on, I bought the English version.

The background is about an old man, Eddie, working in an amusement park for most of its life. He felt bored of the work and useless about himself for not accomplishing anything in his life. This book describes Heaven as a place where you seek answers for unanswered questions in your life. After Eddie's death, he met five people in the heaven. These people answered the questions that he has been seeking in his life, as to why these people crossed his path, as to how these people altered his life and as to why things happened as they did.

The first people he met is a guy that died for him. The whole point of this lesson is: Everything happens for a reason. I believe in this:  that what goes around comes around;  that there are no random acts; that all things are connected; This has nothing to do with religions though, is just a way of looking into life.

I like a quote in this chapter, that Eddie said it isn't fair that why the guy has to die for him and why he doesn't have to pay for his "sin". The guy replied:
"Fairness, does not govern life and death. If it did, no good person would ever die young."

The second people is Eddie's captain during war time.  Eddie lost one leg in the war. Everything changed after that. This lesson tells us that we have to make sacrifice in our lives.

Sacrifice. We made choices everyday, big and small. We inevitably need to sacrifice something to gain another. You win something, you lose something. Give and take. There is a balance to it all. The important thing is we can't keep thinking about what we've lost or what we should have chosen instead.

Another quote:
"Sometimes when you sacrifice something precious, you are not really losing it(the thing that you've sacrificed). You are just passing it on to someone else."

What a quote! This is strengthening what the author wrote for the first lesson, that all lives intersect.

The third person is a stranger to Eddie, yet she is connected with Eddie somehow. Eddie was angry with his father for the whole life, thinking that his father is accountable for all of his losses. But holding anger is a poison which eats you from inside. Hatred is a curved blade, the harm we do, we do to ourselves. That's why we need to forgive.

I like the analogy of curved blade. This is similar to people saying, when you point one finger to other, you are pointing three fingers to yourself.

The fourth person is his wife. His wife died early. Eddie lives by himself after that. His lost wife is the person that he has ever loved. This lesson is about how love goes on, even after death. Death merely ends a life, not a true love.

"Lost love is still love. It only takes a different form -- memory."
"Life has to end, but love does not."


Eddie's job is to maintain the rides in an amusement park. He felt his job is useless, boring and accomplished nothing. Therefore, the fifth person is to let Eddie knows that his job is important to maintain the safety of others, to kept the rides in the park functioning properly. The message conveyed is: Do not belittle yourself, do not feel unimportant for what you are doing. You may not know it at the time, but you will, in the future.

This is a very short review of the book. There are still a lot of great quotes and stories in the book. This is a great book. Totally awesome. However, on the way reading the story which leads to the lesson may be boring. Give it some patience, you will find the time spent is worthy.

Monday, 3 November 2014

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

I think Oct has been a roller coaster for a number of investors. Looking back for just 1 month, how many people has been played by the V-shaped rebound?

Several things to take note of:

1. If looking at the lowest point of adjustment makes me feel fortunate that I've sold my shares earlier, then what should I feel right now (i.e. as of market closed on 31 Oct)? Remember this experience.

2. The lesson of how to sell a share. To learn to let go, not to have any emotional connection with any share. This is not the first time I know this, but I didn't take it seriously. Selling INSAS 1.5 month ago taught me a lot. People say you need to forgive yourself, for all the things we didn't do, for all the things that we should have done. This is even more true in the stock market. It doesn't help if I keep on lamenting things like "I should have bought this share earlier" or "I shouldn't perform this transaction". Make peace, move on.  

3. The importance of capital protection. One of the reason why I sold INARI is that it has come to the point with the minimum acceptable profit. Of course, looking back now seems so stupid of me, but what if? No one knows what's going to happen.
As what people usually say: the stock market is always there, but will you always be ready for the market?

4. Confidence. I have to admit that I lost confidence to INARI after seeing it free fall consecutively. I even thought of something wrong is happening within the company. The is the main reason why I sell INARI (which some people raised concerns about its financial credibility before) and GHLSYS (which I bought in without any good reason except GST). But during the panic sell moment, I kept SHH, because I have confidence in the company. How to have confidence? Do homework and understand the company more.

5. Be patient. Sometimes retail investors are like patients in the stock market, looking for some guidance. So, patient needs to be patient. Even if the market is going up and I am holding cash, that's ok. Return is not determined by 1 month, look for a long term perspective.

