Hello SP Group, I'm Back!

 

Yup, I've moved back to Big Daddy's electricity provider this month.

To recap and have a better sense of context, you may want to read my previous 18 Oct 2021 post:

SP Wholesale versus Electricity Retailers

I've been "lucky" for the past 2 years - paying a mere $0.168/kWh - despite the rising quarterly Electricity Tariffs...

But that 2-year honeymoon ended this month.

My current electricity provider tried to "entice" me to renew the contract for another minimum 18 months with an extra "discount" for repeat customers.

Good try.

I don't sweat the small stuffs like downloading apps to enjoy extra discounts for Kopitiam or points for free burgers at McDonalds...

But for my monthly electricity plans? I bothered to do some quick research. Wink.

For historical electricity tariff prices, click the excel file from SP Group below: 

Historical Electricity Prices

Those of you who see better with pictures may want to convert the data into charts yourself. (What? I don't spoon-feed one OK?)

What do you see?

Locking prices for the next 18 months at current electricity prices is like buying near a market top...

I just can't bring myself to do it. (Occupational hazard of a trader)

But why return to SP Group?

That's because no independent electricity retailers are now offering variable plans!!!???

Remember when we can choose independent electricity retailers for the first time?

We were offered "fixed" and "variable" plans right?

I'll let you figure out why no independent retailers are offering "variable" plans to us anymore...

Well, no worries!

Hello SP Group, I'm back!

Of course I can be wrong!

I'll have eggs on my face if next quarter's electricity tariff goes up...

But if you are a Trend Follower like me (Lower electricity bills from April to June as tariff falls by 5.4%), then not locking-in our monthly electricity is the way to benefit from future lower deflationary electricity prices.

P.S.  Since I'm not Buy-and-Hold but a Man-Whore Market Timer, once electricity prices have dropped to the low 20s (break below 20 even better), I'll start flirting with the independent retailers again.

Early Adopters and Laggards

 

Those of you whole have studied Marketing should know this Diffusion of Innovation Theory chart below:

We too can use this theory when it comes to investing, trading, and speculations - any poisons and vehicles also can!

Next time you buy a stock, ETF, bond, or even contemplating joining the 1M65 crowd, ask yourself, where do you think you fit on the chart above?

Are you the early adopters? (Yeah, you're the influencer or opinion leader)

Part of the early or late majority? (The parrots; the copy cats; you jump, I jump)

Or are you the laggards? (Don't believe, don't believe...Then FOMO!)

Eh... Why did I leave out innovators?

Let's get real lah. If we are innovators, we'll won't be here at this watering hole! Tio bo?

If we wear the white hat, we would be so busy as entrepreneurs at our startups...

If we wear the black hat, where got time to read blogs when we constantly need to come up with "new bottle; old wine" scams to con bei kambings?

I'm not going to write too much on theory. You know, a summary of a summary of a summary... 

Those of you interested in the Diffusion Theory in greater depth would do better to go direct to the source instead! 

People study this in universities OK?

Some of you are probably using the Diffusion Theory already in your investing right now. If you feel like sharing, come share!

Some may be seeing this Diffusion Theory Chart for the first time... (You may want to reflect on it if you invests or trades a vehicle that's completely new to you, but others know it inside out...)

I'll start first!

You know why I blog and read investing/trading blogs and forums?

It's to spot early adopters and laggards.

I use them as my "qualitative" indicators. Wink.

Your turn!

 

How To Make Money In Investing/Trading?

 

By SELLING.

I'll let you figure that one out yourself...

Buying Toto is like buying out-of-money options?

 

The beauty of buying options is from the get go, we know the MAX we can lose.

Worst comes to worst, we just let the option expire worthless.... We lose the premium we have paid. Period.

Note: I'm talking about BUYING options.

If you are selling options, and you have not hedged your position, your losses can be unlimited.

Isn't this similar to buying Toto?

If you buy Toto system 8, you just pay $28. That's the max you can lose - $28.

But if you struck the first prize, its like buying deep out-of-the-money options and hitting the jackpot!.

Yet, even when the losses are limited and known in advance, we have people having their lives destroyed by "playing" Toto and options...

Do you know the reasons why?

