Posted by kcchongnz > 2018-07-30 09:33 | Report Abuse

Posted by KINGV > Jul 29, 2018 11:33 PM | Report Abuse
KCChong, I strongly support your advice against using margin account. There are arguments for and against using margin account and below is a short account of my personal experience in using margin account.
During the time when Iraq invaded Kuwait, markets were down. I approached a foreign bank for a margin account to buy shares . When U.S invaded Iraq,markets rebounded and returns were good. Then came the sheer madness in the early 1990s for KLSE when cheap counters like SHChan, Hwa Tai and AHP reached prices of over RM60, RM200, and RM8 respectively. Practically everybody was making money and celebrating. Those having margin made more. I was conservative in using my margin account in my borrowings and in selecting my counters. Even then returns were very good.
Then came the financial crisis of 1997/1998. The market crashed and it is hard to believe how low the market went. Some of the dubious counters went limit down 3 times in a row. Those with margin accounts have no time to run and by the time the broker firms forced sell, they have not only lost their principals but owed the firms/banks substantial sum of monies. Those who invested in blue chips were not spared.The composite index fell from around 1300 to the unbelievable number of around 240. If I am not mistaken Maybank fell below RM3 and Berjaya Toto below 50 sen. Those who invested in a diversified portfolio of blue chips were not spared since the composite index fell so sharply. Those who had margin accounts suffered more since there were a lot of forced selling at each lower level of the composite index unless one was so skillful in liquidating all his/her blue chips in the initial stage of the market fall. I was not spared but it is a good lesson that margin account can wipe you out.


I would have to say this is one of the best comments on margin finance, with facts and some histories. It is also unbiased showing two sides of a coin. he is also new in i3investor.

Thank you.

Posted by stockraider > 2018-07-30 09:49 |

Post removed.Why?

Posted by stockraider > 2018-07-30 09:57 | Report Abuse

A WORD OF ADVICE TO NEWBIES FROM AN EXPERIENCE MARGIN INVESTOR;

Thus i always, recommend to young newbies, always learn to use margin early, it is okay to lose a couple of thousands on margin tools....learn the robes, when u can still afford to lose....once u develop ur skill it will come very handy...even without margin u know how to risk manage mah..!!
This is a small change tuition fees to be paid for margin loh...!!

Btw for newbies, margin cost only 5% pa....if in long run ...u still cannot make 5% pa....u better hang ur investment boots and work hard in other avenue as stock mkt is not for u loh...!!

Do not accept the fact that people alway says...u r...no good bcos u use margin loh..!!
The real problem is that U really no good in investment, thats why u lose very big loh...!!

BTW...IF U USE MARGIN....U HAVE A VERY CONSERVATIVE PARTNER....THE BANK CHECKING ON U LOH...!!

U WOULD NOT MAKE SILLY MISTAKE LIKE CHASING SING HENG CHAN RM 50.00 AND HWA THAI RM 100.00 ,BCOS YOUR PARTNER THE BANK DON ALLOW U TO BUY LOH......!!

Posted by paperplane > 2018-07-30 10:01 | Report Abuse

but I agree this company not so special, only hope is oil price good, their CFO also good. Most of the Assets are Intangible, nothing to liquidate if go bust. Recent result in net profit only due to negative goodwill, but same time the deprecation high. So net profit actually negative also. haha

Posted by qqq3 > 2018-07-30 10:05 | Report Abuse

want to margin...go and margin
don't want to margin, don't do it.....


so simple also can get so many comments.......

getting ridiculous.....all these funny commentators and educators.....


I think this blog says all that needs to be said on the subject......


What is Sialang? Koon Yew Yin
Author: Koon Yew Yin | Publish date: Tue, 24 Jul 2018, 09:09 AM

The word “Sialang” or “Sai Lang” comes from the Cantonese word “晒冷,” It refers to wagering one’s entire assets, resources, life-savings or wealth on a project, in a competition or an endeavour. In addition, the word Sialang is commonly used in investing, where we always hear people, especially Malaysian investors, say they Sialang in a company.



