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Trading Fear, vix, and vxo

Discussion in 'Shares' started by wdongli, 29th Aug, 2011.

  1. wdongli

    wdongli Well-Known Member

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    Fear is one of basic elements to buy low

    Market is a war place. It sheds the panic and fear when the warriors have been completely defeated. In the fear and panic, the best services to them are that you buy what they desperately want to sell, which usually means lowest price or not far higher than the lowest price.

    Generally speaking, it is basic rule for business: that is "buy low and sell high." Fear is the greatest buy signal ever seen in the stock markets if you have the cash reserve and could afford to wait for hopes and reliefs to come back.

    1. This overpowering emotion flares fast, driving excessive selling that rapidly hammers stock prices down to irrational oversold levels.

    2. These fear-driven lows are the ideal time for anyone to buy low, necessary before selling high later.

    3. Provocatively stock fear has an effective ceiling, absolute levels that demand aggressive buying.

    All of value investors and wise speculators are interested in this concept, for good reasons. If stock fear has a ceiling, it would flag the highest-probability-for-success buying opportunities ever seen. Whenever this ceiling was hit in the future, it would be the ultimate signal to boldly deploy capital regardless of events.

    In the market there are two important matters to decide the profit:

    1. the time and time period for you to buy and hold
    2. the price set by the market sentiment, which will define the cost and profit in the time and time period.

    Quality is not a independent variable for a warrior service business. It has to be linked with the price.

    1. Over-paid quality is bad as the craps you pay too much for its remaining value! If you paid $135 for RIO shares, you are craps.
    2. If you pay BKP at $0.003 and sold it at $0.03, BKP could remains to be crap but if you have reasons to buy and sell, you did good job.

    If BKP gets the shale oil, it would definitely be re-rated its $0.003 price would be extremely low cost for shooting-into-sky effect.

    Fear ceiling would generate the worst price or lowest price at bottom channel. If you could pick up the lowest price constantly, you have won the battle or service business in more than half way.
     
    Last edited by a moderator: 29th Aug, 2011
  2. wdongli

    wdongli Well-Known Member

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    Herd fears and VIX

    How to measure the fears?

    It is difficult to measure the fears directly. It is because there are plenty of factors to affect our mood. However there are plenty of sentiment indicators infer it.

    The most popular by far is the famous VIX in US market. Traditionally XAO would be fearful while it is high. This index measures the implied volatility of certain S&P 500 index options. The S&P 500 (SPX) is America’s flagship stock index tracking this nation’s biggest and best companies, and the best proxy for the stock markets as a whole.

    The VIX uses complex formulas to analyze and weight SPX options prices expiring over the next 30 calendar days. Traders are constantly buying and selling options based on their own near-future outlook, which bids up or drives down specific options’ prices.

    The aggregate of all this short-term SPX options trading is distilled down into implied volatility, or how volatile options traders as a group expect the stock markets to be.

    The VIX expresses this construct as an annualized percentage.

    1. A 20 VIX reading implies that options traders expect to see the SPX move up or down at an annualized rate of 20% over the next 30 calendar days.
    2. Since fear is a far-more immediate and powerful motivator than greed, options volatility soars after major selloffs (the time to buy low)
    3. After the fearful ceiling reaches, it wanes to insignificance after major rallies (the time to sell high).

    If this indicator is used with the market events, such as Buffett bought BofA, it would greatly increase the probability to buy the worst and sell for bullish profit.

    Self-reinforcing and self-limiting of fear and greed

    As we know sentiment, the collective greed and fear of all warriors, is very powerful, which drives the vast majority of all short-term financial-market action. Market acts as a great pendulum:

    1. it perpetually swings back and forth between excessive greed and excessive fear.
    2. In bull markets, maturing uplegs generate widespread greed while maturing corrections spark universal fear.
    3. But these emotional extremes are self-limiting, they soon burn themselves out.

    After prices have advanced long enough and high enough in a major upleg, greed peaks. All warriors interested in buying stocks anytime soon have already deployed their capital, which leave the room only for sellers.

    Their selling spawns a correction. This is self-feeding or self-reinforcing matter, as the lower that prices fall the more warriors are frightened into selling. Eventually all warriors interested in selling anytime soon have sold, so fear climaxes, and then this endless cycle begins anew.