Once you know the reasons, then its a matter of discipline in not going there.

And the self-awareness of knowing when you have crossed the line and need to seek help...

SP Wholesale versus Electricity Retailers

 

I noticed some Singaporeans are quite pissed off with the increased in electricity tariff for households by a "mere" 3.1% for October to December period.

Really?

I mean for a HDB 4 room flat, the average monthly electricity bill will increase by $2.49 before GST. 

That's if you are one of those who have not switch to any of those OEM Electricity Retailers, still happily on the SP Group default regulated tariff plan. Those who laughed at you for not switching are not laughing now... Are they?

To be precise, these pissed off Singaporeans are very "buay song" their chosen Electricity Retailers are no longer giving them the generous 20-30% discounts they used to enjoy.

I mean if you are not in sales, don't have profit and loss responsibility in your day job, you got excuse.

Then again, you mean you have already forgotten what happened with Grab and Uber? 

What about those generous "carrots" that banks and credit card companies dangled in front of you, but after a few years, they'll give you a bigger hamster wheel to run on, or else the carrot incentives will be taken away... 

So fast forget?

You really believed the 20-30% discounts from OEM Electricity Retailers will be forever and ever? You didn't anticipate the spread between Standard Regulated Tariff Rate and Non Standard Rates will narrow over time?  

If you're an investor or trader, I'll be betting you'll be more drawn towards Technical Analysis. Wink.

Before I go on, I believe MOST of you will not be affected by the price increase of electricity FOR NOW.

Steady lah. Don't anyhow panic for nothing just from reading headlines.

Firstly, if you are still on the SP Group's default Standard Regulated Tariff plan, the impact is non-event.

Secondly, if you already have switch to any OEM Electricity Retailers, you are only affected if you are RENEWING your electricity plans within these 3 months from October to December.

Unless you were one of those "unlucky" customers who chose the "wrong" electricity retailers that decided to throw in the towel... Now feeling very jilted and abandoned...

Can anyone spot the biggest difference between those electricity retailers that are still thriving and those who cannot make it? (You may want to reflect if you always thought you're a fundamental investor)

Want to know why LUCK is better than skill?

During May 2021, I blur, blur, no goals, no plans, just renewed my Tuas Power PowerFix plan for another 24 months.

The price locked 4 months ago was - $16.80 cents per kWh with GST. 

Today if I were to renew the same PowerFix plan for 24 months, it would cost me - $25.68!!!

Crazy right?

Not so crazy if you knew during April 2020 last year, WTI Crude futures went negative!? And today one year later, WTI futures is now above USD$80!!! Now that's what I call a reversal!

So what's next year's energy price? Your guess would be as good as mine!

For the majority of us who have locked-in a much lower price till next year or two, don't be complacent.

Use the extra time to prepare in advance what would you do if oil prices were to revert back down to mean. What to do if prices go higher and higher and breaks USD$100? 

If you think oil prices will go lower going forward, would switching from a fixed price plan to a guaranteed percentage discount variable plan be better?

Then again if prices were to go higher, of course remaining on a fixed price plan would make better sense. You should be asking whether to lock the price for 6 months, 12 months, or 24 months? It all depends on the level of conviction for your thesis, doesn't it?

OK, there's a reason I've left the trickiest one till the last - SP Wholesale Electricity Price (WEP).

On paper, its the "cheapest".

If you believed in the Market Efficiency thesis, why isn't this plan the most popular???

I'll let you figure it out for yourself.

But I can help you along with some poking questions:

If big daddy were to liberalise the electricity market today, would it succeed?  

Would you make the switch for a mere 3% discount from standard regulated tariff?

So was big daddy lucky like me? Or did they spot an opportunity 3 years ago, and quickly acted upon it? 

I would humbly suggest you can consider WEP if you are NOT one of those who were genuinely surprised that HDB flats will go to zero after 99 years. 

If your england is so poor you don't understand what a lease meant, you're probably the type of customers that SP Group want to avoid having. Hence the reason why SP Group not pushing WEP so hard in the market.

They probably don't want the CPFIS scenario where customers go to Hong Lim Park complaining why offer the WEP option to me when I can ownself hurt my ownself!? 

