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Trading Fed and shorters

Discussion in 'Shares' started by wdongli, 1st Dec, 2011.

  1. wdongli

    wdongli Well-Known Member

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    DOW jumped about 500 points. XAO jumped more than 100 points. The global markets jumped together.

    What were up? Why haven't we heard any cheerful sounds from the retail traders? What do the shorters feel now? Have you seen it appeared before it happened? Why not?

    The global markets are involved tightly unexpected before internet. Most of retail traders have been in water for more than half years if not years. They are dogs in water and then no any good news could cheer them up!

    It is amazing to see Fed led other central banks to slash the cost of emergency dollar loans to foreign banks. Could it shed enough light for the dogs in water and darkness? Don't know but it is definitely good for market sentiment and help the market find the rock bottom for breaths.

    Market always makes some turning points, which could be seen after but few could see clearly before. Now most of retail traders have been consumed enough and then feel hopeless.

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    A question is "is it bad enough?" Shorters now seem have to answer it correctly! With my spade in hands, I could wait and see! From the charts above one thing is sure that XAO acts as though no resource booming but Australia in deep recession!

    To be safely saying the move is very supportive but not necessarily a game changer after most of market players, big or small ones are in deep water. The market players as a whole are in deep bad emotion after long enough contrition. The impact is more psychological than anything else. Actually XAO has acted emotionally for more than 2 years.

    It tended to question and reacted eagerly to bad news from anywhere more than follow anyone else. Actually it tended to lead the world into GFCII. The charts above show the collective behavior of Australia market. Its economy is small; its financial system operates more conservatively; its traders act more negatively than positively; and then it moves up just after all of others move up and drop down more fast than anyone else in crash or worries about crashes. This collective behavior needs to be remembered and put concern for our own behaviors as market players.

    Could another up-leg have been brewed behind the future curtain? Shorters should be much less aggressive than they were in August!
     
    Last edited by a moderator: 1st Dec, 2011
  2. wdongli

    wdongli Well-Known Member

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    It is all about history and then market

    "Through chances various, through all vicissitudes, we make our way. . . ."

    Do you understand these words inside and outside?

    It is all about us, the history, the market, and life.

    As human kind as a whole it said all but as an individual, you could be put into hell without matter how clever you are for rumors and facts in past.

    When you desperately beat others since they have different views about one thing, you fail to understand the words about.

    Don't lose your gut!

    Don't lose your consciousness!

    Don't be fearful in the vicissitudes!

    Don't curse too much for your unfortunate or that anyone else!

    Don't give up to let you wiser!

    Don't forget if you could make your ways for your personal legend, you are the winners.

    Don't worry or upset if someone disapprove your goals and efforts. They would be gone much quicker than your expectation since they are just people as lookers!

    Chances come with vicissitudes for human kind. Chances come with failures for an individual with guts and conscious minds.

    Chances have the cost. If too high, you have to find alternatives. It is not about right or wrong but could you be a wise people. All of us have our own limitation and not all of them could be broken down!

    In the ruins, if you could have your last defensive lines, you keep the positions to brace the future opportunities.
     
  3. wdongli

    wdongli Well-Known Member

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    IQ, emotion, and intellectual framework.

    1. a lot of traders like to be thought clever
    2. the truth is you don't need high IQ, far sight vision, an inside information
    3. a winner needs sound intellectual framework for decision and never allow emotion to corrode the intellectual framework.

    ***
    Do you have this kind of intellectual framework?

    1. you need the discipline to lead your emotion to the right place.
    2. you need the behavioral and business principles

    Unfortunately too many traders twist the words rather than put effort and intellect; too many like to tell others how they are clever and hit others to show their cleverness.

    ***
    Winners are few in the market since it tends to lead people for quick money.
    Whether you achieve outstanding results

    Market could be crazy as GFC and now. The amplitudes of stock-market folly that prevail in the time you are in the market would greatly affect your result.

    Few market players understand the sillier the market’s behavior, the greater the opportunity for the business-like investor. Unfortunately people tend to join the folly rather than to get their profit from the folly.

