The Financial Association of Singapore (FPAS) announced they are going to launch a online dictionary that aims to shed light on the notorious jargon that so annoys investors. It will give consumers a better understanding of financial products so they can make informed investment decisions. It seek to explain in clear, layman's language, what financial terms actually mean, in order to remove any ambiguity. Don't know when it will be ready.
I came across an interesting advice on decoding fund brochures by a reformed broker, Joshua M Brown at http://thereformedbroker.com/2009/12/14/decoding-fund-brochures/
Fund Brochure Says and What it really means ..
Ultra - Leverage to the Hilt
Global - We"ll chase stocks for you whichever country is most overheated right now.
Clean/Green - A basket of government-subsidized experiments and some shares of G.E.
Deep Value - We will invest in sewing machines and typewriter companies.
Premium - We Will pay up for high-multiple stocks/ you pay up in fees.
Socially Responsible - No such thing - all corporations are evil, sucker.
Diversified - We will basically buy the Index and go golfing.
Enhanced - Uses exotic derivatives you've never heard of.
Balanced - We will under perform both the bond and the stock market. You're welcome.
Aggressive Growth - Collection of Chinese online gaming stocks and New Jersey Bio tech start ups.
Lifecycle - We can see 20 years into the future only Putman knows when and how you will die.
Moderate Allocation - Gutless Fund Manager.
Quantitative - Manager will take credit for Up years, blame computers for Down years.
Endeavour/Opportunities - We will throw darts.
Core - No need to speed it out, send us everything you have.
Sunday, February 28, 2010
Sunday, February 21, 2010
Casino
"If you must play, decide upon three things at the start: the rules of the game, the stakes, and the quitting time" - Chinese Proverb
Singapore's first Casino, Resort World Sentosa opened with a bang on the 14th February, the first day of the Lunar New Year. 149,000 visited the Casino in the first week, despite Singaporeans and permanent residents having to pay $100 a day (24 hours) entrance fee.
A fellow trader went there with his wife on the first 3 days of opening, being regulars on the cruise ship, they paid $2,000 per annum entrance fee each since they will be spending plenty of time at the casino. After 3 days of trying their luck, they were $1,000 poorer. They loved the atmosphere and the Casino loved them too!
He revealed that it's hard for anyone to make money from the Casino over time with the odds highly in favour of the house. It's just plain common sense to me. He like many other futures traders loses big time in the Casino. His wife picked up the gambling habit from him and is now seen frequently at the Casino while he needed to be there to keep an eye on her. He hardly gamble now unless it's between friends.
This trader friend is a very good gambler and he started young, he is good at any form of gambling. I knew him in the early 90s in the mess where a few fellow traders would be there almost everyday to have a game of "Majong" after the Nikkei closed at 2.15 pm. When we were short of a player, he would be invited to join us, always available, jobless. He gambled for a living after leaving the stock broking industry a few years back.
He joined us as a futures trader after we introduced him to our profession of having so much free time at our disposal. He started out trading the Nikkei and was losing money in the first few months. He would asked me to help him out by transferring money to his trading account before the end of the month to show his wife that he was making money while paying me back in cash.
Very sharp and alert, he learnt fast and within 6 months, he started to make money in futures trading. He succeeded partly because of the gambling blood in him. Unfortunately, he contributed back quite a fair sum over the years to the Casino.
I never like to gamble in the Casino because of the odds, why should I when there is a better edge in futures trading. I go there just to have some fun and entertainment.
Singapore's first Casino, Resort World Sentosa opened with a bang on the 14th February, the first day of the Lunar New Year. 149,000 visited the Casino in the first week, despite Singaporeans and permanent residents having to pay $100 a day (24 hours) entrance fee.
A fellow trader went there with his wife on the first 3 days of opening, being regulars on the cruise ship, they paid $2,000 per annum entrance fee each since they will be spending plenty of time at the casino. After 3 days of trying their luck, they were $1,000 poorer. They loved the atmosphere and the Casino loved them too!