    This leads to ongoing bull markets advancing two steps forward in greed-driven uplegs before retreating one step back in fear-driven corrections. Trading these upleg-correction cycles is wildly profitable, buying low when everyone is fearful and selling high when everyone is greedy.

    But in order to trade sentiment, we need some way to attempt to quantify this ethereal construct. Enter the implied-volatility indexes. That is why VIX is so popular for the traders, investors, an speculators to play in the market.

    What's volatility measure for?

    Volatility simply measures how much markets are moving, either within individual trading days or between them. A day when the flagship S&P 500 stock index (SPX) sees a 3% trading range is way more volatile than a 1% one. While volatility doesn’t measure sentiment directly, it is closely tied to it. Since fear is a more immediate, visceral emotion than greed, fearful times witness far-higher volatility than greedy ones.

    Implied volatility extends this concept into the near future. It looks at stock-index options prices, which reflect what options warriors believe about near-future market action. The prices at which they make their options bets mirror their expectations. And when they are scared, which only happens after stock prices have already fallen significantly, ballooning options prices imply higher volatility ahead.

    So implied volatility is effectively a fear gauge, with the famous VIX being the most-popular index. It measures the implied volatility of a weighted blend of SPX index options expiring over the coming month.
     
  3. wdongli

    wdongli Well-Known Member

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    Nothing to fear except fear itself

    All of us know nothing is certain in future but we do feel fearful when we seen too many of uncertainty shocks since the April in Australia. There are internal and external uncertainties for our economies. The fear is powerful and once it starts its self-reinforcing, it crashes everything on the way for it to go. Fear needs to get its ceiling first and then it will reverberate for weeks as usual.

    In the fearful market, any excellent news is good or so so; any good news is bad news; and any bad news are the ticket to be in the doorsteps of hell. It is a time when everyone is over-cautious as that everyone is over-optimism when everyone could get some paper profit. We all are myopic mentally! We are more fearful after we are beaten again and again. That is what happen around XAO.

    Fear usually need some shock to stop and need to be soothed by some authorized people. We all like democracy but we never really trust ourselves for our financial capability while we are fearful. So that what message from Ben Bernanke become so valuable to defeat the herd fears.

    But the collective panic attack that began sweeping through global exchanges in July is far from over. Uncertainty shocks are anything but short and sharp. In fact, they tend to have a half-life of just under two months - in other words, it takes about eight weeks for the panic to subside to half its peak level. On that basis, we may have another six weeks or so to go. By that time, the outbreak of fear will have done its work.
     
  4. wdongli

    wdongli Well-Known Member

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    One of the things we need to be warned is fear itself. Each of these episodes of financial frenzy has presaged an economic downturn. It's hard to separate cause and effect: part of the reason why we are so fearful is because it's become clear that the recovery in the world economy is tailing off.

    But once the markets start to panic, it can create a debilitating feedback loop. Falling share prices reflect firms' fears about the downturn, but they also amplify them by reflecting everyone's anxieties back on themselves. That in itself makes a synchronised downturn all the more likely.

    We saw this effect most clearly in the aftermath of the Lehman Brothers bankruptcy and IT bust. The metaphor most often used was of ''falling off a cliff''.

    1. It is possible that this market chaos foreshadows a recession towards the end of this year, with world gross domestic product contracting by about 1 per cent.
    2. Firms do not hire new employees, or invest in new equipment, if they are uncertain about future demand.
    3. Consumers do not buy a new car, a new TV, or refurnish their house if they are uncertain about their next pay cheque.
    4. The economy grinds to a halt while everyone waits.''

    That's what happened in late 2008 and early 2009, and is what's happening now. Surveys from industry across Europe will be published this week, and are likely to reveal a sharp deterioration in confidence. Maybe it's the California sunshine, but, despite his prediction that we're headed for a double dip, Bloom remains an optimist. He believes that the jolt of the past few weeks will have been enough to shock euro zone politicians into getting their act together, and US lawmakers into tackling taboo issues such as the long-term costs of their healthcare system.

    There are two problems with that view, however. The first is that even if politicians can cobble together a response to these longer-term challenges, they also need to act urgently to prevent a new credit crunch, as Europe's banks struggle with the dodgy debts of the boom.

