"It has been said that Democracy is the worst form of government except all the others that have been tried." - Winston Churchill
Just received this email joke, would like to dedicated to my dear friend Coconut in this quiet market.
A peasant was overseeing his herd of animals in the last family farm in Singapore when suddenly a brand new BMW advanced out of the dust cloud towards him.
The driver, a young man in a Armani Suit, Gucci Shoes, Ray Ban sunglasses and YSL tie, leans ou the window and asks the peasant, "If I tell you exactly how many sows and piglets you have in your herd, will you give me a piglet?".
The peasant looks at the man, obviously a Yuppie, then looks at his peacefully grazing herd and calmly answers, "Sure, why not?".
The Yuppie parks his car, whips out his Dell notebook computer, connects it to his RAZR V3 cell phone, and surfs to a NASA page on the Internet, where he calls up a GPS satellite to get an exact fix on his location which he then feeds to another NASA satellite that scans the area in an ultra-high-resolution photo.
The young man then opens the digital photo in Adobe Photoshop and exports it to an image processing facility in Hamburg, Germany. Within seconds, he receives an email on his Palm Pilot that the image has been processed and the data stored. He than accesses a MS-SQL database through an ODBC connected Excel spreadsheet with email on his Blackberry and, after a few minutes, receives a response.
Finally, he prints out a full colour, 150 page report on his hi-tech, miniaturized HP LaserJet printer and turns to the peasant, "You have exactly 986 pigs and piglets."
"That's right. Well, I guess you can take on of my piglets." replied the peasant.
He watches the young man select one of the animal and looks on amused as the young man stuffs it into the trunk of his car.
Then the peasant says to the young man, "Hey, if I can tell you exactly what your business is, will you give me back my piglet?"
The young man thinks about it for a second and then says, "Okay, why not?"
"You're a MP for the PAP", says the peasant
"Wow! That's correct," says the Yuppie, "but how did you guess that?"
"No guessing required." answered the peasant. "You showed up here even though nobody called you; you want to get paid inspite of the your million dollar salary for an answer I already knew, to a question I never asked. You tried o show me how much smarter than me you are; and you don't know a thing about pigs... this is a herd of goats... Now, give me back my dog."
Thursday, December 30, 2010
Tuesday, December 28, 2010
Position Trading
I have set up another account for one of my trader to do position trading beginning next year. It's another challenge again, not by me but an experience trader who is keen to test his trading skill on a part time basis, while continue doing his day trading.
He can trade any contract when the opportunity arises, no pressure to perform, I'm just curious to see how he will grow and how we can learn from him (if he makes money). He is a stake holder with 50% share in funding the account.
Position traders don't trade daily and might hold on to a position for days or weeks. Can these traders make money? Can he survive and make enough to feed his family? Are most position traders doing it part-time just for the extra money?
I think you have to be rich to do position trading. Stock traders are mostly position traders, can only buy and hold. And for those doing contra trading, most will be digging their own grave, because the comm will kill them over time. But, luckily the comm has now come down tremendously, so they can survive a little longer.
Most of the professional traders are all doing day trading, scalping or spreading to make a living. They are all hardworking, discipline and focus in what they are doing, every second, every minute. It's not a easy life, when you are in, you will realise how tough it is. The competitiion is stiff, it's a negative, negative sum game.
He can trade any contract when the opportunity arises, no pressure to perform, I'm just curious to see how he will grow and how we can learn from him (if he makes money). He is a stake holder with 50% share in funding the account.
Position traders don't trade daily and might hold on to a position for days or weeks. Can these traders make money? Can he survive and make enough to feed his family? Are most position traders doing it part-time just for the extra money?
I think you have to be rich to do position trading. Stock traders are mostly position traders, can only buy and hold. And for those doing contra trading, most will be digging their own grave, because the comm will kill them over time. But, luckily the comm has now come down tremendously, so they can survive a little longer.
