Posted by 1Bid > 2018-08-09 16:03 | Report Abuse

So conveniently use Warren Buffet. It happens to jack ma too. Whatever he says now is like a bible. BECAUSE he is a winner.

What about KYY? He is being forced to sell shares by management through share issue. They know KYY is using borrowed money. Surprisingly They let him get out at this price range.

Posted by hollandking > 2018-08-09 16:05 | Report Abuse

no joke, got one. I think it got to do with the zero balance transfer thing. They give out many cards, but problem is when u burnt the money, that is when the problem grow bigger and bigger. U need more cards to fill the hole u dig earlier on.

Posted by stockraider > 2018-08-09 16:05 | Report Abuse

I thought Kyy did very well...on hengyuan....margin forcing him to sell make alot of monies mah...!!

Posted by 1Bid > Aug 9, 2018 04:03 PM | Report Abuse

So conveniently use Warren Buffet. It happens to jack ma too. Whatever he says now is like a bible. BECAUSE he is a winner.

What about KYY? He is being forced to sell shares by management through share issue. They know KYY is using borrowed money. Surprisingly They let him get out at this price range.

Posted by 3iii > 2018-08-09 16:08 | Report Abuse

What you should know about buying on margin?

Margin can add power to your investment portfolio.

Like any other borrowings, it can be DANGEROUS, and should be treated accordingly.

Margin interest rates, while moderately high, can be lower than some other forms of short-term borrowing, so it might make sense to use margin to get some cash from your investment account for certain purposes.

On a larger scale, when stock margin borrowing levels increase in aggregate, it is a sign that too many people are speculating on stocks and that a bubble might be forming, leading to a bust later on.


http://myinvestingnotes.blogspot.com/2016/03/margin-and-buying-on-margin.html?m=1

Posted by Jon Choivo > 2018-08-09 16:08 | Report Abuse

Raider,

I can give you an argument or perspective, i cannot give you an understanding.

Lets leave it at that. You are old man, i hope you don't lose another bungalow or ever suffer the indignity of being forced to live in your children house.

Good luck.

Posted by Jon Choivo > 2018-08-09 16:09 | Report Abuse

“If you are going to be a very concentrated investor, you should not use leverage. You can’t leverage because you need to live through the downturns and that is incredibly important.”
Joel Greenblatt

“The trick of successful investors is to sell when they want to, not when they have to.”
Seth Klarmen

These two say it all for me.

Posted by stockraider > 2018-08-09 16:14 | Report Abuse

Young cikku, u have no experience in margin financing, business sense, the art of sailang & theory of surewin betting mah....!!

Posted by Jon Choivo > Aug 9, 2018 04:08 PM | Report Abuse

Raider,

I can give you an argument or perspective, i cannot give you an understanding.

Lets leave it at that. You are old man, i hope you don't lose another bungalow or ever suffer the indignity of being forced to live in your children house.

Good luck.


Jon Choivo
1634 posts
Posted by Jon Choivo > Aug 9, 2018 04:09 PM | Report Abuse

“If you are going to be a very concentrated investor, you should not use leverage. You can’t leverage because you need to live through the downturns and that is incredibly important.”
Joel Greenblatt

“The trick of successful investors is to sell when they want to, not when they have to.”
Seth Klarmen

These two say it all for me.

Posted by 1Bid > 2018-08-09 16:15 | Report Abuse

Its not margin force sell make him money on hengyuan. You have seen things wrongly on HY.

Posted by stockraider > 2018-08-09 16:20 | Report Abuse

Stop talking cock loh, if kc...says 83% of all investors are losing monies .....what the fuck ? in i3 talking about share investment leh ??

Generally if u cannot make it as a cash investors, usually u cannot survive as a margin investors loh...!!

Can't u see the problem is not margin investment, it is the problem of the overall investment skill loh...!!

Pls address the overall investment skill b4 blaming margin loh...!!

Posted by 3iii > Aug 9, 2018 04:08 PM | Report Abuse

What you should know about buying on margin?

Margin can add power to your investment portfolio.

Like any other borrowings, it can be DANGEROUS, and should be treated accordingly.

Margin interest rates, while moderately high, can be lower than some other forms of short-term borrowing, so it might make sense to use margin to get some cash from your investment account for certain purposes.

On a larger scale, when stock margin borrowing levels increase in aggregate, it is a sign that too many people are speculating on stocks and that a bubble might be forming, leading to a bust later on.

Posted by kcchongnz > 2018-08-09 17:33 | Report Abuse

Posted by cheoky > Aug 8, 2018 11:38 PM | Report Abuse
buy cold eye revised edition 2018 read. more comprehensive.


Coldeye may have used MF investing in stocks and have made amplified gains. But there aren't many "coldeye" in Malaysia.

The big difference is that he never boast about making so much money using MF (implication of encouragement of using MF). He understands the detrimental effects of MF when market goes against us.

In his books, he persistently discourages the general public from using MF because he knows, and most people know, the general public can't handle it.

That is humility, a great teacher, and a great social contributor, propagating the right things in investing in particular, and life in general.

Posted by stockraider > 2018-08-09 18:24 | Report Abuse

There U R...confirm cold eye use margin successfully loh....!!

Why coldeye ask u don use margin leh ??
Bcos coldeye think u never be as great as him, thats why generally he ask investors to avoid loh....!!

But this type of thinking is flaws loh....!!
Everyone can be a good margin investor loh, but in order, u yourself as a margin investor u must be a good investor 1st loh...!!

Raider urge u to use margin, got rational reasons mah....!!

1. 1st of all u need to be a good investor u need to be at least top 20% in terms of competency loh, but in order to that u must learn proper investment technique loh...!!
Don Listen to conservative misguided sifu who promote to u that investment can be successful but if u use margin u will fail loh..!!
That is not much different investing using cash or using margin loh..!!

2. After u learn the proper technique of investment, next u need to learn the specific technique of margin and risk management loh...!!
In all cases u need to clear the training under item 1 above loh...!!

3. If u r a young newbies....having limited capital...it is best u start with margin, if u cannot master the art not much disaster loh...bcos u can always start all over again loh...!
U must dare to Learn art of making monies, dare to win and dare to lose loh.....!!

