As from April 2013 my Journey in Investing is to create Retirement Income for Life till 80 years old for two over market cycles of Bull and Bear.

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This blog is authored by an old multi-bagger blue chips stock picker uncle from HDB heartland!

"The market is not your mother. It consists of tough men and women who look for ways to take money away from you instead of pouring milk into your mouth." - Dr. Alexander Elder

"For the things we have to learn before we can do them, we learn by doing them." - Aristotle

It is here where I share with you how I did it! FREE Education in stock market wisdom.

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Value Investing
Dividend/Income Investing
Technical Analysis and Charting
Stock Tips

Saturday, 11 August 2018

Upping Your Game Level??? Your Friendly And Thoughtful Brokers Will Assist You


After a few years practicing your trading and/or investing skills in the stock market and your friendly and thoughtful brokers haven't review your brokerage account size, trading limit, and commissions; you have not generate enough business for your brokers to warrant their attention to up your game plan!

When Uncle8888 seriously began to be active in the stock market in Jan 2000 His buy limit was just $20K and T+3.  

Buy limit $20K. Where got enough?

He called his broker to review this buy limit and adjusted to $50K

Soon $50K also not enough. He called his broker to adjust his buy limit. His broker was happy to adjust to $100K and offered him T+5 to help to make him more money and FIRE sooner.


One day; his broker called to tell him this good news after reviewing his account performance and offered to up his game level. Broker has lowered his commission from 0.275% to 0.22% and up buy limit to $200K and then to $300K when $200K limit was hit several times.

Buy limit: $300K, T+5, Commission at 0.22%

Huat liao! FIRE soon! That was his thinking in 2007

When the Game is over!

What left?

Read? CDP - No more printed copy. Now it is History!


The moral of the story:

Never under-estimate the greed in us when we are winning big and on the way to FIRE faster!












11 comments:

  1. In this game, the real and true winner is your broker when you up your game level. Lol

    ReplyDelete
    Replies
    1. CW,

      Lucky you not into leverage at that time. Only contra.

      Your broker not "aggressive" leh. Should have enticed you or worked with "vested interests" to lull you into "investing" with leverage!

      Then your broker can also charge CPF like interests on your positions ;)

      Must develop multiple souces of income from the SAME client mah!


      Trading with leverage is a given - forex, futures, CFDs, etc. That's why 90% of traders fail.

      But to encourage "investing" with leverage to bei kambings???

      Sell to experienced and veteran investors OK as they know risk management.

      But then again, veteran and experienced no need others to tell them what to do. So its back to bei kambings as targets for milking and fleecing...

      Somebody is goona get hurt...


      Delete
    2. Agree with SMOL. What's with this Leverage pitch within our community lately. Scary !

      https://www.cnbc.com/2018/04/12/warren-buffetts-big-life-lesson-to-students-dont-borrow-money-like-donald-trump.html

      Delete
    3. We are likely to be guided by our personal experience or personally witness it with our own eyes. Read? Is Bear Market that Scary??? (2)

      I avoid margin or shares financing to enhance capital base. I rather save up longer for bigger capital base.

      Delete
  2. I suspect in S'pore it's the reach for yield. And with FIRE replacing YOLO among the millennials .... how to generate $50K or more "passive income" on a portfolio of only $300K or $500K ?!?

    Secret sauce called leverage lorr!! LOL!

    And not just millennials ... with the persistent slump in rental yields, the old standby for lau kok koks --- property --- just doesn't cut it anymore. :)

    And govt policies to limit property price takeoff doesn't help. Now is property purgatory in S'pore --- high prices but limited upside, low rental yields, constrained population growth, stagnant growth of high salary expats. Hohoho!!

    Btw it's the same in US --- margin financing has never been higher. :)

    The chart below displays US margin debt inversely. It should be noted that margin debt drops sharply just prior to peaks in the S&P500 i.e. short-term leading indicator. Which indicates that quite a few using margin financing in the US are institutional or sophisticated investors.

    https://kimblechartingsolutions.com/2018/04/margin-debt-hits-historical-levels-watch-spread/

    The latest FINRA margin debt as of June 2018 is still hovering around $650B. But I won't be surprise if the number drops over the next couple of months as the stock markets go thru their usual Aug-Oct slumps.

    http://www.finra.org/investors/margin-statistics

    ReplyDelete
  3. When i started reading books on investing, i have been convinced by an Author making money in the stock without leverage has been difficult enough.

    Don't have to envy others who say they have made so much money by leverage if U think U are not smart enough in their league.

    Of course if the banks or anyone believe in me without collateral, i am more than willing to use leverage in the stock markets.

    The very most prepare to be declared as a Bankrupt.

    LOL.

    ReplyDelete
  4. Hi CW8888,

    Very true, when my broker called me to offer an increase in the buy limit, thankfully I did the reverse, i told him to increase my sell limit and stuck to the buy limit.

    Of course, he then said he cannot reduce the commission! No free lunch.

    ReplyDelete
  5. No! No!

    No body can control anything.

    Pre-meaditing what to to do is all psychology.

    Example why U go inside a Casino with money if U don't want to gamble?

    Control?

    LOL!

    ReplyDelete
  6. I agree with you temperament, nobody can control everything. Every time I feel like I am a total winner, I remind myself of the total write off of my first ever share that I got IPO for. Like CW writes, you need to lose money to learn your lessons, no amount of training, tutorial etc will teach you as much as losing hard-earned money. What one can control though, is the trigger finger i.e. buying and selling too much. By and large, most of the time, I do nothing but update the portfolio (25 counters mostly equal weighted) with the monthly statement. Nothing much happens, this year, so far, the only action was to convert the warrants of Olam into shares. Hopefully, some action towards year end or next year will be nice, but one can only wait. Lastly, it is not a casino, instead of a bank lending money to a company, making 8% and paying me 0.05%, I am giving my money to the company to make something more than inflation.

    ReplyDelete
    Replies
    1. Actually, the buy and sell limit indirectly control our itchy fingers from over reacting to market volatility.

      Delete

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