How to trade STI index on poems using CFD

Do you wish hedge your position when market turn into a bear market or know how to you use lesser capital to take on opportunity in the market? In this article, let me share with you what is Contract for Difference (CFD) all about.

What is Contract for Difference (CFD)?

Contract for difference (CFD) is a contract between two parties, typically described as "buyer" and "seller".  Stipulating that the seller will pay to the buyer the difference between the current value of an asset and its value at contract time (If the difference is negative, then the buyer pays instead to the seller).

CFDs are financial derivatives that allow traders to take advantage of prices moving up (long positions) or prices moving down (short positions) on underlying financial instruments. 

Margin requirement
As CFD is an Leveraged product hence it operates like a Margin Account. Margin requirement is the minimum capital you have to park in to the account to have an open position. 

Financial charges
You essentially become a borrower by as CFD allow you to trade larger stocks or indices using smaller amount of your fund and borrowed fund. Financial charges are charged on daily, mark to market price when market close

Trading STI index on POEMS.How does it look like?

 This is the platform CFDTrader 2. Join us on our Free coaching

CFD allowed you to long as well as short the STI index, 
Long is to buy first, sell later at a higher price to make profit.
Short is to Sell first, buy back later at a lower price to make profit. 

STI Bid-Ask Spread is at 3.6 pips. E.g STI bid price is at 2850.6 while ask price is at 2854.2, 

Search for Straits Time Index 5SGD in PhillipCFD or Poems 2.0 you will find the contract.

To calculate the value of contract, every 1 point in STI is valued at 5SGD. 
If you buy 1 Contract of Straits Time Index 5SGD at 2850, your contract value is $14250, however margin Requirement in CFD is only 5%, hence = 14250*5%= SGD712.5

if you have a 50point Gain in your profit will be 50x5SGD= $250

So, what will be the COST in trading STI using CFD under POEMS?
Here is the counter detail for STI

Important advantage of trading STI is the COST.
Financial Charges: 1.5% p.a for long position and 2.5% for short position.

Minimum Margin requirement: 5% 
(lower requirement mean lower stuck in fund, opportunity cost is lower)

Commission Charge: 3SGD per transaction
(Stock market minimum commission charge is at 25SGD and yet you are required large amount of fund to invest )

Register for our CFD seminar to learn how to benefit from current market condition

Maxis-Downtrend stock, exception of bullish market in Malaysia

MAXIS one of the biggest telecom company in Malaysia suffered from a downturn in share price since May. Our ART Supertrend system suggests there is a change of trend from bullish to bearish at beginning of May, it was indicated in orange bar. Since the first orange bar, price has fallen as much as 12%.

Furthermore, Smart Money Index (Graph at the bottom) assists in identify flow of fund whether is from Banker (Blue bar at bottom) or Retail buyer (Green bar at top). Bankers are commonly known as market mover, they consistently support the price, the share price is not sustainable when Banker Fund withdrawn in April. The trend remain weak unless we see the candlestick close above RM$6.65

When you should look at UOB bank stock?

6 month ago, i met a chinese speaking Aunty investor in one of my seminar, she only trade the bank stocks. UOB and DBS. I ask her why, she told me the rest of the stock is too confusing, what she know is that Bank will always be there, they are back by the government and if bank were to collapse. Everyone in Singapore will going to be broke anyway.

She told me every year she just need to make 4-6 trades and that will be more that enough for her whole year expenses (She dont really spend much). I ask her so how much you made each trade? I was quite shock when she say 7-20k, that means everytime the amount she buy with her cash will be 400-600k. That is pretty good deal for her remisier!

She only buy when price is low. BUY low Sell High actually work, but not on penny stocks. What I see is Rich investor always buy that will still be around in the next 20years and the stock in definitely do better in the next 20years. That is why when they buy during price correction, they dont mind holding for a while more.

Looking at the UOB chart with RSI indicator, everytime RSI go below 30 the stock is in  oversold position, and it seems like it is working well for the past 2 year. If interest rate is going to rise in 2015, banks are likely to benefit from it. Will UOB move higher from here?

Want to receive more frequent Trading Ideas in your Email or SMS? Open a Free Trading Account with us now! http://bit.ly/1gegCv0

The Rich Get Richer with Bond Investing

Sold some CWT bond yesterday $100.35, 4.75% yield, maturity in March 2020. Min 250k,

the client ask: Am i getting $11,875 every year?

I say: Yes! they pay you half yearly, and you get $11, 875 in a year, $59,375 for 5 years. You will be 24% richer in 2020!