Most of the professional traders are all doing day trading, scalping or spreading to make a living. They are all hardworking, discipline and focus in what they are doing, every second, every minute. It's not a easy life, when you are in, you will realise how tough it is. The competitiion is stiff, it's a negative, negative sum game.
Saturday, December 25, 2010
Merry Christmas!
Merry Christmas to all.
I have decided to return here to post my blog.
It's been a long break from writing, what else can I share about trading?
"Top performers spend more hours rigorously praticing their craft" - David Brooks
I have visited Shanghai recently with my brother and brother-in-law to find out more about the potential of the Chinese Futures market. Though the market is closed to foreigners, many are using relatives or friends there to open account for trading the futures market. There are many loopholes for doing business in China, just find it.
There are some local traders who are already there after the launch of the Shanghai Index, CSI300 contract, it's a new frontier, new opportunities for those who are willing to take the risk.
For experienced traders like us, it's much easier for us to find the edge especially with no Algos present there as yet.
The margin for trading is extremely high compared to other Exchanges, I was told that minimum opening account is RMB 500,000/- and that allow only 2 open contracts of the CSI300. The comm is high too and these measures are to discourage excessive speculation.
There is a limit of putting 500 contract orders (need to verify) for any given day, so that fake orders will be eliminated, getting rid of those big bullies unless it's geniune order. I think this is very good so that traders cannot manipulate the market by creating a false impression of huge orders coming in but disappear immediately.
It's a much level playing field for all traders if everybody will to pay the same clearing fees unlike Exchanges that offer huge volume rebates to high frequency traders.
One of the challenges trading in China is obviously the language, the platforms are mostly in Mandarin and offer only 1 price level. The maximum is up to depth of 5 levels and need to pay extra for that feature. There is no ladder which we can click with the mouse to enter orders. The traders there use the keyboard to enter into a position which they demonstrate how fast they can execute an order. Still slow compared to our platform.
We met up with an investor who offered us capital to station in china to trade the various Chinese products. They expect high returns and are willing to take high risk as well. There are plenty of rich Chinese now who have made a lot of money in all sorts of speculation, especially property. They are talking about doubling their money every 2/3 years.
I told him I'm sorry, I can't promise him those type of returns, I'm in the business of risk management, not excessive speculation. He can find someone who can promise such high returns by just throwing a stone in Shanghai, plenty of them, but promise and actual performance is two different matter and how long can that trader last.
My brother is willing to take up the challenge if the fund is at least S$10 million to fully concentrate on trading or else it's not worth his effort. He is comfortable now, in fact one of the most consistently profitable trader, just a few losing days this year, a very good track record. What a change from a year ago when I was so worried for him not making it as a trader. He is a mature trader now but trading for someone else is a different ball game again.
I have decided to return here to post my blog.
It's been a long break from writing, what else can I share about trading?
"Top performers spend more hours rigorously praticing their craft" - David Brooks
I have visited Shanghai recently with my brother and brother-in-law to find out more about the potential of the Chinese Futures market. Though the market is closed to foreigners, many are using relatives or friends there to open account for trading the futures market. There are many loopholes for doing business in China, just find it.
There are some local traders who are already there after the launch of the Shanghai Index, CSI300 contract, it's a new frontier, new opportunities for those who are willing to take the risk.
For experienced traders like us, it's much easier for us to find the edge especially with no Algos present there as yet.
The margin for trading is extremely high compared to other Exchanges, I was told that minimum opening account is RMB 500,000/- and that allow only 2 open contracts of the CSI300. The comm is high too and these measures are to discourage excessive speculation.
There is a limit of putting 500 contract orders (need to verify) for any given day, so that fake orders will be eliminated, getting rid of those big bullies unless it's geniune order. I think this is very good so that traders cannot manipulate the market by creating a false impression of huge orders coming in but disappear immediately.
It's a much level playing field for all traders if everybody will to pay the same clearing fees unlike Exchanges that offer huge volume rebates to high frequency traders.
