Money management and risks.

For profitable contra trades ,a good money management strategy,cut loss policy and when to buy and sell is 

a must.Lets say you have a working capital of 100,000 (or credit facility),how do you maximise your profits

and minimise your risks.Spread your risks by dividing your capital by five if you are trading five counters....

Example:

1) First counter you make 5%

2) Second counter you lose 3%

3) Third counter you lose 2%

4) Fourth counter you make 4%

5) Fifth counter you make 5%



Nett gain is 9%

20,000( 100,000/5 counters) x 9% gives you 1,800

 1,800 x 3 =5,400/per mth (12 to 16 contra trades are done per month.)

For those with working capital of 20,000/30,000/50,000/150,000/200,000 ,please allocate the money accordingly( per counter).

P/S......The above is just a hypothetical example...

Hope the above is helpful to my *Contra Trade Member's Group*.

The above is just *My Trade Plan*.If you have a better plan that gives you good profits,stick to it.

My *December contra trades* will be revised to the above format. 

The 4 Stock Market Stages.

Learn the 4 Stock Market Stages That Every Trader Should Know

To trade stocks successfully, you must first understand the four stock market stages that individual stocks and the overall market go through. These cycles tell you if you should be long, short or in cash.
Once you are able to identify what stage it is in, you can then trade accordingly to those characteristics.
After a while you won't even have to think about whether you should be long or short. You will know, without question, exactly what you should be doing NOW. You will either be focusing on long positions, short positions, or you will stay safely in cash - just by glancing at a chart!
Here are the four stages that stocks go through. This happens in all time frames whether it is a monthly chart, weekly chart, daily chart, or an intraday chart.

Ok, so I'm not the best artist in the world but I think it will serve our purpose here! What? You thought it would be more complicated that? My philosophy on the stock market is that if it is too complicated then it is just not worth doing. Now, we'll look at the characteristics of the four stock market stages. I promise it will be painless!

Stage one

Stage 1 is the stage right after a prolonged downtrend. This stock has been going down but now it is starting to trade sideways forming a base. The sellers who once had the upper hand are now beginning to lose their power because of the buyers starting to get more aggressive. The stock just drifts sideways without a clear trend. Everyone hates this stock!

Stage two

Finally stocks break out into Stage 2 and begins the uptrend. Oh, the glory of stage 2!! Sometimes I have dreams of stocks in Stage 2! This is where the majority of the money is made in the stock market. But here is the funny thing: No one believes the rally! That's right, everyone still hates the stock. The fundamentals are bad, the outlook is negative, etc. But professional traders know better. They are accumulating shares and getting ready to dump it off to those getting in late. This sets up stage 3.

Stage three

Finally, after the glorious advance of stage 2, the stock begins to trade sideways again and starts to "churn". Novice traders are just now getting in! This stage is very similar to stage 1. Buyers and sellers move into equilibrium again and the stock just drifts along. It is now ready to begin the next stage.

Stage four

This is the dreaded downtrend for those that are long this stock. But, you know what the funny thing is? You guessed it. Nobody believes the downtrend! The fundamentals are probably still very good and everyone still loves this stock. They think the downtrend is just a "correction". Wrong! They hold and hold and hold, hoping it will reverse back up again. They probably bought at the end of Stage 2 or during Stage 3. Sorry, you lose. Checkmate!
Here is an example:
Stock market stages occur in all time frames on every chart you look at. This could be a five minute chart of Microsoft or a weekly chart of the Dow.
Generally, you want to stay in cash when a stock (or the market itself) is chopping around in a stage one. In stage two you will want to be aggressively focusing on long positions. In stage three you want to be in cash. In stage four you want to be aggressively focusing on short positions.

Reading Chart.

Someone ask me  how I read the chart.


10 Person looking at the same chart,would have come up with 10 different opinion.

For newbies a chart is just a chart.                                                                                                        

For those with experiences,they know that all the informations and all the insider moves

are there, before being make known to the public but there is more...........