Now I know why rich people get richer,
1) There is people constantly helping them looking for opportunity
2) They buy assets that generate CASHFLOW
3) They always have bank that is willing to give them a lower interest loan and in big sum amount
4) They take calculated Risk, not gambling into penny stocks
5) They look into the Future and invest in a longer term.

5 RULES to prevent a BIG losses in Trading

Few days ago I met up with some investors, they asked me to help the check out their stocks. Some of the stocks is in terrible condition, usually the common question is "Should he/she buy more at current price?"or "Should he/she Sell now?" When your stocks is down 50% it is really not easy to answer the 2 question above, however, lets think about why you think the price up if you continue holding? If you cant find any reason for it to go up, then you should not be holding on to a losing counter. I always tell my client, a big loss always start from a small loss, cut loss when it is still small. 

5 RULES to prevent a BIG loss in Trading

1.  Never follow other people/GURU/INSIDER/FRIENDS/REMISIER to get in a trade.
2.  Never trade just for 1-2bid, it doesnt work here in Singapore unless you are getting super low commission. Many people thought it is easy to make 1-2bid, so they buy ALOT of shares, the price up a bit, they can run away with small profits, however many times they cannot react fast enough to the opposite direction and get caught with Big losses.
3. Never RISK more than 2% of your portfolio in a single trade, you cant win every trade, some times you will have losses, the rule of the game is to win more than you loss, Win big when you win, Lose Smaller than what you win when you lose
4. Never Average down a Loser, buy stocks like you are investing in a business, Dont put in more capital on the business that is losing money! Invest more on the business that is making you the money!
5. Never trade without an Exit Strategy, knowing how you get in is easy, however many people always do not know how to get out when the PROFIT and also when they making LOSSES. Below is some of the example of how you can exit before big drop in the stock price using ART Supertrend System

 Ezra changed trend since August 2014, never show green candle since then, our Smart money index show no more Smart money in the stocks. Mostly retail money stuck in the stocks.

 Ausgroup change trend Since Aug 2014, our Smart money index show no more Smart money in the stocks. Mostly retail money stuck in the stocks.

Mirach Change trend since September 2014, our Smart money index show no more Smart money in the stocks. Mostly retail money stuck in the stocks.

Sharing my experience on another SGX event in the heart of Orchard road!

Hi Friends, i will be speaking tomorrow at Orchard road sharing some of my experience with the young people! Check out more on SGX's My First Stock Carnival 2015!

Will be Sharing:  "5 Secrets Investing Tips the Rich Don't Want You to Know"

Venue: Cathay Cineleisure @ Somerset
(Next to Starbucks)

full event agenda/schedule is here

Common Investor Mistakes - Tom Dorsey

Common Investor Mistakes
Below we have listed a few common investor mistakes.
Try to avoid making these mistakes with your investments.
Falling in love with a position. An account has limited capital, so
ask yourself if the position is the best one to be in here. Are you
tying up capital that can be put to better use elsewhere? Don't get
sucked into the fundamental story.that is, don't hold on to a
stock whose technical picture has deteriorated just because you are
intoxicated with the reasons for your choice.
Buying the stock right, but forgetting to sell it right. There
are two foul shots to make successfully with respect to investing.
You must buy the stock right, and then you must sell the stock
correctly. Therefore, once you buy a stock you must review it on
a regular basis; don't just forget about it. Attempt to sink both
foul shots.
Not having a game plan for investing. Investors will haphazardly,
especially in a strong market, pick stocks to buy, thinking that
the stock market is easy to beat. They fail to realize there is risk, not
only reward. Therefore, it is essential to have a game plan that
helps dictate what stocks to buy and when, and also tells you when
to sell or play defense.
Buying stocks that are extended. When you buy a stock that is
up on a stem, it increases your risk and diminishes your potential
reward. Rather, it is best to buy a stock when it pulls back closer to
support, thereby increasing the potential upside reward, and
diminishing the risk to the stop-loss point.
Taking small gains, but not being willing to take small losses.
Be willing to take small losses by adhering to your stop-loss points.
Avoiding large losses will keep you in the game. You will not be
right on every trade, so be willing to bail out and take the small loss
when the technical picture so dictates.
Buying a stock that is trending down, thinking that it is cheap, or a
value. Often, these types of stocks become an even better value
because they continue to fall in price. Ideally, it is best to stick
to stocks that are in an overall uptrend, trading above their bullish
support line and exhibiting positive relative strength. These
are the stocks that are in demand and should be considered for
purchase.
Acting on poor advice, tips, and financial media hype. Many
investors try to get rich quick without doing their homework. They
rely on the TV or financial media to tell them what to buy. Instead,
take the time to educate yourself, to arm yourself with a game plan.
Then you will be able to make sound, informed decisions. Take
responsibility for your own success. Donft rely on get-rich-quick
schemes and rumors. Do your own research.
Getting emotional and not being able to stay objective. Any
investor knows that emotions can be your worst enemy. Try to stay
objective. The point and figure chart helps you accomplish this
because a picture paints a thousand words. When looking at the
chart, cover up the name of the stock. Make your decision on what
the chart is telling you, therefore taking the emotion out of knowing
the name of the stock.