    Even if financial apocalypse is averted, the second worry is that we're hurtling towards Keynes's ''paradox of thrift'' on a grand, global scale. If one person saves a few quid instead of living beyond their means, that's good news; if everyone does it at the same time, it means collapsing demand and an almighty recession. George Osborne is not the only finance minister wielding the axe. The US, France, Italy, Greece, Ireland, Spain: they're all at it. The risk is that the ''uncertainty shock'' is replaced by the grim certainty that we're sliding into a Japanese-style ''lost decade''.

    So it's hardly surprising that the Fed chairman felt the need to send a reassuring message from his mountain redoubt: he knows as well as anyone the price of panic. Bloom is keen to point out that his work on uncertainty shocks builds on earlier, little-remembered research by a Princeton economist: one Ben Bernanke.

    Read more: Nothing to fear - except fear itself
     
  5. wdongli

    wdongli Well-Known Member

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    What can fears do?

    One of the things we need to be warned is fear itself. Each of these episodes of financial frenzy has presaged an economic downturn. It's hard to separate cause and effect: part of the reason why we are so fearful is because it's become clear that the recovery in the world economy is tailing off.

    But once the markets start to panic, it can create a debilitating feedback loop. Falling share prices reflect firms' fears about the downturn, but they also amplify them by reflecting everyone's anxieties back on themselves. That in itself makes a synchronised downturn all the more likely.

    We saw this effect most clearly in the aftermath of the Lehman Brothers bankruptcy and IT bust. The metaphor most often used was of ''falling off a cliff''.

    1. It is possible that this market chaos foreshadows a recession towards the end of this year, with world gross domestic product contracting by about 1 per cent.
    2. Firms do not hire new employees, or invest in new equipment, if they are uncertain about future demand.
    3. Consumers do not buy a new car, a new TV, or refurnish their house if they are uncertain about their next pay cheque.
    4. The economy grinds to a halt while everyone waits.''

    That's what happened in late 2008 and early 2009, and is what's happening now. A sharp deterioration in confidence. However once the fear is big enough, the fear wold push people to fight for better consequences. The jolt of the past few weeks will have been enough to shock euro zone politicians into getting their act together, and US lawmakers into tackling taboo issues such as the long-term costs of their healthcare system.

    A few problems and system risks are there at moments.

    1. Even if politicians can cobble together a response to these longer-term challenges, they also need to act urgently to prevent a new credit crunch. If it happens GFC II would be insight.

    2. Even if no GFC II we would have Keynes's ''paradox of thrift'' on a grand, global scale. If one person saves a few quid instead of living beyond their means, that's good news; if everyone does it at the same time, it means collapsing demand and an almighty recession.

    3. There are the risk is that the ''uncertainty shock'' is replaced by the grim certainty that we're sliding into a Japanese-style ''lost decade''.

    4. Deflation is more miserable to everyone. Everything is priced down, more and more people lose the job...

    5. Ben Bernanke seems know it very well. So he wants not to scare the market anymore.

    What about Australia policy makers? They can not do too much. RBA is cautious to fine tune the interest rate in case the storm is stronger even it doesn't think it is likely! Good thing is that XAO has rehearsed its crash in case if GFC II becomes true. It priced itself below 3900 before DOW crashed this time.

    We are all in over-cautious mood and if any positive shock moves in a swing positively seem unavoidable. However don't forget to get your corner safe and then get the chances. I like to be sitting duck and wait for good or bad things come in at moment! I do feel sorry for myself since I have not enough cash reserve in this nearly rock bottom!
     
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  6. wdongli

    wdongli Well-Known Member

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    Where would VIX move?

    Do you know the answer? Roughly there are a few scenarios:

    1. VIX shoots up to GFC level such as 80 - 90 from its current range 30 -48. If this happens, anyone in the market would be hurt for short term and a lot of bargain hunters would lose their shirts since most of them would be forced to sell on sale. It is possible but unlikely even double dip could not force market to lose its 50% value again. GFC means great financial crisis or vertical price down when moms and dads were still in euphoria.

    2. VIX moves in range between 30 - 48, it is terrible too since most of bargain-hunter types of traders would be consumed in the contrition war. The longer the more damage to them. They would be very painful if they want to hold or take too much losses if they sell. It is possible and highly likely but the question is how long? I guess it could last for another 2 or 3 months before the end of November. Why? Market seems expect so due to October effect in the market.

