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Investment Stock Market

Lessons I Learned in Trading

5/8/2014

Most investors and traders say that we should not be too emotional when trading in the stock market.

And as I do my daily trading, true enough, i learned that we should try our very best to avoid greed because it will give you nothing in the end.

I’ve been trading conservatively for the past two weeks and I could say that the reason I have not achieved my goals yet is because I keep on expecting for higher returns. if only I get contented with lower returns then I might get higher profits unexpectedly.

Now I’m beginning to understand why most traders suggest not to be greedy.

Bloom has already reached 12.6 from my buying price of 11.95.
I wanted to sell it that day but I expected that it will go higher.. However, it went even lower than its price when I bought it.

Had I sold it, I should have earned profits already and more so, I have already used my capital to trade for other stocks. Now since it’s low, I couldn’t sell it yet because I’ll lose some amount. Thus, my money is stuck. No movement, no profits, no nothing. Just like a waste of time…

Yesterday I bought MA at 0.02, and it went up to 0.023 this morning. I was surprised.. My initial goal was to sell it when it go up to just 0.021 but again, out of greed, I expected that it will go up by probably 0.024 and that’s when I’m going to sell. And to my dismay, it never reached that point. It even went lower down to 0.021 towards the closing period. So I’m left with nothing again. No gains, no movement, no profits.. It’s frustrating but at least I know where i fell short on.

I guess the big lesson here is contentment. Learning how to be content is something that I need to really work on in the next trading days.

Tomorrow is another day and I will do my best to trade better and wiser. It’s better to earn a centavo than zero. Be content with my earnings be it big or small. Don’t be greedy. Set goals that are realistic and attainable. And be firm with it. Don’t try to change your goal just because you think that it might go higher, because we cant turn back time if it turns out the opposite.

Be humble. Don’t let money control you, but rather, be the one to control your money and use it wisely. Don’t overspend nor use it with negative intentions. If you earn, share your blessings to others and give back to the Lord for He is the one who provides everything…

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Investment Stock Market

My First Bid/Order in Trading, failed!

After making my own analysis and computation, I finally made my first order. The first company that I bought shares with was MARC (Marcventures Holdings, Inc.). The prices were playing at 4.0 to 4.5 with points constantly changing from time to time. Meaning , the values change in a minute or two or 5 or stays the same for a couple of minutes or even an hour, and then drop down or go up unexpectedly.

I didn’t know what’s happening and I couldn’t tell either what’s going to happen next but I was observing the trend. I didn’t rely much on the current price movements but rather on the historical data. I found that its 30-day high is at 5.41 and the 30-day low is at 3.60.

And maybe for a first time trader like me, I just wanted to play it safe. So I placed an order to buy shares at a price of 3.7 which is way beyond the current values. My idea was if the 30-day low is at 30.6 then it’s possible that the price may drop down to 3.7 even if the prices were currently moving from 4.0 to 4.5

Actually that’s possible. Nobody knows what the next value would be so any value is possible. But I guess one of the techniques here is to analyze the trend. And this is only possible if you are completely monitoring the price changes. Because we really can’t tell what the next price would be. At one point it was 4.2, then you blinked your eyes for a second and when you looked back at your monitor it’s already 4.9. That’s how fast the changes could be. And those tiny decimal points matter a lot especially for big-time traders.

What was funny here was the fact that I moved away from the trend. And I think a wise trader should always be on the trend. If you stay away from it, then you’ll be left out. Others will gain while you gain nothing. And that’s what happened to me. The buying price that I chose what too far from the trend line that was almost impossible or unrealistic to go down that much. Therefore, my first bid failed.

For experienced traders who might have seen the price that I posted, they might have said, “Dream on, girl!” 🙂 Or maybe they said, “this fella is a newbie who’s goal is for long term investing.”

But then again, it’s my first day! Please bear with my obviously newbie moves. Let’s see how well I trade in the coming days (if I will get any better…) hehe.

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Investment Stock Market

My First Day in Stock Market Trading

April 28, 2014. Monday. I woke up very early… I felt like it was my first day on my new day job. And I didn’t want to be late so I came to work early. But in real life, I was just at home. I logged in to my computer around 8:30AM. Read some articles and news on COL and PSE’s websites. Reviewed the stock list and quotes. And did some comparisons with the stock prices.

