STE's Stocks Investing Journey

 Yes !! we are all market timer , to some extent. Listen to below video from Prof Aswath Damodaran on how he explains investors using asset allocation to time the market, without we realizing it sometimes. We fully understand that nobody can exactly predict the stock’s price movement but that doesn’t stop many from trying to do so, continuously and relentlessly, on a daily basis a.k.a day trading for stocks. We also knew that “ time in the market “ is important base on the long term “ compounding effect” and we don’t try to guess when the stock’s price is at its lowest or its highest point, basically we buy base on fundamental. So what makes you think that we are all market timer?     Market Timing - Dreaming The Impossible Dream?   < By Prof. Aswath Damodaran>                                         ...

  Spoofing, Churning, Cornering, Ramping, Wash Trading, Bear Raiding ….what else?   Market manipulation happens when someone tries to rig the supply and demand of a particular stock or any type of security. It’s a tactic or scam that could lead you into thinking that the market is going in one direction when it’s not. It is the act of intentionally trying to increase or decrease the value of a stock or influencing the behaviour of the market to do so and eventually taking profit from such activities. While insider trading may be a famous example but there are many other illegal tactics that unscrupulous traders use to try and exploit the market for profit  This can take many forms and of course all of which is illegal and can result in hefty fines and criminal prosecution if discovered. Below is the latest case on how a big bank using one of the tactics ( spoofing ) to manipulate and rig the gold futures market.     On 14 th Jan 2020:   ...

We often relate Index ETF as one of the asset class for “passive investing” and one of the main tenets of passive investing is the strategy of long-term holdings and less active trading . Because there are very infrequent buying and selling, fees are low. In short, this means you’ll lose less of your returns to management due to higher transaction cost in the long run. But recent fund flow data seems to show in a different result as what we had always thought. Traders Get Whiplash After Fastest Ever Fund Flow Swing From Euphoria To Despair <source:trulytimes.com>   “US equity funds and ETFs reported $26.87 Bil of outflows, the largest weekly outflow since December 2018 and the third largest outflow ever, more than reversing a $22.67 Bil inflow one week earlier .”   It seems that ETF no longer meant for “passive investors” but more for trading nowadays. New trading platforms with a much lower or zero commission have also contributed a lot to such huge...

  Stocks Valuation: Art or Science?   This is an “old age “ question that pondered all of us as an investor and question we hear from time to time. For me, I think stocks valuation is both a science and an art. We often hear that analysts are trying to find the so-called ”intrinsic value ” of a stock or business and different model or methods of analysis would give a different result of valuations, sometimes the variance could be huge.   <Image Credit: Mishfitlife.com> Beauty (Value) Is In The Eye of The Beholder: Part 1     Valuation is a science because there are “ scientific element ” involved in methods of valuation e.g using DCF (Discounted Cash Flow ), SOTP ( Sum-of the parts  ), Asset-Based Model (Relative Valuation ),  Financial Ratio analysis (PB/PE/Div Yield etc ). Valuation is an art because it involved “judgement “ about the prospect or future of any company. It is always as subjective as art when it comes to “ estimating...