LOL!
Monday saw a quick gap up on the asset I've owned for years now.
Friday evening there was already chatter that the "avengers" crowd - retailers looking out to punish the establishment elites - are targeting the asset I'm vested in.
Sure enough, on Monday morning, the futures price gapped up like a rocket!
To show how volatile it is, if I had entered a small speculative futures trade Monday morning on a pullback, I would have been quickly up a few hundreds by noon. And by the time it reached US opening time, I would have been up a few thousand dollars.
(Of course I've left out the heart stopping up and down gyrations that would have stopped-out anyone who practice money management as in using stop orders - especially on leveraged instruments.)
When I woke up this Tuesday morning, guess what?
I would have stopped-out at breakeven right out of the gate when the market opens as prices tanked - I've got this trading rule to never let a winning position turn into a loss.
But the current price is still higher than Friday's closing price.
No, I sitting this one out from the trading side.
I can't participate when the price volatility is too wild for my money management rules....
But I do own this asset (not tiny size either) - that's the non-leveraged side in my investment portfolio.
My entry price is a lot lower than current prices.
So can withstand the current volatility. In fact, I welcome it!
Who doesn't love higher prices on assets that we own?
I'm now focusing on how to profit best from this interesting mania episode emanating out from US.
Hope I will be as good as those who owned Bitcoins at below $10K.
You know, sell a portion near the intermediate top around $40K, and buyback at current prices around $32K?
Make a spread of $8K, but still retain the same long term core position after buying back to ride Bitcoins all the way to $100K?
Of course not easy!
In case you didn't know by now, the selling or taking profit part is how we tell apart the pros from the amateurs. Wink.
No, I don't want to reveal what's that asset class; I don't want to talk up my own book.
If you're following what's going on in the US markets (not a STI only koala), you'll know what's the asset I'm talking about anyway.
No one so stupid to tell others that this stock good, better, best for investing/trading without first getting vested at much lower prices.
Similarly, no one so dumb as to so well meaning warn others this stock is a possible fraud/scam without first selling or getting short before hand at higher prices.
So when you believe 100% what institutions tell you, you're not as bright as you think...
And if you believe totally what other anonymous bei kambings (some are wolves in sheep clothing) in the internet forums say, you're probably not as wise as you think too!
Readers may want to read: No, you're not their customer
I guess those "avengers" customers in the States found out who the real customers of Robinhood are the hard way.
I mean they never stopped to think how do brokers make money when there's no trading commissions???
How about social media forums, blogs, or well meaning friends and acquaintances?
Well, if you have been practicing others buy I buy; others sell I sell - just look at your portfolio or trading account.
Nothing beats when tire meets the road reality!
Look, if I'm looking into selling a portion of my asset holdings to take advantage of this current "avengers" mania in US, would I be telling you I don't think this move up is sustainable?
For anyone not vested, it would be better to wait for a pullback to a longer term support at much lower prices if you want to get started on slowly accumulating for a long term position?
No, I would be telling you anytime is a good time to invest!!! (That's the dead giveaway that person is probably a snake oil)
Better buy now! Wait prices go higher! You'll miss the boat! (Double confirm)
Long term investing is about buying cheap and selling when its expensive (its not buy and hold).
It can't be cheap when everyone and anyone is buying or talking about it.
Trading is about finding the greater fool to offload your positions onto.
Do be offended if others like to offer you "free" advice. Yup, they're probably treating you as their greater fool!
Heheh in case people missed this gem :
ReplyDelete"In case you didn't know by now, its the selling or taking profit part is how we tell apart the pros from the amateurs. Wink."
You good ;) It is sooo difficult to do this.
Kevin,
DeleteEverything I've learnt is from the hard way... (Why am I not born smart?)
I've let too many multi-baggers turned into a loss that I finally have to admit to myself - stop using Buy and Hold as an excuse!
If anyone would offer to buy your current handphone for $2K would you sell? Of course you would!
Similarly, if someone would offer me $1 million for my BTO flat, I would sell too!!!
I can easily buy another replacement resale HDB 3 room flat in Queenstown for $500K and keep the balance $500K for wine, women, and song ;)
See? When we know what's value and what's "fair" current market prices, we can make the SELL decision EASY!
