invest? whats that?

most of us are unaware. but if we do not make our money work harder, they would eventually decay and succumb to the effects of inflation. when we talk about working harder, investments would be the natural course of action. however, many are unsure of how to go about investing their money, let alone classify and identify the risks of investing. those who are aware may be wondering: when is the right time to invest?

let me help you guys out. there are many ways to invest, and many sectors to invest in. think of it as a vehicle that brings you from point A to point B. the vehicle you choose determines how you are going to get to your eventual destinations.

high risk investments can be seen as a car strapped with rockets. or maybe a motorcycle. fast and can eventually lead you beyond your destination. the speed at which you reach your destination is in relation to the investment returns you are getting. of course, a car strapped with rockets isn't the safest form of vehicle you would want to ride on. furthermore, it may crash, and hence need some repairs (costs or losses) before being able to proceed an reach an eventual destination.

low risk investments are the opposite, and well, should be self explanatory.

of course you wont say "i want to invest in a rocket car", but you might say "i want to invest in an aggressive fund that carries a high weightage of equities and derivatives". the choice is yours.

now many people ask me about the right time to invest. honestly speaking, there's is no 'right time' to invest. investments ought to be viewed as a long term commitment that when you eventually foresee that you may need to cash in your investments, you have a significant amount of gains.

some may ask whether now is a good time to invest. i say why not. warren buffet may say why not. if you go to the jewellery shop one day and you find that the diamond rings go for one dollar a piece, would you tell yourself that you'd buy it another day because the valuation of diamond rings are so bad now you want to wait for the price to go up to maybe $100 then you buy them? well to put it simply, buy when something is cheap and wait for its value to appreciate, rather then miss out on the opportunity that lies ahead.

for more info, i'll be more than happy to share.

this week's TA

i know its abit late but i didn't really have over the weekends to do my analysis. i just had too much fun :)

anyways something different this week, i'll be focusing on 2 indices which i trade on, STI and HSI.

today STI opened 50 points higher, but slowly declined as the trades goes on. last week's trading session saw great movements and volatility within the day, gapping up and down and ranging over 50 points on certain days. one thing to note, because of the recent turmoil in the financial markets, the indices tend to follow suit. thursday and friday saw a slight correction after the 3 day slump, thanks to the US Federal Reserves. good thing for me, this would hopefully give the index some momentum to carry on moving downwards.

looking at RSI, it shows a divergence, having a slight downwards slope at the end of the trading week (even though there was a huge correction), stochastics are moving out of the oversold regions after crossing signal and MACD can't really show me anything clear cut yet.

my opinion on the movement this week: if the index today doesn't manage to sustain a positive movement, the trading week may be bearish. looking at the divergence from RSI, the index doesn't seem to have the momentum for a bullish move, hence, expect the bear to come this week.

now for our favourite index: HSI. same thing as STI, the index opened higher than friday's close, but moved downwards as the trading session moved on. last week, the index had huge movements, its 5 day EMA moving further downwards from its 10 day EMA, but the correction on thursday and friday gave the index some momentum to carry its move downwards this week.

stochastics are moving out of the oversold regions, while RSI is slightly positive in terms of gradient. and again, MACD can't really tell me anything much right now as i can't relate them to the previous 2 indicators.

since today seems bearish for the index, and if it manages to stay in the red, the week's outlook may be bearish, continuing its momentum from last week's session.

well, that's all folks. i'm still abit sleepy, if anything don't make sense, please comment. thank you!

back bear back

finally back after a long reprieve. gosh school is such a boring place because of the assignments and tests. if there were no assignments nor tests, i'd definitely enjoy going to school.

lets look at some short term technical outlook for this week. the past week had seen the market being trampled on by the bear due to various economic and environmental reasons. what's in store for this week? we'll just have to wait and see. but before we wait, we shall analyse the market's current direction and project next week's movement. ready? lets go.

for the case of SGX, i doubt next week's picture would be a pretty one unless something happens along the way which may change its course of direction. current stochastics shows a negative picture, indicating further downward movements while RSI remains below the 40% mark. MACD is already almost cutting the signal line (or has it already had a piece of the cake?) and is showing that yes down is the way to go. a technical picture from the charts shows that a support of 5.50 is likely after friday's close of 5.95. this would all depend on tomorrow. a negative session might carry the momentum further downwards through the week.

next up, Capitaland. current indicators show that it would be a good to short. with stochastics cutting the signal line negatively and RSI levels looms just above the 20% mark, the prices are weak. MACD is painting a sell portrait while it starts to cut the signal line again. a 3.80 may be calling? we'll just have to wait and see. technical charts shows that it may enter a short term consolidation before carrying on its momentum. moving down is the most likely option for the prices after the near term consolidation but the already weak prices may get hit even harder.

