99 Lessons for Profitable Stock Trading Success

PART I

DO’S & DON’TS

There are quite a number of controversial issues regarding remisers. Generally, a remiser is a broker who is self-employed compared to a dealer who is employed by a stockbroking company. Under the Singapore Securities Act, you could sue a broker for giving the wrong advice if you lost money based on the said advice. Thus, it is a norm for a remiser not to give you any advice. What you should do is to do some homework and instruct your remiser accordingly as to when to buy or sell a particular stock.

A remisier is a self-employed broker, not an adviser.

Contrary to the above belief, the stock market is not a casino. It is a capital market where funds could be raised without paying any interest charges. The ups and downs of share prices will depend on issues such as world events and the performances of the respective listed companies. Therefore, to emerge a winner in this investment game, you need to do your homework well before getting yourself involved, otherwise, you may end up losing money.

As a retiree you should not speculate in shares. However, you could improve on your returns by buying shares that are able to give you a yield that is higher than the prevailing bank deposit interest rate. You need to hold on to it as dividend is paid on an annual basis. Nevertheless, you may sell your shares should you be able to reap more than 10% profit. Remember though, there is higher risk in holding shares than putting your money in the bank.

Sure, however, you need to adhere to two golden rules. Namely:

(a) Buy those shares that have been giving dividends regularly — at least for the past 5 years and,

(b) Make sure the dividend yield of the shares that you buy is higher than the current CPF interest rate.

One must bear in mind that comments given are the personal views of the individual analyst. Each of us is entitled to our own views. Thus, each analyst has his own way of interpreting an event or data which need not necessarily be the gospel truth. Therefore, as an investor, you need to do some research and form your own views from the various comments given as to whether to buy or sell a particular stock.

Simply, a contrarian is a person who does things opposite from the masses. To be a perfect contrarian, one must be able to analyse the prevailing situation accurately. Once the mood of the crowd is determined, then one can proceed to do just the reverse of what the crowd is doing. In most circumstances the contrarian approach does work. In the context of share investment, to be a contrarian simply means that when most people are buying, you should be selling and vice versa.

In most instances, the target company’s share price tend to rise higher than the takeover offer price as many speculators are