6. At the lowest point of adjustment, a lot of shares have dropped to below my target buying price. E.g., MMSV 0.45 (lowest 0.38, current 0.58), IFCA-WA 0.30 (lowest 0.285 current 0.59) etc. At that time, I not even thought of buying any share. Ironic isn't it?

This experience makes me realize that I have no difference from most of the others,to be emotionally controlled by the market. I followed the crowd to panic sell at low point. If this is the case, how can this makes a difference in my investment return?

7.  Where do I stand in the market? I need to know what I am doing, all the rationales in buying and selling, and the plans of what if, i.e. risk management. If I know what I am doing, and know where I am standing in the market, I wouldn't have lost myself if something happens.

It is what it is. Take it as a lesson. Move forward.

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. 

Sunday, 21 September 2014

KLSE: Sell INSAS

Finally, I admit my "mistake" for keeping INSAS. I hold this share for too long, longing for a higher return. The fact is that, I could have had the same return 6 months ago, when it soared from 0.90+ to 1.20+. But I chose to stay on. My capital just can't stay the same all the time. I decided to sell eventually.  



Usually a stock with "big fish" in play will move within 3 months after the first round, but INSAS is way too "exceptional". In 6 months, people can already buy other share and gain satisfactory return from the trading. So I have to "change horse" (i.e. switch stock), to look for other opportunities.

Regardless, I still think this is an undervalued stock. I understand that releasing its values and potentials is just a matter of time. But it is just too long for me to wait. And no dividend some more! Earn so much then no give dividend, how can?!

I've had enough with you. Bye.

Saturday, 26 July 2014

KLSE: Thanks PNE, Bye PNE

My first entry price is 0.295. At that time, the relevance for me to hold a share which is not making profit is the cash/share > share price:

Total share: 65.7 M
Total cash (@ 30/9/2013): 24.2 M
Cash/share = RM 0.37

RM 0.295/share to buy a share that has a cash/share of RM 0.37, too good to be true, isn't it?

When the share went up to RM 0.60, I am still holding it. I convinced myself that the relevance now is the NTA price of RM 0.94. That the share is traded at a price well lower than its NTA/share. So I still holding that.

When it went up to RM 1.10, I keep holding. This is where all relevance turns into irrelevance, all rationality becomes irrationality. There is no fundamentals to support this share at this price. Yet I even think of waiting the share to flip twice (i.e. 300% return). But when volume comes, I know that it is time to sell, regardless of what's going to happen next.

Looking back, the price movements come in 4 rounds. I am surprise that I can wait until the 4th round. I might have still kept holding it,  had it not been the candle on 2nd July 2014, where the volume is just too scary for me:

PNEPCB


I felt a sense of freedom after selling. And I know that is a correct decision to have some cash on hand.

P/S:
This company has some direct business transactions recently, and it involved a large amount of shares:

26 June 2014: 5M shares dispose through direct business transaction.
1 July 2014:  14M of shares  dispose through direct business transaction. (gee, this is substantial considering that the total share is only 65.7M) 

And recently many patterns come out, change in boardroom, change in director's interest etc: PNEPCB announcement 

The price for direct deal is RM 1.10, which is higher than the current market price. I do not know what is the intention. And there is no point dwelling into the reason, cause you will never know what is going on.

The important thing is: I am free from it. That's it.

Thursday, 17 July 2014

2014 Q2 Review

Return: +9.9% vs KLCI +0.8% (3 months)

Transactions: 4

1. Top up CHHB. details here
This was a mistake.

2. Sell CHHB
I need to use money. I am grateful that I picked the right share to sell. Easy: just sell the one which is losing money. Don't hope for a break even, it may come after you lost your patience. 

Lesson learnt: a 3% loss in 2 months. Not a big deal. But it serves to remind me in the future, that I should have sold it at the right timing.

3. Buy SHH
This should be the one like INGRESS last year, the same reason that I bought INGRESS last year. I am going to hold this share until it brings me huge return. I believe it wouldn't be long.

4. Involuntary trade due to a one-lot transaction.

Dividend: 1

INARI 2.0 cent


Review: The power of compound interest

I am still very focus on KLSE, although I start to keep an eye on US markets.

My strategy is still the same for this quarter, very simple: buy and hold. Nothing more.

I start to feel the power of compound interest, that even a 9.9% gain comes in as a considerable amount. This is the power of compound interest. Interest on top on interest. This is how rich people gets richer. This is how money brings more money.

Thursday, 10 July 2014

KLSE: CSL chart says it all

Few months ago I wrote something about is low PE shares attractive?

