Investment Talk

[Throttle]

Heh heh,XiaoWang, i knew you would come in if I ramble long enough.

 

* hi Five*

 

Hows is this years P/L at work for you? steady?

[E.V.ilyn]

stew pig forum no delete

[xb84]

Originally posted by E.V.ilyn@Nov 27 2006, 11:04 PM

Hi,

 

Care to elaborate the differences between bonds, treasury notes, and securities? They sure sound like the same thing to me...

try investopedia.com

 

or for a local site www.moneysense.gov.sg (publications)

[xb84]

Originally posted by E.V.ilyn@Nov 27 2006, 11:04 PM

Hi,

 

Care to elaborate the differences between bonds, treasury notes, and securities? They sure sound like the same thing to me...

by definition securities proves ownership of stocks, bonds or other investments. and bonds are contracts over a year issued by companies/govt. and treasury notes are contracts issued by the govt.

 

 

 

but

 

 

 

when we speak of securities, bonds, treasury notes. i believe they are talking abt

1. securites --- stocks++

2. bonds --- those issued by companies

3. treasury notes --- those by govt

 

 

 

pls correct me.

[fooz]

Originally posted by Throttle@Nov 27 2006, 04:40 PM

How about we all pool money and whack the market swee swee one time. Each person $5k 10 people $50k. Then we can hold big position of at least USD3mil one time. ???????

 

All in, show hand !

this is interesting.. reminds me of some pple i noe who pool $50 each to buy thousands worth of bigsweep ticks.... hah.

 

 

juz curious, where will u be foraging into?

[fooz]

i was introduced to options trading last year. but haven had to chance to understd fully it works.

 

anione care to explain? perhaps as compared to stocks...

from my limited knowledge, it works in bips... n apparently, it cannot be as easily manupulated as stocks(as i was told).

[xb84]

why dont u share what u already and let throttle/xiaowang add on to it.

[Throttle]

Originally posted by fooz@Nov 28 2006, 01:43 AM

i was introduced to options trading last year. but haven had to chance to understd fully it works.

 

anione care to explain? perhaps as compared to stocks...

from my limited knowledge, it works in bips... n apparently, it cannot be as easily manupulated as stocks(as i was told).

I do a lot of FX options, vanilla and exotics.

 

Options are a form of derivative instruments. It "derives" it's value from the underlying, be it a stock, a property, an FX position, a bond etc...........

 

The most liquid mkt for options is the FX market.

In fact the FX market is the most liquid of all financial instruments.

That's one main reason why I choose it.

 

The mechanics of a stock option is very simple (For FX option a little more complicated becos you need to know the currency pair)

I will attempt t explain as simply as I can

 

Eg. ABC stock is currently $20 per shr. You feel that it is too expensive to buy it at $20. However, you are willing to buy it at $18.

Strategy 1 : Wait for price to drop

Strategy 2 : Sell a put option on ABC Stock at $18 for say...3 months (for selling you collect a premium)

Strategy 3: Buy a call option on ABC stock at $18 for say...3 months (for buying you pay a premium/cost)

 

 

so what happens? (I'm breaking up into two post becos it makes reading easier)

[Throttle]

At the End of 3 months:-

 

Strategy 1: if the price drops to $18, you can choose to buy or not, if it shoots up to $20++ you bang balls becos it you would have missed the chance.

 

 

Strategy 2: if the price shoots up to $20++, it's ok becos you pocketed some premium money by selling the put option. If it drops below $18, you'll will be obliged to still buy it at $18.

 

 

Strategy 3: If the price shoots up to $20++, you hold the option to buy it at $18. If the price drops below $18, you hold the option to buy it at $18, you are not obliged to exercise the option. In other words, your maximum loss is the premium that you paid upfront.

 

Strtegy 3 may seem like the best, but do note that to buy options, premiums are not cheap so the market must move enough in your favor to allow you to cover the cost of your premium

 

 

I hope this is fairly clear. If not, sorry........

[Throttle]

a word of caution on trading options.....as i have heard from many people who attended some seminar and think the option trading is almost riskless and can make an easy fortune (just like that)

 

Please dont be greedy and foolhardy....

[paithorn]

Thanks Throttle for the info... sure will chat more with you when we meet, maybe later this month....currently really bust daily so can't go for the cigar meet-ups....

[contrarian]

Originally posted by fooz@Nov 28 2006, 01:43 AM

i was introduced to options trading last year. but haven had to chance to understd fully it works.

 

anione care to explain? perhaps as compared to stocks...

from my limited knowledge, it works in bips... n apparently, it cannot be as easily manupulated as stocks(as i was told).

if you intend to trade in options, please do yourself a big favour and make sure you fully understand what they are, how they work and that the real nominal exposure of the position is much larger than the price of the option.

 

that means you can make big and lose big, much bigger than you might have thought. do not brush this off. go ahead only after you have understood and know what you're doing. limited knowledge is not good enough.

 

because i'm conservative, when i trade options, i make sure that i only put down 2% of the total value of the nominal position so that i don't open my value at risk by an amount that i cannot manage.

 

before you sign up for options trading with a US broker, they must give you a risk disclosure and should do an analysis of your income and assets.