From the book  Tom Dorsey's Trading Tips: A Playbook for Stock Market Success

Shanghai-Hong Kong Stock Connect information you need to know!

1.     What is Shanghai-Hong Kong Stock Connect?

Shanghai-Hong Kong Stock Connect is a joint project between the Shanghai Stock Exchange (SSE) and The Stock Exchange of Hong Kong Limited (SEHK). It allows investors to trade cross-border into specific stocks listed in the other's market. It also allows overseas investors and thus Phillip Securities clients to trade China 'A' shares in the SSE.

2.     When can we expect Shanghai-Hong Kong Stock Connect to launch?

Hong Kong, Shanghai stock link to start Nov 17

3.     Which China 'A' shares can I trade?

'A' shares that are

a.     Index constituents of the SSE 180 Index , SSE 380 Index or

b.     Dual-listed on both SSE and HKex

SSE 180 Index Constituents List download

SSE 380 index consists of the 380 stocks with Midcap, high growth and good earning records, which aims to comprehensively reflect the performance of the Shanghai new blue chip stocks.

SSE 380 Index Constituents List download

The shares must also be denominated in RMB and not included in “Risk Alert Board”.

Investors will not be allowed to buy the share, but will only be allowed to sell it in the event a stock subsequently:

o    Ceases to be a constituent stock, or

o    is added to “Risk Alert Board”, or

o    its 'H' Share cease to trade on HKex;

1.     Can I participate in Initial Public Offerings (IPOs) in SSE through Shanghai-Hong Kong Stock Connect?

No, IPOs are currently not supported by the scheme.

II. TRADING ARRANGEMENT

5.     Can investors do short selling, margin financing and stock borrowing & lending on SSE Securities

No. Hong Kong and overseas investors are not allowed to do naked short selling in China 'A' shares listed in the SSE. They are not allowed to participate in the Mainland’s margin trading and securities lending as well.

6.     Does SSE price limit apply under Shanghai-Hong Kong Stock Connect?

Yes. For SSE Securities, there is a general price limit of a ±10% (and a ±5% for stocks under special treatment (i.e. ST and *ST stocks) in the risk alert board) based on previous closing price.

All orders input for SSE Securities must be within the price limit. Any orders with price beyond the price limit will be rejected by SSE. The upper and lower price limit will remain the same intra-day.

Note: ST stocks refers to: stocks that have been resumed from suspension for listing; or stocks that have been relisted; or stocks that have suffered from other significant risks. *ST stocks refers to stocks with the risks of being delisted.

7.     Are there any disclosure obligations for trading SSE-listed Shares?

Yes. Any investors holding or controlling shares more than 5% from the same issuer must disclose his interest within 3 working days. During which, the said investor cannot buy nor sell the shares until the interest is made known.

8.     What happens during severe weather conditions in Shanghai or HK?

Should Shanghai or Hong Kong announce suspension of market due to severe weather (ie. Typhoon Signal above 8 and/or Black rainstorm), no trade will take place until an official announcement for trading resumption. Please refer to Shanghai or Hong Kong Stock exchange for any announcements on market suspension on the day.