At exactly 9:30AM, the trading began. I didn’t know what to do… I didn’t understand the numbers. I just observed the changes in the values of each stock and the changing of the colors from green to orange and to red which I didn’t understand either. I observed the numbers of the companies that I’m familiar with like PLDT, Jollibee, Meralco, BPI, BDO and ABS-CBN. The rest, I didn’t know what they are.

While observing, I also did some side research about the other companies on the active traders list. And as I was getting keen on the changes of the values, my mathematical and analytical skills also started to get involved. So I made computations from the current values to the previous ones, for one company to another, checked the highs and lows, analyzed historical data and charts, and reviewed what other traders were buying and selling and at what values.

I already got an idea on how to do it based on my observations. But I wasn’t confident. I was hesitant. I was afraid. I knew that this is totally different from the Cashflow 101 board game that I played before. There weren’t emotions like these during that time even if I lost money because I knew that it was all play money. And this one is the real game. We’re no longer talking about play money here but REAL MOOLAH. Hard-earned money yes. And that’s what makes it more challenging.

Time was running and the values were constantly changing. I felt the urge to start doing too. So, despite the varied emotions that I was feeling that time, I finally made a move. I picked two companies that I haven’t even heard of before and made my judgment based on what I have observed so far. The first company was Marcventures Holdings, Inc (MARC) and the second was Bloomberry Resorts Corporation (BLOOM).

Why these two companies of all the others on the list?

Simple. I did the math. Not algebra or calculus but just the simplest math. In fact I only used division, multiplication, and subtraction.

How?

I may not be very good in explaining the numbers yet but I’ll try my best to explain it the simplest way I can.

So this is how I did it. For example, I have P50,000 and the current value of the company or stock that I want to buy is P11.40 per share. I divided 50,000 by 11.40 and I got 4,385.9 which becomes my total number of shares. When the price of that stock went up to let’s say P11.9 per share, I then multiplied 4,385.9 (my total number of shares) by 11.9 (price per share) and I got P52,192.21. My initial capital was P50,000 and after buying and selling my shares, I earned a profit of P2,192.21. Assuming there’s a 20% (could be lower) deduction for charges and tax which is about P438.442, my net profit would be P1,753.768.

COMPUTATIONS:

50,000 / 11.40 = 4,385.9

4,385.9 x 11.9 = 52,192.21

52,192.21 – 50,000 = 2,192.21

2,192.21 x 20% = 438.442

2,192.21 – 438.442 = 1,753.768

I don’t know if you’ll find this easy but this is just how I used my mathematics. I could be wrong. Or there may be other blogs and articles that will show you better computations or techniques on how they do their math and analysis. I’m just sharing mine in case some of you may be interested.

Remember this is my first day of trading and I didn’t have any fundamental or technical knowledge about stock market. I just did it my own way. And as I’ve said in my previous post, I’m looking forward to learn more along the way.

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Investment Stock Market

I Finally Opened an Account for my Stock Market Investing!

4/28/2014

Even if I already gained a little bit of knowledge about stock market investing by reading different resources on the internet in the past couple of months, I knew that I wasn’t ready to get into the real thing yet. Therefore, I attended two free seminars that COL Financial offers to interested investors. Yes you read it right. These two seminars are free and that’s absolutely a good thing for a wannabe investor!

However, I still felt the same thing even after attending the seminars. So I spent some of my free time reading more blogs and articles about stock market. There are two other advanced seminars that COL financial offers for FREE but only for those who already have an active account with them. This means that in order for me to attend the seminars, I need to open an account first. Otherwise, there will be a fee for non-account holders. And for a wise investor, I don’t want to pay for something that I can get for free.

One thing I learned from one of the speakers, Mr. Aya Laraya, is that when we open an account for stock market investing, it’s better to let your spouse or a relative know about it. Or better yet, open a joint account with your spouse (if you’re married). The reason behind this is somewhat similar to having an insurance plan. We don’t know what’s going to happen to us, and if the uncertainty happens (knock on wood), at least there’s another person who knows that we have an investment. Just a disclaimer though, this is how I understood his explanation. I’m not sure if this is what he actually meant.

Going back… When I finally decided to open up a joint account with COL Financial, I convinced my husband to join me to the Philippine Stock Exchange building in Ortigas, Pasig City. I tried to explain to him our purpose of going there but because he doesn’t know anything about stock market and that he’s not interested, I just asked him to affix his signature on the application forms and the other documents. My application was approved after 2 business days and they sent me my COL account number through email. I funded my account immediately and it was activated after four business days.

My account was ready, my fund was enough to start trading or investing, but I wasn’t confident enough to get it started. Two weeks passed and I finally decided to get into the real game.