Want to bet that even if OEM were to be introduced today and not 3 years ago, there will be customers who will still switch? Even if the discount is a mere 3%...

Those who voluntary contribute to CPF would do it! (3% not much different from 2.5 or 4%)

These are people who value certainty. And 3% saved, compounded by 30 years, these happy souls would probably giggle in their sleep! 

WEP would be ideal for those who are already into selling naked options for the "passive income".  Its fun collecting the premiums month after month, especially when most options expire worthless. That's until...

Similarly, WEP would appeal to REIT yield hogs gleefully collecting their dividends year after year. That's provided the REIT massacre don't happen again like in 2009. A more recent example is Eagle Hospitality Trust. And I guess most Singaporean yield hogs will never touch Shipping Trusts ever again, never mind their juicy yields were much higher than REITs!

If a 50% increase in electricity bills can get you all knotted up, would you go ballistic if your electricity bill were to spike up by 2 times, 3 times, 7 times?

OK, one year's data from SP Group is too short.

New Zealand has decades more experience with Wholesale Electricity Market. Try this:

Spiking Electricity Prices A Shock To The System

Figure out why those customers not on "spot contracts" were better "insulated".

And why WEP not popular due to "high market risks" according to insiders:

Switch and Save

 

I know. 

Who wants to do their own due diligence. What? Do my own reading and research?

Nah!

Come to think of it...

Why study when we can just copy the homework from our classmates?

The "Free" Trade

 

What's the next best thing to taking your capital safely back and only risking your profits when it comes to trading?

I guess it would be the "Free" trade.

When I put on a trading position, the first thing my order gets filled is to enter a stop-loss order.

Its a bit like options (but not the same) where from the get go, I know the MAX I'm willing to lose on the trade.

Its a risk/money management thing.

Three scenarios will happen next:

1)  I got stopped out of the trade at the predetermined loss. (Well, that was quick!)

2) The price just oscillates around my entry price, going nowhere... (Some advanced traders will get out of a trade if it does not perform within their expected time frame. That's next level stuff...)  

3) My position becomes profitable. (This one I like best! Who doesn't?)

When I can move my stop-loss order point to my entry price, hey! I got a free trade!

Which means if and when the market reverses, I just scratch the trade. 

No harm; no foul.

But if the trading continues to work in my favour... 

Kaching!

Bei Kambing Retail Customers

 

During my weekend sales gigs, I've come across some really "bei kambing" (naive, innocent, blue-eyed sheep) customers.

When I told them which countries the products are made, some customers remarked they can then get from the factories direct themselves.

I said, "Sure! You can definitely get them cheaper! Although the factories will ask how many 40 feet containers you want to order..."

You should see the blank look in their eyes.

Yup, it flew over their heads...

LOL!

Then there are customers who like to ask where the distributor/agent showroom is located in Singapore.

They think by going to the distributor direct, they will get better prices than from retailers' showrooms?

I told them confidently, "Sir, this is their address. Feel free to visit their showrooms and then come back to buy from us."

"Why? Shouldn't the prices be lower at the distributors?" asked the perplexed customer.

I patiently explained, "Think about it for a moment. We retailers are the ones selling their products for the distributors. If they undercut us, which retailers will continue to display and promote their products?

Some customers will sheepishly smile as they knew I made sense.

Some practice Trust But Verify - they come back a few weeks later and buy from me. Yeah, I was right! Our prices cheaper...

LOL!

Of course I understand and empathise.

Not everyone has worked in sales or with supply chain. 

Or have profit and loss responsibilities.

You could be highly educated but you work in academia or at the back office all your lives...

How would you know how the real world worked?

If you are one of those customers, just have the awareness that when you embark on your journey as a fundamental "investor", you do not start at ground zero - you start from negative.

Right off the bat, your fellow cohorts who had more real world experience than you have an edge over you when reading annual reports. 

They can read between the lines and beyond the numbers.

You can either do your best to close the fundamental gap (no, its not taking more courses) by asking your sales or supply chain colleagues out to lunch, or maybe switch to technical analysis instead?

Look, technical analysis is voodoo. Since its voodoo, how can anyone claim to have an edge over others?