Interestingly, I mentioned CSL in that post. At that time (Jan 2014), it was traded at about RM 0.80.

Today, this share is traded at about RM 0.10. A picture says a thousand words: CSL weekly chart.



You know what happen by looking at the announcement. I am not going to say much about this.

Tuesday, 1 July 2014

NYSE&NASDAQ: What is after hours trading?

When you browse for quotes for stocks in US markets, you will see something like this:

after hours trading
(Picture print-screened from the The Wall Street Journal)

The price above is the usual closed price. The price below is the so-called after hours trading price. So what is after hours trading? While this may seems common in US, it is not the case, at least in KLSE.

US market trading hours are below:
(All times are in Eastern Time (ET). Eastern time refers to the time zone in the eastern part of US, not the time zone for eastern countries in the globe, e.g. Japan.)

1. Pre-Market Trading Hours: 4:00 a.m. to 9:30 a.m.

2. Trading time: 9:30 - 4:00 p.m. (Unlike KLSE which has a break time of 2 hours in the afternoon, no break in US markets. Break time even in market trading, what a Malaysian pattern? )

3. After hours trading: 4:00 - 8:00 p.m.

We see that apart from the normal trading hours, there is also a pre-market and after hours tradings, which are also known as extended hours trading.

The reason for this is for investors to trade outside normal trading hours (nonsense?).  This is because a lot of companies make announcement, e.g. quarterly report, corporate news before market open or after market closed.

For example, Chicago Board Options Exchange ( CBOE ) plans to  list options for  GoPro, Inc. (GPRO). (NB: This GPRO has nothing to do with the GPRO in KLSE, although they have exactly the same listing name.) This was announced at 17:05, 30 June 2014 (i.e. after market closed). Seeing this as a positive sentiment for the share, the share of GPRO rose during after hours trading:

(Picture taken from Nasdaq.com)


30 June 2014, 4:00 p.m. price: 40.55 (normal trading hours)
30 June 2014, 8:00 p.m. price: 42.15 (after hours trading)
Change: 3.95%


30 June 2014, 4:00 p.m. price: 40.55 (normal trading hours)
1 Junly 2014, 7:30 a.m. price: 43.37 (pre-market trading)
Change: 6.95%


The price movement will continue until the market opens. Therefore, after hours trading and pre-market trading provides a very good indicator on how the market reacts to the news, and a good insight of the price once the market opens as normal. 

Extended hours tradings give investors to trade at a flexible time. It can also serve as the time to "digest" the news just announced by companies. In addition, for pre-market trading, it can reflect the conditions in other markets, especially EU markets since EU markets start earlier than US markets.


Last but not least, some facts about extended hours trading:
  • they are REAL trading, requires both buyer and seller for a transaction to match (in US, filled is used instead of matched).
  • All stocks listed in NYSE, NASDAQ and AMEX companies can be traded in extended hours trading. 
  • Only for stock trading, does not include options.
  • A lower extended hours trading activity (lower volume) will result in a wider spread (i.e. a larger difference between bid and ask price. Again, in US they use bid and ask instead of buy and sell.) 
  • Share price change, i.e. % change is still calculated based on closed price during normal trading hours. Chart only shows the price movement during normal trading hours.
  • You can view the most active, most advanced and most decline for after hours trading on Nasdaq.com
I hope you have an idea what is extended hours trading now after reading this.

Saturday, 28 June 2014

KLSE: the so-called one-lot-transaction (一阳指)

In share trading it is not uncommon to see a 1-lot transaction being made. It creates interests because in some cases, a 1-lot match would result in a 10% brokerage fee of the total amount traded, or even much higher.

Yesterday, I have this experience:


SHH transaction

Match amount = RM 94. Brokerage about RM 10+. Brokerage fee = 10%+. This mean that I must have a 10% gain in this share just to make it break even. 

Looking at the queue, the best sell price is 0.985.


SHH queue


The seller intention is apparently obvious: hoping the buyer to increase the buy price to buy at seller's price. As a retail investor, some people would do that because even if they buy more, the brokerage charge remains relatively the same for a trade amount of up to RM 1k. So why not buy more? But then you have to pay a higher price, which is the pitfall set by the seller.

But I am not going to do so. The first reason is because I already have some shares on hand, so that I can sell them all together. Secondly, I am not comfortable to buy at this seller's price, so not falling into the trap. Kind of self-comfort, isn't it?