A picture speaks a thousand words.But the chart can be painted..... by those who wants

you to believe what you see.For those with well trained eyes and experiences,they

are able to see through this *trap*.

It takes years to really learnt.... how to master the art of chart reading if you are learning

from the school of hard knocks.Basic TA is a *must*for those who wants to know

more about the share market.

For me ,I am able to see more things from the chart and able to anticipate the next

moves, to make more profitable trades.

It takes a lot of financial power to move the market.See how I predicted with deadly

accuracy on the FBMKLCI. ( refer to all my postings on it ).


( Just my thoughts )

The Rules Of 72.

How to makes your *Money* grows more .....

Example :

1) Putting money into FD ( says 4% a year ).

    Using the *Rules of 72*,your money will double up in 18 years.
    
     72 divide by 4% ( a year ) = 18 years.

2) Putting money into share investment,with a return of  8% a month.

    Using the *Rules of 72*,see what happens.....

     72 divide by 8% a mth.  = 9 mths. to double up.


It is obvious from the above that share investments will give you a better returns.

And not forgetting investing in properties also gives you good returns.

To be successful in trading shares,you needs to know the market well.You are

up against the *smartest and experienced*who think of ways and means to take

money away from you.You needs to have good knowledge (FA or TA),years

of experiences and a consistent winning strategy and not forgetting a lot of hard

works to achieve your dream of making more money.Trading in shares like

running your own business will more than often helps you to make the right decision.

Highlight: No sabotage/error in Friday’s trades, says Kenanga source

Highlight: No sabotage/error in Friday’s trades, says Kenanga source

MY SPECULATIVE Observations.

This morning all the 6 counters which limit down on Friday reverse back to

almost near the previous prices.


My Observations.

Counter         Price      On Friday                                             Today( price)  Vol. done
                                    (approximated vol.done @ )

1) Bjtoto       3.20        50000                                                   4.16               17923

2) Bkawan   13.46        2240                                                    17.48              6

3) Cbip         1.93         6200                                                    2.50               15582

4) Coastal     1.48        41150                                                  1.92                10392

5) Tdm          2.90        21730                                                  3.77                119

6) Hsplant     1.89        55180                                                   0                     0


Remarks

1) Powerful invisible hand at work.

2) Selling from right hand to left hand and making huge profits....

3) More upward prices action are expected from now......

4) The program buying /selling is well executed on Friday before closing time

    is to prevent interference....



( Just my 1 cent opinion )

NO UMA issued for----Bjtoto,Bkawan,,Cbip,Coastal,Hsplant,Tdm,Jcy,Star.


LIMIT DOWN .

1) Bjtoto

2) Bkawan

3) Cbip

4) Coastal

5) Hsplant

6) Tdm


LIMIT UP.

1)Jcy

2)Star


Bursa have confirmed trades are valid and genuine.There is no reversing to

the original price come this Monday.


THINGS TO PONDER

1) Some said the above are done through "Married Deals".

    What are "Married Deals"???

    Married Deals are off market deals agreeable between an Institution Buyer and Seller

    over a block of shares at a fixed price.

2) Why would the SELLER sell to the BUYER at such a low price???( 30% discount ).

    A smart SELLER would sell to the current market and get a better price.

    All the above 6, are fundamentally strong counters. 

3) Why would the BUYER acquired the counters( Jcy,Star ) at such a high

    price from the SELLER?.He could get it much cheaper from the current market.

4) Why all the Trades are done 10 mins before closing time???Why not earlier???


MY ANALYSIS.( Just my 1 cent opinion ).

I have detected Programme Buying/Selling on the above 8 counters.

Hundreds of trade done with different volumes on the above counters

over a short period of 2 seconds.It is manually impossible to key

in such a large orders.

WHAT WOULD HAPPEN ??? ( Just my 1 cent opinion ).

Come next week, I am expecting the counters to be goreng up....

( To buy or not....the decision and risks are yours.....)



Just a note.

What a coincident, Jcy ( my runaway train ) is running faster now.....

see if you can catch it...( And again ,all my private blog members

are laughing all the way to the.........BANK.  )