 

[E.V.ilyn]

Was just reminded that NSS will "mature" Mar 2007.

[Throttle]

whats NSS?

[E.V.ilyn]

Originally posted by Throttle@Dec 3 2006, 10:43 PM

whats NSS?

New Singapore Shares. Given by Big Brother back in 2001.

 

http://www.nss.gov.sg/

[Throttle]

I see, i see. Give so little, makes no diff . ERP, GST, Tobacco tax, Road tax, etc.. would have more than wiped out everything and a whole lot more, hahaahahah

[E.V.ilyn]

Originally posted by Throttle@Dec 3 2006, 10:59 PM

I see, i see.  Give so little, makes no diff .  ERP, GST, Tobacco tax, Road tax, etc..  would have more than wiped out everything and a whole lot more, hahaahahah

Well true, but look upon it as a mini windfall. Big brother is not obliged to hand it out just that sometimes big brother want to "be closer" (etc.) to the people... Regardless, this is sort of unexpected income so ...

 

That 1k+ (assuming that none was taken out previously) can be used for say a slip on after market exhaust for your bike, 1 year's insurance for your bike/car, road tax for the year, 1 year worth of HDB car parking (>5 for bikes), a new paintjob you've been contemplating, couple months of utilities, etc.

 

Now that I'm reminded of this NSS thingy, I think in 2008 the ERS allotments would have matured as well.

 

Edit: Hey Throttle, you can try to gather like 30 persons and then use their NSS allotments to forward your proposal.

[Throttle]

hehh he, very frankly, i wont be bothered to gather 30 people for $1000 each.

[Throttle]

ooh yes, Big Brother IS obliged to give the handouts.

BEcos if they dont, they wont have an excuse to raise other taxes.....heh he

[fooz]

Originally posted by contrarian@Dec 3 2006, 03:49 PM

if you intend to trade in options, please do yourself a big favour and make sure you fully understand what they are, how they work and that the real nominal exposure of the position is much larger than the price of the option.

 

that means you can make big and lose big, much bigger than you might have thought. do not brush this off. go ahead only after you have understood and know what you're doing. limited knowledge is not good enough.

 

because i'm conservative, when i trade options, i make sure that i only put down 2% of the total value of the nominal position so that i don't open my value at risk by an amount that i cannot manage.

 

before you sign up for options trading with a US broker, they must give you a risk disclosure and should do an analysis of your income and assets.

 

i like ur nick .. hah.. how apt for this thread...

 

 

contrarian> thks 4 ur advice.. i tink this pc of advice not onli applies to options, but for all types of financial investment.... its alwiz gd to do homework 1st...

 

throttle> thks for info...

[E.V.ilyn]

Originally posted by Throttle@Dec 3 2006, 11:29 PM

ooh yes, Big Brother IS obliged to give the handouts.

BEcos if they dont, they wont have an excuse to raise other taxes.....heh he

err... big brother actually can do without excuse for raising taxes. afterall, big brother is not exactly known for bring democratic. so far so long as big brother happy, big brother will implement. iron-handed approach as wiki put it. however, big brother is an aspiring actor. always like to put up a wayang show. i got listen to your views. but that does not mean i'll heed them.

[Throttle]

Originally posted by contrarian@Dec 3 2006, 03:49 PM

because i'm conservative, when i trade options, i make sure that i only put down 2% of the total value of the nominal position so that i don't open my value at risk by an amount that i cannot manage.

 

Your statement quite contradictory and incomplete, contrarian.

You say you are conservative, yet you only put 2% of total value of nominal.

 

if $10,000 = 2%, then your nominal underlying is $500,000, that doesnt sound conservative in any language.

 

What is your usual nominal amount?

 

Care to elaborate?

 

---------------------------------------------------------------

For the benefit of others, Contrarian is talking more about margin equity option trading. I'm more into FX option trading. Concept is the same but complexity and variety is different

[E.V.ilyn]

My mum just showed me a "lobang". Apparently someone just introduced her to this thingy called SwissCash and she bought it!!! Wanted to get me to buy. Then when I showed disinterest she wanted to buy using my IC... #%@^#&

 

I later ran a quick check but found it rather dubious. MLM style. No information on how the money is spent, etc. Their FAQ says that since you are getting fixed payout every month, you do not need to know how they use your money for investment...

 

Imagine they are promising 300% returns over 18 months! Guaranteed! If this is true (which is too good to be true and in my dictionary, means most likely untrue) then I might as well save 2 years worth of salary, dump 1 year's into the SwissCash, then live on the remaining year for 18 months, then when 18 months is up, I'll have 300% back in return! This means I'm I do not need to work at all!!! All I ever need to do is to rechannel the returns into the investment.

 

Just hope she don't buy anymore into it... I'm doubtful if she can even get any amount back...

[paithorn]

My ex-colleagues just approached me at the Big Boys Toys expo to consider buying th Oilpods thing.... Throttle you have good knowledge?

[Throttle]

sorry paithorn never heard of oilpods.

 

In terms of "lobang" , I think i'll start ThrottleMoneyBigBigFund.

You can join by giving me $10,000

In 12 months you'll get back $20,000

Every month I'll paid you $100 more than previous month Starting $500 on first month and last month i return one lump sum. Wanna join or not?