He revealed that it's hard for anyone to make money from the Casino over time with the odds highly in favour of the house. It's just plain common sense to me. He like many other futures traders loses big time in the Casino. His wife picked up the gambling habit from him and is now seen frequently at the Casino while he needed to be there to keep an eye on her. He hardly gamble now unless it's between friends.
This trader friend is a very good gambler and he started young, he is good at any form of gambling. I knew him in the early 90s in the mess where a few fellow traders would be there almost everyday to have a game of "Majong" after the Nikkei closed at 2.15 pm. When we were short of a player, he would be invited to join us, always available, jobless. He gambled for a living after leaving the stock broking industry a few years back.
He joined us as a futures trader after we introduced him to our profession of having so much free time at our disposal. He started out trading the Nikkei and was losing money in the first few months. He would asked me to help him out by transferring money to his trading account before the end of the month to show his wife that he was making money while paying me back in cash.
Very sharp and alert, he learnt fast and within 6 months, he started to make money in futures trading. He succeeded partly because of the gambling blood in him. Unfortunately, he contributed back quite a fair sum over the years to the Casino.
I never like to gamble in the Casino because of the odds, why should I when there is a better edge in futures trading. I go there just to have some fun and entertainment.
Thursday, February 18, 2010
Coming Back
"If you don't like something, change it. If you can't change it, change your attitude" - Gail Sheehy
A friend called to wish me Happy New Year, a former floor trader, he quited trading after the floor closed in 2005. He is a good sportsman, coaches kids tennis and golf before joining a golf club as a manager.
I was relieved that he is doing OK and not asking me for a loan, I really have a phobia of casual friends calling me out of the blue.
The workload in his current job is killing him. He needs to ensure everything is alright before the first flight and run smoothly till end of the day. That's almost 12 to 15 hours everyday except for a weekday off. He is paid about S$5,000/- a month, a sum that a foreign worker will be more than willing to take up.
In his late 40s, he would like to spend more quality time with his family and with age catching up, he might not have the energy to put up with such hectic schedule.
Since he is spending so much time and energy in his current job, he felt instead, he should channel them back into trading for a living, something he had done before. The time is flexible.
He called 2 other friends who are currently trading and both advised him not to give up his current job as trading is very "tough" now. I wondered why these 2 traders didn't quit trading, of course, I believe they had good intention.
He asked how my second brother is doing now, they were once tennis buddies. I told him my brother struggled for 1 year before finding his niche trading in the afternoon session. That's how long it took him, a seasoned floor trader, it's definitely tough but he is currently very comfortable.
As usual, I asked him what was his expectation. He hoped to at least match his current income. I'm surprised that many of the former floor traders didn't have great expectation, they were realistic and aimed for something achievable, low risk.
I analysed his situation and finally asked him whether he can survived without income for a year with his wife being a homemaker. He pondered for a moment and told me he needed to do some calculation but expressed his intention to make a come back.
I guided him on the various procedures to become a member of SGX, trading platforms and charting providers. He requested to visit me at the arcade to see how I trade once he is ready. That's definitely not a problem, I'm willing to help.
A friend called to wish me Happy New Year, a former floor trader, he quited trading after the floor closed in 2005. He is a good sportsman, coaches kids tennis and golf before joining a golf club as a manager.
I was relieved that he is doing OK and not asking me for a loan, I really have a phobia of casual friends calling me out of the blue.
The workload in his current job is killing him. He needs to ensure everything is alright before the first flight and run smoothly till end of the day. That's almost 12 to 15 hours everyday except for a weekday off. He is paid about S$5,000/- a month, a sum that a foreign worker will be more than willing to take up.
In his late 40s, he would like to spend more quality time with his family and with age catching up, he might not have the energy to put up with such hectic schedule.
Since he is spending so much time and energy in his current job, he felt instead, he should channel them back into trading for a living, something he had done before. The time is flexible.
He called 2 other friends who are currently trading and both advised him not to give up his current job as trading is very "tough" now. I wondered why these 2 traders didn't quit trading, of course, I believe they had good intention.
He asked how my second brother is doing now, they were once tennis buddies. I told him my brother struggled for 1 year before finding his niche trading in the afternoon session. That's how long it took him, a seasoned floor trader, it's definitely tough but he is currently very comfortable.
