Saturday, June 18, 2011

Scalp Trades Dated 17/6/2011

1. Scalp traded the following on 17/6/2011 :-

2. As promised i will reveal the CW that i bought on Thursday, i bought DRBHCOM-CE again as depicted in the picture above at 0.145sen and liquidated at 0.15sen. Make half a cent. :)

3. Vincent, i will not apply Eversendai C Bhd this time round. This type of company dealing with oversea business and mostly dealing with USD. You know how bad is USD doing now, it might affect the revenue or profit if USD were to take another dip. We know that the crude oil is now hovering at USD100 per barrel, likely to shoot up to USD120 in the near future to come. At that point of time, i might foresee more problem at our local company if USD currency were to dip further.

4. How to trade well in CW ? i used my own method, so far out of 6 trades i win all of them. Will share it out after few months down the road. However, i did shared some information on my previous posting on how to trade CWs. You can refer to those postings if you want. Nevertheless, for the ease of your reference, i will post it here again :-
a) Never look for too expensive CW. Anything more then 3.5% premium is out of my list. As you mentioned, the banker controlled, they normally take profit if they see good premium to their advantage. So, we are on the disadvantage side if banker were to throw their holding to us to make the premium more attractive as the expiry date draw nearer. To make thing worst some of the CW players may come into the selling force as well. :(
b) Never plan for long term hold for CWs, unless you are pretty sure that the underlying mother share will surge high in the near future and before its CWs expired.
c) Trading CWs is a momentum game. Which mean the underlying mother share goes up, rightfully the associate CWs will follow but it depend on how responsive the CWs toward the mother share. As a guide but may not be necessary true, e.g if this CW has the ratio of 2:1, this would mean that the mother share need to move 2sen up in order for this CW to move a sen but that also you need to pick the right premium that is in your comfort level. When you see mother share goes up, then you will need to pay attention to its CWs, check their ratio and premium. Say for example, if the underlying mother share move up 10sen and the CW has a ratio of 2:1 only moved 2 bids which is equivalent to 1sen or 2 x 1 = 2sen up comparatively to underlying mother share, this would mean this CW has a potential to move further to at least on par with mother share, that is 2 x 5 = 10sen to equal with mother share movement. For this instant, this CW will need to move 5sen to be on par with mother share but it only moved 1sen so far, so potentially moving up is high, at this point of time, we will need to make a decision to buy in and once you have bought in reasonably enough quantity (e.g 25000units) then place sell 1 bid higher immediately with the low risk taker like me. You can opt to aim high when the underlying mother share keeps moving up and same practise when the mother share has the tendency to retrace, you got to take decision to sell or cut your position. Practise small first until you gain experience before attempting big. I myself is low risk type, i prefer to accumulate with small gain, so i normally take profit even with half a sen gain. It is better safe than sorry.
d) Never ever average down but it is possible to average up, cause when mother share gain momentum it will likely held up for a while but i don't encourage average up even though i concurred that. It is ok to take small profit, so long as it is a profit. :)
e) Try not to carry trades for too long, as we are dealing with trading here.
f) All CWs have expiry date you can send them for cash settlement exercise to make profit as well. This is another way of making money. Refer to my previous post for clues on how to pick expired CWs.

5. wyson, please refer to my previous postings, how i make money even with only 1sen different.

1 comment:

vincent168 said...

Thanks for your detail CW trading strategy.

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