4. If u r good, naturally u can amplify return with margin as its interest rate only 5% pa loh.....!!

Posted by kcchongnz > Aug 9, 2018 05:33 PM | Report Abuse

Posted by cheoky > Aug 8, 2018 11:38 PM | Report Abuse
buy cold eye revised edition 2018 read. more comprehensive.


Coldeye may have used MF investing in stocks and have made amplified gains. But there aren't many "coldeye" in Malaysia.

The big difference is that he never boast about making so much money using MF (implication of encouragement of using MF). He understands the detrimental effects of MF when market goes against us.

In his books, he persistently discourages the general public from using MF because he knows, and most people know, the general public can't handle it.

That is humility, a great teacher, and a great social contributor, propagating the right things in investing in particular, and life in general.

Posted by popo92 > 2018-08-09 18:29 | Report Abuse

margin financing is only one of the tool to leverage. if your appetite is bigger then use leverage on your own risk, it is the ability of controlling risk that matter the most, not leverage.

Posted by Jon Choivo > 2018-08-09 18:32 | Report Abuse

By this metric,

1) Raider thinks he is top 20% investor, except he pick hengyuan and evergreen in one year, both also die.

He was saved only because KYY go fry the stock last minute. Without KYY, he will be in holland with his RM10 cost second round, with the stock selling RM6.

Likely to be lose hundreds of thousands, not counting margin.

Assuming you really is 20%, maybe now its you need to be 1%.

2)Its like saying once you learn how to drive properly on race track, you should now take racing slicks to the road. Yeah, easy way to die early.

3)My friend started with margin, 10k to start, end of 5 month, negative 12k. We started the same time. I had essentially a one year had start because of that. I'm worth 3 times him.

But that is anecdotal, statistically, most investors lose money, leverage, helps even the good ones lose money. Not guaranteed, but on average, you have a higher probability.

4) Ok tbf, maybe one can consider say 25-50% margin. Lets say you hold 100k in stocks, you only buy 25-50k in margin.

But what if you get successful? Chances are you will go up higher and higher, before you die.

Its the good swimmers who drown.

Why stretch if you know you will be rich. There is small difference between being worth RM20mil and RM100mil.

but Being bankrupt and being worth RM20mil is very big.


======================================================================

Raider urge u to use margin, got rational reasons mah....!!

1. 1st of all u need to be a good investor u need to be at least top 20% in terms of competency loh, but in order to that u must learn proper investment technique loh...!!
Don Listen to conservative misguided sifu who promote to u that investment can be successful but if u use margin u will fail loh..!!
That is not much different investing using cash or using margin loh..!!

2. After u learn the proper technique of investment, next u need to learn the specific technique of margin and risk management loh...!!
In all cases u need to clear the training under item 1 above loh...!!

3. If u r a young newbies....having limited capital...it is best u start with margin, if u cannot master the art not much disaster loh...bcos u can always start all over again loh...!
U must dare to Learn art of making monies, dare to win and dare to lose loh.....!!

4. If u r good, naturally u can amplify return with margin as its interest rate only 5% pa loh.....!!

Posted by kcchongnz > 2018-08-09 18:39 | Report Abuse

Posted by CharlesT > Aug 9, 2018 03:17 PM | Report Abuse
Margin is neutral lah..just dont let some cunning old shares operator brainwashed n misleaded u to buy his shares at high prices using margin when he wanted to dispose...

Margin is neutral. This is a fair statement. Same as what Howard Marks said that,

"Leverage doesn’t add value or make an investment better."

He also said recently,

Leverage + Volatility = Dynamite

http://www.oaktreecapital.com/memo.aspx


More significant effect,

Noble prize winners Kahneman and Tversky (1979) studied
how people respond to the prospect of loss. They find that a loss has about two and a half times the impact of a gain of the same magnitude and they call this phenomenon loss aversion (Prospect Theory)


Combining maths and behavioral finance, a new "theory" by KCChong

Expected gain in using MF = 0.5*1-0.5*2.5 = -0.75

Posted by value88 > 2018-08-09 18:59 | Report Abuse

I heard a lot of great people, including Warren Buffet, advise not to use margin finance in stock investment.
Well, I have to confess that I have been using margin financing in stock market. I did hesitate when I first using it, I had to then bcos my capital was not big enough.
I fully agreed that margin financing is a double edges sword, and I definitely won't encourage people to use it, especially newbies.
Having said that, i do not regret using margin finance. Conversely, it has served me well, and it amplifies my returns in past 5 years. Therefore, I am going to continue using it..oops..sorry for those who preach not to :p

The only reason I do not like about margin financing is the transaction fees is higher for margin account. If I stop using margin finance one day, it would be due to I want to save transaction cost.

Posted by stockraider > 2018-08-09 19:03 | Report Abuse

But newbies suppose to quickly learn the robes like u mah....!!

Posted by value88 > Aug 9, 2018 06:59 PM | Report Abuse

I heard a lot of great people, including Warren Buffet, advise not to use margin finance in stock investment.
Well, I have to confess that I have been using margin financing in stock market. I did hesitate when I first using it, I had to then bcos my capital was not big enough.
I fully agreed that margin financing is a double edges sword, and I definitely won't encourage people to use it, especially newbies.
Having said that, i do not regret using margin finance. Conversely, it has served me well, and it amplifies my returns in past 5 years. Therefore, I am going to continue using it..oops..sorry for those who preach not to :p

The only reason I do not like about margin financing is the transaction fees is higher for margin account. If I stop using margin finance one day, it would be due to I want to save transaction cost.

Posted by Sslee > 2018-08-09 19:22 | Report Abuse

Dear all,
I refer:
https://www.investopedia.com/terms/m/margincall.asp
What is a 'Margin Call'
A margin call can only arise when an investor borrows money from a broker to make investments. When an investor uses margin to buy or sell securities, he pays for them using a combination of his own funds and borrowed money from a broker. An investor is said to have equity in the investment, which is equal to the market value of securities minus borrowed funds from the broker. A margin call is triggered when the investor's equity, as a percentage of the total market value of securities, falls below a certain percentage requirement, which is called the maintenance margin. A margin call happens when a broker demands that an investor deposits additional money or securities so that the margin account is brought up to the minimum maintenance margin. A margin call occurs when the account value falls below the broker's required minimum value.
The margin call is for certain specified sum, and if the investor does not deposit the money in a timely manner, the broker can liquidate securities for the value sufficient to bring the account into compliance with the maintenance margin rules.