HSI has been pretty powerful these few days with its huge movements into the red. RSI is showing a slight diversion, making the near term outlook harder to foresee. however, sticking to current indicators, the downtrend is already present. stochastics and MACD are showing a likelihood of carrying the index downwards for the week. the index may consolidate tomorrow, but a sustained open below 20,000 would indicate the rather obvious.

STI took a hard hit as most of the companies took a blow. moving down 3%-4% over the past week is a huge feat, making me wonder where it would fit in on monday. in terms of a technical picture, indicators show signs of a continued downtrend even if it opens above friday's close. support at 2,600? indeed it was supposed to be but friday's session brought it a tad prematurely. if the movement sustains below this support level, then we could see a continuation of the trend for the week or so.

well thats all for me, my eyes are dead with the lack of sleep. enjoy the market week ahead and have an eventful trading session!

worry now or worry later?

where will you be 10 years from now? highly successful businessman? top remisier? world class hedge fund manager? a housewife? engineer, technician or architect? whatever your job may be, you would definitely be doing something to pass your time. however, from now till then, what will you be doing as you carry out your daily activities?

let me present you with some food for thought. how is your marriage going to be like? would you like to live in your dream house or just a simple 3 room flat? would you like to have a child, or a soccer team?

the needs are non-exhaustive. we all want things that we don't have, and yet, when the time comes for us to obtain our needs, we are set back by our budget constraint. the world, is made of money. all green and crumpled. money makes the world go round, and so does our head.

imagine ten years from now, you start to think back to the day when you should've start managing your finances well, instead of splurging on your LV bag or that zara tanktop. and what you have now, is practically nothing. you can't afford your dream house, you can't start a family and you are unable to sustain your desired standard of living.

the above scenario isn't made up. in fact, many singaporeans are facing the problem of having insufficient funds to sustain their standard of living. but wait! how come people still drive luxury cars, go shopping every weekends and dine in expensive restaurants? all this is possible to mr mastercard and mr amex. these 2 baddies put our poor souls in debt, by making it look as if we are in control. think again, it is not you who control the line of credit, but the line of credit controls you.

how do they make it affordable? simple. it is all in the "minimum sum". pay $100 a month for 3 years and you'd probably end up paying $1,000 more than what you purchased for. and well, that $1,000 in the future is definitely worth more today because of inflation.

too much to handle? well it is. the only way to get out of the rat race is to beat the credit demon, and manage your finances well. save for the rainy day even though the rainy day may not come. leverage your funds through investment vehicles to make your money work harder for you. protect your future income against uncertainty or risks. and once you are out of the rat race, you would naturally have a peace of mind for the rest of your life.

worry now or worry later? i say, worry only for today, and do something about it tomorrow so you won't have to worry anymore.

technical analysis

time again for another round of analysis. this would serve as a continuation of last week's analysis. let's first look at SGX's performance.

the stock closed in on friday at 6.68, just as i thought it would. the week saw a downtrending trading session, from 6.92 down to 6.68. currently the market may show a sign of a temporary recovery as H1 earnings are going to be reported (even though the earnings may be below expectations, an slightly higher than what was negatively expected could trigger a hiccup).

as we can see from this stock, share prices have been on a steady decline without any stoppages for consolidation or a correction, hence, most people would expect a slight correction coming up soon. however, in my opinion, since the market is still relatively quite, the steady downtrend is just an indication of how weak and 'lifeless' the market is and as far as anticipating a correction, i'm not too sure.

currently stochastics are still hovering in the oversold regions, where the last 2 trading days pushed the stochastics above the signal line with a green trading session. now with this, i would refer to RSI readings, but at the moment, the momentum of the stock is still weak, and i would need a convincing move above the 30% or 50% mark spark a long signal. as far as the MACD goes, i can't really get a clear indication from the readings as of late. however, if upcoming trading sessions shows a positive divergence, then i better keep my eyes peeled for an upturn.

my verdict: next week looks rather uncertain. i'm not sure whether there would be an upwards correction of the prices, but from the looks of it, prices may continue to fall. here are 2 scenarios. first, if share prices presents a lower open, and ends the day in the red, then just be prepared for a steady downtrend. second, if prices open higher and ends the day in the green, then keep eyes peeled for a correction. however, in my opinion, if prices continue to fall, it may fall down to the 6.50 level, where it should nestle and find strong support.

