Kenmark vs Rule #1

Kenmark became KLCI star of the week, month or perhaps the year. I hope you are not holding or buying any of it?

Several financial institutions, including a number of stand-alone brokerages, may be facing millions in losses after they were forced to dump shares in Kenmark, previously held as collaterals, at rock bottom prices. They were forced to sell the pledged Kenmark shares after their clients were unable to top up their margin accounts. The margin call was triggered after the stock price sank below a pre-determined threshold level. The loses they suffered are a few millions ringgits.

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Knowledge-Based Stock Challenge Lesson

So have you joined the first knowledge-based stock challenge held in March 2010 earlier? If you missed it, no worry. It is organized twice every year, many chances for you to participate. 

Result has been released. I feel disappointed because I'm defeated by a UM student and 2 engineers. The student managed to grab away with RM8,888, which suppose to belong to me in the first place. According to the 26 year old student (the winner) interview, he has 3 years trading experience. He makes use of  RHB Analyzer and RHB ShareInsight. And he said he spent 3 to 4 hours daily to study the fundamental and price chart of the companies. He also mentioned that he would like to use the winning money to invest in RHBCAP.

Okay, the winner looks like a nerd. He deserved the prize.

From the look at it, I highly suspecting RHB Investment taught him to provide such a commercial speech. We all know RHB trying to utilize the winner to promote it's products. Damn, I don't think I can trust him anymore. But one thing for sure he deserves the win and prize, he did his homework. He spent 3 to 4 hours a day to do his homework, where I only spent 5 to 10 minutes to do some stock scanning and trading. I don't have a trading plan some more. How can I beat him? No way.

So, in order to win in KLSE, spend plenty of time to do homework seems like an honest feedback from the winner to us. This is the best route if we want to make money with dignity. Okay I get the picture now, will I be the winner of the next round contest? 

Ops, I should stop dreaming from now.

Market Will Continue Down or Up?

I believe this theme has been bothering most of the traders for the past 2 weeks, due to one or two negative news attacking the global market, Euro debts worsen and dispute between South and North Korea. I saw many trading bloggers took profit and watch the global market slump. With no surprise, KLCI index has gone down nearly 100 points for the past 9 days, and finally rebounded strongly on yesterday. So what did you do during the past 10 days?

For me, I missed this interesting drama and I was doing other more important things for the past 10 days. I'm not even spend my time well to blog, really sorry about that, folks! I know I should have listen to other bloggers to take some profits before May. Once I have a look at my portfolio 2 days back, my unrealized profit gathered since end of February was all wiped out by this little bear, and turn into unrealized loss. What a joke! However, somehow the market rebounded strongly on yesterday. 

                                                            Why bear? Because bear's eyes are facing down.

If you have unrealized loss, don't worry, I'm with you for the time being. I'm not sure (of course) whether this little bear will extend it's attack, but Malaysia and global economy outlook is obviously under recovery and in a bright side. Most of the companies are making money. So if little bear attack the market, it is an opportunity for everyone of us. I'm surprise that everyone is very hot in discussing about the market and stock during the past 10 days, especially in forum. That's a good sign, because they learned from their mistakes and busy doing their homework?

Whatever it is, the advice is always unchanged. If you want to make money from any field, you got to do your homework. That's the deal. That's mean, after away for 10 days, I also need to do my homework from now on. 

Let's fight (enjoy) together, for money. 

The Pros of Technical Analysis

What's so great about Technical Analysis (TA), folks? We always heard people complaint and doubt about the accuracy of TA. To TA expert, this is not always true, because FA also has it's own weaknesses. And some TA experts only use TA to make money from stock market.

Today, let's look at what TA can offers us as a trader, as below:.

I don't really use to draw my price chart looks like this complicated.

1) To Catch the Right Entry and Exit Timing

TA can provides you the signal of entry and exit. Even though the signal is not always right (still depends on how you create your signal), it is a good reference to support your decision. The concept is based on the level of supply and demand.

2) Faster to Discover a Potential Stock

With TA, accumulating volume via stock scan for example, you may able to lead the rests to discover various stocks that have potential to go upside, instead of reading the company annual report one by one. You may also take one step ahead over stock analysts and investors to discover the gems!

3) Easy to Learn and Use, Save Your Time

TA saves you plenty of time, because most of the tools are ready made and available for free. You just need to tune them to fit into your trading strategy. With stock scanning subscription available in the market, it only takes you a tens of minutes a day to do your homework. Of course, the existing KLSE tools are a lot more to improve compare to Forex investment tools.

4) Ability to Detects the 'Lousy' Stock

FA traders always claimed that TA traders might bought a poor fundamental stock, if they merely based on TA. To TA investors, price chart also can tell a stock whether a stock is healthy. For example, if the stock has poor fundamental, normally there will be selling pressure. Once they notice it, they won't even look at it. Price chart analysis also enable you to obtain the pre-signal whether the market or certain stock is going for the downside.


5) Potential to Make Money in the Short-Term
TA traders have the ability to make money in a very short-term, by referring to the shorter term price chart, such as hourly and daily. You always manage to obtain a more accurate entry point, such as trend line breakout (after correction or sideway), rebound from the bottom, etc. And exit to cut loss or grab profit earlier than others when there is selling pressure detected.

Do you think this trend line breakout really works?

There are other pros to use TA for stock trading.

How about FA vs TA? In fact, both FA and TA have their own blind spots, even you use the combination of them. To me, it really doesn't matter to argue which one is better. Do you think the 90% traders have not try each of the method before? Why they are still donating money to the minority?

Like what Deng Xiao Ping said, 'it does not matter a white or a black cat, whichever can catch a mouse is a good cat'. So, just stick to whichever method works for you. else, look for a better one.

Note: The post above is just my personal opinion, I believe you would have yours too. ;)