9.     Do I need to have a broker in HK?

No, as you can trade through us, or simply call ARTeam now

10.    3rd Party Website with Free stock information? Real time Price Quote and Free Real time Chart

www.aastocks.com

Finance.sina.cn

http://www.etnet.com.hk/www/eng/stocks/realtime/quote.php?code=1

11.     Before trading in Poems, what should you take note?

Before you can trade any Oversea stock on poems please make sure you already acknowledge the Risk Warning Statement. RWS form is available under Poems 2> Account Mgmt> RWS

More FAQ please visit our Global market website

http://www.poems.com.sg/globalmarkets/global_chn_a_share.html

For more Group discussion or updated Information on Hong kong stocks do join us at our Facebook group
SGX KLSE & HKSE Stock Discussion https://www.facebook.com/groups/sgxstock/

Rights Issue and Subscription FAQ for new Investor

Most commonly ask question about Rights Issue and Subscription

How do i Subscribe the Rights
The easiest way is to subscribe through the ATM machine

Which ATM can subscribe.
It is better to call CDP to ask 65357511 (to speak to officer press English 1,1,1,0 Chinese 2,1,1,0), "usually" Local bank ATM but we have encounter some RIGHTS is only available on specific ATM. So dont do last minute if you decided to subscribe. Pay asap. For the upcoming OCBC rights, we have tried the POSB/DBS, UOB, OCBC ATM. application is available.

What should you do if you dont have money to Subscribe the rights?
You should sell off the rights BEFORE the end of the Rights Trading Period (Last day trading OCBC rights is 9 September 5:00pm). If you forget to sell or subscribe(never do anything) your entitlement will be rig

How to sell if I have 125 OCBC rights
Use Poems account look for OCBC R 125, R means Rights, 125 is the min lot size quantity.

What happen if i got 128 Ocbc Rights
Use Poems account and sell at OCBC R, this one min is 1 share, so you can key in whatever number you like. But if there is not enough share, you might want to key in 125

What if you have OCBC rights in SRS
You will need to double check you have the Rights in SRS and ask your broker(ME) to sell for you.

If you have more question do feel free to drop us a message!

How to jump the queue (after 5pm)

First REIT triggered today at $0.91 and have been hovering around the 0.905-0.91 the whole day. Seller queuing to sell at 0.91 and buyer waiting to buy at 0.905. At 4+pm, I wanted to buy this stock, there is only 2 choice, either I buy at a higher price 0.91 or I queue up obediently on 0.905.

Since the price is only hovering between the 2 price, I believe it is not possible to break 0.91 in the last min. Decided to grab it during share matching time (5.00-5.05pm). Reason being, the share will either close 0.91 or 0.905 depend on which ever side is more desperate(seller or buyer). So what I do is 1) wait till 5.04pm to key in order, 2)key in at a higher price.

As a result, when poems matches the share, and decided the closing price to be 0.905(more desperate seller). I will hence be the first few to buy as I have key in the higher price. What ever orders came in after 5pm will be executed on this agreed price, those who queue at 0.905 will have to queue behind me.

Do note that:

1) It might close at the higher price, due to supply and demand. (calculate from market dept)

2) Your order might not be done

if you submit too late.

3) preferably to do on 5.04pm(make sure ur

clock is working well)

4) etc.... its a trail and error thing..

First Reit

Asia's Premier Healthcare Trust

First REIT is Singapore's first healthcare real estate investment trust (REIT) that aims to invest in a diversified portfolio of income-producing real estate and/or real estate-related assets in Asia that are primarily used for healthcare and/or healthcare-related purposes.

First REIT aims to deliver regular and stable distributions and achieve long-term growth in the net asset value per Unit through growth in rental yields and acquisitions.

This dividend darling today moves higher to $0.905 breaking the resistant of previous high. Seeing there is a CD(cum Dividend) on poems then it reminds me it is due for dividend again. Dividend yield as of today on bloomberg is 8.442% (comparing the past dividend given divide by today's closing price). P.s: I have been holding this stock for quite some time.. for long term investing =)

Dividend play

Dividends may be in the form of cash, stock or property. Most secure and stable companies offer dividends to their stockholders. Their share prices might not move much but the dividend attempts to make up for this.

High-growth companies rarely offer dividends because all of their profits are reinvested to help sustain higher-than-average growth.

Risk adverse investor should scout for high dividend payout stocks and BUY them when stock market corrects heavily. Stocks paying significant dividends have less downside risk than other stocks as long as their dividend isn't threatened. Of course, the biggest advantage of buying these dividend stocks is that you get paid just to hold them. Stocks with solid dividend prospects don't go down as much as other stocks, because when they start falling, the resulting rise in dividend yield attracts more value buyers from fund managers and sharp investors. Dividend yield is the estimated dividend payouts over the next 12 months divided by the price you pay for the shares.

Dividends are normally quoted in terms of dollar amount of each shares. For example, if a company share price is $100 and a dividend of $6 per share is paid, the result is a 6% dividend yield. If the share price drop to $80 and dividends remains at $6, the result is a 7.5% dividend yield.

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