Capitaland shocked me with a rebound over the last 3 days of the week, closing on friday at 5.79 from a low of 5.57 on tuesday. i guess my verdict on the stock fell short on wednesday when the share prices shot upwards. i believe that it was a much needed correction before prices can continue downwards.

as it stands, stochastics shot way above the signal line and has cut above the 50% mark, a potentially good long signal. however, i would wait for my RSI reading to cross above the 50% mark before going long (currently just hovering below the halfway mark). the positive divergence on the low closing of 27th june and 1st july may have sparked the 3 day uptrend during the week. however, looking at the current readings, a sustained move above the signal line may indicate further uptrending for days to come.

personally i am still rather bearish about this stock at the moment, but something tells me to shed the bear skin and put the bull horns on. so far i have arrived at a number of conclusions regarding this stock.

my verdict: currently, it is the end of the downtrend (for the moment) and i would advise others to wait till the dust cloud settles and a clear trend presents itself before jumping on the bandwagon. a higher open tomorrow with a close in the green may signal an upward move. if the prices were to move upwards, i'd probably give an estimate of about 0.30 to 0.40 depending on market sentiments. it may move up to its resistance at about 6.20 and may drop back down to 5.70 mark. and when this happen, try and watch out for a reverse HNS. if tomorrow's session presents a lower open and ends off in the red, then be cautious over the next couple of days to establish a clear direction. i believe that the 5.50 level is still open for testing if the momentum carries the stock downwards. as of now, i won't be surprised if the prices were to move up for the next couple of days.

that's all folks, has been a busy week so far. enjoy and have a good trading week.

technical analysis for this week

wow the week has passed in such a short amount of time. and it is finally time for the euro 2008 finals. sadly, i'm not your punter so i won't be talking about odds, but let's assess my two favourite stocks and see how they would perform this coming week.

currently as it is, share prices for SGX closed in at 6.92, 0.08 below my defined support at 7.00. the week's session saw a general decline as volume of trading remains relatively low. as a result, the stock hasn't been very volatile in the current down market, but the positive thing about that is that the direction is certain, and so far it has been a clear downtrend for weeks.

as it stands, conditions for SGX are similar this week as it is to last week, however, the support at 7.00 may require a little bit of testing. RSI showing a negative momentum, and coupled with stochastics crawling in the oversold regions, seem to indicate a further downtrend in the next week or two. however, a couple of scenarios may likely emerge. firstly, monday's session may see an upside gap back above support levels (if 7.00 seem to prove to be quite a support) and that the trading session for the day would end in the red. secondly, the downtrend would most likely continue and keep heading down, down and down.

my verdict: if prices open up above 6.92 on monday, watch for price actions and get a sense of where the market stands with the stock. if there's a huge selling pressure, then by all means go long on your puts or short the stock. for those not really apt with market sentiments, a close below 6.92, or even below 7.00 may give the same signal. and well if there's a huge selling pressure and the market opened lower than 6.92, what are you waiting for?

as for Capitaland, the situation remains similar to that of last week's trade. for those with an eye for charts, currently, the share prices are at the consolidation phase, and there's a slight positive divergence that can be seen from the past 2 weeks. i emphasise, very slight. i can't really tell whether it'll prove to be any form of reversal signal, but my best guess is a definite NO.

as what was quoted last week, the stock didn't have enough downward momentum to carry it lower to the 5.50 levels. however, now it becomes even clearer to me because of the consolidation phase it is currently in. if so, the next week may see a continuation, mainly because stochastics are pointing down and RSI isn't really pointing very much upwards. it is somewhat likely that prices may fluctuate upwards, up to the 5.70 levels, however, a breakout would be needed and that would come from a lower open on monday. and in my honest opinion, the only way for the prices is down.

my verdict: a lower open would signal a breakout, and a close in the red, a confirmation. need i say more? go long on puts, or short the stock.