But when it comes to investing, we tell ourselves little lies that its Buy and Hold to avoid admitting we have no clue what's fair value... (Hence don't know when its overpriced or what!?)
The funniest, if not sad ones, are those who say they are buying and holding on for their grandchildren... (Want to bet they still holding on to their SPH shares?)
Trading that's another matter as we have price targets when to sell or for like for me, I prefer to use profit stops to protect my winnings (which means I can never brag about selling at the top).
There are no such things as Buy and Hold traders!!! LOL!
Although we have traders that turned into Buy and Hold "investors" when they let a trade turned into an "investment"...
Hi Smol,
ReplyDeleteLOL! If the asset is what I think it is, there'll always be big up & down days for people to take both sides of the trade.
Over the medium term (5-7 yrs), the fundamentals ought to be tremendous though.
For sinkies the returns may be mitigated as long as govt doesn't follow the rest of the world into lower for longer (or forever).
Spur,
DeleteFor trading, I prefer to trade its yellow big brother - less volatile ;)
For holding on for the longer term, I rather accumulate the dips when this "wilder" little brother asset is unloved and when no one is talking about it.
Yes, Singaporeans are a bit spoilt to the point of being complacent I think. We never had to bother to ask what "currency" or "currencies" should our net worth be denominated under?
If you ask our Malaysian or Indonesian cousins would they embark on the equivalent of our 1 million by 65 through savings thingy, they would probably laugh their heads off!
That's despite their higher interest rates over there than us!
You think why the richer ones come to Singapore to buy life insurance policies denominated in SGD?
But then again, what if we had a regime change or they so desperate to stay in power that they start giving free this, free that?
I better have a bit of "insurance" OUTSIDE of CPF ;)
Especially for that day when HDB 3 rooms resale is easily a million or more...
That would make 1M65 "obsolete"?
Just like the old recommended 60% equities and 40% bonds portfolio?
Its meaningless when BOTH equities and bonds are in a bubble!
Hi SMOL,
ReplyDeleteDoes your asset rhymes with liver? lol
LP,
DeleteYes ;)
LOL!
Rhymes Sharon Stones Sliver...
ReplyDeleteYes.
DeleteI remember looking up the dictionary to find out what's "sliver".
Before watching that RA movie, I've never come across this word "sliver"...
Come to think of it, I've never used this word "sliver" until now.
LOL!
Hi SMOL,
ReplyDeleteIt's good black swan event for you. :)
I like this post. So 一针见血.
Rainbow girl,
DeleteThanks for the feedback!
For someone who likes to argue with the STOP sign and poke hornet's nests, I do appreciate it :)
I sold 5x "1964" dimes to a shop 2 months back. Each one was worth $1.50
ReplyDeleteEarly Retirement SG,
DeleteGood for you!
You brought up a very interesting point.
Digital currencies (not cryptos), when they are introduced all over the world, will not "appreciate" like physical coins.
Come to think of it, no need to wait. Your 5 x 10 cent coins will forever stay as 50 cents (digitally) in a banks savings account or in our CPF even after 50 years.
OK, with interests it will grow. But will it grow to a 15 bagger in 50 years?
Not all physical coins are the same.
Some have high numismatic value - can worth a lot more like Hello Kitty toys!!! Never underestimate the passions of a collector!
Some old coins have actual copper or silver content. Even no collector's value, those who are familiar with current commodities prices will grab them as they are worth a lot more than the face value minted on the coins ;)
Its about knowing what's fair value and current market prices isn't it?
Hmmm... those first generation plastic $50 notes which came out around 30 years ago, didn't appreciate enough though. I think now worth less than $150 each piece. 3x over 30 years isn't enough in investment terms, but probably better than bank interest.
DeleteBut in the US, the silver content in its old coins makes all the difference. 55 years for 15x returns. Now prob worth even more.
Haha, maybe the legendary "old auntie who keeps cash in the milo tin" did better than most people thought she did.
ERSG,
DeleteAh! I see you're into numismatic too like Unintelligent Nerd. I'm more into philately.
LOL!
That would put us so called "financially literate" people in our place!
In an inflationary environment, anything that's an "asset" will beat money that's getting smaller, and smaller...