CFD trading for SGX listed stocks in Singapore. Date: 17 August 2015

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Malcolm Brent Cummings
8 years ago
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1 CFD trading for SGX listed stocks in Singapore Date: 17 August 2015

2 STI

3 Disclaimer No license to give financial advice Consult your personal financial adviser

4 A little bit more about CFDs Date: 17 August 2015

5 Salient features A CFD is a tradable instrument that mirrors the movements of the asset underlying it. It allows for profits or losses to be realized when the underlying asset moves in relation to the position taken, but the actual underlying asset is never owned. Essentially, it is a contract between the client and the broker. Ownership Risk

It allows for profits or losses to be realized when the underlying asset moves in relation to

6 Cost of trading Commission per trade Daily financing Dividends Data fee

7 3 key CFD strategies Long positions (substitute for contra-trading*) Sell positions (substitute for naked shorting, share borrowing) Hedging for risk protection (long stock, short CFDs)

com/help-and-support/share-borrowing.html https://www.phillip.com.sg/stocks-a-shares/shares-borrowingand-lending.

8 Long strategy: Buy low sell high

9 Short strategy: Sell high buy low

10 Hedge 100% hedge i.e. go to neutral Partial hedge Part of a plan e.g. ownership, dividend, collateral etc.

11 Own stock, sell CFD to go neutral Mr Tan owns 10,000 shares of XYZ. When XYZ was trading at $30, he monetized it by using it as a collateral and received $24 per share. With 240k in hand, he made down payment for a new condominium. He expect XYZ shares to be stable, that he continues to receive yearly dividends of around 2.5%. His life was in shambles when XYZ fell to $10 in a financial crisis.

With 240k in hand, he made down payment for a new condominium.

12 Alternate timeline: 100% hedge Sensing a crisis, Tan sold 10,000 XYZ CFDs at $28. He lost $2 per share on his stocks. But when XYZ fell to $10, his $18 dollar gain per CFD offset corresponding stock losses. He was neutral. When XYZ reversed to $12 per share, Tan sense a recovery and closed his CFDs at $16 gain. His XYZ exposure to market risks is now $12.

But when XYZ fell to $10, his $18 dollar gain per CFD offset corresponding stock losses.

13 Is market doing that well? It s about time

14 Copper mthly

15 Baltic Dry Index mthly

16 Crude oil mthly

17 Natural gas mthly

18 Relative performance

19 China drops 30 percent

20 No market escapes stock/business cycle

21 Stock market signals Buying climax Failing 52-week highs and lows Long term trend lines

22 China A50 buying climax

23 Hang Seng Index buying climax?

24 Straits Times Index buying climax?

25 Danger Signs You Risk Ignoring 12 blue chips with new 52-week lows Genting Singapore, Global Logistic Golden Agri, Hutchison Port Jardine C & C, Jardine Strategic Keppel Corp, Noble Group Sembcorp, Sembmarine SIA Engineering, Starhub

26 Trend is over ( BN4 Keppel Corp TL from 1998 broke last year. CC3 Starhub TL from 2005 broken in May 2 this year. J36 Jardine Matheson TL J37 Jardine Strategic TL S51 Sembmarine TL U96 Sembcorp - TL E5H Golden Agri - TL C6L Singapore Airlines - TL Same TL November 2014 May 2015.

27 Price falling with high volume A17U Ascendas REIT BN4 Keppel Corp C07 Jardine C & C C09 City Development MC0 Global Logistics N21 Noble O39 OCBC U96 Sembcorp - TL

28 Internal signals

29 If market is that bad should I stay away? This is the best time now speculate on a direction or to apply protection to portfolio

30 Strategies for bear market 1. Start with a list of stocks that have short CFDs avail Identify sectors that are already trending down 3. Sell into biggest losers after they have retraced 4. Rotational play 5. Do not do counter trend 6. Time with broad market sentiment based on STI

31 Strategies for bear market 1. Scan for 52-week highs and lows 2. Scan for high volume

32 Best stocks for CFD trading 1. Blue chips, market darlings 2. Liquidity, availability of scrip, fast-moving 3. Responsive to market sentiments, story-driven 4. Trading at $1 - $10 region 5. Has made new 52-week high or 52-week low 6. Belongs to growing/troubled sector

33 Buy strongest sell weakest - stocks ProductRegions/OTHER/1/ASIA/1

34 Buy strongest sell weakest - sectors

35 Major signal for STI (see charts for subindices)

36 STI 1-year heatmap ( All sectors 1 month performance Financials 1 day performance

37 Within sector which stock is weakest? Financials 3 month performance Financials 1 day performance

38 FST China Indices

39 What does the best setups look like? (Switch over to charts) Momentum Consolidation Chart pattern

40 STI

41 9-point crash guide ( % corrections in the stock market are healthy and nothing to worry about % corrections might even be labeled oversold. 3. Be very worried if market crosses 20% mark. Bad markets go into a tailspin worsened by margin calls and forced selling. 4. Illiquid stocks may gap down repeatedly due to absence of quotes. 5. Steep rallies can still happen in the bear market. 6. Don t fall in love with any particular stock. Be quick to cut losses and never average down. 7. Price may drop on low volume but price drops on high volume are almost certainly bad. Never catch a falling knife. 8. A crisis is a good opportunity. Always have a reserve. Some of the most successful oldtimers in the stock market did not trade. They made their money buying generational lows.

42 Never fall in love

43 IG platform training 27 August 7pm 9pm For individuals who sign up account today 3 Shenton Way #25-02 Shenton House (S) Register: forex@terraseeds.com or SMS

44 The end CFD trading for SGX listed stocks in Singapore Monday 17 August pm 3 Shenton Way #25-02 Shenton House (S) Register: forex@terraseeds.com or SMS $40 per pax

Leverage. Chapter 1 LEVERAGE. In this chapter, you will be able to:

Leverage. Chapter 1 LEVERAGE. In this chapter, you will be able to: Chapter 1 Leverage In this chapter, you will be able to: Understand how traders magnify their profits with leverage Understand how to profit from the market when it is declining by short selling Identify