As usual, I asked him what was his expectation. He hoped to at least match his current income. I'm surprised that many of the former floor traders didn't have great expectation, they were realistic and aimed for something achievable, low risk.
I analysed his situation and finally asked him whether he can survived without income for a year with his wife being a homemaker. He pondered for a moment and told me he needed to do some calculation but expressed his intention to make a come back.
I guided him on the various procedures to become a member of SGX, trading platforms and charting providers. He requested to visit me at the arcade to see how I trade once he is ready. That's definitely not a problem, I'm willing to help.
Sunday, February 14, 2010
Friends
"A friend in need, is a friend indeed" - English proverb.
I learnt this proverb in my primary school days, we were taught to help our friends in need and those who help us are really the good friends we need to treasure.
A friend called me last week out of the blue to have lunch with me. We updated each other about our family members and finally he asked me for a favour in a very nice way, to borrow money from me.
He used to be my booth clerk and I have supported him in his career advancement in the past. He SMS me very year to wish me happy birthday as most in the service industries do. He is hardworking and did well in his career.
I sympathised with him when he started pouring out his recent problems and needed money to tight over for a year. Should I?
I have lent money to many friends in the past, from a few thousands to a few hundred thousands. More than 90% of these "friends" never return back the money to me, some disappeared from the radar, totally lost!
I have to sue a friend in High court not too long ago for the return of money loaned to him many years ago. He fought back and claimed that the money was loaned to his company instead. With all the evidence I won the case, he then declared bankrupt. He had transferred money to his wife, still driving a car, eating out at resturants, staying in a terrace house and travelling freely to Johor, Malaysia to conduct his businesses.
This guy had cheated me and a few friends in various business ventures, we lost big time. I can only curse and swear inside my heart and wonder why this guy is not being punish by GOD! or Buddha! or Allah! for his misdeeds. He is a con man and has cheated many.
I'm sick of calling those friends who owed me money, many can afford to pay me by instalments but most just give excuses.
I have many regrets in my life but I'm not going to let it ruin me, I just hope to share my experiences to understand what is "friends", "close friends" and "intimate friends" before extending that helping hand. It's a blessing to be able to help.
For the first day of the Lunar New Year, I shouldn't be writing about all these unhappy incidents.
I would like to wish all my readers a very Happy and Prosperous Tiger Year!
I learnt this proverb in my primary school days, we were taught to help our friends in need and those who help us are really the good friends we need to treasure.
A friend called me last week out of the blue to have lunch with me. We updated each other about our family members and finally he asked me for a favour in a very nice way, to borrow money from me.
He used to be my booth clerk and I have supported him in his career advancement in the past. He SMS me very year to wish me happy birthday as most in the service industries do. He is hardworking and did well in his career.
I sympathised with him when he started pouring out his recent problems and needed money to tight over for a year. Should I?
I have lent money to many friends in the past, from a few thousands to a few hundred thousands. More than 90% of these "friends" never return back the money to me, some disappeared from the radar, totally lost!
I have to sue a friend in High court not too long ago for the return of money loaned to him many years ago. He fought back and claimed that the money was loaned to his company instead. With all the evidence I won the case, he then declared bankrupt. He had transferred money to his wife, still driving a car, eating out at resturants, staying in a terrace house and travelling freely to Johor, Malaysia to conduct his businesses.
This guy had cheated me and a few friends in various business ventures, we lost big time. I can only curse and swear inside my heart and wonder why this guy is not being punish by GOD! or Buddha! or Allah! for his misdeeds. He is a con man and has cheated many.
I'm sick of calling those friends who owed me money, many can afford to pay me by instalments but most just give excuses.
I have many regrets in my life but I'm not going to let it ruin me, I just hope to share my experiences to understand what is "friends", "close friends" and "intimate friends" before extending that helping hand. It's a blessing to be able to help.
For the first day of the Lunar New Year, I shouldn't be writing about all these unhappy incidents.
I would like to wish all my readers a very Happy and Prosperous Tiger Year!