    ***
    Hit others are stupid and idiotic since it just wastes the time. However in worst time, people tend to hit others rather than to put their efforts to build their defensive line and get the chances for themselves.

    When I read the post to hit others and the emotional reactions I do wonder what they want. Emotion is not cheap resource. You put out more you become easier to be exhaustive.

    Why do you just enjoy to evaluate others? You are idiotic or immature in the market. If you could not be consumed by the market it is your lucky!
     
  4. wdongli

    wdongli Well-Known Member

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    Too many traders want to show how clever they are. However they forget people are always do something foolish, something creative and something generous.

    When I read the clever words in the trading forum I do feel these people are too good to be true. Some said in this forum there are a lot of experienced and clever people, which may be true or not. However I do wonder how wise the people around here and there in the market. I never know any wise people who declare they never make mistakes. However too many of us declare to be mistake free.

    Have you ever do anything foolish, creative, or generous? No? When you push others at the corners for nothing, you are foolish and not generous even could be creative.
     
    Last edited by a moderator: 6th Dec, 2011
  5. wdongli

    wdongli Well-Known Member

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    Do you know the winners in the market need the right emotional framework and good analytical tools? These framework and tools are essential and would correct your miscalculation about the gap of your perception and reality.

    Do you understand all bull markets must end badly and all bear market must end reasonable good? Do you understand insights tend to go the hard way? That is you have to make mistake and feel firsthand the anguish of financial loss. You have to know the history and psychology of the markets.

    All of us would get lessons but wrong emotional framework and good analytical tool tend to lead people to show off and curse others to let them pass by the ruins even the cost is sale on fire.

    Some would be rich even just because their lucks. That is not wrong but use your lucks to beat others' failure is not right. Life is short and to be poor you just need a few mistakes with high consequences.
     
  6. wdongli

    wdongli Well-Known Member

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    There are rules and principles for anyone who would like to make money in the market. Few market retail warriors would like to spend the time to understand. Too many follow the winds rather than the rules and principle to behave in the market. Do you follow any rules and principles?

    1. a stock, blue or dirty cheap, is more than a symbol and how the wind would go. Anything has its value and any business has its underlying value. Value would decide the price sooner or later rather than price make value. However too many traders just guess and follow the price, which move up/down based on the market sentiment.
    2. the market is a roller-coaster which never stop to roll. It swings between or around unsustainable optimism and unjustified pessimism. Too many buy in optimism and sell on fire. How could you destroy your business? Sell on fire!
    3. there are simple relationship with complicated variants between future value and present price. Future value is a function of its present price. The higher you pay today, the lower you get in future. Too many clever traders cry in ruins and cheer in euphoria. They are in constant bipolar disorder.
    4. you are human. Human makes mistakes as a individual. Human kind move forward in vicissitude and mistakes. No one can ever eliminate the risk of being wrong. Who pretend to be right forever would pay the cost, which is very dear.
    5. You have to protect yourself and your money. You have to get margin of safety. You should never overpay no matter how exciting an idea seems so that you can minimize the odds to be absolutely wrong.
    6. you are never more clever than Mr. Market to play the tricks in prices. The winning core is in yourself. You have to be independent on critical thinking and never follow the market fades.
    7. you need discipline and courage. You have to refuse anyone to disturb your emotional framework. You need peaceful mind and patient confidence. You have to take steady advantage of even the worst bear markets. Don't cry in the ruins.
    8. Don't allow anyone in the market or forum to swing you up/down and then the swings of the market price govern your financial destine. You have to be sure if you are wrong it is your mistakes not anyone else.
    9. At last, how you invest is much less important how you behave as a man. For example, after any big enough mistake, you have to pause and find a way to protect you first rather than join the criers in the ruins.

    Why so many genius fall in the ruins and still stay in the hell? Think about. Don't cry and let the crying eat out your guts about life and market. If so, you are a coward. That is it is!
     
  7. wdongli

    wdongli Well-Known Member

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    What have you got from stock market in a decade?

    Do you know how much you have got from stock market in a decade? Could you honestly tell yourself not anyone else the fact, not the guess, not the feeling, but the fact?