For astute investors, Sialang is the best way to grow wealth and maximise gain. I have never known any successful people who do not Sialang in the companies they dedicate their lifetime effort to. This practice is very common in world of business, where we see a lot of the successful businessmen or businesswomen focus on what matters most and have their money invested only in the companies they founded. For example, in Malaysia, the wealth of Public Bank’s Chairman Teh Hong Piow, IOI Group’s founder Lee Shin Cheng and Press Metal’s CEO Koon Poh Keong is all tied to their stakes in their own companies and the performance of their stocks.



Most investors and investment professionals overly concentrate on fundamental and technical analyses and fail to notice the importance of profit growth. They do not think like a businessman. But the best way to mint money in stock market is to Sialang in a company with high profit growth prospect like a businessman. To be really successful in investing, one must be willing to venture like an entrepreneur and focus on the profit growth prospect of a company. Out of the stocks in Bursa Malaysia, you must only pick the one that has the truly tremendous profit growth potential.



Why company with tremendous profit growth potential?

Among all the criteria, such as NTA, cash flow, dividend yield etc, the most powerful catalyst to move share price is profit growth prospect. To do so, you need to be able to see the earnings potential of the company and must use some business sense to estimate the earnings of the company a few years down the road. One of the techniques is finding the factor or catalyst that can move the earnings needle. The chance of picking a winning stock would be higher if you could leverage on your knowledge and experience to find a profitable company with near-term and long-term catalysts. For example, I have done business for more than fifty years and involved in many mega construction projects. I know how construction companies make money and can tell if the companies would make more money next year than this year.



I know readers do not like to read anything written by egotistic writers. For the sake of additional clarity of this article, I have to boast that I was one of the founders of Mudajaya, IGB, Gamuda and IJM Corporation Bhd.



Bank loan and Margin loan

Many conservative business men dare not use Bank loan to do business. To maximise your profit, you must use bank loan. I always borrow money from banks to do business. If I did not borrow money, I would not have expanded my businesses so quickly.



I always use margin loan to buy more shares. Of course, I can win more if my bet is right. But I will lose more if my bet is wrong. Margin loan is a double edge sword. It cuts both sides. It is only meant for experience investors.



“If you want to get rich……you have to concentrate and focus.” Jim Rogers

Posted by paperplane > 2018-07-30 10:07 | Report Abuse

Raider way of using margin is interesting, learning here....I hardly on margin nowadays. But thinking to use it soon.....

Posted by paperplane > 2018-07-30 10:07 | Report Abuse

and margin+pledging the shares somemore for 100% running horse/stocks, it will be interesting....

Posted by qqq3 > 2018-07-30 10:09 | Report Abuse

raider....don't use words like conman.....

can sue u one.

Posted by stockraider > 2018-07-30 10:09 |

Post removed.Why?

Posted by qqq3 > 2018-07-30 10:13 | Report Abuse

of course I can add....dependency culture is an enemy culture to anyone in the share market.....

dependency negative applies to dependency on rich man as well as dependency on educators.....


and I prefer practice to theory.....

Posted by paperplane > 2018-07-30 10:15 | Report Abuse

its sia lang...according to him

Posted by stockraider > 2018-07-30 10:22 | Report Abuse

A WORD OF ADVICE TO NEWBIES FROM AN EXPERIENCE MARGIN INVESTOR;

Thus i always, recommend to young newbies, always learn to use margin early, it is okay to lose a couple of thousands on margin tools....learn the robes, when u can still afford to lose....once u develop ur skill it will come very handy...even without margin u know how to risk manage mah..!!
This is a small change tuition fees to be paid for margin loh...!

DON GET ME WRONG....I SAY SMALL CHANGE....TUITION FEES FOR NEWBIES MARGIN INVESTOR.....ACTUALLY I MEAN NEW NEWBIES INVESTORS INCLUDING CASH INVESTORS....MOST OF THE TIME ABOUT 80%, THEY USUALLY LOSE LOH....!!

SO IF U R A MARGIN NEWBIES INVESTOR U LOSE NOT BCOS U USE MARGIN...U LOSE BCOS U HAVE NOT ACQUIRED THE NECESSARY INVESTMENT SKILL YET LOH...!!