The broker only authorized to liquidate part of your securities held in margin account to bring the account into compliance with the maintenance margin thus MF do not cut win/cut losses all your holding. But if your securities keep dropping the margin call will keep coming, till a day will come where all your securities in margin account are liquidated and you still owe the broker money (The liquidated securities did not able to cover your total borrows money due to time lapse between margin call and the day and price the securities are liquidated).
Thank you.

Posted by stockraider > 2018-08-09 19:50 | Report Abuse

Correctloh...but those who kena margin call...should never allow the banker to do your dirty work loh....!!

U r given 3 days grace or notice...b4 banker take action loh...!!
U should on your own take immediate action during the grace period loh....!!

The other thing, is it not advisable for u to bring in new cash resources or securities top up loh....!!

Since u kena margin call...something is wrong loh....!!
So u should heed the red flag....sell...sell & sell loh...!!
Not necessary to sell to bring down the exposure limit but to deleverage even more mah....!!

Posted by Sslee > Aug 9, 2018 07:22 PM | Report Abuse

Dear all,
I refer:
https://www.investopedia.com/terms/m/margincall.asp
What is a 'Margin Call'
A margin call can only arise when an investor borrows money from a broker to make investments. When an investor uses margin to buy or sell securities, he pays for them using a combination of his own funds and borrowed money from a broker. An investor is said to have equity in the investment, which is equal to the market value of securities minus borrowed funds from the broker. A margin call is triggered when the investor's equity, as a percentage of the total market value of securities, falls below a certain percentage requirement, which is called the maintenance margin. A margin call happens when a broker demands that an investor deposits additional money or securities so that the margin account is brought up to the minimum maintenance margin. A margin call occurs when the account value falls below the broker's required minimum value.
The margin call is for certain specified sum, and if the investor does not deposit the money in a timely manner, the broker can liquidate securities for the value sufficient to bring the account into compliance with the maintenance margin rules.

The broker only authorized to liquidate part of your securities held in margin account to bring the account into compliance with the maintenance margin thus MF do not cut win/cut losses all your holding. But if your securities keep dropping the margin call will keep coming, till a day will come where all your securities in margin account are liquidated and you still owe the broker money (The liquidated securities did not able to cover your total borrows money due to time lapse between margin call and the day and price the securities are liquidated).
Thank you.

Posted by calvintaneng > 2018-08-09 20:12 | Report Abuse

Sifu Raider got his point.
Margin call is a red warning flag to run!
Like eating poison fugu or puffer fish which killed the careless margin is a game for experts. So newbies must treat it like throwing grenades.
If not careful get get maimed or even killed.
One Sifu called John Templeton bought shares from bank loans just at the outbreak of the 2nd world war and did very well.
But not everyone is a John Templeton. Most ended like Jesse Livermore

Posted by kcchongnz > 2018-08-09 20:46 | Report Abuse

Posted by Ray168 > Aug 9, 2018 02:53 PM | Report Abuse
Using MF is just like driving a F1 car... it can brings to your designation fast but may also bring to to holland.
If you don't have the skill set and guts, don't do it.


Ray, good analogy. Is it better to drive safely within the speed limit to arrive the destination timely, of drive a F1 car at 200km/hr to reach the destination faster?

Actually, this article is about the irresponsible advice of elderly telling the youngsters and the new drivers, or even those without the driving license, to drive like a F1 racer to reach the destination fast.

The proponent above justified that it is good to advise the new drivers, or inexperienced drivers, to meet some accidents first, while they are young, so that they can be better drivers in the future.

Great analogy too!

Posted by kcchongnz > 2018-08-09 21:14 | Report Abuse

Posted by cherry88 > Aug 9, 2018 09:44 AM | Report Abuse
I agreed with KC. I worked in Margin Department in stockbroking firm before. I can confirmed and testify again here that "less than 1% actually make money from MF over a 5 years period or longer" !!! Why risk yourself and let broking house (or investment bank) make the money ? I term of risk-reward ratio, I believer it is better to risk the money in casino than via MF.


Cherry,

Good on you as one in the industry and also involved in this thing to do some social service to the public together with us.

You are the right person.

Posted by stockraider > 2018-08-09 21:46 | Report Abuse

I m surprise that kc call it is a F1 car loh....!!

The analogy is like driving a Myvi v driving a bigger car like camry loh.....!!

As raider says...there is really not much difference between cash or margin investment loh....!!

What type of poor understanding this kc calling himself consultant loh....??

In a way he is irresponsible saying as a financial consultant with a blanket...negative on margin products loh...!!
If u don understand, try to understand & learn and see what r the benefit mah...!

Put it this way it is like u r a muslim...they have a blanket no alcohol but research shows moderate consumption of alcohol give health benefit loh..!!

Thus raider see the rest of the 80% can do away without margin but the balance 20% will definitely benefit loh...!!

Kc need to open his mind & and learn loh...!!

No need to be so naive loh....!!

posted by kcchongnz > Aug 9, 2018 08:46 PM | Report Abuse

Posted by Ray168 > Aug 9, 2018 02:53 PM | Report Abuse
Using MF is just like driving a F1 car... it can brings to your designation fast but may also bring to to holland.
If you don't have the skill set and guts, don't do it.

Ray, good analogy. Is it better to drive safely within the speed limit to arrive the destination timely, of drive a F1 car at 200km/hr to reach the destination faster? YEAH KC SAYS 83% CASH INVESTORWILL FAIL, WITH THIS TYPE, WILL IT BE MORE RESPONSIBLE U AVOID MKT TOTALLY ??

Actually, this article is about the irresponsible advice of elderly telling the youngsters and the new drivers, or even those without the driving license, to drive like a F1 racer to reach the destination fast.
IT IS VIEW AS IRRESPONSIBLE WHEN PEOPLE ARE NAIVE AND DO NOT UNDERTAND THE BENEFIT OF MARGIN LOH....!!

The proponent above justified that it is good to advise the new drivers, or inexperienced drivers, to meet some accidents first, while they are young, so that they can be better drivers in the future.
THE ANALOGY IS LIKE THAT LOH, UR SON START TO LEARN WALKING...IT IS NOT CONFIRM HE WILL DEFINITELY WILL FALL LEH ?? SO IF U R A CASH INVESTOR U WILL FAIL TOO MAH...!!
SO BY USING MARGIN WE ARE JUST ACCELERATING THEIR LEARNING PROCESS LOH AND MAKE THEM TO BE A GOOD INVESTOR LOH...!!