So this is it!!! My First Day in Trading

Categories
Investment Stock Market

How I learned about Stock Market

4/26/14

Getting into the stock market was one of the hardest decisions I’ve ever made. It’s seriously NOT easy.

I initially learned a bit about stock market when I attended a half-day workshop called Cashflow 101 early in 2012. I found it interesting but due to lack of knowledge, resources and motivation, I totally forgot about it. I just thought it wasn’t for me and it wasn’t my thing.

When I got pregnant last year, I was advised to be on strict bed-rest due to some health reasons. And this was when I spent almost all the days and hours reading everything about investing, parenting, blogging, and anything that I can think of. Thanks to google for providing me the answers to all my questions and queries.

Two of my favorite blog sites that are related to investing in the Philippines are frugalhoney.com and thewiseliving.com. But there are a lot more on the world wide web. Just search “how to invest in the stock market, how to earn passive income, how to make money grow” and surely you’ll be directed to various helpful blog sites.

Reading blogs and articles online has indeed helped me in understanding not only investing in the stock market but also with other investment vehicles like mutual funds, UITFs, VULs, insurance, among others. It’s been almost a year since I started reading blogs and just a few weeks ago, I finally got the courage to open an online account for my stock market venture. And just like what I said early on, it wasn’t easy. And that’s the very reason why it took me some time to finally take on this challenge.

Almost everyone who ventures into any investment vehicle has his/her own turning point. And mine was simple. A few days before I opened my account, I stumbled upon a blog with a quote from Mike Dooley that says

The best way to live the life of your dreams is to start living the life of your dreams today, in every little way that you possibly can.”  

I suddenly felt awaken when I read this. There are so many things that I would like to do but I fail to simply because I don’t start it. Fear and pride keep on pulling me back from the starting line. I’m afraid that I might not be successful or that I might lose all my capital. I’m afraid that my family and friends would criticize or look down on me for not meeting their expectations or whatsoever. I’m always afraid of failure and that’s the reason why I just always want to keep it safe by not doing it at all.

I realized that I won’t know whether I will be successful or not if I won’t try anything at all. Most if not all successful people started from small things or even nothing before they became successful. And that’s because they took the risk.

I didn’t want to start yet because I felt that I wasn’t fully prepared and my basic knowledge about investing was not enough to get this started. And I had been delaying this for a few months already. Then I realized that there will never be enough because learning is a continuous process. It never stops thus we can never get enough of anything. But we can stick to what we have now and use it to start on this journey. We will never get close to our dreams if we don’t make the first step. And I’m glad I’ve made mine!

And I’m positive that all the rest will be learned along the way…

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Investment Stock Market

Cashflow 101

4/26/14

Investing in the stock market is not completely new to me. I first heard about it two years ago (2012) when I found an item on Metrodeal about a seminar-workshop on investing.

It’s called the Cashflow 101 and after checking all the details, I bought it online and attended the half-day event at Spicy Fingers, Greenbelt 2 Ayala Center, Makati City.

As far as I remember, it started with a short topic about investing and what makes rich people richer and poor people poorer. I forgot the name of the speaker but after the short talk, it was then followed by the workshop proper.

I really had no idea what the workshop would be like before I went to the venue and I was surprised when I found out that it was literally a board game. I’ve never played it before but my thought that time was that this was similar to the millionaire’s game. No real money was involved, only play money.

During the game, we were given same amount of cash (play money) and we simulated investing in stock market, buying properties, putting up businesses, and spending for our personal needs and wants. Whoever gets the highest amount of assets and fewer liabilities at the end of the game will be the winner, which meant that he was able to manage his funds properly and earned substantial returns.

The P340 fee that I spent for this event was really worth it. Not only did I enjoy the board game but also the delicious lunch that they served. More than that, I learned new things about taking control of my personal finances, proper cash flow management, and how to earn passive income. One thing that caught my interest was investing in the stock market which I had no idea on how to do it. All I knew when I heard about stock market back then was that it was only for the rich people and the businessmen.

One of my co-participants in that event encouraged me to invest in the stock market and she referred me to the Philippine Stock Exchange website for more info. I did check it when I got home but I didn’t really understand what stock market was all about even after reading some resources.

I totally forgot about the cashflow101 workshop and stock market investing until after two years when I got ample time to read and read and read anything that I found online about investing… And now I’m proud to say that even if I am still a newbie in the stock market, I am ready to take on the challenge and I’m excited to play the real game.