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Two easiest way to make money in stock market?

April 23rd, 2008

There are two easiest ways to make money in stock market.

Scenario 1:

You went into the market and BUY and you strike gold, even without coming out with capital.  Why?  The market is on the upward trend, BULL market., Cheong AH! Easy to make money right?  You buy 1 lot and you make $300 easily.  Imagine $300 x say 22 days, it’s S$6,600/- a month effortlessly.  I ever made S$15,000/- within 1 week in contra situation, meaning you don’t even need to come out a single cent.  I can use $100,000 to generate a volume of $1,000,000/- Fantastic right!  Getting greedy already.  So, dig all your savings and stake onto the market.  Well done! 

Next, the market needs a rest, tumble say 3%.  What happen?  Fund Managers offloading but the Uncles, Aunties, Newbies, Ah Gong and Ah Mah and also some experienced investors still buying leh because they believe market will still go up. YES and NO.  YES because the BULL hasn’t finish the marathon.  NO, the BULL has reached the finished line.  But, the market needs more time to rest, what happens?  Some, over invested, using margin, borrowed monies, don’t have the muscle to hold it, SELL or being FORCED-SELL by your remisiers.  So, all your profits wipe off.  On top of that, you lose your pants! And the cycle keeps repeating.

Scenario 2:

Market is damn depressed, BEAR Market.  Even fund managers are holidaying. Newbies after reading newspaper articles that so many people making market in the stock market went in.  Make money?  YES AND NO.  Why?  The prices are like SINGAPORE SALE, LELONG LELONG.  So, you buy and make some money right? Your heart become “tham sim” (greedy), easy money wat! So, you increase your stake.  The market hasn’t got a clear upward trend yet.  It might slump further, up to the BEAR.  If you use margin, GOOD LUCK TO YOU.  Do you have the guts to swallow the losses or the muscle to hold it?

Daily Journal, Smart Money

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