One of the challenges trading in China is obviously the language, the platforms are mostly in Mandarin and offer only 1 price level. The maximum is up to depth of 5 levels and need to pay extra for that feature. There is no ladder which we can click with the mouse to enter orders. The traders there use the keyboard to enter into a position which they demonstrate how fast they can execute an order. Still slow compared to our platform.
We met up with an investor who offered us capital to station in china to trade the various Chinese products. They expect high returns and are willing to take high risk as well. There are plenty of rich Chinese now who have made a lot of money in all sorts of speculation, especially property. They are talking about doubling their money every 2/3 years.
I told him I'm sorry, I can't promise him those type of returns, I'm in the business of risk management, not excessive speculation. He can find someone who can promise such high returns by just throwing a stone in Shanghai, plenty of them, but promise and actual performance is two different matter and how long can that trader last.
My brother is willing to take up the challenge if the fund is at least S$10 million to fully concentrate on trading or else it's not worth his effort. He is comfortable now, in fact one of the most consistently profitable trader, just a few losing days this year, a very good track record. What a change from a year ago when I was so worried for him not making it as a trader. He is a mature trader now but trading for someone else is a different ball game again.
Tuesday, March 30, 2010
Migration
Attended a course on blogging over the weekend, spending 2 long days learning from an expert that's half my age. Just like trading, it won't be easy, there are so many new things to learn, the tricks and the shortcuts that's equivalent to the Yums in trading.
It's worth every cent if you are going into blogging for a living, shortening the learning curve, saving precious time. I'm still uncertain how to go forward from here especially with my busy schedule, being only just a weekend blogger.
In the past I have experienced my blog post being block for unknown reasons, probably over some sensitive issues I might have written. Whatever I have written in blogspot don't belongs to me, thus I have decided to migrate to www.fat88trader.com and pay a yearly hosting fee.
I would like to thank all my readers and please visit me at my new website.
It's worth every cent if you are going into blogging for a living, shortening the learning curve, saving precious time. I'm still uncertain how to go forward from here especially with my busy schedule, being only just a weekend blogger.
In the past I have experienced my blog post being block for unknown reasons, probably over some sensitive issues I might have written. Whatever I have written in blogspot don't belongs to me, thus I have decided to migrate to www.fat88trader.com and pay a yearly hosting fee.
I would like to thank all my readers and please visit me at my new website.
Saturday, March 20, 2010
Dreams
"You know what, it doesn't matter if you're big or small, you've got to believe in yourself, believe you can do it and you've got to be able to dream the big dream." - Mr. Teo Ser Luck, Singapore's Senior Parliamentary Secretary for Community Development, Youth and Sports. Few thought it possible that tiny Singapore would win the rights to host the first Youth Olympic Games.
So, what's your dream?
Most traders have big dream when they first started out but somehow or rather, after a few months they ended up having nightmares instead. Dream is the driving force for anyone who aspire to achieve a goal that might seem impossible and full of obstacles.
I would suggest new traders to have smaller dreams instead in the beginning while working hard towards that big dream. Nothing comes easy and there's no free lunch.
Successful traders not only need to work hard, they need to work smart as well. They need to know when is the right time to trade and the right size to trade.
My new batch of students were very realistic when I asked them about their expectation, most had some experiences trading in stocks or Forex, having attended other courses and know how difficult it is to be a successful trader. They just wanted to learn how to survive and make a decent living.
It's an eye opener for them to see and learn how a real trader trades live in front of them. It's no doubt really stressful for me. I justify each of my trade with an explanation, the mistakes I made and the various emotions expressed especially the frustration when the trade goes against me. Most were stunt to see how I cut losses with such ease, something that is so difficult for them to do so.
I'm glad and happy to enlighten them on their new journey in life as most have quit their job to be full time traders. Their success will make my hard work worthwhile. I hope to guide them towards the big dream I have achieved long time ago.
So, what's your dream?
Most traders have big dream when they first started out but somehow or rather, after a few months they ended up having nightmares instead. Dream is the driving force for anyone who aspire to achieve a goal that might seem impossible and full of obstacles.