Posted by qqq3 > 2018-07-30 10:28 | Report Abuse

whether businessman or educator
margin account or no margin account
a value investor needs conviction to make money

if for any reason cannot find conviction....go and be a trader like me....

it is not bad one to be a trader....important is don't hang pig head sell dog meat...only cheating yourself and that is no good in decision making.

society tells you....be an investor...don't be a trader....shy to be labeled a trader.

not true....everyone is a trader and speculator

in fact in last 12 months....your average trader surely do better than buy and hold strategies.


https://klse.i3investor.com/blogs/qqq3/151380.jsp

Posted by stockraider > 2018-07-30 10:33 | Report Abuse

correct loh..!!...u talk so big...n want to make rm 280 million...but u only put rm 100k investment monies....i really doubt ur conviction.??

i also doubt u really learn anything....other then hot air & talk big loh....!!


Posted by qqq3 > Jul 30, 2018 10:28 AM | Report Abuse

whether businessman or educator
margin account or no margin account
a value investor needs conviction to make money

if for any reason cannot find conviction....go and be a trader like me....

it is not bad one to be a trader....important is don't hang pig head sell dog meat...only cheating yourself and that is no good in decision making.

society tells you....be an investor...don't be a trader....shy to be labeled a trader.

not true....everyone is a trader and speculator

in fact in last 12 months....your average trader surely do better than buy and hold strategies.

Posted by CharlesT > 2018-07-30 10:34 | Report Abuse

DON GET ME WRONG....I SAY SMALL CHANGE....TUITION FEES FOR NEWBIES MARGIN INVESTOR.....ACTUALLY I MEAN NEW NEWBIES INVESTORS INCLUDING CASH INVESTORS....MOST OF THE TIME ABOUT 80%, THEY USUALLY LOSE LOH....!!

SO IF U R A MARGIN NEWBIES INVESTOR U LOSE NOT BCOS U USE MARGIN...U LOSE BCOS U HAVE NOT ACQUIRED THE NECESSARY INVESTMENT SKILL YET LOH...!!

Well said.

Anyway I really cant tahan when seeing oldman promoted the use of margin facility while promoting his shares...Can mislead newbies or waterfish to go Holland

Posted by CharlesT > 2018-07-30 10:36 | Report Abuse

qqq3, if u wanna make RM280M by using Rm100K i believe u are in the wrong place..

Maybe u can try lottery

Posted by qqq3 > 2018-07-30 10:37 | Report Abuse

charles....I have faith....you don't have.....

Posted by CharlesT > 2018-07-30 10:39 | Report Abuse

U should use yr faith in Lottery..though very slim the chances but still better than no chance at all in stock investing

Posted by CharlesT > 2018-07-30 10:41 | Report Abuse

Seeing yr records in I3 so far

Posted by CharlesT > 2018-07-30 10:41 | Report Abuse

U seems to me just another CPTeh...always talk talk talk but......

Posted by qqq3 > 2018-07-30 10:45 | Report Abuse

charles...no problem for me whatever u think....doesn't bother me.

at the moment a bit difficult to make money. I blame Donald Trump for that....but opportunities will come.

Posted by paperplane > 2018-07-30 11:17 | Report Abuse

haha
Charles, ignore him

Posted by Jon Choivo > 2018-07-30 12:07 | Report Abuse

That is like saying, put a knife in font of the steering wheel, so that you will be more alert when driving.

Imagine he bough PBBANK before recession, in recession from RM10 drop to RM3, he got no margin call since he is cash investor, every time drop RM2, he buy more. His position go from 20k shares to 50k shares, as he buy every month during the year.

Now, RM24, dividend also dont know how much d.

The person on margin, sold at RM7-5 because get margin call, everyone also get margin call, so he had to sell some for lower than expected. His capital, lost almost 80% by then. He had 40k shares, after margin call, only left 4k shares. This guy maybe a bit smart, when lost almost everything, no trauma at all (not probable) keep buying for the year, after recession only got 34k.

Not so bad, because he bought PBBANK. Super incredible company

Imagine if its rubbish company, long time ago jump from klcc d.