    It was said here we have a lot of experienced experts. What make the experts? The big enough return from the market in a decade! “Those who do not remember the past are condemned to repeat it,” said the wises. Are you experts who have forgot this saying?

    I could not feel we have a lot of experts here as any trading or investment forum since I could not hear the wisdom and intelligence from too many mates here. All seem feel too good to be true!

    ***
    “Everybody Ought to Be Rich,” but few really becomes rich enough. Is it rich enough since we all could post something here? Is it rich enough since we could cry nicely and synchronized with the fades and winds? is it rich enough since we dream to be rich effortless since we grip up on some revolutionary ideas?

    We all show some insanity due to the fears and greed. How many IT lovers are still active in stock market? Most of them just are gone. It was a exciting and terrible decade. All of us now could google and have some right or wrong ideas but few could get money from "googling!" All sound as experts in the market but few have good enough emotional framework and the right tools.

    So most of us are still struggling to buy the rumors and sell the fact. Are you really experts to make money? Easy money is easily gone! How many of us live on the pensions without their own houses after work hard for a life?

    ***
    Some were lucky and could get a lot in any gambling. 85% of market retail players are losers in the past decade as any decade in history. Why?

    You admire Livermore? Why not? He made a legend even the consequence was tragic. One principle that applies to nearly all these so-called “technical approaches” is that one should buy because a stock or the market has gone up and one should sell because it has declined.

    This is the exact opposite of sound business sense everywhere else, and it is most unlikely that it can lead to lasting success on the stock market too. In the last decade, I didn't see anyone who have been extremely rich through any tech only.

    Too many became broken since sale on fire. That should be so since it is most effective way to close any business. Who could follow market always right for money?

    That is why we have more criers now than cheerers. Too many lost their shirts and then how could you not cry? Crying is the fade in the market now. The louder you cry the more proud you feel! What's insane crowd in what unbelievable market environment!

    If you could cry so loudly why don't take your spade for your last defensive line? It is insane and mad time since most of people have lost their guts. I always have faith on the sky since no sky all of us would be in hell! I just could not see the logic of the criers! I just could not see the logic to think crying as wisdom! Clever? Maybe! But a crier everyday has no tomorrow usually!
     
  8. wdongli

    wdongli Well-Known Member

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    A fact few pay attentions on

    Anyone, if just buying and holding a diversified portfolio, which is big enough, can equal the performance of the market averages.

    Theoretically it would seem a comparatively simple task to beat the averages or beat the market. But as a matter of fact in the last decade, most of retail traders and investors lost a lot of money since they jump into the market at wrong time, when they felt good about the market.

    The proportion of smart people who try this or that but fail is surprisingly large. How many smart people here could get no-loss position? Very few since if there are enough winners, we would not hear so much crying and have much larger amount of people post here and there cheerfully.

    It is a losing decade, which is true even to the majority of the investment funds, with all their experienced personnel, have not performed so well, over the years as has the general market. How much have your super funds lost your money?

    Allied to the foregoing is the record of the published stock-market predictions of the brokerage houses, for there is strong evidence that their calculated forecasts have been somewhat less reliable than the simple tossing
    of a coin.

    The market is a wild field. You have to be right in your mental framework. You have to buy at the right time. You have to buy a $1 at $0.50 price so that you could survival when all are selling the $1 at $0.25, which could be expected to be recovered later.

    When I saw a various of prediction about 2012, my gut is crunching. These experts in prediction are horrible to get any lessons. They tend to break themselves before they could beat the market.
     
  9. wdongli

    wdongli Well-Known Member

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    Put the fundation for your castle!

    Someone once said "if you have built castles in the air, your work need not be lost; that is where they should be. Now put the foundations under them."

    Have you asked the question where your castle is? No one could predict the future and no one could tell you how beat the market! Few retail traders and investors think about it. Most of them want to use some computer system to win out! However they have the castles in the air, where their money out of their hands.

    There are three lessons in the last decade are extremely important for a retail market player:

    1. how to minimize the odds of suffering irreversible losses;
    2. how to maximize the chances of achieving sustainable gains;
    3. how to control the self-defeating behavior that keeps most retail players from reaching what they want.