    3. VIX stabilizes between 30 - 35 for a few week and moves down to 25, 20, and could be spike up to 30 - 48 ranges times by times but could not stay there more than a week. It is possible if policy makers in US could use the money and fiscal facility to fight against the job stagnation. It seems very impossible to expect dramatic change in fiscal policy but money policy has to do something at about 25 September when Fed get its meeting.

    4. There are other scenarios for VIX outputs but above are the worst and best cases.

    Could you be in no loss position in worst case? Could you be rewarded in best case? Could you hold your position for months if not years in a contrition war? I bought some of PRR, FMS, SSN, and FAR and sell a few fishes to get my portfolio to balance the risks and reward and have got more cash reserve to avoid sell on fire.

    VIX turns to be less US focus only but what happen in Euro, China, and global economies as a whole. However it is reasonable to expect VIX would be slow down. The longer the stock market doesn't crash down as GFC the less probable it will.

    More important thing for a market player is get a balanced portfolio for a no loss goal in the coming storms if they would come so that if we are lucky to get sunny days sooner rather than later we would be rewarded.

    ***
    I am focusing on reading the book series of little books for profit and just finished the followings:

    The Little Book of Behavioral Investing
    The Little Book of Common Sense Investing
    The Little Book of Economics
    The Little Book That Builds Wealth
    The Little Book That Makes You Rich
    The Little Book that Saves Your Assets

    and I am reading "The Little Book of Main Street Money."

    The objective is to get all of basic concepts of the market, economy, human psychology, asset building and allocation, value, the linkages and differences of Wall Street and Main Street, and balance of risks and reward, together. It is a necessary steps to get a reckoning after I have tried to update my minds since 2004.

    I need to finish another few little books

    The Little Book Of Bull Moves In Bear Markets
    The Little Book of Bullet Proof Investing
    The Little Book Of Value Investing
    The Little Book That Beats The Market

    All of these are to set a backdrops to be a wise and intelligent businesslike market player.

    The reading is based on my evaluation on my English about social terms too. I have got enough vocabulary in Social English and now I need to speed up my reading and focus on the speedy reading.

    It needs the speed and quality to update the mind as we need them in our market playing.

    ***
    I do feel we need to perform properly and separate the skillful from the lucky takes top - notch information, careful analysis, and keen insight. I do feel even if we have all of that and most of us don’t nothing is guaranteed.

    We have to be conservative, prudent, intelligent, and protect us in worst time without cutting off us from opportunities, which could be possible if we are knowledgeable, use the knowledge intelligent, and organize our market playing as a businessmen to make our portfolio work as a high yield bond for our future in good and bad times!

    In the market there is the dangers that we run out of money before the bear comes back to its cave or we are so fearful that we give up any opportunities just staying in the sideline. Both of these dangers could be fatal!
     
    Last edited by a moderator: 4th Sep, 2011
  7. wdongli

    wdongli Well-Known Member

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    Bad, really bad, and all know it is bad!

    Now all of Aussies in the market or out of the market know it is bad, really bad, and very bad! Some of gurus expect now "A Tremendous Financial Collapse!"

    After 24 months correction of XAO, all of warriors(especially the bargain type of ones) who have had guts in the market, have taken the flights into the sideline. They targeted the pennies with dollars capital, which they failed. So the bubbles in all of sectors have been greatly deflated. The "tremendous financial collapse" is telling us that they are really depressed and hopeless.

    Is market in its worst time in half year or a year time horizon? Don't dare to say so but do feel it is likely it is at the worst point. When too many people predict the financial collapse, it usually means it goes too far.

    Deficit crises are the extension of GFC. They are results to save the sky. After the houses are burnt down, you have tries all to rescue as much as you can, and you see most of your assets in the houses gone, you could not feel good and perhaps you feel very no hopes to build a new houses with the bared hands. However the damages should be capped, that it all you could lose even you could not build new house in days or even months.

    Very happy I could pick up some promising fishes and rebalance my portfolio. No desperate selling of the fishes in my portfolio in the red ocean of the stock market today. XAO has collapsed at August 2, which crashed below 3900 then. Could XAO crash down to 3300 again? Possible but quite unlikely!

    What if the market would not collapse? Invert, invert, and always invest against the herd sentiment! They could not be right to predict the fate of the sky! They could not do so before and they could not do so now!

    What if unfortunately they are right? All of us would be in the water and if all of us in the water, it is fate and doesn't matter you cry or not! I believe that. How many genius run in the stampede with the advanced system in GFC? A lot! It is the time to use the common senses and life logic!