===================================================================================
JUST IMAGINE IF JOHN USE RM 50K CASH AND RM 50K MARGIN AND BOUGHT 1,000,000 RSENA-W INSTEAD....AT RM 0.075 HE WOULD HAVE GOT A MARGIN CALL AND WHEN HE SELL EVERYTHING SAY AVERAGE RM 0.07.......HE STILL HAVE REMAINING CASH RM 20K, IN OTHER WORDS AT LEAST HE IS SAVE BY THE MARGIN MAH....INSTEAD OF HAVING ZERO IF USE CASH TO INVEST LOH.

Posted by stockraider > 2018-07-30 12:22 | Report Abuse

Already proven mah....!!
If u bought at too high price...u will be force out....due to force selling loh.....!!

But ur position...may not be worse compare with dumb dumb hold cash investor loh....!!

If the bank is putting some sense of balance on your investment....u call that putting a gun on ur head meh ??

Posted by Jon Choivo > Jul 30, 2018 12:07 PM | Report Abuse

That is like saying, put a knife in font of the steering wheel, so that you will be more alert when driving.

Imagine he bough PBBANK before recession, in recession from RM10 drop to RM3, he got no margin call since he is cash investor, every time drop RM2, he buy more. His position go from 20k shares to 50k shares, as he buy every month during the year.

Now, RM24, dividend also dont know how much d.

The person on margin, sold at RM7-5 because get margin call, everyone also get margin call, so he had to sell some for lower than expected. His capital, lost almost 80% by then. He had 40k shares, after margin call, only left 4k shares. This guy maybe a bit smart, when lost almost everything, no trauma at all (not probable) keep buying for the year, after recession only got 34k.

Not so bad, because he bought PBBANK. Super incredible company

Imagine if its rubbish company, long time ago jump from klcc d.

Posted by stockraider > 2018-07-30 12:26 |

Post removed.Why?

Posted by Jon Choivo > 2018-07-30 12:29 | Report Abuse

Raider,

I think if someone need bank put gun to their head to be smart about investing, they shouldn't be investing.

If you buy at good company at a cheap price, dumb dumb hold is the best.

When Warren Buffet buy Amex and washington post, the company go and drop another 50% for him to see. Back then, he also small potato, less than 50 mil networth.

If he buy margin, he would have to sell both of them at some point. Instead, because he buy cash, he can buy all the way down.

What balance the bank give you? You need the bank to tell you when to sell only you know? You don't know the value of what you buy?

If you buy rubbish, dont want to admit to yourself you buy rubbish, then yes, dumb dumb will die.

but if you buy rubbish, triple limit down is possible. Even good company also can limit down 2 time.

How you plan to sell and get back capital afterwards?

raider, you are not a fool. You have lived through 1997 and 2008. And you telling me on average those on margin and gone through these 2 came up on top compared to those who held cash?

No way.

======================================================================
Already proven mah....!!
If u bought at too high price...u will be force out....due to force selling loh.....!!

But ur position...may not be worse compare with dumb dumb hold cash investor loh....!!

If the bank is putting some sense of balance on your investment....u call that putting a gun on ur head meh ??

Posted by stockraider > 2018-07-30 12:35 |

Post removed.Why?

Posted by Jon Choivo > 2018-07-30 12:52 | Report Abuse

Imagine this,

Investor Raider: Got RM100k. and Margin Up to RM200k. Lets say, raider is super investor, even in 1997 he know public bank is god like company. He buy RM300k Public Bank Shares. He pay RM4 per share. So got 75k Shares

Crisis happens. RM3.5. Lets assume no limit down (quite unlikely in real crisis). Raider run kuat kuat. Average price RM3.3. Effectively lose RM52.5k got RM47.5k.

After losing more than 50% of networth, raider scared d, dont dare touch for awhile. Drop to RM2.7. Got some support, raider feel safe. He sailing in again. This time his capital is RM47.5k and he add RM15K. Total RM62.5K. He buy RM187.5k in shares.

Suddenly news come out, mahathir go kowtow to singapore and japan, but they dont want to give him money.

Limit down. Raider straight lose 90% d. Want to run also cannot run. Capital now RM4.75K from RM100k.

