Trading Something important to both traders and investors!

Traders or investors tend to separate them in black and white but I do feel without mater what part you take the goals for everyone in the stock market should be the same.

Successful traders and investors actually have similar goals: manage risk; diversify, and learn to control emotions. The main differences are the tools they use and how long they hold a position.

All of us should stay the course to make profit in short term and long term. Without short term profit you would be in trouble of your cash flow, which would harm you definitely. Without long term profit accumulate, you would be in trouble for your life in the stock market.

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We are the most optimistic when the market is at an all-time high, and most pessimistic when it’s at an all-time low. Because of that we could not get profit both in short term and long term.

We are hungry for profit. But we should remember time is our friend, impulse is our enemy. We need the diversification and time average so that we can roll our snowball bigger and bigger.

We need to find a way to hold stocks in an amount and with the margin of safety so that we can sleep at night without matter the cause is euphoria or depression. Sell down to the sleeping point.

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Managing risks actually could be simple. Don't buy too much for any target even they seems very promising and don't buy all at one time; only buy what the calculated profit is promising and the calculated risks are affordable.

Since 2004 before May 2011, every time when I used time average such as first entering a position, he often buys half of a normal position, and adds a little to it if the stock goes up, I could manage my portfolio very well. However while I was fearful or greedy I tended to buy too much at one time for one position, which always led failures.

The trick is we should make bigger money when we’re right, and cut losses when we’re wrong. We have to know we do not always need to be in the market. Knowing when to lock in gains and move to the sidelines is just as important as knowing how to capture gains in the first place.

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Today some traders or investors around PPX were in bad mood. They sold it to a new low, $0.05.

PPX announced it just sold some of its asset for $69million and its market cap was $30million only. I still have not got the skills to evaluate its value. However PPX has been on fire for 5 years and the price should be much less than its remaining value.

Read the news from China and did feel it was bad enough. So I bought $5000 PPX at $0.051, which let me feel not very good since I paid $0.001 more than its close price.

If the crowd mood becomes good again, it should be a good buy if not a best buy. Could it come back to $3.5? Don't know but if it could I would make a killing.

 

Stop read and write before...

I enjoy to read since I could read. I want to write since I feel amazing if the flash can light my mind.

Long before my 30, but I did find I have to get a pause so that I can ponder. No pondering you could know everything but could not understand anything. A true stupid and hopeless!

There are traders and investors who read and write but never ponder. Nearly all of retail traders act as primary animal for their hungry of the money.

How about you? I came to the stock market since the internet and the hungry to the money for my dream. I started instinctively. I read enough but ponder too little.

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Economies are built based on the businesses.

Do you know it is the season for harvest or do nothing since it is too cold to survive outside? Do you know or understand what you own If it is a harvest season? Do you know what the company does.

If you know you should know and carefully put buffer on your back you would not be panic during bear markets, and takes them in stride.

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A lot of our mistakes have been made just because we don't know and don't understand. When you copy and paste an article from somewhere do you know what it is really talking about?

Seriously saying when I started to bet in the stock market in 1996, I didn't know economies and businesses at all. I didn't have the time to ponder what the economies and market are. Since 2004 I put the time for my pondering but there have been too much misunderstanding.

We know too much but we don't understand how to survive if something is seriously wrong in the stock market. The challenge is you could not use your instinct to survive in the stock market. You have to update your mental framework.

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Just encountered words "do remember something in your life are deserved for your broken heart" in TV series, Doctor Who.

Stock market opened a new door for anyone who would like to get in for his/her life. It is marvelous but very heart-broken times by times. There were millions of retail traders who have left away with the broken hearts. Just look around how many mates have left in your trading forums.

You want to get the profit and then you have to remedy your ill heart. Before you can cure your ill heart you have to get your gut to take the fact you are not good and quite possible you are very bad.

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I have admitted my ignorance and arrogance. I have the gut to face my own ill-heart. I would cure it since the stock market is deserved for my broken heart.