Sunday, February 7, 2010
Algo Trading?
Attended a one day course on Algo trading yesterday sponsored by SGX, the trainers from RTS were knowledgeable and proficient in their craft. We were introduced to the many strategies that can be written for Algo trading. I just wonder why don't they write some strategies to trade themselves?
"Things do not change, we change"
I have been using a simple standard spread Algo strategy with the TT trading platform for my Topix/Nikkei spread trading. I gave the Auto spreader a 1 tick discretion and many times I was filled just 1 tick away which cost me about S$70/- per lot which can be quite costly for bigger quantity traded. I suppose there are more powerful machines and faster platforms out there that squeezed me.
Should I go for the more powerful RTS Tango platform for Algo Trading? One big problem is Phillip Futures don't support the RTS platform because it's rather expensive, not many traders can afford a near US10,000 a month fee. AFACT and SGX are negotiating with RTS for a lower fee for members who are keen to try out the Algo strategies and subsidising part of the Tango platform fees.
To keep the cost down for this learning period, it would be good for like minded traders who are keen on Algo trading to team up. I'm all for it. I would also like to explore the possibility of using simple trading strategies for Algo trading on the TT trading platform.
"Things do not change, we change"
I have been using a simple standard spread Algo strategy with the TT trading platform for my Topix/Nikkei spread trading. I gave the Auto spreader a 1 tick discretion and many times I was filled just 1 tick away which cost me about S$70/- per lot which can be quite costly for bigger quantity traded. I suppose there are more powerful machines and faster platforms out there that squeezed me.
Should I go for the more powerful RTS Tango platform for Algo Trading? One big problem is Phillip Futures don't support the RTS platform because it's rather expensive, not many traders can afford a near US10,000 a month fee. AFACT and SGX are negotiating with RTS for a lower fee for members who are keen to try out the Algo strategies and subsidising part of the Tango platform fees.
To keep the cost down for this learning period, it would be good for like minded traders who are keen on Algo trading to team up. I'm all for it. I would also like to explore the possibility of using simple trading strategies for Algo trading on the TT trading platform.
Saturday, January 30, 2010
Fear and Fearless
"Nothing in life is to be feared. It is only to be understood" - Marie Curie.
The week has been good for most Equity futures traders with the increase in volume and volatility.
Had a chat with a fellow trader after the market closed yesterday and was sad to learn that he was not doing well since the close of the trading floor. That's almost 4 years ago and yet he is still very persistent. He confessed that fear have overtaken him now with his dismal performance despite being hardworking and trying his best.
Another trader who overheard our conversation, suggested that to overcome this demon "fear", he should try bungee jumping. Will it help in overcoming the fear in trading? I doubt so.
The definition of fear is a feeling of anxiety and agitation caused by presence or nearness of danger, evil, pain, etc. So, what's the danger and pain in trading? It's not life threatening and this feeling of pain is all about losing money.
I explained to him that fear existed in him because he is not sure about his strategies, he don't know his edge and he is simply gambling without the trading skill. This skill can be acquired through learning, that's best cure for fear of trading.
At the arcade, there is another trader who is fearless and he specialises in trading the Nikkei. This trader sometimes scalps up to 5,000 contracts a day holding position size from 20 to 50 lots, his P/L a day is my monthly target. I respect this guy for his guts though I'm not too sure whether he is such a good trader. His commission alone is close to S$10,000. Being an old bird, I certainly hope that he can survive in the long run.
I have my fear too, I trade small relative to my margin, I am now a Kiasi and Kiasu trader taking minimum risk now compared to my younger days. I just want to be consistent in my trading making small amount of money almost everyday with no stress, enjoy trading and the challenge of beating the market.
My cousin had the best performing week since joining me, it's really a great boost to his confidence though he still has a long way to go, he is still fragile. Being new to the industry, his performance is up to expectation, he is keen, willing to learn and most important, hard working.
I once told him that in order to succeed, he need to cast other things aside, just talk, think, read, focus and dream about trading everyday. He is getting better by the day with the constant drilling of having a strong and positive mental attitude.