Saturday, 14 June 2014

NYSE: AMD analysis

AMD shares closed with 2 white candles with relatively high volume on 10 and 11 June. On these two days, there is no apparent reasons why the shares moved with volume. One day later, the news revealed.

Headline: AMD reorganizes (MarketWatch) which states the plan of the company to consolidate some of its business segments and appointed a new chief operating officer. Another news concerns about its rival, Intel (INTC) which loses appeal against record $1.43 billion EU fine (MarketWatch). I think AMD didn't earn any money from this, but morally, is a good news that push AMD share.

On 12 June, the share opened higher @ 4.33, trading high @ 4.44, but closed @ 4.29. A newbie technical chart:


The share has just broken its upper Bollinger Band (BB), with volume. This is a good sign for the share price. A black candle on 12 Jun, could it be a "washing" process? Not sure, still fumbling in US markets. Let's see what happens in the next few weeks.

Back in 2006, AMD bought over ATI (Engadget), a big move by the company at that time. Since then, the company has shaped its future direction, to combine a CPU with graphics technology into one single chip, known as APU (Accelerated Processing Unit). I like this idea. By now, more and more APUs are being installed on laptops, easily observed when you walk into a computer shop. In gaming console areas, XBox One is using AMD APUs too. You can find chips made by AMD in personal computers, tablets, game consoles and cloud servers as well.


If the direction of APU is right, it could be very rewarding in years to come. 

Monday, 9 June 2014

A brief review: when to sell a share?

Selling a share is a tough decision for me. When I intended to sell a share:
- for which that have an unrealized gain, it is as if I am cutting my limbs.
- for which that have an unrealized loss, it is as if prohibiting the loss to turn into victory.

Perhaps I hang on to these things too long, with too much emotions.

SBCCORP is a typical example:

Bought in Dec 2012 @ 1.04 (before right issue)
Went up to 1.18 at 17 Jan 2013 (before right issue)
An unrealized gain of 4 figures within 1 month. Yet I hang on there, wanting more gain. (I mentioned this before 2013 Q1 Review)
Finally sold @ 1.01 at Feb 2013.

Looking back, I realize two things, that:
I sold it too late, that only took action after it fell from peak price.
I sold it too soon, that I didn't continue holding or the share would have doubled its price in a few months time.

Why would I mention something 1.5 years ago? Because I found that I didn't learn from that experience at all. That I went through the same thing again: 

CHHB:

Bought in Mar 2014 @ 1.48
Went up to 1.61 at 21 Apr 2014
A 9% gain within 1 month. Yet I continue to hold, not even think of taking profit.
Worse comes to worst: top up @ 1.55 Top up CHHB
Current price @ 1.45

Yet I am still holding the share, get nothing for almost 3 months.

Yes I bought both of these shares at a pretty "decent" price. But buying at a low price alone does not guarantee profit. It must be paired with a good timing of selling to maximize profit. 

I keep repeating the same pattern: holding, telling myself that the share is going to move very soon. But as one day turned to two and two days turned to weeks or even months, at the end of the day the opportunity cost that I may have lost may cost me a lot in the waiting. Until the share did move, months would have passed, and by then I would long for an even higher return, which in turn results in not selling AGAIN, which traps myself in this circle eventually.

So how to sell a share? JUST SELL IT when volume comes! If not willing to sell or, then at least take partial profit. Look at these two example, if I sell them when it shot up, the waiting period is within 1 month, and yet I secured profits. Remember: Profit in the account is still the best, not the unrealized profit in the portfolio.

Sunday, 1 June 2014

US markets hit record high (consistently?)

I wonder how 1 month can fly in a blink of eye -- I didn't notice this at all until I checked my last post. I was just too obsessed with my stuffs, and I realized I shouldn't.

Now, US markets closed at new high is not new anymore. Let's have some statistics.

Dow Jones Industrial Average(DJIA):
 31 Dec 2013: Record high close of 16576, see related news 
 4   Apr 2014: Hit an intraday historical high of 16631, see here
 30 Apr 2014: Closed at record high, at 16580
 9  May 2014: Close of 16,583.34 narrowly topped the previous record, less than 2 weeks ago
12 May 2014: Continues from last Friday, closed at historical high again, at 16695
13 May 2014: Continued the rally, closed above 16700 for the first time, at 16715
30 May 2014: Another record high, 16717, see related news

S&P 500 is another key index in US markets, have a similar trend too. closed at 1923 last Friday, a fresh record in the history, see Wall Street Journal.