I would suggest new traders to have smaller dreams instead in the beginning while working hard towards that big dream. Nothing comes easy and there's no free lunch.
Successful traders not only need to work hard, they need to work smart as well. They need to know when is the right time to trade and the right size to trade.
My new batch of students were very realistic when I asked them about their expectation, most had some experiences trading in stocks or Forex, having attended other courses and know how difficult it is to be a successful trader. They just wanted to learn how to survive and make a decent living.
It's an eye opener for them to see and learn how a real trader trades live in front of them. It's no doubt really stressful for me. I justify each of my trade with an explanation, the mistakes I made and the various emotions expressed especially the frustration when the trade goes against me. Most were stunt to see how I cut losses with such ease, something that is so difficult for them to do so.
I'm glad and happy to enlighten them on their new journey in life as most have quit their job to be full time traders. Their success will make my hard work worthwhile. I hope to guide them towards the big dream I have achieved long time ago.
Saturday, March 13, 2010
Cutting losses and riding profits
Which is easier to execute, cutting losses or riding profits?
A simple question that traders should ask themselves to determine the trading style that suits them. Long term position trader FSK revealed that it's difficult for him to cut losses but it's so easy for him to ride profits. He can hold a position for months and even years to ride the long term trend until there is a U-turn sign. There is almost no cut loss level for him, he invest in a few countries that offer the best returns through his proprietary formula.
As a scalper, it's the total opposite, it's so difficult for me to ride a profit and I won't be making money if I don't cut my losses fast. And for those who find it difficult to execute both, will find themselves struggling to survive in this very competitive game.
A simple question that traders should ask themselves to determine the trading style that suits them. Long term position trader FSK revealed that it's difficult for him to cut losses but it's so easy for him to ride profits. He can hold a position for months and even years to ride the long term trend until there is a U-turn sign. There is almost no cut loss level for him, he invest in a few countries that offer the best returns through his proprietary formula.
As a scalper, it's the total opposite, it's so difficult for me to ride a profit and I won't be making money if I don't cut my losses fast. And for those who find it difficult to execute both, will find themselves struggling to survive in this very competitive game.
Saturday, March 6, 2010
How long it take to learn?
"Learning is not attained by chance, it must be sought for with ardor and attended to with diligence." - Abigail Adams
I have been asked frequently by the newbies how long will it take for them to learn how to trade and start making money. It's a question that is rather difficult to give a correct answer. It depends on the individual.
Everyone is born differently, some are fortunate enough to be bestowed with higher IQ, smarter and more intelligent while others are handsome and beautiful. I realised from young that God is never fair because I had to study very hard yet my academic performance was something I have never been proud of while one of my classmate breezed through so effortlessly with all the As. He was smart, the only one in our class that went to RI and studied overseas with government scholarship.
Nothing in life is fair, being average, I just have to work harder to catch up with those more intelligent who are miles ahead. I'm a slow learner, I take longer to learn anything, I try avoiding anything complicated and look for simple solutions. I know my limited ability and weaknesses, thus trading is the simplest business for me, just 2 decisions, either buy or sell, then take profit, scratch or cut loss.
There are so many things to learn in trading , I believe smart people will learn faster in using the trading platform, the different functionality in enhancing trading, charting, analysing the market and forecasting.
But, apart from learning the basic, trading involves emotions, focus, guts, hard work and passion, that's where the playing field becomes more level. There are many smart people who failed to trade successfully, they think too much and worry too much.
Those who are very successful and make tons of money in trading have a very common trait, they have guts. They dare to bet big once they believe the odds is in their favour. They take calculated risk which differentiate them from a gambler.
My father, a vehicle mechanic told me that he worked many years as a apprentice in a small workshop with no proper training, paid pittance and did all the dirty work. He learnt from stealing glances and assisting the mechanic in the repair job, pure hard work.
Trading is so much easier, there are so many books written on the subject and one can simply borrow them from the public library, learn from the Internet or attend the various courses available to shorten the learning curve.