that's all folks, and well all i can tell you is that it is possible to make money from both of these stocks now. hope you guys make lots this week to come.

happy trading!

money money money

money makes the world go round. and round, and round and round. money goes around the world too, at exceptionally high speeds that we, as consumers, simply love to ignore.

in a recent article on business times, it was quoted that there was about 77,000 high net worth (HNW) citizens in singapore. high net worth would mean that he or she has at least S$1,000,000 (that's one million for those who are bad with numbers) in liquid assets. liquid assets would generally mean basic cash in savings account, or even holding in equities, bonds and other financial instruments. wow. amazing isn't it.

then we look even further back in time and we can see how inflation rates within the country skyrocketed, reaching as high as 7.5%. and currently, the rates doesn't seem to be heading lower.

as compared to our regional neighbours, we have to thank the strength of our singapore dollar against others. despite such trying times, our currency value remains strong and there wasn't a very significant tumble.

with such major problems bogging us from all around us, how can we afford to spend so much and have so little? then it that case should we save too much and spend too little? how do we preserve the value of our money?

so let us talk about savings. now any tom, dick and harry should be familiar with how the bank works. put money with them and the money will grow. wow, grow, but by how much? now any tom, dick and harry won't realise that interest rates being paid out by banks are pathetic in combating the inflation. at an interest rate of 0.25%, you are below inflation by 7.25%! wait hang on, what is inflation?

lets look at it this way, just to put it simply. say you have one dollar today, and inflation rates are at 10%. say you tell yourself that you are going to put this dollar and bury it in your flower pot for a year, hoping a money tree will come out. then a year later, you take our the coin, but instead of a money tree, you have deposits of rust on the coin. bravo.

then, you take your dollar coin to the provision shop downstairs and you think that you might want to have a bottled soft drink since you have been hibernating for a whole year, together with your dollar. so you asked the store owner "hello uncle, this bottle of 100Plus costs one dollar right?" however, to your horror, the owner gives you an icy glare and says "ONE DOLLAR TEN CENTS!" and with that you go "WHAT THE FUDGE?!"

the above scenario, though may be somewhat inaccurate, shows the effects of inflation. as the value of money drops due to inflation, the dollar in the future may only cost 90 cents today. and to keep pace with inflation, prices of everyday things go up.

now what? how can we ensure our money don't grow mushrooms, but instead, grow more money. the answer is simple, but yet most people choose not to even give it a thought because they feel that the future is risky and uncertain. (well even any brain dead guy on the street knows that so what makes you think you are special?)

investment opportunities gives you the ability to keep pace with inflation, and at the same time, grow your money. the earlier you invest, the more money you will have in the future. this is simple math: compounding interest. a sound investment allows for a person to effectively grow his money over long periods of time, and hence when the future arrives at his or her doorsteps, he or she will have much more than what was being put in. a theoretical figure would be an investment of $4,000 per annum at a return rate of 7%-8% annually. in about 40 years, say when you retire, you'd probably be joining the high net worth people.

however, with returns comes risks as well. the thought of risk put many people off, because most of us live in fantasy-land where we think low risk can generate high returns. boys and girls, time to wake up ok? the risks involved in investments can be properly managed, and minimised through various means. hence, an investment portfolio usually has risk management systems to allow for investors to sleep with a sound mind and a clean smelling pillow at night.

at such times, the banks, are just like a safe box. spiders live in safe boxes. so start your investments early. for more information regarding investment opportunities, strategies and products, my msn channels are open.

technical analysis for this week

since i'm still currently being bogged down by tonnes of work and studies, i can't seem to find time to trade as of yet. but rest assure, i'll continue during the next week if the market permits, and at the same time, share my trading strategies as well as my profits and losses.

this time round, i'll give a more comprehensive analysis on the two stocks i'm watching. first up would be SGX.

from today's close, the share prices were at 7.19, down 0.96% from the day's open to close off in the red. for the past month, the stock has been trading below its 10, 20 and 50 day EMA, sparking a continuous downward movement since then. between the period of april 20 to may 20, a head and shoulders formation was seen, where the last shoulder triggered the downwards spiral from then on. a clear support can be seen at the 8.00 mark, where the share prices consolidated before the drop in the RSI triggered the breakout in support levels. the same can almost be said for the 7.50 support, where a short term consolidation was proceeded with another loss in momentum to carry the share price further downhill.