I like to pay what I should pay. Watch Doctor Who and do feel the difficult to get the capability to listen English as my mother language. However it is my first step and work I have to do for a long time as I have to update my mind which needs the language to get the knowledge, wisdom, intelligence, and then the profit.

It is my second road of my professional career. I would fall down since I could not be human errors free but I would find the way to roll my small snowball and let it bigger and bigger. I need a lot of knowledge to win out in this new road. I would like to commit myself in!

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I like this road very much. It can let me have a job I could work on dance for the time after 50s. It is of course not cost-free. You have to educate yourself along the road. You have to deal with the time heart-broken!

A few weeks ago I suddenly find I was becoming weak physically. I could not change our nature course but I could do what I can do. Good work needs enthusiasm, optimism, and healthy. So I started to do physical exercises for half hours every day.

Could I win out in the stock market? I don't know but I do want. We could not predict the future but our characters do form the future. I need to control what I could and then let the lucks play its course.

***
Good to see DOW raised up for about 200 points. XAO would be the follower of good mood and leader to run into the hell.

However if EU just stabilizes, China lands softly, and US moves into slow expanding track, the coward Aussie traders and investors would be fearful to miss the train.

Yes don't forget it could be worse than your imaged worst! Put your armor with big back up team behind and then service the depressed warriors. Life is good and always good!

 

What's going on?

I believe less and less of retail traders and investors have the desires to ask "what's going on?" after they have beaten by the Aussie stock market for nearly 2.5 years since the peak of V-shape recover.

A lot of bargain hunters have lost their tiny hopes for the bull to come back after struggling in the attrition war for more than 1 year. Do you remember Aussie shorters just pushed XAO to 3,800 in a few days last August? Crying became popular and cursing the market turned as a burner to destroy the remaining capital in the stock market.

In the eye of tsunami, the crowd just could choose to run, run for the safety which just doesn't exist. The logic action should be that don't run but find a corner to make you feel safe since the running is more risk to stay steady.

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EU crises, China tipping off image, and US failure of its recovery so far fail to push XAO down to 3800 again but retail traders and investors have lost their hopes and don't believe anything could be better soon.

However life tells us bad opens the door for good even no one could tell how long the bad could take its lead in the life and stock market. Do you know FMS? It was $0.025 in the GFC ruins but it just raised to $0.40 in the euphoria to be takeover?

The worst case would force the positive forces to fight desperately since bull needs to be alive by itself and human kind. We have to learn to question what's going on and learn how to get the right answer!

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1. Lock the profit while bull attracts everyone into the party so when the rainy days come in you could get reasonable good life and when the bear into its end of days you could put seeds into the soil.

2. Buy the discount after the toughest bargain hunters run as head-less cats. At some days after bear becomes popular, all are sell on fire and some would close the door. Find the business which could not close the door, diversify your portfolio, and buy with time average.

3. Ask the question: what's going on? Timing is not important but it is everything. You should not be a warrior but a service provider for the warriors. Their fate is consumed by the war and you get what you deserve by your good service.

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So what's going on?

EU could not be at its end very soon. China economies are slowing down but seem not lose its mettle to land softly. Aussie economies are still one of the best in this world. Aussie retail traders and investors have lost their guts. Aussie retail traders and investors always are the followers not leaders. They just the pigs or warriors to be slaughtered time by time.

The market have linked the crowd, fundamental, and market price together for itself destruction for 2.5 years. The crowd has put all it could see into the price but it just misses a important thing, the Sun!

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The Sun over the Aussie land have been clouded for years. XAO has nothing with the resource booming even it has been there and never go away!

The Sun is jumping up down in the horizon. Once it overcome the darkness you would have the chances to run under the Sun. Don't bother what the crowd is doing. They are stupid!

Stupid is weak hand in the stock market and weak hand would be washed away always. It is amazing to see the early Sun. Early birds would be fed and fed generously if they are patient and have gut!

***
Dow was up 203.82 points, or 1.62 per cent, at 12,777.09. XAO just added 12.3 points, or 0.3 per cent, to 4118.3 points.

After the better-than-expected results from China, the Australian dollar pulled back losses and gained overnight, rising 0.86 per cent, to $US1.0226.