Posted by stockraider > 2018-08-09 21:48 | Report Abuse

Rubbish loh...what type of pariah stockbroking margin CO this cherry is working where 99% losing loh ??

Some more 5 yrs or longer...reading ah ??

1. Margin lose so long meh ??
2. Margin holder no cut loss meh ??
3. 5 yrs how u know the margin account losing meh ??
4. U can remember what stock they buy or sell ah ??

Very suspicious loh...this cherry is talking loh....it is done just to discredit aspiring margin holder loh...!!

Posted by cherry88 > Aug 9, 2018 09:44 AM | Report Abuse

I agreed with KC. I worked in Margin Department in stockbroking firm before. I can confirmed and testify again here that "less than 1% actually make money from MF over a 5 years period or longer" !!! Why risk yourself and let broking house (or investment bank) make the money ? I term of risk-reward ratio, I believer it is better to risk the money in casino than via MF

Posted by kcchongnz > Aug 9, 2018 09:14 PM | Report Abuse

Posted by cherry88 > Aug 9, 2018 09:44 AM | Report Abuse
I agreed with KC. I worked in Margin Department in stockbroking firm before. I can confirmed and testify again here that "less than 1% actually make money from MF over a 5 years period or longer" !!! Why risk yourself and let broking house (or investment bank) make the money ? I term of risk-reward ratio, I believer it is better to risk the money in casino than via MF.


Cherry,

Good on you as one in the industry and also involved in this thing to do some social service to the public together with us.

You are the right person.

Posted by stockraider > 2018-08-09 21:53 | Report Abuse

U SEE WHY RAIDER N KC APPROACH IS TOTALLY DIFF LOH ??

RAIDER BELIEVE ANYONE CAN BE TRAINED WELL TO USE INVEST WELL AND USE MARGIN AND AMPLIFY RETURN LIKE COLD EYE DID LOH...!!
KC ON THE OTHER HAND THINKS 83% PEOPLE ARE MEDIOCRE IN INVESTMENT & CANNOT BE TAUGHT TO IMPROVE WITH EXCELLENT LOH....!!


Posted by stockraider > Aug 9, 2018 06:24 PM | Report Abuse X

There U R...confirm cold eye use margin successfully loh....!!

Why coldeye ask u don use margin leh ??
Bcos coldeye think u never be as great as him, thats why generally he ask investors to avoid loh....!!

But this type of thinking is flaws loh....!!
Everyone can be a good margin investor loh, but in order, u yourself as a margin investor u must be a good investor 1st loh...!!

Raider urge u to use margin, got rational reasons mah....!!

1. 1st of all u need to be a good investor u need to be at least top 20% in terms of competency loh, but in order to that u must learn proper investment technique loh...!!
Don Listen to conservative misguided sifu who promote to u that investment can be successful but if u use margin u will fail loh..!!
That is not much different investing using cash or using margin loh..!!

2. After u learn the proper technique of investment, next u need to learn the specific technique of margin and risk management loh...!!
In all cases u need to clear the training under item 1 above loh...!!

3. If u r a young newbies....having limited capital...it is best u start with margin, if u cannot master the art not much disaster loh...bcos u can always start all over again loh...!
U must dare to Learn art of making monies, dare to win and dare to lose loh.....!!

4. If u r good, naturally u can amplify return with margin as its interest rate only 5% pa loh.....!!

Posted by kcchongnz > Aug 9, 2018 05:33 PM | Report Abuse

Posted by cheoky > Aug 8, 2018 11:38 PM | Report Abuse
buy cold eye revised edition 2018 read. more comprehensive.

Coldeye may have used MF investing in stocks and have made amplified gains. But there aren't many "coldeye" in Malaysia.

The big difference is that he never boast about making so much money using MF (implication of encouragement of using MF). He understands the detrimental effects of MF when market goes against us.

In his books, he persistently discourages the general public from using MF because he knows, and most people know, the general public can't handle it.

That is humility, a great teacher, and a great social contributor, propagating the right things in investing in particular, and life in general.

Posted by Alex™ > 2018-08-09 21:57 | Report Abuse

yes I read coldeye book, he advises against margin. But he used also? haha...really play with fire =D

all in jaks~

Posted by 1Bid > 2018-08-09 22:01 | Report Abuse

If you need margin call to remind you that you suck in picking stock and lose too much money. You have probably enjoyed the trips to Holland.

Posted by kcchongnz > 2018-08-09 22:02 | Report Abuse

Posted by stockraider > Aug 9, 2018 09:46 PM | Report Abuse

What type of poor understanding this kc calling himself consultant loh....??

In a way he is irresponsible saying as a financial consultant with a blanket...negative on margin products loh...!!
If u don understand, try to understand & learn and see what r the benefit mah...!


Raider, I really do not wish to quarrel with you as you can see, all my comments are without any name calling, unlike yours.

I have poor understanding about margin finance? I have shown you with numbers, and facts about MF. Have you shown any besides general statement? Yes, write a proper article to articulate your point of view, with facts and numbers, rather than wild shouting.

I am irresponsible to say people shouldn't tout MF to the general public? Or is it you who are irresponsible telling youngsters to use MF?

For your information, I am not a financial consultant, and never claim to be one. But I know a lot about finance and investment, whether theoretically or practically.

Learn the benefit of MF from you? Look at my articles with all the numbers, and different scenarios I have presented. Have you?

Tell you bluntly, you need to open your mind, learn from others, from internet etc about the negative side of MF.

Investing is not about getting rich quick but risk losing everything. It is about building long-term wealth slowly but surely.

However, if you want to get rich quick, you are entitled to d it yourself, but please don't teach the wrong thing to the youngsters.

I have poor understanding and irresponsible? Read through all the comments. There is one thing one must be aware, it is seldom that everybody is wrong and you are right.

Posted by 3iii > 2018-08-09 22:04 | Report Abuse

Please give a link to this book by coldeye. May wish to own a copy.

Posted by kcchongnz > 2018-08-09 22:12 | Report Abuse

I have poor understanding in MF? I am irresponsible? I need to learn about MF?

These people are some of the richest in the world from investing, making billions for their clients and themselves. Do they also have poor understanding in MF? Are they irresponsible? Do they also need to learn MF from you?