How about NASDAQ? Nasdaq closed at 14-year high of 4357 at 5 Mar 2014. Media cannot use a record high for NASDAQ, because its record high was set in 2000 during the dot.com bubble, where NASDAQ soared above 5000 before collapsing. Is NASDAQ actually heading to another rally?

Now, how about Bursa Malaysia? It remains as boring as it can be, as usual. Bursa also closed at a record high of 1887 on 19 May 2014. A 1900 seems to be so close, and so far. Will Bursa breaks the history as well? If it really does, I hope it comes with volume.

Tuesday, 29 April 2014

KLSE: Top up CHHB

It has been some time since I posted my last transaction, but it doesn't mean that I did not buy or sell in these periods.

Today I queue RM 1.55 for CHHB, a share by guazi in Investalks.


CHHB transaction



Why would I buy this share? 

The chart is beautiful, is very much like INGRESS lasty year:  Why would I buy INGRESS? Price up within short time, then price consolidation with low volume, to "wash out" contra and uncertain shareholders.




Why is it 1.55?  

Well, first of all I am very "prudent" in buying something, including stocks. I wouldn't pay full price for something - a typical Malaysian style, and will always bargain: 

kurang sikit boleh tak? (Malay)

eh kah kiam oh? (Hokkien)

不能再便宜了meh? (Mandarin) 

can you give a better price? (English) 

So I will feel reluctant to even queuing for RM 1.56.

Secondly, 1.55 is the lowest price since 21/4/2014. Because at that day there was a slight movement in the stock with volume. I believe this is a relatively safe entry price.  

Target price - No target price. If volume come and I find a better chance, then I will change.  

Saturday, 19 April 2014

NYSE&NASDAQ: What is buy to open, buy to close, sell to open and sell to close?

When you are on your first time to trade options, you may be baffled by the choice of transactions:

buy to open (BTO), sell to close (STC), sell to open (STO), buy to close (BTC)

First time seeing this: what the heck are these? How come buying something can close something (buy to close)? How come selling something is to open something (sell to open)?

In stock transactions, there is only buy and sell, which is already self-explaining. But for options, because you have the right to buy or sell, every time when you want to OPEN a position, you need to choose if you were to OPEN a BUY or SELL position, i.e. buy/sell refers to the transaction you would like to make, whereas open/close refers to your position, whether you would like to open or close your position.

Assuming that currently you do not hold any open position (i.e. do not hold any options):

i) when you want to buy a call or put options, you choose BUY TO OPEN. When your transaction is matched, then you will have an open position. This open position will then required to be closed on or before expiration, e.g. if you wish to close earlier, then you choose SELL TO CLOSE, since you are SELLING your options and at the same time CLOSING the position.

ii) when you are selling a call or put options, you choose SELL TO OPEN. Then you will have a some kind of equivalent "short" position, e.g. when you sell 10 contracts, you will have -10 contracts for that options. You will then require to CLOSE the position by BUYING back, i.e. BUY TO CLOSE.

In short, if you were to commence a new trade, and you wish to be the buyer, then you choose BUY TO OPEN. Otherwise, if you want to be a seller, then you choose SELL TO OPEN. 

Hope this thread will clear the doubts of many options beginners, as I was also confused by these terms at first.


Friday, 4 April 2014

2014 Q1 Review

Return: satisfied.

Transactions: 3

1. Top up PNEPCB
This transaction did pull up my average price. So I actually endured the "pain" when I topped up -- already 2X of my first entry price, how could I still buy it? But I don't want to regret, and this share did not disappoint me. It "hurts" me in the sense when seeing the % return "decreased dramatically", however, in terms of amount, the return is of course higher. 

2. Buy INARI-WA
I used to think that an investment of less than 2k wouldn't make me any huge return, at most a few hundreds in short time. But INARI-WA has really "broken my glasses". For this small amount of investment, the return is really surprising in 1 month time. This shows the power of investment, of how money is being duplicated. 

3. Buy CHHB
Clearly a "follow wind" trade, from guazi in Investalks. Buy at low volume, not too bad. 

Dividends 2
1. INARI 1.5 cent
2. INSAS 1 cent

Review:
This results show that I don't have to trade frequently to pursue for huge return. In fact, buy and hold may be the best way for high return - just do nothing and wait for the return, isn't this the best part of investment?

Yes, I could have sold INARI at high price and then wait for adjustment and then go in again, but how could I catch the moment precisely? What if I miss it, and then just let the rest of the return gone?