    What if another V-Shape recovery comes in? Impossible? Who really know? However if it is there in a year, I would be at very good position and could recover my lost paper profit which I lost between April and July. If so I would never forget the hot market could make my head hot! If so I would never allow my cost runs and my cash reserve deleted before the market moves into another worst point! I don't believe the sky would fall down when I am alive even it could be true! If it is just a tsunami, it would pass by definitely!

    Could you be safe if the sky is there and the attrition war continue? If yes, no worries! I am working in my corner and start to look around just my corner! If some dumping happen I would try to rebalance my portfolio for lower cost!

    Could gold move up and up in the crying for the sky crashing down? Quite likely! I have held some gold hopeful in my hands. They are still very desperate but if gold shoots up to $2000, 3000, or the crazy 5000, I guess they would be very valuable!

    Life is good even in the storm and ruins if you could find the light and don't run in the stampede of the running of the crowd. I have not run in the crowd since 2004 even I have made some silly honest mistakes!

    Could we say: if you don't run in the crowd stampede madly God would bless you? How many genius lost their shirts in GFC with their advanced systems when they run desperately in the storm? It is the time to call life logic and common senses(not conventional ones).
     
    Last edited by a moderator: 5th Sep, 2011
  8. wdongli

    wdongli Well-Known Member

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    If feel safe, you could dream!

    Do you feel safe in the crying of another tremendous financial crash or do you feel the damage has been done? Yes? It is time to dream!

    What if BKP could get shale oil in September? It would be a 10 bagger betting! Don't forget I have sold 1,000,000 of BKP to rebalance my portfolio. There are multiple scenarios and what we choose is very important. Now I have only 800,000 of BKP, which is what I could afford to lose!

    What if SSN could get a lot of shale oil in its Defender Well? It would fill the gap between its calculated value and price definitely?

    What if FMS could get a powerful financial partner with the help of Citi? That would change its dirty-cheap fish nature then!

    What if FAR could drill in African and get a successful oil burst? That would be fantastic too. Its price has been crashed due to the failure of drilling and market selling season!

    What if CTO could overcome its problem and gold price just hover over $2000? It would be fantastic too.

    ...
    ...
    Some thing would happen and surprise all of us times by times! They could be positive and negative. What the storm would last for a few weeks more or less? No surprise at all. All of crowd have got themselves ready for that. It is highly likely the positive surprises would make people crazy!

    Why do you predict the same thing as the crowd? It is mad and crazy!

    When the crowd and their doomer desperately tell the sky is in danger, someones would work to fix the poles to support the sky. Who would win? I bet 70% of chances for the people who try to fix the sky!

    I prefer to cry for my own mistakes and madness but I would never cry for the fate! I would dream in the night and be confident I would wake up tomorrow morning even I really don't know!

    ***
    It is the time all of assets are in fire sale. All of news are viewed by the bias minds for worse results than what they tell! It is reactionary to the reality as euphoria in the mania! Could you feel the value and the discount? Do you have buffer to hold for months or years?

    I don't believe I could always get things at their worst price but I do feel very good I never buy anything at peak since 2004! I do feel sorry for myself since my head could be very hot when the profit becomes too big to lose and I allow they were lost in the collective money burning activities! It happened in IT boom and bust and now!
     
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  9. wdongli

    wdongli Well-Known Member

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    Why don't you burn XAO down to ground?

    XAO tends to go more extremely now than anyone else! DOW drops down 2%. XAO would drop down 2.5 or 3%! If DOW could keep volatile for another 4 weeks or 8 weeks, all of retail warriors could be wiped out from the market, couldn't they?

    CIG announced

    1. When the compression equipment required to test flow rates was delayed again, Caspian decided to run a low-volume mechanical pump into the well to confirm the presence of moveable oil. Using this method a small volume of oil (about 10 bbls - equivalent to the pump capacity) was pumped from the well bore. The oil was essentially water-free and appears to be heavy crude (API < 20°).
    2. Laboratory tests have been requested to confirm these observations. During the test, pumping fluid levels were monitored and remained essentially static with a head of about 840m during the period of pumping operations.
    3. To obtain an understanding of potential flow rates, which is required to size pumping equipment and facilities for the well, the services of a large air compressor is still required. A unit has been sourced from Kyrgyzneftigaz (the National Oil Company), and is expected on site early this week.
    4. While commerciality of the discovery has still to be determined, initial estimates suggest that there is a potential mean recoverable resource of 1.0 million barrels, with an upside case of 2.2 million barrels of oil within Bed III of the West Mailisu structure.