We're putting in a bottom, not a top if China could land softly!

***
It was bad and very bad China slowed for a sixth straight quarter to 7.6 per cent. Why did DOW take it as a good news?

It is because the result was better than some in the market had feared. It also kept open the possibility that more stimulus may be forthcoming from China's policymakers. Market as a whole is never stupid as the retail crowd. It sells when the crowd has any hopes. It buys when the crowd has nothing could be dreamed for tomorrow.

With a full slate of corporate earnings come in, some institutional traders/investors believe the market may see more upside after the recent run of pessimistic global economies. If it is true the worst should be there.

It is very good to see no one dares to declare "stop losses are all!" It is because the crowd has nothing could be lost any more!

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Sir, please remember the market doesn't crawl as the shirt-losing traders and investors but it does jump up in surprise. It is fair since most of the crowd should be the losers for the common good as the Gamblers in the Casino!

I feel guilty since I failed to lock my profit in the April 2011. I feel better since I have got my lessons when all of warriors were in the valley of death. I feel encouraged since I could put myself as a whole into the cause to update my mental framework. I did get the lessons from my mistakes as much as I could!

I do hope the Sun raises up for next 6 months. I am plans to deal with the worse than my imaged worst case and fly under the Sun as an early bird. I am never and ever a genius but I want to be wise and intelligent. I want and then I could get them bit by bit!

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Anyway it is the time I should continue my watching of Doctor Who now!

It is necessary task to update my mind which makes me painful but I don't have choice. The stock market is far fair than the offices even I understand all of us are not very fair naturally in the offices.

My future at senior age is in Stock Market without matter it is a failure or success story!

 

Something from Sir John Templeton

Sir John Templeton was one of some great investors who survived and revived from 1929 Great Depression. Actually he was timing the market excellently, bet in 1930s, and harvested in the recovery and booming followed.

The lessons from the book about him are simple and clear but hard to follow:

1. do your research.

All of us know it is very important but few really know how to do their research. No way so that most of traders and investors take reading, coping, watching Youtube, and finding data for self-supporting.

You need goals. You need plan or road map for your goals. You need your organization to implement your plans. And then you just make profit every year from your portfolios. IT bust, GFC, EU crisis, and China slowing down, have shown their failure of their research.

One important matter of your research is to know you have failed, find the way to fix your own problems, and then restart with better plan to protect yourself and make profit.

So far nearly 100% of traders in all of trading forums I know have failed in the stock market and then the end of their lovely researches.

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2. be prepared for anything.

Market is fair, elusive, and risky. Who don't know that? All are preparing for something for what they want but why we do need to prepare for anything.

If you could not understand the importance of this lesson, you are market idiots since you really could understand market is elusive and risky.

Market is very risky! It is terribly risky when all want to get something from the stock market: party or exit!

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Unfortunately, I learned this on my own. I was ignorant and arrogant between January and April of 2011. My head became red hot. I believed even I didn't dare to declare, I could get profit as I wished. It is hard to make money in the stock market for decades. You need the basic respect and appreciation for the great investors and speculators.

Unfortunately all of us tend to make ourselves feel invulnerable. Have you read some losers just joked Warren Buffett and Soros? Idiots don't know what they should respect and then they only could be the losers.

Now, I am prepared for any possibility before my buying, try to get the calculated probability, and get buffers for the worst cases. However I just could not declare I could follow these lessons in all of the times since an idiot need a lot of efforts to be wise enough!

 

Paradox and self-balance

Retail traders and investors tend to play for their feeling and belief even the market never and ever care about what they feel or believe.

Nealy all of retail traders or investors don't understand they would be in paradox constantly, which never changes since the market is there. Something would come in and be gone and something would stay with them in their life. We are so limited that we tend to be confused by the things which would gone or stay!

If you are traders you play the things which come and will be gone. You could not hold any further if the profit is far more than the means. If you are investors you play the things which would stay for the time you believe they would stay and grow.

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That is one of reasons you have to know whom you are and what you are playing. In 2011 I didn't know whom I was and what I was playing. I dreamed the things would have played out as I wished. It is a fundamental mistake and I deserved all of defeating and failure!