Yes, I could have sold PNEPCB on 14 Feb 2014 @ RM 0.84 and switch share for another return. And until today it did prove working, since PNEPCB still hovering around this price, but WHAT IF? I am loyal to this share, really feel reluctant to sell at this price though.

After all, it is easier said than done. When my capital gets larger, when I have some cash to play really short term, then I can go for different trading style. For now, I am satisfied with my return.

Thursday, 3 April 2014

NYSE&NASDAQ: March options virtual trades

Mar 14 options virtual trades, expired 21 March 2014.

Mar14 virtual trade

1. BAC, return of 33% while the mother share rose 1.2% in that particular period. (magnified power of options, just like call warrants)

2. JPMorgan Chase Co. (NYSE: JPM), advanced US 3++ in 1 week, or 5.93%. I bought the option at $0.98 and it ended up with $3.60. A return of 267% in 1 week time, not bad right? This is the kind of return in US markets.

3. TSLA, a recently hot stock in NASDAQ, where the call option is out-of-money @ strike price of 250, i.e. options expired worthless. A loss of 100% of the capital. 

Not too bad when you are a buyer and you bought at the right trend - unlimited profit and a limited loss of 100%. In real trade I would chose those expire at least 2 months later, so that the price fluctuation will be lower. Still a lot to learn for this financial derivatives.

Sunday, 23 March 2014

NASDAQ: Symantec stock plunged 12%

Last Friday US stock ends lower, with DJI - 0.17%, NASDAQ -0.98% and S&P 500 -0.29%.

I was wondering how come NASDAQ would have fallen relatively extensive as compared to S&P 500. Having observed the trend of NASDAQ recently, this is rather unusual. A look into Wall Street Journal clear my doubts: SYMC (NASDAQ:SYMC) plunged 12% yesterday due to the news that CEO get sacked in less than 2 years.  Related news can be found in Investor place. Symantec, which develops Norton anti-virus, is a well known company for computer anti-virus software. I am using its product currently.

NASDAQ is an index comprises of 100 companies mainly related to technology / health care operations. A list of its components companies can be found in CNBC Nasdaq component companies. You can easily identify some of the well known international companies by just a glance at the component companies: Microsoft, Intel, Adobe etc.

This is what happens when you get to know US market, a greater insight about the companies of which you use their products daily, and also have a sense of how fluctuating US markets can be.

Sunday, 16 March 2014

KLSE: INARI price soars, transferring to Main Market?

Last time when I wrote something about target price reached, where to?

My target price was RM 1.71, but now the share price stood at RM 2.27. I didn't make any transaction, as I found no reason to sell this share.  The decision is correct, at least, until now.

Last Friday, INARI volume was relatively higher - not a good sign. As volume comes, I would choose to go. The price has increased ceaselessly over the past two weeks. Seeing the share price soars day by day, I am very excited at first, but soon the feeling changed.

INARI


I found myself to be even greedier than ever: when my portfolio sees an earning that has never appeared before, I found myself to be even more unsatisfied. I want to see EVEN more profits. Is this human nature, of the more you have, the more unsatisfied you will be, or is this just about my boundless greed? I guess, in some sense, that this is part of human nature, a weakness that can be improved, but not eradicated.

Anyway, I believe the movement in the past two weeks is strongly related to the news regarding transfer from ACE market to main market. It has been more than two months since the application has been made on 10 Jan 2014.

It breaks new high everyday, sky is the only limit. I have no more target price for this share, will only watch and see what happens, only to decide what to do next.

Cairns trip, the Great Barrier Reef, people met

Continue from Cairns trip, the Great Barrier Reef, a memorable experience.

F is from Italy. She spent her Christmas holiday traveling around Australia. She managed to travel to: Adelaide, Tasmania, Sydney, Cairns and Uluru in two weeks time. This is just too short. It requires determination: if you don't travel now, you will not have the chance next time. This is why I travel to Cairns. During our conversation, when we talk about having meals, she said that she wants to save money for Uluru, her last trip, during Christmas. Traveling to Uluru during Christmas? God knows how much it would cost. But I understand that. This is all about experience. 

G is locally born, just graduated from University. He was the "translator" between F and I, as the English slang by F is too hard for me to understand. When we first met, F asked me a question: So you are a student here? (she student pronounced as stadent). I didn't get it. 2 seconds later, G said she mean student. I laughed nonstop. Looking back, it is this small things that made up a large part of this memorable experience.