    The above if in a sunny day would excite the warriors very much but not now! Now all of people turn to be very sensitive about the words, "While commerciality of the discovery has still to be determined." What if it is not economical and commercialized? Big question! But if it is tested and write down in white and black, it would be no bargain at all! I do feel it has chance more than 80% to have the oil economically!

    Is it bad? Not at all! I bought some of it at $0.011.

    I do wonder why Aussie don't burn XAO down? It makes them too painful than anything else, such as DOW and FTSE around the world. What Aussie dollar goes to sky and XAO down to the bins? It would be great to them!

    Sell, sell, and sell! Why don't you sell?

    I will sell after no people cry for the sky to fall down any more and the market turns to be over-optimism or I feel hot again! I like the cold days which force me to be optimism with the guard!
     
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  10. wdongli

    wdongli Well-Known Member

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    That is a good news!

    News said Warriors'(so called investors in great respect) "confidence in Australia has hit its lowest point since the first quarter of 2009, when the domestic stock market plunged due to the unfolding global financial crisis," according to a survey!

    It is a great news if you have cash reserve and good position in the market!

    1. Australians are clearly panicking and preparing for tough times ahead

    2. "80% of respondents predict an economic slowdown over the coming quarter.

    3. Warriors have become much more negative about business conditions, with 68% of respondents expecting them to deteriorate, up from 44% last quarter.

    4. What market as a whole predict, its price would be set for this prediction!

    Based on 20/80 principle in the stock market, in panic 10% of market players would make 90% profit while 90% people burn them money desperately! Can not be sure the assertion is absolutely right but roughly OK!

    The first quarter of 2009 was the worst time of GFC! I get more confidence I have got my position on a rock while I try all to lower the cost of my portfolio and patiently wait for the rising Sun.

    If it is darkest time, the sun would rise sooner than later! The market is like a chess board where there are too many different scenarios we could choose but 80% of warriors would get the wrong options in best or worst time, 20% of all of their market time!

    I am happy I am not one of these warriors even I am a fool, who made a series of mistakes honestly since April!
     
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  11. wdongli

    wdongli Well-Known Member

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    Why are you happy in most of time?

    One of my friends wondered why I could be happy in this bad time and so confident about the future. Yes I also wonder why in Australia so many people are so unhappy too!

    The resource is scarce, all of us here don't need to worry about the necessities as our grand and grand fathers, and we could have chances to win or lose in the market. We are lucky enough to live in this highly civilized time. We have the internet to know things happen around the world. We could live independently with free thought. So why should we be unhappy?

    I felt very painful to see my paper profit gone which I had accumulated between October 2010 and April 2011 but I couldn't find the reasons why I should be unhappy after I have identified my mistakes and learned the lessons from my mistakes. My friend wonder if I am happy just because I am alive. I guess it is a important reason. You are alive in the market, try to make your future, pick up your own selection, and then how more could you expect? Something if you could get, you will get after you pay the time and efforts. So why do you expect the things which don't belong to you?

    Don't you feel bad if you know somebodies could do much better than you. Better than me? How? Everyone has his own colorful life. Somebodies were born to cry or enjoy the life. No any points to compare. Do what you enjoy to do and take the consequences; good? take; bad? try to change for better. Who could be better than you for your dreams and future. No one! You make your life colorful or dull!

    I should be happy! All I do are based on my own decision so far. When I wanted to open my eyes to see the world, China opened its door. When I wanted to bet on houses I could borrow all for the houses. When I wanted to be full time market student I could quit my job and at least I have studied for nearly 2 years.

    Now after I wanted to fix my mistakes I could spend all of my time to fix them. I don't believe lucks but understand the lucks could give us some great bonus. I feel very lucky in my life since I could have chances to lose $400,000 paper profit in IT bust, $180,000 paper profit in the current crash, and then still have some saving to focus on learning the life logic, common senses, and wisdom! How lucky I am! I still hold 3 houses even with $400,000 debt, which if I want to pay back I could pay 70% of the debt back. I am thinking to sell two investment properties when the residential property market recover. I believe I could be a master in a decade or longer. Stupid? Sound it is but if we can do something naturally we could not do, we should be happy!

