Sunday, January 15, 2017

e-meeting : Importance of CUT LOSS

Morning ... 15th Jan ... mid-month of Jan. As KLCI rebounded strongly ... many would be profitting?

Yesterday I attended a good market-talk by a FA person, Mr David (he was previously from ET). Tho I may disagree on buying AirAsia, being traders ... we could look to trade her as it is very volatile ... up-down. Hard to trade. Haha.

For the TA speaker ... I do not use EW/FR ... so, I would not put my focus in that. 2017 is the time to learn more about FA ... hence, I will attend courses/workshops on FA. We still need TA and planning, of coz. I m focusing in my preparation ... ahead of the coming crash.

Yesterday, during the meeting ... I met a person(a Liverpool fans) who said TTB missed the whole bull ... from 2011 ... he is waiting for the crash. I have disagreed with him in 2012 ... but 2017, I will attend his Investor-Day talk (re-subscribed to icap's newletters) ... and will listen closely to those in bearish-camps.

We are ikan-bilis ... so, we are followers. Attending market talks to get ideas from many 'experts' and experienced investors/traders ... on what we should be looking at ... the cracks and what we should be doing. I m still in STAGE ONE of preparation ...

#1 : Preserve capital : withdraw half of our funds out of equities. CUT LOSS is important to survive.

#2 : Accumulation of bullets : Where to get more funds?

#3 : Instruments and Platforms : Where should we venture to ... BIG SHORT?

#4 : Knowledge and Experiences : Listening to more ... meet more, attend more market talks.

This is stage one ... the BEFORE crash preparation. If we STILL stuck up there in some stocks, we would have FAILED the #1 ... so, DO NOT get stuck. Easier said than done ... I could have another session of CUT LOSS ... to remind public/retailers the importance of cut-loss ... buying blindly into stocks without plans would be the biggest mistake as we might get stuck for years ... and market not even collapsing yet. TTB mentioned below 1000 ... for KLCI.

Preserving capitals could also means ... be frugal, use less ... buy less. That is a challenge as when we are so used to spending.

Let us listen to this nice song ... one of my fav. The title : 10 years.


THPlant : At low ... take the peak RM2.10 ... divide 2 = RM1.05. That is the buy level ... around there la. Using RM1.05 as our cut-loss exit point, we could accumulate THPlant if we are anticipating a rebound/rally in plantation stocks. TH = Tabung Haji, mind you. I have an interest to buy THPlant (disclaimer applied).

Imagine if we bought THPlant at peak RM2.10 ... we are 50% down. For us to breakeven, back to RM2.10 ... we need a miracle ... that the stock to climb from current RM1.10 level to RM2.10, which could be a feat. Don't give me AirAsia as example ... please don't be so naive.

Even if we got THPlant at RM1.50 ... we still stuck 'up there' if we do not practise CUT LOSS mentality.

In general, whatever stocks we are buying in 2017, we should place an exit point if the trades go against us ... it could be 5%-10% below our entry price to exit. By selling, we could re-coup our capitals ... and could buy something that is performing.

I have used O&G counters as examples of CUT LOSS ... how crucially important it is ... for us NOT to go against the trend. BEARISH in O&G could be for years to come ... with better technology bringing down the operating cost of 'shale' and 'renewable' ... the theme of such. By the way, technologies ... yes, that is the THEME at the moment. Uncle Ben profitting well by buying into IQGroup around RM2 ... and average it up! Great trade.

Let me give another example ... the hot-stock for this week.

MBSB : Adjusted rights ... 50% down from the peak (mind you, this is only a 3yr chart) ... RM1.50 to 75cents ... at the moment, surged to breakout 95cents and closed at RM1.05 ... a great rebound due to some news ... but, we are still STUCK up there.

One of member told me that his father bought into MBSB and stuck up there ... have to go thru the right-issue and average it down. But ... it is still a distance from his average at RM1.05 currently. So ... never place our trades on HOPE it will rebound ... CUT LOSS is the answer to such woes.

CUT LOSS : Jan 2017

Sun, Jan 15, 2017 10:00 PM - 11:00 PM
  Please join my meeting from your computer, tablet or smartphone.

 I will use the two above examples to discuss on my cut-loss one-hour talk. Perhaps, HOVID would be a good example too. Or AirAsia ... or AnnJoo?

See you tonight

You can also dial in using your phone.
United States (Toll-free) +1 (571) 317-3122
Access Code: 128-997-741

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