L is from Poland, having two weeks break for her holiday, she chose to travel in Queensland without any plan. I like this, no plan. Unlike me, I plan everything before the trip. I realized how "thoughtful" I was for my trip, which turned out to be redundant sometimes. I guess this is the difference between eastern and western culture. No plan, don't have to think so much for this. Just wing it* as many others here did.

* wing it, verb, it means to accomplish something without preparation, i.e. is like flying through with a wing. E.g. She traveled to Cairns without booking any accommodation and just wing it upon arrival. (i.e. she found her accommodation on the spot).

He is a Canadian, ages 50s from my guess, sold all assets in Canada, traveling since Feb 2013, and will continue till the rest of his live. I admire his bravery, something that I doubt if I have the courage to do it. Living in my comfort zone for years, I couldn't imagine what will happen if I lost a place to stay. Thinking the other way round, why would a person need a certain place to stay? Wherever he wants to go, wherever he intends to stay, just go for it. He planned to stay in South East Asia for sometime, as these places are relatively cheaper.

C is from Switzerland. She came to Penang before. I like to hear this. Listening someone praising my home town made me proud. She travels for 3 months in AU and NZ, has been traveling around other parts of QLD.

Ch is from UK. "Well, I am 40 now and I haven't traveled around the world." He quited his job and started traveling for 3 months. Another difference. They desire of traveling around the world. At the age of 40, I doubt if I could give up my jobs and everything and just start traveling for months. My trip "unit" is days. Their trip "unit" are weeks and months, or even years.

This trip has widen my views and experience. Meeting other travelers is just amazing. The differences in cultures show that there are something we can to learn from each other. It is about embracing the good from other cultures. 

Tuesday, 25 February 2014

Cairns trip, the Great Barrier Reef, a memorable experience

I traveled to Cairns (CNS) alone last year. Solo traveling is not something 'miserable' as I've thought, as I've got chance to meet other solo travelers along the trip, which is part of what making this trip to be memorable. . Cairns is located in Queensland (QLD), Australia, very far north from Brisbane (BNE), a city that would not become a city without tourism industry. Great Barrier Reef is the main attraction in Cairns, a natural gift for Australia with more than 1000 km of reef along the ocean. This is something that I've long sought after for, a place that I would go regardless of how much it would cost.

In travelling, it is always a good idea to rent a car with friends so that it is always easy to go anywhere. In Australia, I would always go for VroomVroomVrrom (click here for website) for car rentals. It combines many car rental companies in Australia so that you can compare them in a click, is really convenient to use.

The first day trip is to Green Island, where turtle can be easily spot. What is wonderful about this trip is the sub-marine tour, where I got a chance to observe the reef through glasses. The view on that day was not excellent, due to the rains few days ago.

great barrier reef

great barrier reef 2

In the city, on the way to Cairns Central, a shopping centre, you will walk by this bar with a creative, humorous sign board:

creative sign board


The second day trip is about a Daintree Rainforest and Cape Tribulation. The tour guide is in his 30s, very outgoing, sociable and passionate about his job. This is what makes him a good tour guide. On the journey to the destination, which took about 2 hours, he explained some history, the locations past by and sharing some of his personal experience. He mentioned about how he traveled around Australia with his girl friend (now wife) in his 20s, and finally decided to settle down in Cairns. The way he sounds when sharing this story reveals how much affections he has to Cairns, the same feeling that I have to my home country Malaysia. 

Cassowary, a big eater, only in Australia and Papua New Guinea


cassowary

WALUWURRIGA Alexandria range lookout point

Alexandria range lookout point

Another look out point:


The tropical climate in Cairns is humid, which somehow compensates the dryness in other parts of Australia. This is part of what making Australia to be a great place: a seasonal climate in the southern part, a tropical climate in the northern part. 

The last day trip is to great barrier reef, which I purposely planned for, which didn't disappoint me. The event crew on the boat are all very helpful, fun and humorous, a typical way many Australians would behave. The coral sea is so beautiful. I opted for a helicopter scenic flight. The view of Great Barrier Reef from the helicopter is just spectacular and amazing.

Crystal clear water:


a fish

Life experience - helicopter scenic flight!


helicopter

Nice view from the helicopter:

spectacular view

 This is just spectacular:


spectacular view 2

How beautiful is this?


spectacular view 3

Staying 4 nights in a backpacker resort, people come and go. Each and every day I will meet new travelers staying in the same room. We always talk and exchange experience. The next post will be about people met along the trip.