I have a new trader who joined me this month, he approached me a few months back and after a short interview, I decided to take him in as my trader. He was a stock broker for a short period of time. Young and energetic, he is full of vigour and enthusiasm with a happy deposition. I figure it would be much easier to coach him with his financial background.
His performance for the first month is way beyond my expectation. He is a smart chap and learns very fast. With proper guidance and grooming, I believe he has the potential to be a great trader.
The week has been good for most Equity futures traders with the increase in volume and volatility.
Had a chat with a fellow trader after the market closed yesterday and was sad to learn that he was not doing well since the close of the trading floor. That's almost 4 years ago and yet he is still very persistent. He confessed that fear have overtaken him now with his dismal performance despite being hardworking and trying his best.
Another trader who overheard our conversation, suggested that to overcome this demon "fear", he should try bungee jumping. Will it help in overcoming the fear in trading? I doubt so.
The definition of fear is a feeling of anxiety and agitation caused by presence or nearness of danger, evil, pain, etc. So, what's the danger and pain in trading? It's not life threatening and this feeling of pain is all about losing money.
I explained to him that fear existed in him because he is not sure about his strategies, he don't know his edge and he is simply gambling without the trading skill. This skill can be acquired through learning, that's best cure for fear of trading.
At the arcade, there is another trader who is fearless and he specialises in trading the Nikkei. This trader sometimes scalps up to 5,000 contracts a day holding position size from 20 to 50 lots, his P/L a day is my monthly target. I respect this guy for his guts though I'm not too sure whether he is such a good trader. His commission alone is close to S$10,000. Being an old bird, I certainly hope that he can survive in the long run.
I have my fear too, I trade small relative to my margin, I am now a Kiasi and Kiasu trader taking minimum risk now compared to my younger days. I just want to be consistent in my trading making small amount of money almost everyday with no stress, enjoy trading and the challenge of beating the market.
My cousin had the best performing week since joining me, it's really a great boost to his confidence though he still has a long way to go, he is still fragile. Being new to the industry, his performance is up to expectation, he is keen, willing to learn and most important, hard working.
I once told him that in order to succeed, he need to cast other things aside, just talk, think, read, focus and dream about trading everyday. He is getting better by the day with the constant drilling of having a strong and positive mental attitude.
I have a new trader who joined me this month, he approached me a few months back and after a short interview, I decided to take him in as my trader. He was a stock broker for a short period of time. Young and energetic, he is full of vigour and enthusiasm with a happy deposition. I figure it would be much easier to coach him with his financial background.
His performance for the first month is way beyond my expectation. He is a smart chap and learns very fast. With proper guidance and grooming, I believe he has the potential to be a great trader.
Sunday, January 24, 2010
Correction?
"The entire essence of America is the hope to first make money - then make money with money - then make lots of money with lots of money" - Paul Erdman. Hello! how about the risk?
Finally, a long overdue correction for the world's equity market. President Barack Obama is making the right decision in announcing a new plan to limit the bank's size in nipping the problem of "too big to fail" financial firms that might engage in reckless behaviour.
President Obama wants to limit the scope of risk-taking by barring banks with federally insured deposits from trading securities for their own accounts and from owning hedge funds and private equity funds.
I certainly hope that he can succeed in pushing through those reforms and curb the excessive bonuses paid to those greedy bankers that nearly cause the collapse of the global financial system.
How far will the market correct? 10 to 20 percent would be ideal which should offer traders like us more opportunities from the increase market volatility.
Finally, a long overdue correction for the world's equity market. President Barack Obama is making the right decision in announcing a new plan to limit the bank's size in nipping the problem of "too big to fail" financial firms that might engage in reckless behaviour.
President Obama wants to limit the scope of risk-taking by barring banks with federally insured deposits from trading securities for their own accounts and from owning hedge funds and private equity funds.
I certainly hope that he can succeed in pushing through those reforms and curb the excessive bonuses paid to those greedy bankers that nearly cause the collapse of the global financial system.
How far will the market correct? 10 to 20 percent would be ideal which should offer traders like us more opportunities from the increase market volatility.
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