Now he feel like jumping d, wife dont want to even see his face. He feel like failure in life, decided to never buy stock again even thought he was a good investor.


Investor Jon:

Got 100k, buy 100k. RM4 per share. 25k shares.

Drop to RM3.5 per share. He abit sacred, study more, every day see teh hong piow face, decide to buy RM4.9k more. That is 1.4k shares.

Drop again for him to see to RM3. Simi, i also scared, study even more, annual report also tearing d. But dont dare to buy.

Drop to RM2, similc, decide its cheap should buy abit more. Buy Rm10k. 5k shares.

Next day drop to RM1, now i want to cry d. Dont know why so cheap, both excited and damn scared. Dont dare buy.

Rebound to RM1.2, i think maybe economy recover, sailang take out all the cash, buy 20k shares.

Drop back down Rm1, walau eh....... But i study the report more, i feel it is way way way too cheap to begin with, but i no more money... Aih, heart also pain, throw in account don't want to look. Abit trauma, don't even want to think about the account or look at shares

Now, i got 51.4k shares at average cost of RM2.7. Manatau, i really go forget about the account, focus on work and business. Suddenly 2018, i see friend buy stock, decide to ask remisier how my shares is.

RM24 per share. Wahhhh. This also explains whey twice a year suddenly got pocket money come in.

Posted by Jon Choivo > 2018-07-30 12:55 | Report Abuse

Raider, there is no doubt that some leverage will really shoot up returns.

If one is a really good investor. But this is precisely how really good investors still die in market. The only way for rich and smart people to go bankrupt in the market is through leverage.

No matter how smart you are and how great your stock. The price can go crazy suddenly.

And your banker will force you to sell at the worst time.

If you are a good investor, why want to risk bankruptcy, you will be rich anyway given time.

Posted by paperplane > 2018-07-30 12:56 | Report Abuse

if you use margin to buy TM, you think high risk or low risk

Posted by Jon Choivo > 2018-07-30 12:58 | Report Abuse

Raider, for the record.

I also have leverage of about 38% on my portfolio. But this is loans at 4.5% with a potential kicker, only payable upon maturity. They have tenure of 3 plus years.

Nobody can force me to sell. If tmr triple limit down my portfolio, im still ok. I can hold. No banker to go press sell button for me.

Thats the difference between my kind and margin.

Posted by Jon Choivo > 2018-07-30 13:05 | Report Abuse

Do you assume the person bought at margin at the bottom? Thats a little rich.

Lets say he sailang in at RM3.9 on 11 june 2018. Reasonable time, you might think uptrend continued.

Drop to RM3.1 on June 21. Lets say your margin call at RM3.4. You get average price of RM3.3

easily lose about 45% of total capital.

You heart got so calm, at that point still go buy in ah?

Now RM 4.

Could've made a small profit instead.

The fact that someone can make you sell at a time you don't want to sell, is very high risk.

If you buy say public bank on 20 June 1997, and you expect to sell on 1 July 1997 for a profit, its very very high risk, cause it 50/50.

But if you said, i will only sell 30 years from now or when the price is leng, very low risk.

If this does not make sense to you, i dont know what to say.

Having said that, if my portfolio drop more than 50% in a recession, i intend to go on margin.

but i wont have more than 70% leverage, and i will make it so that i can get 8% leverage each month, maximum.

======================================================================


Posted by paperplane > Jul 30, 2018 12:56 PM | Report Abuse

if you use margin to buy TM, you think high risk or low risk

Posted by VenFx > 2018-07-30 13:07 | Report Abuse

Posted by paperplane > Jul 30, 2018 12:56 PM | Report Abuse 
if you use margin to buy TM, you think high risk or low risk

ME : PAPER BRO, I THINK MOST ANSWERS WILL BE AS GENERAL GUIDANCE ONLY.
EVENTHOUGH SIFUS ALSO NOT DARE TO GUARANTEE PROFIT IN EVERY TRADES.

AS LONG AS INVEST IN THE COUNTER U FAMILIAR MOST, AND WITH THE RISK TAKEN CARE OFF ... THAT'S GOOD TRADE .

