Reversal of Fortunes, Investing in my Education & Community Support

Reversal of Fortunes

What a big change in the past 2months, I remembered updating my yearly resolution plans when I realized all my financial goals for 2021 were hit, setting new targets of repeating the gains which led to "performance stress" where I begun to oversell to max out the limit (ie.utilized nearly every available dollars balance in my ThinkOrSwim platform).

Initially, my portfolio started with about 10 different counters which I sold put options on, then the series of China clampdowns drove down prices so fast that the usual tactical maneuvers of rolling over results in double & double & double down, before I know it, my put options losses ballooned to 3-4x. Over the past month, I closed off other counters which results in risk concentrations over 2 specific counters, BIDU (Baidu) and BABA (Alibaba) to raise available dollars for roll overs. Until the deltas hit .90+ so much so that, towards expiry, I cannot even roll them over without taking debits as the time value (of even 3months+) are not enough to cover the ITM losses. My paper profit of almost USD70k late July reversed into losses (currently $2-3k losses YTD that hit my capital), a reversal of +USD70k to -USD3k! Ouch!! 😭

Most of the losses were taken when I closed my BIDU put options sold & reduced my exposure to BABA.

I took assignment of 200 BABA shares at strike of USD220 when the price closed at USD157.96 on 21 August 2021.

This experience forced me to research & explore other tactical maneuvers to reduce losses, other than simply taking the losses, I also sold calls at expiry price to reduce the losses (2x premiums from put sold & new call sold), hopefully as price recover, the premiums from puts roll over & call sold at or above put's strike I will be able to gradually recover my account.

This reversal of fortunes also reminded me to be humble & always remember the risk management & diversification rules as well as setting cut loss of 1% limit & avoid rolling over more than once to avoid becoming "married" to the position & suffer huge losses with a prolonged downtrend like many of the Chinese tech shares.

Investing in my Education & Community Support

Adam Khoo & his team launched a new "Beat the Market" sale, as shared in my earlier post, knowing the techniques is only at most 1/3 of the winning share, the critical part of risk management if not monitored can easily reversed the fortunes like what I did. Also, I am lacking of social support of other options traders to discuss & exchange ideas, hopefully with the investing into my own education, am purchasing bundle 5: Ultimate Profits (promo price until 1 Sept 2021 https://btm.piranhaprofits.com/sale), I know I can make the money many folds back. With the community support, hopefully I can avoid drawdowns like what I been through the past 2months.

God bless & may the trends be with you! 🙏🍀

Disguised Charges by SG Brokerages

Recently brokerages in Singapore has become more competitive after the entry of Tiger Brokers charging 0.08%++ and US low costs brokerages like TD Ameritrade at 0% commission for US and Interactive Brokers at 0% commission for US, 0.08% for SGX. This has driven down brokerage commission charges by several local brokerages such as POEMS to 0.08% SGX and USD 6.88 flat and LimTan to 0.12%-0.18% for SGX and USD 0.07% (not really that competitive actually but it gives NTUC Linkpoints).

However, what drove me to write this post is the disguised charges by SG brokerages that used to be dormant & has started taken effect. These are charges that applied to custodian shares accounts (most of the lower commission charges require you to use custodian accounts where your shares are held in trust with your brokerages, this assure the brokerages that you will have to sell your shares through that particular custodian brokerage where your shares were held).

Most of these disguised charges were previously "waived until further notice" but has started to taken effect in recent months since August 2020.

Examples:

POEMS charge $10.70 for "Cash Offer, Rights Issue, Privatisation Exercise, Merger & Exchange, Cash In Lieu, Liquidation, Redemption of Warrant, Loan Stock or Bonds, Capital Distribution, Tender Sales, Warrant Conversion" which is quite a heavy cost that comes with basically any action that you take as a shareholder, whether its receiving dividend or choosing between scrip or cash dividends. The brokerage now has squeezed itself in between to take a unfair cut out of it, this is regardless if you receive a $10 or $5000 dividend. By the way if its $5,000, POEMS "1% on net dividend subject to min of S$1.07 and capped at S$53.50 (inclusive of GST) + Foreign broker fees and taxes (if applicable)" would ensure it takes 1% at $50, capped at S$53.50.

This compares to other brokerages, like LimTan's Schedule of Charges.pdf 

One can see how ridiculous the brokerage market has become with its charges, the way they take a cut out of our hard earned investments without being a shareholder, I wonder about the "fiduciary duty" that these firms supposed to have. Worse (probably as usual), this happens in stealth, meaning there was never a formal letter or email with any exit options given, these brokerages just happily charged your account's cash away and give you the balance. Had there been a formal announcement & exit option, such as if you wish to avoid these charges, we can transfer them back to your CDP for free? (no? in your dream world maybe).

In any cases, one need to take stocks of your portfolio, if its short term trading, perhaps the lowered commission fees might be worthwhile to use custodian accounts and try to sell / exit before any corporate action's ex-date. But if you are like me or most retail investors who held shares since start of 2020, you probably have some shares "struck" in your portfolio where their market price is lower than your cost price. Most people might think well the company is good, it gives dividend, so lets hold it... 

Yup... until the brokerages come in & take a cut, without telling you (oh its there at our website you see, oh my mother also said one should be act with integrity & communicate transparently too... didn't your mom taught you that?).