“I've seen more people fail because of liquor and leverage (in stock investment)—leverage being borrowed money. You really don't need leverage in this world much. If you're smart, you're going to make a lot of money without borrowing.” Warren Buffett

“If you are going to be a very concentrated investor, you should not use leverage. You can’t leverage because you need to live through the downturns and that is incredibly important.” Joel Greenblatt

“The trick of successful investors is to sell when they want to, not when they have to.” Seth Klarmen

Posted by stockraider > 2018-08-09 22:14 | Report Abuse

RAIDER NEED TO PUT IT BLUNTLY LOH....!!

INVESTMENT IS NOT TOTALLY AVOIDING RISK LOH....!!

IF U MAKE SUCH A STUPID STATEMENT 83% OF SHARE INVESTORS LOSE MONIES, THEN WHY DON U ADVISE ALL OF THEM TO PUT IN FIXED DEPOSITS & AVOID STOCK MKT TOTALLY LOH....!!

INVESTMENT IS TO TO DEVELOP UR TALENT TO ACHIEVE GOOD RETURN MAH....!!

MAKING SWEEPING STATEMENT THAT MARGIN INVESTORS WILL DEFINITELY LOSE, IS NAIVE AND MISLEADING LOH...!!

AT LEAST 20% CAN MAKE IT AS MARGIN AS INVESTOR SUCCESSFULLY LOH...!!

BUT SPREADING FALSE MISLEADING COMMENT, U R HINDERING POTENTIAL YOUNG INVESTMENT TALENT FROM PROGRESSING LOH

Tell you bluntly, you need to open your mind, learn from others, from internet etc about the negative side of MF.

Investing is not about getting rich quick but risk losing everything. It is about building long-term wealth slowly but surely.

However, if you want to get rich quick, you are entitled to d it yourself, but please don't teach the wrong thing to the youngsters.

I have poor understanding and irresponsible? Read through all the comments. There is one thing one must be aware, it is seldom that everybody is wrong and you are right.

Posted by kcchongnz > 2018-08-09 22:23 | Report Abuse

Posted by stockraider > Aug 9, 2018 10:14 PM | Report Abuse

RAIDER NEED TO PUT IT BLUNTLY LOH....!!

INVESTMENT IS NOT TOTALLY AVOIDING RISK LOH....!!

Me: Who says one must totally avoid risk in investing? Please show!

IF U MAKE SUCH A STUPID STATEMENT 83% OF SHARE INVESTORS LOSE MONIES, THEN WHY DON U ADVISE ALL OF THEM TO PUT IN FIXED DEPOSITS & AVOID STOCK MKT TOTALLY LOH....!!

Me: Stupid statement? Where did I say such a precise number that 83% of share investor lost money? Please show.

Why should I tell them to put their money in FD and avoid stock market?

In fact, it won't be a bad advice to tell them to put their money in FD for the last 5 years. I have shown the fact and numbers in my article. Wouldn't them better to put their money in FD the last 5 years?

INVESTMENT IS TO TO DEVELOP UR TALENT TO ACHIEVE GOOD RETURN MAH....!!

Me: Wow, incredible statement. Talent in the use of MF when so many people lost their underwear? You know they are not good in investing, don't you?

MAKING SWEEPING STATEMENT THAT MARGIN INVESTORS WILL DEFINITELY LOSE, IS NAIVE AND MISLEADING LOH...!!

AT LEAST 20% CAN MAKE IT AS MARGIN AS INVESTOR SUCCESSFULLY LOH...!!

Me: Is it a good advice to use MF when 20% only make money and 80% lose their pants? What logic is that?

BUT SPREADING FALSE MISLEADING COMMENT, U R HINDERING POTENTIAL YOUNG INVESTMENT TALENT FROM PROGRESSING LOH

Me: My statement with facts and numbers false and misleading? Not yours without nothing to show?

Me hindering potential young investment talents from progressing; or your telling them to go to Holland?

Posted by stockraider > 2018-08-09 22:24 | Report Abuse

After so much arguement on margin, especially with KC, raider have concluded using margin is neutral, there is no bad or good about it loh....!!

For every 100 arguement the opponent can say bad of margin, there are another positive arguement good about margin loh...!!
Why like that leh ???
It is actually for margin there are 2 side of the coin mah....!!
One side negative the other positive loh...!!

So margin is just a tool of investment....the key to success still lies mainly to the skill of investor plus a little bit positive of luck loh..!!
The main reason why people fail bcos their skill no good mah...!!
Just like if u drive car without proper training, very high risk of accident loh...the same applies to margin loh...!!

Why margin the whipping boys leh ??
Human nature loh....to blame anything and everything other than themselves loh....!!
So alot of failed investor will claim margin is the cause loh, it is amazing some of this failed people do not use margin at all loh...!!

But why raider say no, it is not due to margin leh ??
In the mkt 75% participants lose monies in the long run...whether use margin or not, why leh ? Why even long run,they lose monies, is it not share investment fundamental in long run advantage meh ??
Ans; Sustained Success in Investment we need deal with overall positive expected value outcome mah....!!

A clear example if u flip coin...Head 50% and Tail 50% mah...!!
So the $$$$$ payout if u bet fairly Rm 1....the payout or the loseout is Rm 1 loh....!!
Suppose the rule is change to if u bet Rm 1 head, the payout is rm 1.20 head, thus this advantage of HEAD bet, raider called a thereotical positive outcome....which the foundation of investment success...where we invest loh......!!

So a sustainable investment success, must seek potential positive thereotical positive outcome probability, no matter, whether they use cash or margin to invest loh....!!

JUST REPEAT THIS LOH;
For every 100 arguement the opponent can say bad of margin, there are another positive arguement good about margin loh...!!
Why like that leh ???
It is actually for margin there are 2 side of the coin mah....!!
One side negative the other positive loh...!!

WHEN RAIDER HAVE TIME...EASILY RAIDER can refute ALL THE NEGATIVE POINTs THAT KC RAISED ON MARGIN INVESTMENT LOH.....!!

WHY THIS IMPORTANT ??
THE WAY KC TALK LIKE, HE COMPLETELY DO NOT UNDERSTAND....WHY PEOPLE FAILED IN INVESTMENT LOH....!!
THERE IS A BIG MISCONCEPTION THAT MARGIN IS EVIL BUT IT IS NOT TRUE LOH....!!
Margin is neutral, it is just a tool loh....!!