Posted by Jon Choivo > 2018-07-30 13:09 | Report Abuse

Even my best pick rcecap. Got drop 30% for me to see at one point this year. Now its 6% gain.

If i on margin for this one, by now die d. Instead, i could average down.

Posted by VenFx > 2018-07-30 13:10 | Report Abuse

I trust everyone need to sharpen their edges n skill in study n research... better one to cross checking in i3 for any potential blind spot .

I trust paper has been conducting this always.

Posted by paperplane > 2018-07-30 14:10 | Report Abuse

hehe. use margin to go in if Div yield>> Loan Interest. So lower risk??

Posted by stockraider > 2018-07-30 14:23 |

Post removed.Why?

Posted by stockraider > 2018-07-30 14:31 | Report Abuse

Good example is myeg, which i have highlighted..should u by back...after u have sold out due to margin call and now u r ahead now loh...!!

SHOULD U BUY BACK MYEG AT BELOW RM 1.20 NOW LEH ??

Good example is in myeg case....dumb dumb cash investor sitting on a value Rm 30k whereas myeg margin investor still got rm 47k in his bank mah.....!!

The margin investors still can buy back at a lower price if he wants to loh.....!!

LET RAIDER CLEAR THE MOST MISCONCEPTION OF INVESTMENT IN THE FIELD OF INVESTMENT MARGIN FINANCING- IT IS USED AS THE BIGGEST WHIPPING CHILD BCOS OF POOR INVESTMENT DECISION LOH ;

B4 WE PROCEED, PLS LOOK INTO THIS IMPORTANT STATEMENT MAH;
emember if u decide to sell bcos u r margin holder.....the same principle u decide to sell also must apply if u r a cash investor mah......!!

1."Don get confuse loh....!!
If u lose monies as margin investors....usually u will lose monies even u r a cash investors loh....!!

In the case that u r cash investor u can be a little bit more stubborn and end up losing more monies for holding much longer...in the case of margin investor u need to be decisive...sell...sell..n sell....!!

Margin investor must learn to retreat & fight another day loh....!!"

SO U NEED TO COMPARE APPLE TO APPLE LOH...!!

OPTION 1 RAIDER HAS RM 100K CASH TO INVEST AND DO NOT HAVE THE OPTION TO TAKE MARGIN.

OPTION 2 RAIDER HAS RM 100K CASH TO INVEST BUT CAN TAKE ANOTHER RM 200K MARGIN.

OPTION 1
IF RAIDER INVEST INTO MYEG AT RM 4.00, TODAY MYEG IS RM 1.20, RAIDER WOULD HAVE LOSS RM 2.80 OR 70% OF MY VALUE AND MY PORTFOLIO WILL WORTH ONLY RM 30K TODAY MAH.....!!

OPTION 2
IF RAIDER INVEST INTO MYEG AT RM 4.00, USE CASH RM 100K AND USE MARGIN RM 200K....RAIDER WILL ALREADY GET A MARGIN CALL WHEN MYEG SHARE PRICE AT RM 3.50 LOH....!!
REMEMBER THE RISK MANAGEMENT IS TO SELL...SELLL AND SELL MAH...!!
SO RAIDER MANAGE TO LARI KUAT KUAT AT LOWER AVERAGE PRICE OF RM 3.30.
SO EFFECTIVELY RAIDER LOSE RM 52.5K AND STILL HAVE REMAINING CASH OF RM 47.5K MAH.

CONCLUSION
SO IF U LOOK CAREFULLY THE ABOVE EXAMPLE SOMETIME MARGIN INVESTOR MAY EVEN HAVE LOWER RISK THAN CASH INVESTOR ALTHOUGH BCOS THEY ARE MORE DISCIPLINE & FORCE BY THE BANK IN CUTTING LOSSES MAH....!!

SO HOW CAN U SAY MARGIN IS THE CAUSE OF BIG INVESTMENT FAILURE COMPARE WITH CASH INVESTOR LEH ??

THE MAJOR FAILURE IS DUE TO WRONG STOCK SELECTION LOH...!!

