Aspellian's Garden

[Aspellian]

Wonder how deep is the correction or this is the last of the final dip?

i have friends who start to feel the pinch that their stocks are way off the highs in mid Jan 2010.. but most are still sitting on gains (or slight losses), some are considering to average down (or have done so), especially when RSI are at all time low (of individual stocks) and they believe it will always bounce back up.

me? tempted (short moment) to buy cos certain stocks went up on high vol 2 days back... but realise one shouldnt trade against the market... see what happen today. but of cos probably by end of today, STI will close above and be positive again.

Have to remind myself not to go against the market, not to time the market by going in and out but just bet on general trend through FA (short or long) and TA (entry point).

[millionairemind]

Wonder how deep is the correction or this is the last of the final dip?

i have friends who start to feel the pinch that their stocks are way off the highs in mid Jan 2010.. but most are still sitting on gains (or slight losses), some are considering to average down (or have done so), especially when RSI are at all time low (of individual stocks) and they believe it will always bounce back up.

Can't tell la.. but I don't think this thing is going to end anytime soon

Your friends' reaction is VERY normal after a prolonged uptrend. It takes a bit of time for ppe. to adjust from buying on dip mentality and average down mentality to PURE HORROR AND MKT CAN GO DOWN SO MUCH!!! mentality

The issue in Europe might spark a run on the Euro, possibly tearing it apart. USD is strengthening as a result, possibly unwinding the carry trade in double quick time.

Maybe this time around, instead of Asian currency crisis, we will see an Euro Crisis???

Just sit tight and watch the show.. more pain is at hand

[Aspellian]

Hi MM,

thanks for your inputs. For the first time, i am really so glad that I am into cash before the bloodbath begins.

there are at times doubts of the many "IF ONLY" i know CANSLIM earlier, but i shall look forward to the future.
but if i never go to A&E because of backside burnt, i may never know CANSLIM....

now to improve on other aspects of trading... especially emotional controls.

I must remind myself to stay on the sidelines (not be tempted to catch falling knife) and be humble.

[Musicwhiz]

Oops, I am not into cash during this bloodbath.

But I do have some cash to deploy lah. Problem is I cannot seem to deploy into the companies I like.

[Aspellian]

Let's gaze into the wonderful crystal ball and do some (always perfect 20/20 vision) hindsight analysis on what I can do better of recent trades:

1) I overtrade. getting in and out of positions. take small profits, cut losses, overall lose. (compounded because of brokerage fees - like what MW's words of wisdom - "Brokerage fees are like sandpaper that grinds away at your capital!"

2) I tried to trade too many instruments
- i thought i know market trends, so i tried options, i tried CFD index and all ganna burnt by market's volatility!!
i haven even master equities and i thought i can fly... dream with your feet on the ground, please.

3) I remembered my best trades were when i buy growth stocks (based on FA) sat on my winning stocks patiently before i take profits. My core skills are FA - so i should just throw myself and do more fundamental analysis. Stick to your core competencies!!!

4) Never trade against the market trends - i was greedy and thought i can profit from both sides of trades - haha!! must remind myself that gold do not grow on trees...

5) Control emotions - be it fear, greed, ignorance and hope - its always battling against each other. The carnal man is your most enemy. Renew your mind.

6) Have a plan before each trade - have cut loss and profit targets. stick to your plan.

7) Have a list of shorts and longs for each situation (still not streamlined -things are everywhere)

8) always think ahead, do not anticipate but have a plan for most situations - forces you to think more...

9) i dun think enough.......

[Musicwhiz]

Aspellian,

Good sharing, thank you!

Emotion control is always important. I practise a lot of it - steel myself to be totally unmoved by any changes in market price. When I first started in 2005, I panicked when prices dropped 5%. These days I don't feel much, and control my thoughts better. What matters, after all, is the company, not the market - to me at least.

And you are very candid with your mistakes, which is good!

One thing though - sometimes over-analysis is also just as bad as insufficient analysis. Call it "Analysis Paralysis". if you will. haha

[b0rderc0llie]

I've been waiting for "pure horror and market can go down so much" for a very long time already. Still have not seen it yet...

[cif5000]

My core skills are FA - so i should just throw myself and do more fundamental analysis.

IMO and I am in no position to judge, you are probably one of the best I have encountered in doing FA. You looked at the tangibles and intangibles, quantitative and qualitative, inside and outside the box. Able to string up seemingly unrelated facts and make sense of something. Honestly, your thoughts and analyses are something I look forward to read. Hope this doesn't give you too much high. A raw and unpolished diamond that is intrinsically worth a few carats.

Ok, let's get back to gardening and my rearing of chicken.

[lithium]

Many FA guys gets angry when traders trade their stocks.

Do you guys have the same experience?

Why is that?

[millionairemind]

Many FA guys gets angry when traders trade their stocks.

Do you guys have the same experience?

Why is that?

Its OK la.... most of them want to be like what WB says "don't care if the stock market closes down for 10 yrs" yada yada yada...

Everyone has their own method to make money in the mkt.

I have a trader friend who moves about 600-800K of stocks EVERY DAY. He is an intraday trader and is pretty good at it. I am NOT him. When he makes 3K a day, he tells me and I congratulate him but I don't want that kind of stress

Its traders like him and you that add liquidity to the market. If everyone buys and hold, the Singapore mkt would be a DEAD market