looking now at stochastic readings, both fast and slow stochastics a looming down on the oversold levels, and RSI readings shows a cutting below the 20% mark. can't really pick out much from MACD readings, just that it still remains below the signal line and would most likely remain so.

outlook for this week would be again, negative. 7.00 didn't seem to prove to be much of a strong support in the past, but this week may see a testing of the support. since the price is currently about 2% above the support, i won't advise going long for puts as of yet. for those who loves risks, you may consider going for a higher leverage on your instruments, or warrants, which has a high gearing and low conversion ratio.

now let us take a look at one heck of a volatile stock, and one of my favourites, Capitaland.

from today's close, the share prices were at 5.81, down 4.44% from the day's open to close off in the red. for the past month or so, the stock has been trading below its 10, 20 and 50 day EMA, sparking a continuous downward movement since then. between the period of april to early may, a triple top formation was seen, where the last spike triggered the downwards spiral from then on. last friday saw a huge upward spike in the share price, not sure what it reacted to but it was the much needed retracement for the continuation of the downward trend.

looking now at stochastic readings, both fast and slow stochastics a remains noisy in the oversold region, and RSI readings shows a downward movement, probably heading for the 20% mark. can't really pick out much from MACD readings, just that it still remains below the signal line and would most likely remain so. the spike in the stochastics is my much needed indication of a downward continuation. the stochastics react very quickly to price fluctuations, however, RSI still shows a downward movement. this would indicate that the stock doesn't have the momentum for recover, but the spike in the stochastics is actually giving the stock prices a further downward push for the week.

my verdict on this: very good! gong long on puts would definitely help during the week, as a further movement to the 5.60 mark and below is highly likely. now is the perfect time to go long on your put warrants, hopefully you'll make some money this week. i believe that the share price may retreat to levels of about 5.40 to 5.50, a good 10% drop or so from today's price.

Have a good trade week ahead guys, and hopefully you could make some profits on Capitaland.

quick update on stocks

ok before i got off for a 3-day retreat out in no man's land, i'll get going with an updated on my 2 favourite stocks.

SGX closed off this week in the red and has a consistent downtrend for the past 2 weeks. nothing much can be said at the point of time, but the only thing that can be said is that it is a good time to put the puts into action. follow the trend until it faces a reversal. currently, a near term reversal seems unlikely, and this coming week will be downward trending.

my best guess would be that by the end of this coming trade week, the prices may close near the 7.00 mark. investor strength is weak and confidence doesn't seem to be at a high. my call: long over puts, or go short over mother share (for risk loving junkies).

now with Capitaland, the same applies. nothing much can be said. however, a close below 5.80 may signal a further downtrend to come for the week. and from what we've seen so far, a near term reversal may not be coming in pretty soon. so we shall just follow the downtrend and ride it till it runs out of steam.

the trade week may see the prices drop down to the 5.50 mark, or below. my call: long over puts or short over mother share (again, for risk loving junkies).

i just want to clear the air of mystery over short-selling. the main reason why people are so averse to the idea of shorting stocks is because of the relatively short cover period as deemed by SGX. usually, the position must be covered by the end of the day, and if not covered within 3 working days, SGX will cover your position at 2 ticks higher. however, shorting is nothing but the reverse of any long position for an intra-day traders. i guess we as singaporeans are still risk averse and finds the idea of shorting a taboo. personally, i've made money from all my short positions.

anyways, cheers and have a good trade week!

a story of dreams

dear. a house at the crest of the field. on the horizon are hills that rolls over an eternity. the gray clouds hang low on the sky's edge, cascading down a blanket of fog that seems to devour the curvy landscape.

the skies are gray, and tiny drops of rain strikes mother earth with a gentle touch. it is as though the heavens are crying, not because of sorrow but because of an overwhelming sense of joy. the pitter patter of the droplets keep in tune with our beating hearts, now, they beat as one.

loving each other's embrace we gazed deeply into each other's eyes. we forget. yes we left behind all that was attached, our families, our friends, and our lives. we started fresh, fresh from the day we ran away from the world. the world that shackled us and plays poker on our very existence. he seemed to be winning all the time, but now, he is at our mercy.

a house, and a life together, a dream that seems to always whisper in my ears and cast faint shadows that i can barely make out. a dream that was once a wish. but a wish that still is, a wish.

an excerpt from "a story of dreams" by ms demon in exit