Wednesday, 19 February 2014

A past experience, a reminder to myself

There are several types of stock account. One of the most common is a cash upfront account, in which you are only able to buy shares with the money in your trust account, i.e. trading limit = cash available. Another common one being the margin account, which allows you to trade, e.g., 2X based on your cash available.

Having mentioned margin account, once I saw a "joke" in Investalks, saying that for those working in Singapore, they don't even need to have a margin account to trade 2X of the cash available, because what they are earning already has the marginal trading effect in Bursa Malaysia. Kind of cold jokes, but it reflects how the continuous depreciation of MYR erodes its value against other currencies.

Back to story. When I opened my account, I opted for cash upfront account. I know that, deep in my mind, this will prevent me from "gambling", as my weaknesses will be completely reflected in stock market, of how greedy I am, of how uncontrollable I am, of how unsatisfied I am, when the crucial moments come. By only forcing myself to use cash upfront account, I can avoid gambling on trading limit which may be over my financial affordability.

This decision DID save me from some losses. Back in 2011, I have a cash value of about 10k in my account. It happened at that time that PROTON (now delisted, took over by DRBHCOM), came the news about take over by DRBHICOM. Read a related news here.

Due to the news, PROTON gap-up open on 6 Dec 2011, from RM 4.50 previous close to open at RM 4.75. Its call warrant, that I was aiming at, PROTON-CG, open at RM 0.430 from a previous close of RM 0.370. Seeing such a strong positive sentiment, I plan to hantam (ALL-IN) all my cash to buy this call warrant.

PROTON-CG


I remember vividly that, I key in BUY RM 0.435 for 250 lots. ORDER DECLINED. I don't know why the order was declined. I tried a second time IMMEDIATELY (such a rash decision), same amount same price. ORDER DECLINED. Only then I calculated the total amount I wished to trade = RM 0.435* 25000 = RM 10875, which is over my trading limit for about RM 1k. I gave up buying.

Soon after that, PROTON turned from green to red, and PROTON-CG closed at RM 0.315 on that day. Had the transaction been successful, I would have suffered a loss of 3k in a day. Although it has gone up finally - 1 month later, I wouldn't have waited until that should I have the call warrant, I would have cut lost on the first day of my purchase.

My cash upfront account SAVE me from the loss. Of course, it did "prevent" me from some earning, but using margin trading limit for me is risky currently, as I am still learning how to control myself. In addition, past experience has shown that even though I may win some money at first, I might have lost even more at a later stage due to uncontrolled trading. I still feel comfortable using this cash upfront account. The feeling of "not earning enough" abates as my experience accumulates.

This experience also proves the well-known quote "buy on rumours and sell on facts". When news have already been announced, don't chase, is time to sell if you hold the shares. Anyway, this is an experience for me to remember, which will hopefully remind me to avoid the similar mistakes in the future.

Friday, 14 February 2014

NYSE: Selling call options: some basic stuffs

This time is the seller of call options. Selling options will always earn you premium, as you get the chance to be the "insurance company", as if collecting premium from buyers who wish to protect their shares. 
Case 1: Out of money

Buy: AMD JanWk5 3.5
Strike price = $ 3.5
Expired date = 31 Jan 2014
Cost: 0.13/options = 0.02*1000 = $ 20 + ($ 15.35 brokerage)
AMD cloased at 31 Jan 2014 = $ 3.43

AMD @ 30 Jan 2014 = $ 3.45. It has little chance to close above $ 3.50, hence the premium is very small. At the expired day, AMD closed below strike price, so premium was collected free by call seller.

Case 2: In the money

Buy: AMD JanWk5 3
Strike price = $ 3.5
Expired date = 31 Jan 2014
Cost: 0.13/options = 045*1000 = $ 450 + ($ 15.35 brokerage)

Call options is in the money at the expired date, i.e. call options will be exercised. I am required to sell the share @ $ 3 to the call options buyer. If I will to buy back immediately, this will cause me a loss of $ (3-3.43) = - $ 0.43 / share. But I collected premium from selling the call. So is a different story.

Based on yesterday closed price of $ 3.70, if I buy back to close my position, my net loss will be:

+ $ 450 - $ 3000 + $ 3700 = - $ 250.

There is something known as Sell Covered Call, which is pretty common in options. Covered here means that you own the mother share, and at the same time, selling call options to earn premium. If the shares go down, the premium collected will be yours. If the share rises, you still earn from having the upside of the mother share. This looks to be a good deal, although still need some time to have a deeper look on it.