    Why do you cry? You fail to avoid suffering irreversible losses; You could not get any chances to get any gains; you could not avoid selling on fire; you could not become any little bit richer.

    What's a loser in the market? It is those who lose their capital. Don't let you feel better to curse or beat others! You make yourself to be the loser! If you really want to be a winner, you need the mental framework to be a winner.
     
    Last edited by a moderator: 13th Dec, 2011
  10. wdongli

    wdongli Well-Known Member

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    Cleverness and intelligence?

    Are you intelligent or clever in the market? You are very clever but don't know yourself and environment and then you lose your shirts emotionally in the market. Howe many clever boys and girls here and there lost their shirts?

    Intelligence has nothing to do with IQ scores. It simply means being patient, disciplined, and eager to learn; you must also be able to harness your emotions and think for yourself. This kind of intelligence is a trait more of the character than of the brain.” Do you know that? If you talk about buying the rumors and sell the news, you could be very clever but not intelligent. Could you know yourself and environment from rumors and news only?

    In 1998, Long-Term Capital Management, a hedge fund run by a group of mathematicians, computer scientists, and two Nobel Prize–winning economists, lost more than $2 billion in a matter of weeks on a huge bet that the bond market would return to “normal.” But the bond market kept right on becoming more and more abnormal—and LTCM had borrowed so much money that its collapse nearly capsized the global financial system.

    Sir Isaac Newton owned shares in the South Sea Company, the hottest stock in England. Sensing that the market was getting out of hand, the great physicist muttered that he “could calculate the motions of the heavenly bodies, but not the madness of the people.” Newton dumped his South Sea shares, pocketing a 100% profit totaling £7,000.

    But just months later, swept up in the wild enthusiasm of the market, Newton jumped back in at a much higher price—and lost £20,000 (or more than $3 million in today’s money). For the rest of his life, he forbade anyone to speak the words “South Sea” in his presence.

    They are all too clever to hold what they could get. Why? They were very clever and hoped the world follow their will. Could you let EU and China follow your magic rod? If not why don't you be intelligent and do what you should do? Could you learn anything to cry or curse?
     
  11. wdongli

    wdongli Well-Known Member

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    What means intelligence in market

    Intelligence has different meanings in different fields. Newton was one of the most intelligent people in sciences, who was very intelligent as most of market losers define.

    But, in market, Newton was not intelligent. He let the roar of the
    crowd override his own judgment and acted like a fool as most of market players do. He definitely was cautious at beginning but he also definitely lost his mind due to the rumors and facts he could see.

    Have you failed in market so far, it’s not because you’re stupid in your field. It’s because you haven’t developed a emotional discipline that successful investing requires.

    Do you know how to enhance your intelligence by harnessing your emotions and refusing to follow the market’s irrationality. Read about what you posts and think about why you lose your shirts while throwing away the stupidity to pretend you are the best. You are not!

    Remember it is more a matter of “character” than “brain” to be an intelligent investor. What you do in the wind and storm defines your stupidity and wisdom!

    In the discussion about "opportunities for 20 people only" all sound very clever and declare their assertion is the best. Are you sure?
     
    Last edited by a moderator: 14th Dec, 2011
  12. wdongli

    wdongli Well-Known Member

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    Damage could be avoided but not...

    Big losses usually cause crying or cursing. Retail market players tend to expect regulators to do what they should do by themselves. So too many damage, which could be avoided, has been done in the ruins.

    Most of retail traders could not understand “while enthusiasm may be necessary for great accomplishments elsewhere, on Wall Street it almost invariably leads to disaster.” They tend to let themselves get carried away or traded in.

    What're rumors for? What're facts for? To them, wisdom and intelligence are nothing. They make their judgments and decisions based on their guess work. They ignored that “the really dreadful losses” always occur after “the buyer forgot to ask ‘How much?’ ” They simply lose their self-control just
    when they needed it the most.

    How many retail market players here or there really believe their chief problems and their worst enemies are likely to be themselves? Could any one make his business successful based on the winds and storms? However most of retail market players put their future on the guess work about EU and China!

    They are clever but very stupid even some of them have experiences in the market for a decade. They have systems maybe but no brains for logic and common senses!