Margin on capital (pledged FD, cash, property & shares (based on valuation). The limit provided by bank is usually 1.5 to 2.5x. Need to fulfill FMR % to avoid margin call.
Theoretically, SMF with pledged FD is the cheapest financing option in town (FD interest 3.8% p.a less SMF interest 4.5% p.a = 0.7% p.a). However this is subject on one's drawdown amount of the SMF facility.
I do not view SMF as a quantum leap leverage tool. I view it as a cheap source of fund. How much we profit from share price increase is based on our knowledge (FA, TA and news).
There is a saying that 80%-90%of the retailers are not making money in the stock market, only those skillful ones are able to survive to make profit!!
Same analogy impling that only 10-20% investors are able to use margin wisely as to generate extra profit in stock market. So please make sure you yourself is the cream of this group of talented investors before leveraging with margin account. ^o^
Posted by paperplane > Nov 1, 2019 1:15 PM | Report Abuse margin is like smoking, smoking not good for health still ppl smoke. But if smoke lightly it gives you boost. so use margin wisely. U cannot tell ppl smoke no good hence cannot smoke. Must give ppl freedom mah
Who here is restricted from, or cursed for smoking?
Smoking is one of the few things proven for not good for the well being of a person, and can shorten the life of a person. But if you enjoy smoking, please go ahead. In life, quality is better than quantity.
However, if you know smoking is not good for health, do you still keep on telling how good smoking has done to you and pestering others to smoke, and feel damn proud about it?
Posted by paperplane > Nov 1, 2019 1:45 PM | Report Abuse aiyo. kc. in real life, apa macam ppl pun ada. to certain ppl result more important than process, vice versa for other as well mah
This article illustrates that if one uses $1m of his own capital and hare margin finance to the maximum buying Jaks from RM1.00 all the way up to $1.80, he would have made a profit $1.92m, or 192%, within a short period of just over a year.
What if he uses $50m of his initial capital? The profit would be close to $100m.
Wasn't me talking about "results", the unimaginable Magic of margin finance?
By the way, kc, whats your result compared to him? Results is what all ppl see end of the day. Dont care abt process one ppl nowadays. Only look at yearly return.
Posted by paperplane > Nov 2, 2019 12:26 AM | Report Abuse By the way, kc, whats your result compared to him? Results is what all ppl see end of the day. Dont care abt process one ppl nowadays. Only look at yearly return.
"Him"? Who is this "Him"? Why "Him"? Is this article about "Him"?
This article is about the "Unimaginable Magic from Margin Finance". It is purely a subject matter. Does it involve any personality?
Anyway, it is your prerogative to worship money, and rich people. Money to me is at the bottom of my list. I value more on personal traits such as honesty, incredibility, humility, truthfulness etc.
Well, everyone is different. Let us agree to disagree.
Still, result is everything to me. Personal traits you mentioned worth nothing in the scenarios when u even struggle surviving daily life. Thts the real life, maslow theory.
Posted by paperplane > Nov 2, 2019 1:58 PM | Report Abuse Ya. Everyone is different. Then why u preaching not using margin, and what wrong when other preaching using margin. Right. Be fair loh.
Is this article about "preaching on not using margin"? Or it is abut the unimaginable Magic of Margin Finance, praising the great thing about margin finance? Can you read it again and see if you understand it?
Is there anything wrong for me to "preach not using margin" if I intend to do so?
To be fair mah if I present an opposite view.
So please may I write an article on the opposite view on the margin finance, please?
THE USE OF MARGIN OR NO USE OF MARGIN, HAS BEEN DEBATED MANY TIME LOH..!!
SOME SAY GOOD AND SOME SAY NO GOOD LOH....!!
TO USE MARGIN OR NOT THE GENERAL CONCLUSION ARE ALL DEPEND ON THE INVESTORS & ITS RISK TOLERANCE LOH...!!
RAIDER VIEW IS THAT YOUNG CIKKU SHOULD USE MARGIN QUICKLY TO LEARN & BUILD UP HIS ABILITY FAST, AND AS HIS BORROWING CAPACITY OF CIKKU IS LIMITED THE DAMAGE AND RISK, CAN BE BEARABLE EVEN IF HE FAIL LOH...!!
FOR OLD FOLKS LIKE KYY, HE SHOULD SCALE DOWN HIS MARGIN FINANCING LOH....!!
the discussion has gone out of the point KC is actually telling you , if you follow uncle Koon style to trade you can become rich very fast and also can become bankrupt very fast also Uncle won't go bankrupt because 64M is sap-sap-sui for him most of us will go bankrupt because 64M is no play-play for us
conclusion : play small small . earn a little more to make yourself happy loh.....
Monday go buy BJL lah.... privatization play is more interesting than margin play if you win, take big money home if you lose , be happy to be appointed as a life long member of BJL
tell you quietly I was once a royal supporter of uncle the one who had defended him the strongest to fight sslee now ? run far far away from him or play hit and run to get some kopi money
Me one of them, been using SFM for over 10 years, so far so good (only on good quality stock)
Posted by lachai2004 > Nov 1, 2019 11:25 AM | Report Abuse There is a saying that 80%-90%of the retailers are not making money in the stock market, only those skillful ones are able to survive to make profit!!
Same analogy impling that only 10-20% investors are able to use margin wisely as to generate extra profit in stock market. So please make sure you yourself is the cream of this group of talented investors before leveraging with margin account.
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