Posted by kcchongnz > 2018-08-09 22:30 | Report Abuse

Posted by stockraider > Aug 9, 2018 10:24 PM | Report Abuse

WHEN RAIDER HAVE TIME...EASILY RAIDER can refute ALL THE NEGATIVE POINTs THAT KC RAISED ON MARGIN INVESTMENT LOH.....!!

Me: Please do! Please show some examples, facts and figures too. Otherwise it is of no use.

THE WAY KC TALK LIKE, HE COMPLETELY DO NOT UNDERSTAND....WHY PEOPLE FAILED IN INVESTMENT LOH....!!
THERE IS A BIG MISCONCEPTION THAT MARGIN IS EVIL BUT IT IS NOT TRUE LOH....!!


Me: ok, ok. Ever with facts and figures, examples etc, you still say I don't understand. Show us that you so understand, please.

By the way, you have not responded to my questions above. Do the following super investor also don't understand MF and need to learn MF from you?

“I've seen more people fail because of liquor and leverage (in stock investment)—leverage being borrowed money. You really don't need leverage in this world much. If you're smart, you're going to make a lot of money without borrowing.” Warren Buffett

“If you are going to be a very concentrated investor, you should not use leverage. You can’t leverage because you need to live through the downturns and that is incredibly important.” Joel Greenblatt

“The trick of successful investors is to sell when they want to, not when they have to.” Seth Klarmen

Posted by stockraider > 2018-08-09 22:35 | Report Abuse

Twisted MF argument 1

“I have never known any successful businessman who does not use MF.”

Arguably leverage is a key part of our capitalist system, allowing capital to be allocated to those who can use them most productively. Where leverage is used prudently it is hugely beneficial: companies can fund projects by borrowing the money needed to get started.

That is what businessmen do; some borrow money and use it prudently for doing business. Many, if not most businessmen focus on making money in their business. Most of them reinvest their profit back and grow their business. Some may utilize some of the excess profit to invest in other public listed companies by investing in their stocks, passively. I personally do not know and hardly heard of any successful businessmen using MF punting in the stock market. Those very few I know doing so had lost their business and also their pants and the wise ones vow never to do it again.

RAIDER REPLY,

WARREN BUFFET ADVICE PEOPLE TO INVEST IN SHARE ON A BUSINESS LIKE MANNER MAH, THUS SHARE INVESTING IF DONE PROPERLY IS BUSINESS LIKE AS ANY BUSINESS MAH...!!
IF GOOD BUSINESSMAN ARE ALLOWED TO BORROW, THEN WHY NOT GOOD INVESTOR SHOULD BORROW TOO LOH....!!

KC ARGUE SHARE INVESTMENT NO NEED TO USE MARGIN, CAN USE OWN SWEET TIME TO GROW, THEN THE SAME ARGUEMENT SHOULD APPLY TO BUSINES, WHY DON THEY USE CASH AND TAKE A LONGER TIME TO GROW, INSTEAD OF TAKE RISK TO BORROW FOR GROWTH LEH ??

Who else here know any businessman who is successful, using MF to speculate or invest in the stock market?
THE ABOVE SHOWS THAT, IF U THINK BUSINESS LIKE FOR SHARE INVESTMENT, THE PARTICIPANTS SHOULD BE GIVEN THE OPTION TO BORROW USING MARGIN MAH...!!

Posted by stockraider > 2018-08-09 22:44 |

Post removed.Why?

Posted by stockraider > 2018-08-09 23:03 | Report Abuse

Twisted MF argument 3

“Are you so hopeless that you can’t even make more than the 5% MF rate investing in stock? You are not suitable to invest in the stock market then.”
I always ponder those proponents above if they know that the 5% interest rate one has to pay is fixed whatever your outcome in investment is, whereas the return from investment is just an expectation, of which the outcome is full of uncertainties and will only be known in the future.

Table 1 in the Appendix shows the cumulative and annualized returns of the general market in Bursa Malaysia for various periods as shown by the KLCI Index.

The Table shows that none of the periods has a compounded annual return (CAR) of more than 4%. If one invested long-term from 2013 until now, with their performance mimicking the return of the broad market, he would have made positive returns in those periods, albeit small. For those using MF, they would have lost money for all the five periods as the returns were all below the MF cost of 5%, without even considering other costs such as setup fee, roll-over fee, transactions costs etc. Those “ordinary” investors who engaged in the use of MF would likely be struggling to make enough money just to pay bank interest for their MF.

That is the general performance of the broad market, and the return of investors investing in the stock market over those periods. Statistics have shown that about those 80% of individual investors actually under-performed the broad market. What about their performance? How if they engaged in MF?

RAIDER REPLY,

IF U R GIVEN A MIN HURDLE RATE LIKE 5% PA TO MAKE....NO DOUBT IT PUT PRESSURE ON U TO PERFORM LOH....!!

JUST LOOK AT EPF THEIR RETURN IS 6% PA LAST YR....CAN EPF FUND MANAGER TELL U ....NO LAH DON PUT IT AS RETURN 1ST LOH ?

EPF FUND MANAGER TARGET RETURN MUST EXCEED 6$ PA , THAT IS EVEN HIGHER THAN 5% PA MARGIN COST MAH...!!

EPF INVESTING MANAGER NEED TO HAVE TALENT & TAKE RISK TO ACHIEVE ITS TARGET RETURN LOH....!!
SUPPOSE EPF ONLY ACHIEVE 1% PA RETURN....DO U NOT THINK THEY WILL BE A BIG OUTCRY & THEY MAKE EVEN BE SACKED MAH...!!

SO IF U TAKE MARGIN 5% PA...AND INVEST R U.. NOT NEED TO ACHIEVE THE REQUISITE ABOVE 5% PA RETURN....IF U FAILED U WILL BE PUNISH...THRU CAPITAL LOSS LOH....!!

SO THE TREATMENT OF EPF MANAGER & U AS MARGIN INVESTOR BOTH NEED TO ACHIEVE THE TARGET RETURN LOH...!!

IF U FAIL TO ACHIEVE 5% PA...IS IT NOT U NEED CONSIDER WHETHER U R SUITABLE IN INVESTING , SINCE U R NOT GOOD ENOUGH LEH ??