And it involves less brain power too. 

Its like looking at ink blots or ice cubes in a glass. We see what we want to see!

P.S.   The only times when distributors have prices lower than their retail showrooms are:

1)  Clear horribly aged stocks that no retailers are carrying anymore. Great for retail customers looking for that "retro" look.

2)  Reconditioned products. When we bought lemons and returned our products to the distributor and got a brand new replacement, have you ever thought where your defective product ended up?

Landlords love reconditioned products. I mean if you are renting out your apartment, you don't expect your tenants to take care of your home appliances, do you?

 

Freak Weather and Weird Market Movements

 

I was buying dinner at ABC market just now at around 5:30 pm.

Just as I was about to cross the road to take the bus home, the sky suddenly opened up like those monsoon rain!?

And its still shining brightly with sunlight piercing through the rain!!!

Idiot!

So I walked back to have my Chendol to wait the rain out.

I knew from experience, the rain although heavy, will not last long.

True enough, the rained petered out even before I finished my Chendol.

 

I wish I had that level of confidence when it comes to my trading though...

Ever got shaken out of a perfectly good position because the market have one of those weird and unexplained counter-trend moves against us?

Very frustrating right?

I'm a coward.

I prefer to get stopped-out. 

See the price retrace.

Sheepishly get back into the same position I had before. 

Sometimes at an even worst entry price than before @$%^$#@!!O

What to do?

If the rain didn't stop like what I expected, I can always have another bowl of ice kacang (sugar rush and brain freeze).

I'm still dry.

But in trading...

No way I'll let a paper cut turn gangrenous!

I noticed some retail traders do the opposite.

Who's afraid of some rain?

Just dash and run like mad. Its only water!

For trading, they are not afraid to let a short term trading position turn into a long term investment!?

Stocks always go up right?

Don't worry.

We are "investing" for the long term.

Remember Warren Buffett said if you can't stomach a 50% loss you should not be in stocks?

Wait.

Have you noticed retail "investors" looking to breakeven one day are often good at parroting wise investing quotes?

 

How Old Is The Captain? Most get it wrong...

Click on the video below.

Once you've got the question, pause the video and try to figure out the answer on your own. 

No, you can't ask your mother.

Or your ex-tuition teacher.

Don't cheat!

Once you're done, click on the video to get the answer.

 

Those who majored in Math, and who knew the answer long ago, did you apply what you've learned when it comes to investing/trading?

As for the majority of us who were confused, or got the answer wrong to this primary school math question, how?

Does it reminds you of those talking heads on TV (or analysts with their newsletters) who try to explain the market moves for the day?

Don't believe?

Try explaining the gains on our 3 bank stocks in STI last Friday when big daddy removed the cap on dividends payout?

But it fizzled out today...

Or Keppel's price popped when dividends got increased, but now price retracing back... Eh? Those selling today made their contra gains already?

Now you know why most retail traders eventually quit trading and become born again "investors".

Trading is hard. (Unless you're the savvy ones who sold last Friday and bought back today)

Most of the daily moves in the markets are like the math question above, "How old is the Captain?"

LOL!

Great! They are moving on to the asset I own!

 

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!

 

Correct Belief vs Correct Practice

I'll steal with pride from CW and do a blast from the past.

When I first wrote it in 2013, you could hear a pin drop... LOL!



Now, maybe some can appreciate it better, having gone through both bull and bear phases in their financial journeys.



Here's the post:


Orthodoxy versus Orthopraxy








When we started out, without any track record to our name, we have to rely on some theories as our foundation. And more frequently than not, these theories or "correct beliefts" were implanted into us from outside in.

It could be a book we read , a class we paid for, an advice from someone we trusted, or even an anonymois source we swallowed hook, line, and sinker nevetherless!? Hey! Its "free" what!?

  

How did all those "correct beliefs" done recently?

Some are not shaken. Their "faith" strong as ever. Unrealised losses are not "real"...

Some are having their cognitive dissonance moment. 

Some are not letting this crisis go to waste. They are thinking for themselves and making adjustments to their "correct beliefs". 

No need to consult others as they have their own track records to do their own "trust but verify" due diligence. 