Speculation and investment both could make or fail you as bull and bear could fail or make you too. You have to deal with the constant paradox and get yourself in balance: self-reliant and get balance between the risks and chances, which should be a dynamic process without matter you are traders or investors.

We are trained to be special but the market needs the balance of special skills and the seasoning. We don't get used to it instinctively. You could be genius but you could not be wise and logic to all if no special training would be taken by you.

***
I was surprised first and then not surprised to see PPX lost $0.05 or 10% today. The surprise came from the fact that the mood of traders around PPX became worse but soon I didn't feel surprise anymore.

The market is in a very special stage: the market has been in darkness for 2.5 years, damage has been done, the crowd has lost the gut, and some could sell desperately since no hope to them any more! It is not surprise if the crowd would like to burn more.

I am little bit disappointed for myself. I should buy today after the 5% dropping down but I just could not see. We always have the problem to see what happen tomorrow. However I do feel not regret since I use the diversification and time average without letting my cash run.

***
Market is huge and there are millions of elements to affect the course of a share after it have hurts all of its loyal investors who bought and hold. It is tough to call the lowest price but you have to do so in the ruins: get the chances with affordable risks.

China policy makers have more influence on its stock market which also makes the traders and investors has much less confidence on the stock market. The policy interpretation tend to define the winners and losers. The market was so scared by the words from Mr Wen.

Could China land softly? Powerful central government seems more effective to change the course while economy fundamental is promising. Is China's economies still in the expansion road? It seems Market not sure the fundamental in near future. It is hard to do so and me too.

However you have to feel lucky if you didn't buy PPX at $3 or more. I am still lucky and hope I could be lucky it could get the feet on a rock. Of course I have to think the impact to my portfolio as a whole.

No losses and never allow unaffordable losses, which is easy to say but hard to get!

 

Stablization and rate cut

China's GDP growth came in at 7.6% in the second quarter as expected but there were new signs of its falling into deflation. If it goes further China will need much more aggressive interest-rate cuts.

In April, its producer price index (PPI) quietly slipped negative, and this contraction has since gathered pace. In June, prices fell 2.1% year-on-year. So the focus of the stabilization sooner or later would shift to stop the whole of the economy dropping in deflation.

Deflation could be worse than inflation to economies. Could China afford a hard landing? Could the policy makers know the dire impact of the deflation. Economies are a complex system which needs some expansion to be alive.

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It is a general rule, falling prices at the factory gate are bad for profits, especially when consumer prices are outpacing producer prices.

1. China’s consumer price index (CPI) inflation has been slowing to 2.2% in June.
2. The wages for factory workers have been rising at close to 20%.

This raises huge imblance and will result in deflation if the imbalance could not stop! It is worse that the slowdown in the economy will put much greater pressure on company profits than on GDP growth.

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Under the falling prices, authorities would be pressured to be more aggressive in cutting interest rates.

It could be said that a rate-cut is justified because it helps companies not to face rising real interest rates on their debt burden. Otherwise, the revenues would be contracted and companies could quickly see financing pressures escalate.

It is also true that China has a shadow banking system, which has blunted the effectiveness of this key policy tool. Until recently at least, yield can be twice as large as on banks deposits.

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China’s central bank may become the latest to drop interest rates to the floor in an attempt to reflate away its debt burden. A sharply lower interest-rate outlook has various implications for corporates and investors.

1. Lower rates are typically seen as a positive for investment. If rate cuts continue, there could be a shift of money from lower-yielding deposits into equities.

2. The best time to invest is when interest rates have already hit rock bottom and deflationary pressures are abating. They argue that we are still some way from that point.

***
There are always winners and losers from lower rates and deflation.

1. Lower rates should help companies with high working-capital requirements, which is common in China.

2. As well as helping cash flow, this can boost profit margins.

3. Lower energy prices and commodities can also give a boost to margins, which could give some relief to the industrial sector.

4. Property developers should be benefited, despite repeated government assurances that they do not want to revive a property bubble.

