Saturday, June 27, 2009


"If you think education is expensive, try ignorance" - Andy Mcintyre

A few days ago, I met 3 ex-floor traders near my office having their lunch. They were trading out of Ong First arcade specialising in US interest rate contracts. One of them is doing well and is a mentor/partner/employer to the other two traders. We exchanged greetings as usual and I asked the two students how have they been doing so far. They jokingly said that their mentor taught them only 80% of his skill and holding back 20% like some Chinese Kung Fu Masters. That's why they are still struggling.

I rebutted them instantly, as a stakeholder their mentor would be more than willing to transfer his knowledge and skill to them but unfortunately their absorption rate were only 50%. They should be grateful that their mentor is willing to put in time and effort to teach them. Their mentor would be proud of them if they can be successful traders and he would also benefit, it's a win win situation.

The fastest way to successful trading is to learn from those who are doing well in their trading, of course it's their trade secret and not many are willing to teach as their students might turn out to be their biggest competitor later on especially in a small and tight market. Personally, I feel the market is big and there are so many contracts available now, with Internet technology, we can trade in any major exchanges around the world.

Not all traders can be good mentors, some are only half past six. A good mentor should be one who is consistently profitable, having a good trading system and sound money management. Recently, a trader from the arcade told me she was busted after trading for nine months despite having a mentor. I felt sorry for her because she was not taught sound money management as the mentor himself consistently trade to the maximum position available for his trading margin.

What is the "Holy Grail " to successful trading? In fact every trader know the secret but just simply unable execute it consistently, that is "cut your losses fast and ride your profit", so simple, found in every trading book, yet so difficult to master.

Profit to date is S$11,419.00. Holding long 3 Topix/Nikkei spread position.

I have not perform up to expectation, much to catch up.

Saturday, June 20, 2009


"There are two ways to live your life. One is as though nothing is a miracle. The other is as though everything is a miracle" - Albert Einstein

Have been rather busy lately helping to set up an organisation, "Association of Financial and Commodity Traders" (AFACT), objective is to have a common goal of representing the interests of the members basically from the financial trading communities.

The 12 committee members including myself put in plenty of hard work, meetings, bargaining for benefits from SGX, planning social activities and rolling out mentor and educational programmes for the members. It's really a thankless job and I wish to emphasize that the committee members are not paid for taking time away from their trading and burning some weekends.

I would like to say a big thank you to my younger brother, Alastiar (AIM) who has put in tremendous amount of time in helping out with the creation of the website despite his busy schedule.

The committee members are happy and are prepared to sacrifice their time to work for the benefits of the trading communities. The biggest obstacle is funding and of course members need to pay to join the Association for the cost of running it, that's where the unhappiness and scepticism arises especially from traders who feels they do not benefit from joining.

"Whatever you do is none of my business, don't get me involve", sounds familiar, for those who feels they don't gain anything from joining and "why should they contribute?"

"We do not see things as they are; we see things as we are" - Talmud

We have to thank SGX for the support and seed capital to set up the Association. SGX has also send their staffs to help us in the planning and organising for the launching of AFACT. Besides that, after some tough negotiation, SGX has agreed to the scratch trade rebates for the Nikkei and Taiwan contracts for a minimum of 2 months without condition and monthly review after that. At least we get something from the goodwill with SGX.

I am glad the majority of traders are generous with their words of encouragement and appreciative of the hard work put in by the committee members. The world will be a much better place to live in with more of these gracious people around.

"The only ones among you will be really happy are those who will have sought and found how to serve" - Albert Schweitzer

We are still building the website at

More traders are feeling the heat as volume keep sliding with smaller trading range, many complained that trading is tough. So, when is trading not tough? It's just a market cycle, in order to survive, traders need to adapt to the ever changing environment.

Profit to date is S$11,218.00 with 1 long Topix/Nikkei spread position. Still very cautious with taking more risky trade.

Saturday, June 13, 2009


"Young men speak of the future because they have no past but old men speak of the past because they have no future" - from the cartoon Pickles in the Sunday Times.

"Just because you're an old guy, you don't have to sit around drooling in the corner. Get out and do something" - Bush senior turns skydiver again on 85th birthday.

Caught up with some ex-floor traders trading from home at the town hall meeting for traders last night. Many complained that trading has been very tough recently with falling volume and reduce interest. I agreed with them wholeheartedly and noted their frustration that echoes the similar sentiments of many traders at the trading arcade too.

Yes, the cake is getting smaller and the best survive. Traders are getting more sophisticated, investors getting more knowledgeable and fools losing their fortunes. Are old traders having no future? No!!! There is a old Chinese saying "ginger grow hotter with age", old men like us are more experienced, no doubt about it, so "try me".