THERE IS NO FREE LUNCH....THEY IS COST ON MONIES OR OPPORTUNITY COST MAH...!!

Posted by stockraider > 2018-08-09 23:10 | Report Abuse

Twisted MF argument 4 & 5

“Using MF, your gains are amplified when your stocks go up in prices. Then you can borrow more and more and soon you will become multi-millionaire with millions in MF.”

“Margin call is an advantage as it forces the sale of my shares. MF helps to reduce losses as cut-loss is automatically triggered. Once encounter margin call, it is a wakeup call and sell sell sell is the only option! Margin call is a blessing in disguise”

This appears to me some of the most dangerous “teachings” in the stock market. They focus on one direction of the stock market, that one always makes money buying and selling of stocks, and totally disregard the other side. Let us examine using the past one-year movement of the share price of Jaks as shown in Figure 1 below as an example to see if the above statement is always true. I use this as it is a hot stock now many people here know.

Ignoring all borrowing and transaction costs, and assuming one starts with his own capital of RM1m, and a MF of another RM1.0m buying Jaks at RM1.30 a year ago, having the ultra-strong opinion that Jaks, with its excellent profit growth prospect, and “guaranteed profit” from Chinese banks due to its power plant development in Vietnam, with a long gestation period, is a long-term buy. He would have made RM600k in less than two months when its share price went up 30% to RM1.69. He then used another RM600k additional MF. When the share price dropped to RM1.28, his equity would drop to about RM820k, more than 50% below its borrowings, and assume that margin call was triggered. He then treated the margin call as a wake-up call and he “sell, sell sell” all his holding in Jaks, and vowed that he would never look back again. He lost RM176k from his foray in using MF “investing”, supposedly to be a long-term investment in Jaks.

In fact, those using MF and “awoken” by margin call and sold all their shares would have missed out the run from October 2017 to February 2018 when the share price of Jaks went up to RM1.83, or a gain of 40%.

Would MF make you rich by doing the same thing again, by borrowing to buy at RM1.30 in October 2017, add more MF at RM1.83, and then “woke up” by margin calls and sell sell sell the shares at RM1.10?

So, is MF “always’ make one rich? Is margin call a good “wake-up” call? Is margin call a “blessing in disguise”? You judge with this real hot stock example.

WHEN YOUR PARTNER THE BANKER DEVICE A MARGIN SCHEME FOR U THEY THINK OF HELPING U TO MAKE MORE MONIES AT THE SAME TIME SAFEGUARDING U TO PROTECT THEM LOH....!!

SO MARGIN CALL IS TO PROTECT U LOH....!!
AND A GOOD MARGIN FINANCE WILL AMPLIFY UR RETURN LOH...!!

BUT KC...USE A VERY BAD ILLUSTRATION ON JAKS....WHICH RAIDER THINK IT IS NOT A GOOD REFLECTIVE EXAMPLE LOH....!!

BASICALLY RAIDER WOULD USE MARGIN INVESTMENT LIKE USING CASH INVEST MORE CONSERVATIVELY FOR LONG TERN THEN KYY LOH....!!

Posted by stockraider > 2018-08-09 23:20 | Report Abuse

Twisted MF argument 6

“If you are not good in investing, whether you use MF or not, you will still lose money.”

I do agree with the above statement. That is why 80% of the stock market players lose money. But the difference is they lose their own money and just suck up, and the loss is much less at RM30k in the above example, compared with MF players of the loss of RM176k. There is no worry of having to find money somewhere to pay the banks after all his money has been lost.

RAIDER REPLY,

REMEMBER WHEN U R A SMALL KID, U USE BICYCLE TO TRAVEL, DO U NEED TO PASS WITH A LICENSE TO RIDE A BICYCLE LEH ??
THE ANSWER IS NO LOH....!!
SO ANYONE CAN RIDE A BIKE WITH NO LICENSE, IN FACT SOME ALSO DO NOT KNOW ANY TRAFFIC RULES LOH...!!

THUS JUST LIKE A CASH INVESTORS UR NOT FORCE TO HAVE A HIGHER INVESTMENT STANDARD....THUS U R NOT REQUIRE TO BE SO GOOD...THUS ALOT LOSE MONIES LOH....!!

BUT THEN WHEN U DECIDE TO DRIVE A CAR...U R FORCE TO GO AND TAKE CAR DRIVING LICENSE AND NEED TO PASS IT B4...U CAN DRIVE MAH...!!

SO IF U TAKE MARGIN, U R REALLY FORCE TO IMPROVE UR INVESTMENT SKILL MAH, B4 U CAN BE SUCCESSFUL INVESTOR LOH....!!

THATS WHY RAIDER SAYS YOUNG TURKS SHOULD TAKE MARGIN TO IMPROVE HIS INVESTMENT SKILL LOH....!!

Posted by stockraider > 2018-08-09 23:35 |

Post removed.Why?

Posted by liowst > 2018-08-10 06:19 | Report Abuse

KC, my little suggestion to you is to ignore Stockraider before you ended up like KYY that comment is not allowed for the article. Not sure why, I am in those international market forum too. They are not like Malaysian, Of course there are plenty of different views and opinions, but they accept the differences. However, Malaysian hold very strongly in their own points, many like to criticise for article and comment that not in line with them. Maybe this is just part of our culture

Posted by qqq3 > 2018-08-10 09:41 | Report Abuse

instead of young people going negative, it is more important young people think how businessman become so successful in stock market.

Posted by 3iii > 2018-08-10 09:58 |

Post removed.Why?

Posted by stockraider > 2018-08-10 10:07 | Report Abuse

THE PICTURE PAINTED BY THIS JOKER IS AS IF RAIDER DO NOT ACCEPT DIFFERENCE LOH...??

PUT IT THIS WAY, RAIDER IS THE MODERATE GUY, IN THIS ARGUEMENT MAH...!!

1)IN A NUTSHELL RAIDER ALREADY SAYS MARGIN IS ACTUALLY IS A TOOL, IT IS NEUTRAL, THAT IS NOT GOOD OR BAD IN ITS USED LOH..!!

BUT KC INSIST IT IS A BIG INVESTMENT SIN TO USE IT LOH...!!

