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Issingaporean LV
发表于 31-10-2009 16:12:07
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Hi Issingaporean,
Thanks a lot for your wonderful article.
May I ask you a few questions?
sysg 发表于 30/10/2009 14:28 
Answers to your questions. A combination of the following based on my (experimental) short-term trades :
1. Yes and No. I do look at their numbers, but I don't go deeper than that. Take for example I go for the following,
a. RSI - below 30% is oversold, and above 70% is overbought. I will try to avoid stocks above 60%.
b. MACD Histogram which represents the distance between the MACD Line and Signal Line is in the declining negative values. What it means is the MACD Line is below the Signal Line but is converging upwards making attempts to cross above the Signal. As I mentioned before, proper way is to wait for MACD to cross Signal. It's a matter of risk appetite and personal preference.
c. 20-day Average Traded Value. I prefer above $500k but never below $300k, because my trade values for most counters are between $6k-$9k unless the stock price is above $9. It should be at least 50 times your intended trade-value. You do not want to get stuck with a stock unable to sell it because there are few buyers. Incidentally, the optimal trade-value is $9k based on a 0.28% brokerage & other fees.
d. How many most recent Volume is above the 20-day Moving Average Volume. This represents amount of recent investors' interest in this stock. Price will not move unless there are investors' interest, right? Don't forget Volume picking up can also be due to negative reasons.
e. Of course my favorite Candlestick formations. It's really not easy. You notice the formation, you go back to the book to confirm on the formation. You look at other indicators and they say "yes". You buy, but it doesn't go up as predicted. Worse, it goes down. So? Activate your Stop-loss order, be it 5% or 10%.
2. This is a question for the Wealth Management consultants or Investment consultants. As an ordinary guy, I can only use common sense to make some suggestions. It depends on your:
a. Age. Younger people can afford higher risk, because after a fall you can still pick yourself up and continue the fight. Older people can get 'paralysed' for life after a fall.
b. Income. With higher income, your most basic & lifestyle needs are mostly satisfied. The remaining money, you can strike a balance between bank savings & investments. What proportion depends on your risk appetite. (i) Do you have to worry about your job? Retrenchment? (ii) Do you have a dependant family: spouse, children and parents? (iii) How about commitments like housing & car loans? Planning to get married?
3. I don't have special preferences on Sectors for both Long & Short-term trades. However, for short-term trades, I do consider advice given in Analyst reports. Long-term investment is actually quite immune to Sector performance. I pick the companies I have confidence in (criterion mentioned in my original post), and thereafter I don't quite look at them except the following:
a. Bad news about the company I bought. If so, better verify the news as soom as possible before it is too late. Meanwhile observe the prices, and take appropriate action.
b. Broad market condition, local & world economy. I don't quite bother about market corrections. That's the beauty of Long-term. But I am worried about 'bubble bursting' or 'market collapsing', becasue the STI may go back several years within a very short period.
4. I can't tell which company will outperform another. You can read Analyst reports. Sometimes they put up such comparison. Hey, you must have forgotten I had a big, big disaster with short-term trades. As for long-term, who can make a judgement on outperformance.
5. Again, I do not have the expertise to predict growth rate for 2009 or 2010. I don't make a living from trades. I wrote to share my past experiences because I don't like to see 'Lemmings' committing suicides.
As for Long-term appreciation, I can show you my purchase & sale of UOB in 2 cycles:
Bought in July-2002 $13.07
Sold in May-2007 $23.30
Capital appreciation $10.23 = 78.27% of original investment
Dividends received $4.18
Total gains $14.41 = 110.25% of original investment
This is about 16% compounded over 5 years.
Bought back between
Nov2008 and Mar2009 (average) $10.57
Price on 30Oct2009 $17.08
Capital appreciation $6.51 = 61.59% of original investment
Dividends received $0.60
Total gains $7.11 = 67.27% of original investment
This is 67% over 1 year.
Can you imagine if I have bought UOB @ $3.30 in the down-turn in 1998? One property counter I bought in the first cycle appreciated 227% in capital. However, I must warn again that whatever you do, you are taking some form of risks.
Well, different people has different risk & target appetite. As for me, that's good enough.
The money is yours. Invest with care!!!:sleepy: |
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