I asked those traders who were still struggling very bluntly, "what is your monthly expectation?" Their expectation ranged from S$3,000/- to S$10,000/- a month and they would be very happy. For $10,000/- divided by 22 trading days is $455/- a day, that's about 13 Nikkei tics, 23 Simsci tics or 32 Taiwan tics. Is it difficult to achieve this target consistently on a daily basis?

Why not? I have been able to achieve the monthly target of S$10,000 consistently, of course with some days that I lose money while I make more on other days to cover up. The secret to my success is to trade small, very small to eliminate the fear of losing, with a small daily target, it is much easier to achieve on a consistent manner. That's money management.

For taking such small risk, I have to work much longer hours to wait patiently for the "YUM" trades such as market orders or stop loss orders. I can only do so with a fast, stable trading platform, good Internet speed and support which only the trading arcade can provide. That's my competitive edge that suits my trading strategies.

There are also many successful traders operating from home, they have also found their edge using strategies that suits their personality and risk tolerance.

We need to be flexible to be a successful trader, when the market condition does not allow us to trade bigger volume, reduce the size of the trading. Lower down the expectation, the market will roar again one day and be ready and prepared to seize the opportunity.

Profit to date is S$7,391, not much improvement from a month ago. Still holding long 4 Topix/Nikkei spread position, will accumulate more positions if it goes down further.

Sunday, June 7, 2009


"When you are young, you do a lot of stupid things you don't quite comprehend. It's fun, you do, you don't think about the outcome" - Edison Chen on his sex photo scandal.

Yes we have done many silly things in our younger days especially taking risk in doing things that we would frown on in our old age. We are out to prove our worthiness and courage ignoring the serious consequences of our action. "You can do anything, but don't get caught", this phrase is too familiar to the NS (National Service) men in the olden days.

When I first started out as a floor trader, there were numerous time that I nearly busted my account with the "big" positions that I traded relative to my capital outlay. As the Chinese saying goes "don't know how to write the word Die". I was reckless and have taken ridiculous risk in my young days. I have to thank my lucky star to have survive so many close call, or else I would have been out of this business long ago.

It took me a long and painful one year to break even as a floor trader. I have been told many times by other traders "pay to learn", ya, I understand, no lesson in life is free. But, how long do I have to endure? There were many times that I wanted to give up when my account was left with only 10% of the original capital outlay of S$30,000.00.

Where can I go with just a "A" level qualification? How can I compete with those Diploma and Degree holders?

I can't think of any job except being a trader at the Exchange floor that offer me equal opportunity to compete with the brightest. I am neither smart nor having a high IQ, with just average academic performance, I have been offered an opportunity to make it in life. I am really thankful for that.

It's the determination and hard work that pull me through. Learning the lessons of not doing too many "stupid things" in trading is vital to the success of a new trader. I always advise new traders to trade small so that they don't have to pay too much in their learning phase. Learn how to crawl, then walk before attempt to run.

Profit to date take a step back at S$6,426.00. I have added another Topix/Nikkei spread increasing to holding 4 open position. Auto legging using the Pats system platform is giving me some headache with it's unreliable fill, the slippage is frustrating.

Saturday, June 6, 2009

"DARK" pools of liquidity

"A prudent question is one-half of wisdom" - Francis Bacon

Came across an article in the ST about this "Dark" pools of liquidity now in Asia, this is something really new to me.

Anonymous or "dark" pools of liquidity have extended their operations beyond the United States, and are now operating in Asian markets, particularly in Singapore, Hong Kong and Japan.

Dark pools are private networks that operate away from traditional exchange houses, offering investors anonymity. They are used by institutional investors to trade large quantities of shares, without moving the market in a big way such block trades usually do.

Examples include Liquidnet, the largest independent operator of dark pools in the United States, which has operations in Asia; and BlocSec, which is part of CLSA Asia-Pacific markets.

One question that come to my mind is the source of funding from these "Anonymous" investors. Are they dirty money that "cannot see daylight"? How these investors acquired their wealth? Are they using "dark" pool for money laundering? How are they regulated? Their money muscle could be partially responsible for the recent stock market rally. I hope to be enlighten.

With the demise of many Hedge Funds, we are seeing something new now coming out from the United States. Americans are really ingenious in coming out with new ideas to beat the system.

Thursday, June 4, 2009

Life Challenges

Smooth roads never make good drivers;

Smooth sea never make good sailors;

Clear skies never make good pilots;

Hassle-free life never makes a person strong;

Be strong enough to accept the challenges of Life.

Don't ask Life "Why Me" Instead say "Try Me"