Posted by Jon Choivo > 2018-07-30 15:18 | Report Abuse

Raider,

Your example data also wrong.

Lets say you had myeg at RM2.58. RM1m, RM2m Margin. You were long term investor in MYEG for more than 5 years, every time div come out, you reinvest, and your CAGR 230% (MYEG grow at 76.65% CAGR for the last 5 years up to May). You feel like genius, your family feel like you genius, your neighbour jealous of you.

And you were a cikopek making RM2k a month who only had RM16K to put into stock market 5 years ago, now your RM16k is RM1mil net to you. And you got more money than your boss.

Day 1 after election: Limit Down, RM1.81 Cannot sell. Lose 90% of portfolio d.

Day 2 after election: Limit Down again, RM RM1.27. Now you owe the bank RM1m d. All your capital done.

Day 3 after election: No limit down, lets say you very decisive like raider, sell on open. Average price RM1. Now, you are 60% down, or 180% down. You now owe the bank RM1.8m.

You think market so nice always let you sell?

Imagine, you top investor, like OTB can get 30% CAGR, and you get that for 10 years double OTB, so smart like genius!

You learn to sailang and all in, because you really understand the business, top top business only you buy.

This limit down scenario only need to happen once in your long life, and you will lose 90%.

If you kena myeg scenario, you will now owe 180% of your capital to the bank.

CAGR from 30% for 10 years.

To Negative 10.8 for 10 years.

All that track record gone in 1 day.

And now, you not only cannot buy at bottom. You have to pay back bank. By the time market boom again say 5 year from now, 20% also haven't pay back.

You will pay until you die.

Imagine if that was raider, from having millions in portfolio and property asset.

To losing it all (40 year of working, salary and investment ) in one day, have to sell off all the property, and even then not sure enough to pay back bank anot.



===================================================================================
OPTION 1
IF RAIDER INVEST INTO MYEG AT RM 4.00, TODAY MYEG IS RM 1.20, RAIDER WOULD HAVE LOSS RM 2.80 OR 70% OF MY VALUE AND MY PORTFOLIO WILL WORTH ONLY RM 30K TODAY MAH.....!!

OPTION 2
IF RAIDER INVEST INTO MYEG AT RM 4.00, USE CASH RM 100K AND USE MARGIN RM 200K....RAIDER WILL ALREADY GET A MARGIN CALL WHEN MYEG SHARE PRICE AT RM 3.50 LOH....!!
REMEMBER THE RISK MANAGEMENT IS TO SELL...SELLL AND SELL MAH...!!
SO RAIDER MANAGE TO LARI KUAT KUAT AT LOWER AVERAGE PRICE OF RM 3.30.
SO EFFECTIVELY RAIDER LOSE RM 52.5K AND STILL HAVE REMAINING CASH OF RM 47.5K MAH.

CONCLUSION
SO IF U LOOK CAREFULLY THE ABOVE EXAMPLE SOMETIME MARGIN INVESTOR MAY EVEN HAVE LOWER RISK THAN CASH INVESTOR ALTHOUGH BCOS THEY ARE MORE DISCIPLINE & FORCE BY THE BANK IN CUTTING LOSSES MAH....!!

SO HOW CAN U SAY MARGIN IS THE CAUSE OF BIG INVESTMENT FAILURE COMPARE WITH CASH INVESTOR LEH ??

THE MAJOR FAILURE IS DUE TO WRONG STOCK SELECTION LOH...!!
30/07/2018 14:31
30/07/2018 15:06

Posted by stockraider > 2018-07-30 15:34 |

Post removed.Why?

Posted by stockraider > 2018-07-30 15:41 | Report Abuse

just look at Jaks today....everybody expect it will crash n crash n crash....but it is still rm 1.03 just down only 5% loh....!!
Usually if u want to lari kuat kuat.....u can....but u must decisive to cut loss and panic very fast loh....!!
don mark around like pondan loh....!!

For margin investor....the act of lari kuat kuat very important loh...!!