2) RAIDER ALSO EMPHASIS THAT U NEED TO IMPROVE YOUR INVESTMENT SKILL IN ORDER TO USE MARGIN LOH...!! IF U R COMPETENT ENOUGH U SHOULD BE ABLE TO MAKE MUCH MORE MONIES THAN USING CASH TO INVEST LOH...!!

BUT KC SAYS THAT USE MARGIN IS NO NO SURE LOSE MONIES MAH...!!
WHICH RAIDER TOTALLY DISAGREE HERE LOH...!!

3) RAIDER PUSH FOR HIGHER EXPLORATION OF THE USE OF MARGIN TOOLS TO THE YOUNG, BCOS IT IS MOST SUITABLE TO START BUILDING THE WEALTH LOH..!!

BUT KC SAYS RAIDER IRRESPONSIBLE LOH...!! RAIDER THINK IS VERY RESPONSIBLE BCOS THE YOUNG CAN LEARN FASTER, CAN AFFORD TO LOSE BCOS THEY HAVE TIME & CAN STILL START OVER, AND THEY HAVE LIMITED TO CAPITAL TO LOSE.
IF U DON START YOUNG, DO U WANT TO WAIT UNTIL U R 55 TO START USING THIS WONDERFUL MARGIN TOOLS ??

4} WE ARE IN THE INVESTMENT FORUM SURELY MAKING MONIES, WITH MANAGING RISK ARE GIVEN BIG EMPHASIS, U LOOK AT RAIDER COMMENT IS ALL IS A BALANCE ON THE ISSUE OF MAKING MONIES AND AT SAME TIME MITIGATING RISK LOH..!!

KC APPROACH OF BEING TOO CAUTIOUS WITH BIG NO ON MARGIN, WITHOUT UNDERSTANDING THE OBVIOUS ADVANTAGES, JUST SHOUTING NO NO, MAY RESULT IN MANY LOST OPPORTUNITY TO THE INVESTMENT PEOPLE. WHAT U REALLY NEED TO JUST TO IMPROVE A LITTLE BIT MORE IN MARGIN INVESTMENT SKILL AND UR OPPORTUNITY TO GROWTH UR WEALTH IMPROVE MANY FOLD LOH.

CONCLUSION: RAIDER LIKE TO EMPHASIS MARGIN IS JUST AN INVESTMENT TOOLS CREATED FOR YOUR USE, U HAVE OPTION TO USE IT OR NOT.

IF U USE MARGIN AND MAKE ALOT OF MONIES RAIDER CONGRATULATE U LOH..!!

IF U LOSE, RAIDER SYMPATHISE WITH U ?? BUT SHOULD U GIVE UP ?
NO LOH....U NEED TO DO A SOUL SEARCHING B4 REALLY GIVING UP LOH..!!

Posted by liowst > Aug 10, 2018 06:19 AM | Report Abuse

KC, my little suggestion to you is to ignore Stockraider before you ended up like KYY that comment is not allowed for the article. Not sure why, I am in those international market forum too. They are not like Malaysian, Of course there are plenty of different views and opinions, but they accept the differences. However, Malaysian hold very strongly in their own points, many like to criticise for article and comment that not in line with them. Maybe this is just part of our culture

Posted by qqq3 > 2018-08-10 10:13 | Report Abuse

3iii > Aug 10, 2018 09:58 AM | Report Abuse

Warren Buffett: Leverage is also a way to get very poor.

Unquestionably, some people have become very rich through the use of borrowed money. However, that’s also been a way to get very poor. When leverage works, it magnifies your gains. Your spouse thinks you’re clever, and your neighbors get envious.

But leverage is addictive. Once having profited from its wonders, very few people retreat to more conservative practices.

============

3iii...leverage is the best tool to move the world.....any thing that moves the world involves leverage, even multi level marketing is leverage.

people posting here also want leverage......getting other people to buy their shares.

Posted by stockraider > 2018-08-10 10:30 | Report Abuse

Invest in share can also be addictive mah....!!

in other words everything can be addictive loh....!!

If u have tendency to be addictive....it is nothing due to leverage...it is something wrong with u....u have some psychological & mental problem mah....!!
U NEED HELP...MAY BE START SEEING THE PSYCHIATRIC MAY HELP U LOH...!!

Posted by qqq3 > Aug 10, 2018 10:13 AM | Report Abuse

3iii > Aug 10, 2018 09:58 AM | Report Abuse

Warren Buffett: Leverage is also a way to get very poor.

Unquestionably, some people have become very rich through the use of borrowed money. However, that’s also been a way to get very poor. When leverage works, it magnifies your gains. Your spouse thinks you’re clever, and your neighbors get envious.

But leverage is addictive. Once having profited from its wonders, very few people retreat to more conservative practices.

============

3iii...leverage is the best tool to move the world.....any thing that moves the world involves leverage, even multi level marketing is leverage.

people posting here also want leverage......getting other people to buy their shares.

Posted by qqq3 > 2018-08-10 10:45 | Report Abuse

stocks and portfolio has its own characteristics,.....you can design your own portfolios./ characteristics.....


my recent portfolio designed for one and only one purpose met its objective very well.....the objective of being fine and do well under any circumstance....the portfolio of....DRB, FLH, Vitrox , Gas Malaysia, Sam Chem and added LCtitan and Petron.

instead of going negative like this kc....what needs to understand is that stocks and portfolios can be designed to serve its set of objectives.......

stocks and portfolios is always about risk - reward......you want safety or you want high risk/reward......


I know....you guys think I am poor guy talking in rich man land......but none of you know any thing about me......none of you know who am I, my background or any thing like that.

Posted by cherry88 > 2018-08-10 11:20 | Report Abuse

Why this Stockraider merely like to comment on blogger's comment in a very "long form" . He / She should be good in write a proper blog. Let's others give feedback to him / her.

Posted by stockraider > 2018-08-10 11:24 | Report Abuse

SHORT CUT MAH...!!

Posted by cherry88 > Aug 10, 2018 11:20 AM | Report Abuse

Why this Stockraider merely like to comment on blogger's comment in a very "long form" . He / She should be good in write a proper blog. Let's others give feedback to him / her.

Posted by seekingalpha888 > 2018-08-10 11:56 | Report Abuse

It's appalling to see KYY preach to the general public via various articles, the latest being Aug 4th only for him to turn around for him and sell. If this is not pump and dump, I'm not sure what it is.

Posted by arv18 > 2018-08-10 11:57 |

Post removed.Why?