If you find yourself not wanting to be "slaughtered" like some fat hog (I'm skinny with little money btw); there's one option left, that is to submit a formal request to your brokerage to transfer your shares in custodian back to your CDP account where its safe & sound (no charges whatsoever of the disguised fees above). You will need to ensure you negotiate hard, SGX CDP charges only one time $5.35 when you in custodian & you in CDP are essentially same or related. https://www.sgx.com/securities/depository

Be careful, not to be led astray & suffer more cuts with other fees; until they cut you, then you realize it. 

Pokemon Go finally launched in Singapore!

In this post today, I am going to share on 2 things:
1) Pokemon Go, the game & company behind it
2) Pokemon Go, starter tip - how to get your favourite Pikachu as your starter pokemon
3) Pokemon Go, the lazy ethically legal way of playing it without the 5km+ travel

1) Pokemon Go, the game & company behind it
In case you are not aware, Pokemon Go (www.pokemongo.com) is one of the first Augmented Reality mobile games where the imaginary creatures called "pokemon" which derives from Pocket Monster could be "seen" from your phone's camera. And you could throw a device "pokeball" to try and capture these pokemons.

Watch the videos below, to find out more about why this game is hot!!! And you will appreciate why the craze all over the world!

Google even did a "recruitment"video for their search for talents!

Nintendo the company that co-own Niantic, the company which created Pokemon Go; its stock price went rollar coaster along the news of this Pokemon Go!

Look at how its price rose from JPY 14,380 on 6 July 16 all the way to its peak at JPY 31,770 on 19 July 16, a 220% rise in less than 2 weeks! It came half way down after company announced the super success of Pokemon Go will have no impacts on its earning for the current financial year; this led to a disappointment as investors were hopeful that Nintendo could made a comeback to its heyday of Super Marios & its other games to compete with the new generation of gaming companies.

What does this have to do with investing? If you haven't notice, as Warren Buffett often says, great companies are all around us. If you enjoy playing games, a new game is launched & you notice a fast spreading wildfire of interests catching on among your friends & colleagues, this could be one way of detecting potential great companies in the making. Pokemon Go was initially launched on 6 July, 2016 but prior to that, Niantic has already developed another game called Ingress (https://www.ingress.com) whose maps & database forms the backbone of the current Pokemon Go.

The reporter that caught & first announced the news, noticed how the number of downloads were breaking all time records, and how its daily active users fast exceeding other famous apps. like Twitter, & fast approaching other social medias like Facebook, wechat etc.

Imagine you were that reporter that spotted the trend, took a stake before it becomes common news, you can imagine how much your investments would have doubled in 2 weeks!

So the next time you are playing games, say you are researching the next explosive stocks for investment ;)

2) Pokemon Go, starter tip - how to get your favourite Pikachu as your starter pokemon
As promised, I shall now reveal the tip on how to get the Pikachu pokemon as your starter pokemon. First off, all starters will get to choose from 3 of the pokemons (Charmander, Squirtle and Bulbasaur) below, but if you want the main character Pikachu in the movie & animation series; here is how to do:

On the map, do not touch the 3 default pokemons, keep walking away from them. When you walk some distance away, the 3 default pokemons will slowly fade away from the screen, when that happen, it will "respawn" and reappear near you again.

Keep walking away, until they respawn 4 times, from the 4th time onwards, you will notice a 4th pokemon appearing nearby, that will be the popular Pikachu [see screenshot below]

3) Pokemon Go, the lazy ethically legal way of playing it without the 5km+ travel

Now for the lazy way of playing, without the 5km+ walk... nope I am not talking about fake GPS, that is not ethical & you will risk getting banned. For those whom wish to try, go ahead but Niantic has improved their programming and will detect whether you are enabling "mock location" which is a feature that mus be enabled along with fake GPS. So, its not going to work, of course "crackers" those programmers who crack the programming could try & by pass it, but then what's the fun if you just lie down and play? It defeat, the objective of going out & meet new people.

Well, I did promise without the 5km+ walk, but it require some luck, so here is the way.

  
Most of us lived in HDB, Condo, this is where the GPS signal bouncing happens due to the high rise buildings which caused your character to move around. Eg. when you move to your balcony and stand by the window awhile, you will notice the GPS slow catch on & your character start moving some distance to one side before it then readjust back once your location is slowly "zoom in" and reflect your true location. You could repeat this, by going to the front, back or side of your houses, and see if this will help you momentarily move closer to some nearby pokestops, this way you could pick up some goodies & even fight some pokemons without leaving your comfort home.

So there you have it, one last tips to help you along your pokemon journey.
There are already sevaral pokemon groups on Facebooks;
Pokemon Go SG
https://www.facebook.com/groups/PokemonGoSG/
Pokemon Go North East Singapore
https://www.facebook.com/groups/PokemonGoNorthEastSingapore/

Look around, join various groups to make friends, and for those fans there's even merchandise been peddled at the various groups, for the entrepreneurial ones, who knows you might have a one-time opportunity to monetise this trend if you could identify the needs of comsumers & sell them some real life "pokeballs, pokemons soft toys etc".

Enjoy the coming National Day 8 Aug 16 holiday, have fun! & remember to watch where you are going when you play Pokemon Go ( * v * )")