Posted by apolloang > 2018-07-30 15:43 | Report Abuse

where got crash? slow death only....hehe

Posted by KLCI King > 2018-07-30 16:19 | Report Abuse

Why Koon Yew Yin Sold his JAKS since he is so "sure" in JAKS???
https://klse.i3investor.com/blogs/happyinvest/167473.jsp

Posted by Jon Choivo > 2018-07-30 16:54 | Report Abuse

Raider

May 8: 2.58
May 9 election market close
May 14 (market reopen): 1.81

There is no 2.1 for you to see.

You say sell at RM14 so easy, i ask you, did you sell on the way up or down?

People are human. Bull markets is like sex. Its feels fantastic up until just before the climax.

If you think having someone being able to sell what you own at the time and price of their choosing is low risk.

I nothing to say.

Yes if you pick shitty stock, you will lose money whether cash or margin.

But margin lets you pick good stock and still lose it all. Very unique.



===================================================================================
taking ur example
Where got the day after election straight away Rm 1.00 leh ??

If u decisively want to sell, sell & sell ....u could comfortably got out at Rm 2.10 loh.....!!

Just that u just being greedy wants to got better price if rebound loh...!!

The samething...Hengyuan the all time high at Rm 19.50, u could easily got out at Rm 14.00 if u want to sell & not being greedy loh...!!

The point is still whether u use cash or margin ....u still lose monies if ur stock selection koyak loh...!!

If price ...crash systematically the natural thing is cut loss loh...!!

Pls remember my friend John lose his entire capital investment using cash on rsena-w loh....!!

Posted by stockraider > 2018-07-30 17:03 | Report Abuse

good stock u will still lose monies if u overpaid....do u brave enough to buy good stock like nestle, dutch lady, pbank, F&N , petdag today at current price leh ??

Posted by Jon Choivo > 2018-07-30 17:07 | Report Abuse

Irrelevent to the discussion.

I also know how to say:

"Walk out without umbrella, you will get wet when rain." hahahahaha

Stick to the points.

I personally hope you wont kena limit down while on max margin. And if you kena, i hope it is very public, at least people can learn something.



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Posted by stockraider > Jul 30, 2018 05:03 PM | Report Abuse

good stock u will still lose monies if u overpaid....do u brave enough to buy good stock like nestle, dutch lady, pbank, F&N , petdag today at current price leh ??

Posted by SALAM > 2018-07-30 17:14 | Report Abuse

Haha..Nothing can beat NESTLE, PBANK, PANASONIC , DLADY, NOT even EPF.....

Posted by SALAM > 2018-07-30 17:17 | Report Abuse

No need to crack your head with business sense,cow sense, dog sense, FA TA.

Posted by stockraider > 2018-07-30 17:38 | Report Abuse

In summary those who lost big monies using margin will lose big monies anyway loh....bcos they are really lousy investors loh....!!

Pls do not blame margin loh....!!

Don get confuse loh....!!
If u lose monies as margin investors....usually u will lose monies even u r a cash investors loh....!!

In the case that u r cash investor u can be a little bit more stubborn and end up losing more monies for holding much longer...in the case of margin investor u need to be decisive...sell...sell..n sell....!!

Margin investor must learn to retreat & fight another day loh....!!"

Thus i always, recommend to young newbies, always learn to use margin early, it is okay to lose a couple of thousands on margin tools....learn the robes, when u can still afford to lose....once u develop ur skill it will come very handy...even without margin u know how to risk manage mah..!!
This is a small change tuition fees to be paid for margin loh...!!

Btw for newbies, margin cost only 5% pa....if in long run ...u still cannot make 5% pa....u better hang ur investment boots and work hard in other avenue as stock mkt is not for u loh...!!

Do not accept the fact that people alway says...u r...no good bcos u use margin loh..!!
The real problem is that U really no good in investment, thats why u lose very big loh...!!

Posted by Jon Choivo > 2018-07-30 17:42 | Report Abuse

That's not the summary of this discussion, not even close.

That's the summary of your thought process throughout, that did not change at all, publicly at least, in view of new information given. Not even a properly reasoned out counter perspective.

That's stockraider for you, I still remember very clearly how loud you shout for hengyuan and evergeen, everyone who come out with contrary opinion is automatically pondan.

Now, both also die. The only money you earn is from people who stupid enough to follow you.