Some "beliefs" they had held dear for so many years may have to be thrown out...



Its the transition to grey. 

Where "labels" matter less. Just like you don't care whether the cat is black or white, can catch mice that's what important!

"Correct practice" can also be more apealing to those who thrive on feedback from reality. 

When we do something, there will always be "crash got sound" feedback. 

When all one does is "believe" but never do anything abougt it, how to verify whether its true or not? Wink.








  



  

Average Down Versus Average Up (revisited)

In recent days, its interesting to see quite a few in the community buying on the way down.

These are the buy in tranches people.

You know, they have already planned in advance to buy X% when STI hits 2500, another Y% if STI drops to 2200, and Z% when the index plummets below 1800, etc.

(Please don't ask what happens when STI goes below 1400? That's rude.)



But first, got to give respect and props to those who actually execute their plans they have shared openly to us.

That takes discipline and conviction. Its not for the faint hearted.

As for those sound bites that say say only, well, you know who to discount next time they try to parrot something they have stolen from others, pretending to sound all knowing. Wink.



I've tried averaging down for investing. Nearly destroyed me.

And for trading, I nearly gave it all up at one point - to return to born-again "investor" - when the disgust with myself was that bad... 

Yup, I've let a small loss turned gangrenous. Was lucky the market turned and I survived. 

Never again. Can't always depend on Lady Luck to bail me out everytime!

I've put in place mechanical stop-loss orders from then onwards.



I prefer to buy on the way up. It just feels better to have tailwind support and positive reinforcements. 

And I sleep better too.

I'm not into masochism.



How to find the bottom and start averaging up? 

Crash got sound.

When I initiate a position, if it got stopped-out, that's that. The losses won't grow and compound since they can't fester on me anymore.

But if the position is profitable, and I can't find any reason to take profit, then its natural to add to a winning position.

That's how the initial small position may eventually scale into size. Its quite organic.

Long ago when I was youth, it was 100% all-in entries, and 100% all-out exits for me. I know. The hubris!

Winnings were spectacular; losses were even more gargantuan! LOL!

That's youth for you. I didn't know what cannot be done.

Now I know. 

Ouch!



Newer readers may want to read this old post to get a better understanding of chosing the right shoes to fit your own feet.

Mind you, there's nothing wrong with averaging down if it suits you better. It could be you have a higher threshold for pain than me.

See?

You win!












\

OK, that escalated quickly!

Wow!

US markets savage or what this week?

Two -3% down days and one -4% big move last night.

Didn't matter.

I lost money this week!?



I'm not mad or flustered. (OK, seeing the Simsci gap down 9 points pre-market this morning without me sucks)

Of course it helps I've made some kopi money from the previous 2 weeks.

2 weeks win; 1 week lose. Oh well...



I've discovered something quite useful (never let a loss go to waste).

My Method does not work too well in high intraday volatile markets. 

I mean I already knew I hated one day up, one day down kind of market moves; my Method still can handle them. That's not the problem.

The problem is when intraday, the market have big swings back and forth...



Of course the problem is easily solved by having wider stops, or even no stops at all?

Hello. 

I don't think I would want to mess with a Method that has helped me made $10 from $1 so hastily...

Have you noticed both gold and silver went down last night despite the -4% US market loss?

Oh, sure, Dollar/Yen went down this week acting like it would as a safe haven trade, but not without first profit stopping me out last week when it zoomed to 112!? (Lucky never lose money, but still...)



This week is something else...

Its as if the different asset classes are taking turns to exact maximum humiliation and damage to me.

LOL!



I will sit today out.

I can't control the market moves; I can control whether I want to play or not. Wink.

Back to sharpening the saw.



Must reflect and review how I can do better in these kind of markets. 

Or maybe stay the hell out the next time?





  

Well, that de-escalated quickly!

Whiplash!

Hands up anyone who were pleasantly surprised to see our STI up today?

Especially after the -3% mauling for all 3 US major indices last night...



Not easy right?

Investing Is Not Gambing?

Regular visitors to this watering hole would know I've always equated investing as same same with trading.

And trading is no different from speculation.

Speculation in turn is just another word for gambling.