***
Ultimately, because authorities have created such a debt overhang, they have little choice left. So the stabilization now seems how much the rate could be cut to avoid the property price red-hot again and the economies could avoid the deflation.

Where will China go? More rate cut until they feel comfortable for the property price and how bad the deflation would be. So China seems have to make some decision to avoid hard landing, which is seen good in DOW at least.

How about XAO? A tiny economies with very good financial system have to act carefully so that its traders and investors have little room to cheer before the course become clear as black and white.

 

PPX: scaring but affordable

PPX's CEO quit and the traders and investors around it became mad.

Its price dropped as a stone yesterday and today. All seemed surprised or shocked. Me? Surprised or shocked too. In two days it lost 20% of its market cap. If anyone put unaffordable money in, he would cry! Fortunately most of traders and investors have raised white-flag and this news appeared after its price had dropped down from $0.10 to $0.05.

All of the traders seemed didn't know what animal thy were playing with! Actually all of the traders and most of investors are the animals who are fed by the news for their life. However the news is not the food for a life!

***
Based on news it was targeted by some private investors who would like to pay $0.09 to take it in hand. However its board seemed hate to be takeover and sell US and EU assets as poison pills.

I could not know its internal tricks but I still believe it has been put in heavy discount already. I would not sell since around worst time the faster you move the riskier you are. I have locked a little more than 40% from my CTO so that I could wait to see what would be displayed.

Today XAO followed China stock market and raised about 0.6%. It is not a market driven by the fundamental but fear. China's stock market is priced as though it would crash down. XAO is priced as no resource boom at all.

***
Of course I would lock the profit and correct my mistakes but I don't feel guilty to buy PPX. When bad black swan hits us, we just need to let the losses affordable.

I am not lucky this time as I expected. AKK also shed about 26% from $0.023 to $0.017. I need to buy much tougher later but all of the reasons the selling is caused by the fear. AKK is drilling for its first shale oil well. The traders or investors are fearful so much that no announcement have fretted them very much.

AKK as BKP are about the oil. If they have oil all of the traders sold in the ruins would jump in desperately. They want to be sure but future is never sure matter. We have to learn how to deal with the black swans.

 

Don't blow the money!

Have you got some debts? Few don't since we need the loans for something we want but out of our touches if we don't borrow. Leverage to start your family and make you move around is good if we could service it.

However we do need remember you have to start to pay off all your debts while holding what you have got with the leverage. Money could not be made without stages in the road of your financial independence.

I thought I knew it before I paid off my home houses. Actually I should have done so for my investment property. However the hungry for the money let me take more risks than what I should take for my paper profit in the stock market time by time.

***
Being lucky enough is necessary element for life and fortune. You have to keep the profit from your lucks or efforts for the rainy days. Leverage in booming time is lovely but in bust it could kill you or make your life hard.

Do remember after being debt-free, you must not be tempted to blow your money on risky financial adventures! Please take paper profit as real money. Actually it is. In 2002 I burnt $400,000 paper profit. I didn't feel I did anything wrong until I lost another $180,000 paper profit in 2011.

Don't make any excuses to lose the money. It is resource. After you lose it if big enough and you could not get them back you would find how stupid you are. Not long time ago I tried to show I was not stupid but I was. How many $580,000 I could make in my life?

***
We all are sort of stupid but if we have the gut to admit our own stupidity we would be become wiser. Last one year I have learned much more than all I learned in my last decade in the stock market.

We need to know it is hard enough for most people in this world to earn a bare living, including 95% who are unable to keep and acquire a fortune. This is not to discourage us but to warn us and give us courage to fight harder to be one of the 5%.

We all need the first bucket of gold. We all need to protect our first bucket of gold while we work for second one. We are different and size of the first buckets of gold to each of us are different. I failed to know enoughness and balance before.

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I will train myself to use enoughness for my second bucket of gold.

Today I sold BRO at $0.003 which I bought at $0.0025 in average, AXM at $0.11 which I bought at $0.10. I would have not sold them if I don't know the enoughness and balance of risk and chances more deeply than before.