    I am optimism always and now I know I should be optimism with some great guard. I know I should not be synchronized with the market sentiment. It is a valuable asset. I could not be unhappy. It is the worst time, right? If not it should be not far away! We could not change the fate but we could choose to buy at the worst time and lock the profit in the bullish time.

    If I could be prudent and balanced in the market I could turn me to be a businesslike market player. No too many people believe I could, which is fine. If I fail after I work hard for it, it is still good since at least it confirms that I could not live on the market. I just fail in the market but my life is colorful in my own standard. So I should be happy.

    Life is a journey and if we could move forward, we should be happy. I could not find the reasons why I should not be happy when I dance on tap to work out how to make profit in the market.

    Yes I am happy and really grateful I could be happy! I could be insane this time but I will try not be so insane next time. I could make my life, good or bad so that I should be happy! What if another V-shape recovery is moving in? Who knows? Luck comes into prepared hands. I am preparing for my turn of lucks!

    Anyway it is a journey and all of money belong to this world, which no one could bring away. Do what you want, get what you could get, and leave some of money behind without worrying who would use them. If we think so and do so we should be happy! Life is good and really good, isn't it?
     
    Last edited by a moderator: 5th Sep, 2011
  12. wdongli

    wdongli Well-Known Member

    Joined:
    31st Mar, 2010
    Posts:
    1,292
    Location:
    Perth
    Amazing to see the sky again!

    Surprise, surprise, and surprise! DOW dropped down not 500 but 100 only! XAO doesn't drop down further but moves up this morning!

    What's wrong? Everything has told us the sky could fall down and what I could read just tell me we were hopeless!

    Even consciously I trust the words that we should be greedy when the Wall Street is full of bloods, I still feel gut crunching to buy when everyone just burns the money on fire!

    How about more bloods that the Wall Street wants from us? We don't have too much blood to fill the street! No we could not buy in the blood! We have to run in the ruins! We rather die in the stampede than just move around corner! We believe we have to do something before something happen but when something happen we will not do what we have to do!

    Feel amazing to see the sky again!

    Warriors need a day break!

    XAO seems get part of its mind back!

    I am happy all of the market could have a break!

    I am happy I could painfully get my gut to rebalance my portfolio for lower cost in August painfully rather than run in the ruins tearfully!

    I should not make new mistakes in this bearish time due to the fearful scenes in the rear mirror for my next goal!

    Mr Market is a bad guy! How could he grinds over the depressed warriors so terrifically and suddenly change his mind without any notice! It is impolite conduct! Could we put it in jail and then we can make a lot of money without any pains since we have a lot of lovely systems?

    What? Our death squads are moving out of the valley of death! How long could they be safe and start building the bridge for all of us to move forward? About a few weeks or a few months! You mean some great victory ahead? No, it is just one valley of death! Be organized, patient, analytical, and self-reliant!
     
    Last edited by a moderator: 7th Sep, 2011
  13. wdongli

    wdongli Well-Known Member

    Joined:
    31st Mar, 2010
    Posts:
    1,292
    Location:
    Perth
    Could you predict the future?

    What happened yesterday and today repeats a truth:

    No one really could predict the future exactly. We have sky before and now even we have a lot of tsunamis around the world. Pundits tend to predict what will be in future but they just could talk about but never dare to put the money in and out based on their talking.

    In the sunny days, these pundits tend to tell you the reasons why it is so bright and when you follow their words, you are hit by the market again and again. In the rainy days they tend to tell you the reasons why the sky should fall down or at least it should sink 99% or 49% after ruins are everywhere!

    Unfortunately warriors have no gut and brains in the market! They like to hear rather than think. They run first and listen the bullshi* from pundits. So we could see the similar plays in the market again and again. Market warriors buy desperately at peak and sell in panic at lowest price or crash!

    Independence is important always to a people! When you lose your capability to think independently, you lose all of chances to make mistakes, get lessons, and act rationally in the market.

    I don't listen what the market pundits saying! I would like to make my own human mistakes! I would like to run in the day it is sunny!

    Could we expect the sunny days? Could we expect the storm would be gone? Don't expect too much and we just need to move around the corners! Rain? Come back to my corner. Sun rising? Run for something around the corners for next raining days!

    Go to the hell, pundits and fortune tellers!