Just like associating seagulls as "good" just because they're "white", and crows are "bad" because they're "black", those who are "trapped" by words tend to believe if one ownself declare ownself as an "investor", they are holier than thou compared to traders, gamblers, and speculators?

I on the other hand prefer to focus on:

Its the adjective silly! Never the noun



Howard Marks from Oaktree is well respected and followed by quite a few retail "investors" locally. His memos are religiously read and quoted like those annual letters by Warren Buffett.

So when I saw his latest memo, I can't let this opportunity pass!

You Bet!

So Easy Until Pros Are Shutting Down?

I call myself a Trader.

That's only to make myself sexier to the babes in pickup lines. 

I don't really believe in labels, but if it helps me to impress the panties off them, call me a man-whore also can!



Notice a psychological quirk that we do after buying into something that were sold to us?

We tend to "jio" others to do the same? (Politicians, marketers, and religion shepherds have taken full advantage of it)

It's as if we were suffering from cognitive dissonance or buyer's remorse... 

So, if we can "inspire", "influence", or "motivate" others to do the same as what we did, it suddenly felt a lot better? 

Often, you do this "sharing" not based on your own user experience or using your own words; you simply "parrot" the same sales spin that were sold to you. 

Don't bluff! You did it!



It's the herding instinct lah!

You didn't mean any harm; it just more comforting to know if die, all die together!



Have you ever read or heard me say because I like to trade, so should you?

The cheerleading you often hear from me is crash got sound!

Don't try how to know?

Whether the shoes fit your feet how would others know?



And I've always given trading its due respect - I treat it as a craft. 

If you say you can't tell the difference between a craft from a hobby or pastime, then you're even more dishonest to yourself than you think! 

What's the point of goal setting and planning if they were based on little lies you've spun for yourself?



Trading is definitely not for anyone and everyone. 

Its in the realm of Earn More. 

If you can Earn More, you wouldn't have the need to seek FIRE to escape, would you?

Talk about the irony!



Something to mull about this weekend:

SocGen Considers Shutting $4.7 Billion Prop-Trading Unit





P.S.  While you are at it, if you consider yourself an "investor", you may want to ask yourself why are you "condemning" trading when you have never tried it before?

Or if you have tried and failed in trading, are you not behaving like that cad whose girlfriend dumped him... Now go telling everyone his former girlfriend was a slut?

Now think for a moment how a skilled shepherd (snake oil) would take advantage of such human tendencies?

Trading With Different Time Frames

Traders A & B both worked in the same investment bank.

Trader A longed EUR/USD while Trader B shorted EUR/USD; both at the same exact time and at the same price.

Both of them made money.



How is this possible?



Trader A is a swing trader who holds his position for several days to several weeks. 

His stop loss is 100 pips away from his entry price. 

Upon entering his trade, he suffered a -40 pip loss on that day. But since his stop order was not triggered, he was able to hold on to his money losing trade and give time for his trading thesis to work.

Eventually, the EUR/USD rallied and he was able to close the trade 5 days later for a 200 pips profit.



Trader B is an intraday trader.

His stop loss is 10 pips away from his entry price.

Right off the bat, his short EUR/USD position turned into a quick profit of 40 pips. 








Normally, I am more of a Trend Following Trader who likes to hold my positions for several weeks or months. Profits got more meat mah!

However, I can't dictate what I want to the markets... Even going to Waterloo Street and pray to Kwan Im Ma also no use!

If the mountain don't turn, I turn.



Swing trading is a lot easier to transition to. 

But man! Intraday trading is a lot taxing and harder to execute... I swear some of the price movements look totally random! And they probably are!

Only no choice will I dabble in intrady trading. Especially for those 1 day up, 1 day down kind of days. 

In this situation, I rather close all my trading positions at the end of the day. 

This is to lock-in whatever profits I had, if not they will disappear the next day when the market reversed #@!!%&(&%$@!

LOL!



Do note one important caveat. 

Irregardless of whatever time frames I trade in, I always enter my stop loss order immediately when an order is filled.

My entries are discretionary; my exits are systematic.

Why?

I don't trust myself when it comes to taking losses. 

Plus I can't be staring at the screen all the time if I used mental stops, can I?