It was to leave margin of safety for what I bought since May 2012 and made my 2012/2013 budget a little bit better. In the stock market if you are active and not the losers, you would get your chances.

 

Money is for life and loves!

All of us have some responsibilities for our parents, loves, kids and of course the societies.

Most of retail traders and investors are good guys but fail to remember that they should let their own feeling or gambling to destroy their money for the responsibilities.

You need to put some kind of insurance, the margin of safety for anything you would like to take. Once you lose your shirt, you fail yourself and your loves let alone you struggle or live based on the social securities.

Seriously saying we should not find any excuses for our failure. It is not just a financial issue but moral one.

***
In this world there are a lot of people need your hands. As traders you have some resources and have already get better position in lie.

If you could not help others you should not stand in line of the dole by killing your asset and profit. It is not easy to make the money. It is just a flirt to burn all. You must be very careful and cautious with a brave gut for your chances.

You have to get your corner, make it strong, put seed into the soil after the chilling winter has destroyed all left in the field, look after the buds, and harvest in the Autumn.

***
You need the harvest and all of the necessary stages before the harvest. Spend less than means. Buy at the lowest part of probability distribution for each share or all of your portfolio.

You are good man and then you should have the gut and resource to help those who have been trapped in the stock market. They are depressed. They disbelieve anything in the future. The timing is not important but everything. Don't help the cheerful boys and girls. They have been spoiled and they need the lessons to be responsible for themselves.

You want the privilege of helping those who are afflicted and impoverished. It means not just the patterns in days. Fortune never could be made in days if you could not be so lucky that a dart changes everything.

***
Success in any life fields needs integrity, hard work, and being right more than 55% of the time.

Why do you have to diversify and use time average? We are not gold and stop losses is just a tiny tricky to lose less but doesn't mean you can make profit let alone the fortune.

I have made a lot of mistakes. But I am lucky so that with zero saving in my early days in Australia I did use the leverage, diversification, time average, and cautions in the property market.

***
However after the first bucket of gold in the back yard. I become greedy and arrogant. I was wrong and more worse I was wrong when I should not be so.

Ambition generally is good but if you are at your 40s, you have to know there are thin air between ambition and arrogance. Never and ever let yourself cross the line into the arrogance.

However man is quite special. They were born without the necessary caution and intention for details. They could find excuses for their ignorance, arrogance, and stupidity and take excessive risks.

***
Just read the posts in the trading forums after you become wiser. You would understand it is natural results that most of male traders would lost all and then fail their responsibilities.

They tend to show off for any tiny profit. They tend to give up when they should stand steadily. They don't know they can play the fire but they have to get the protection cloth if they want to be safe.

Too many come into the market for lucks but lucks come to the prepared mind only. They shown they are weak hands and weak hands always are washed away. So after the storm you could not find any conscious mates in the trading forum.

***
Could you be different?

I want to be different, know the difference comes from the mental frame work updating.

I have put myself into my own university. Mother language is the base for your existing and natural mind. English is not my mother language. I need it as a benchmark for my mind updating.

***
I will get my job done if I am lucky and could be alive for next two decade. To get more chances for it I started and will keep to do my exercises for a best possible body. Good soul needs the good bags, our bodies.

Could I get what I want? Maybe or maybe not. It is not the most important issue. I do what I want to do in dance and efforts should be rewarded if I could be wiser everyday.

Why don't talk about the tech? If you wise you should find the right tools from somewhere. I am still very stupid so the tools are not very important now.

***
A road map in next few years:

1. get a good possible body and enjoy what I do
2. get the cash income enough from stock market for current life style every year
3. get debt free so that my investment properties could become a trustful income sources.
4. all would give me a self-reliant environment

***
Is it a right, wise, and reasonable road map? Sound good and I am happy as I figured out where I should do in my 16 in my life.

It sound not very great, isn't it? I am ordinary and old. I could not dream and gamble anymore! I am just regret I never bother this road map before.

Anyway life is good and I have gone far more than I could dream in my 16. Is it enough? Yes but I like it is better bit by bit!

Time for my TV series, Doctor Who!