So, how long it take to learn? A few months will do to learn the basic but to start making money, it might take longer to gain the experience, from constantly learning from the same mistakes repeated again and again daily.
No joke, this is what's happening to most newbies, they just freeze holding a bad position praying that it will come back to their level and get out once they have a small profit. One of my student just did that despite my repeated exhortation to cut the losses fast, he averaged further and happily told me later that he finally made a profit from turning the losses to profit. When will he learn?
After the trading floor closed in 2005, it took me more than 2 years to get back on my feet, to focus and concentrate on trading before finally seeing the light. Many of my fellow floor traders were making good money during this period of time because they were smart to stay in the trading arcade with fast trading platform and Internet speed.
Being a scalper and spreader my whole trading career, it took me just one month to realise my edge, "speed" when I went back to the arcade to trade. My brother-in-law who struggled trading from home joined me in the arcade later and was profitable immediately. He couldn't afford to lose. My younger brother, the smartest in the family and a former floor trader took a year to start making consistent money.
It's a matter of time that a passionate trader who persevere starts to mature by gaining the experiences through daily engaging the market, learning from past mistakes, understand the nature of the market and finally self discovery.
I have been asked frequently by the newbies how long will it take for them to learn how to trade and start making money. It's a question that is rather difficult to give a correct answer. It depends on the individual.
Everyone is born differently, some are fortunate enough to be bestowed with higher IQ, smarter and more intelligent while others are handsome and beautiful. I realised from young that God is never fair because I had to study very hard yet my academic performance was something I have never been proud of while one of my classmate breezed through so effortlessly with all the As. He was smart, the only one in our class that went to RI and studied overseas with government scholarship.
Nothing in life is fair, being average, I just have to work harder to catch up with those more intelligent who are miles ahead. I'm a slow learner, I take longer to learn anything, I try avoiding anything complicated and look for simple solutions. I know my limited ability and weaknesses, thus trading is the simplest business for me, just 2 decisions, either buy or sell, then take profit, scratch or cut loss.
There are so many things to learn in trading , I believe smart people will learn faster in using the trading platform, the different functionality in enhancing trading, charting, analysing the market and forecasting.
But, apart from learning the basic, trading involves emotions, focus, guts, hard work and passion, that's where the playing field becomes more level. There are many smart people who failed to trade successfully, they think too much and worry too much.
Those who are very successful and make tons of money in trading have a very common trait, they have guts. They dare to bet big once they believe the odds is in their favour. They take calculated risk which differentiate them from a gambler.
My father, a vehicle mechanic told me that he worked many years as a apprentice in a small workshop with no proper training, paid pittance and did all the dirty work. He learnt from stealing glances and assisting the mechanic in the repair job, pure hard work.
Trading is so much easier, there are so many books written on the subject and one can simply borrow them from the public library, learn from the Internet or attend the various courses available to shorten the learning curve.
So, how long it take to learn? A few months will do to learn the basic but to start making money, it might take longer to gain the experience, from constantly learning from the same mistakes repeated again and again daily.
No joke, this is what's happening to most newbies, they just freeze holding a bad position praying that it will come back to their level and get out once they have a small profit. One of my student just did that despite my repeated exhortation to cut the losses fast, he averaged further and happily told me later that he finally made a profit from turning the losses to profit. When will he learn?
After the trading floor closed in 2005, it took me more than 2 years to get back on my feet, to focus and concentrate on trading before finally seeing the light. Many of my fellow floor traders were making good money during this period of time because they were smart to stay in the trading arcade with fast trading platform and Internet speed.
Being a scalper and spreader my whole trading career, it took me just one month to realise my edge, "speed" when I went back to the arcade to trade. My brother-in-law who struggled trading from home joined me in the arcade later and was profitable immediately. He couldn't afford to lose. My younger brother, the smartest in the family and a former floor trader took a year to start making consistent money.
It's a matter of time that a passionate trader who persevere starts to mature by gaining the experiences through daily engaging the market, learning from past mistakes, understand the nature of the market and finally self discovery.
Subscribe to:
Posts (Atom)