Wednesday, June 11, 2008

RE: iPhones?

It’s going to the moon…your not going to miss the boat, your going to miss the space shuttle!!

Ok dude, looks like you have been intro'd to trading but you have not been given you the run down.

Three type of inputs into a trading decision

a) Technical

b) Fundamental

c) Wishy washy feeling in your stomach ;)

I can’t explain the third, you will have to find that from watching romantic movies…just kidding…it will just come to you.

Now between the two others a) and b) above.

I like this.

In a shopping mall, a fundamental analyst would go to each store, study the product that was being sold, and then decide whether to buy it or not. By contrast, a technical analyst would sit on a bench in the mall and watch people go into the stores. Disregarding the intrinsic value of the products in the store, his or her decision would be based on the patterns or activity of people going into each store.

So most people (mum and dad traders) use 90% technical .

Remember 90% of the mum and dad community never make any serious money in the markets. Seems like a correlation, aye!!!

I am a fundamental trader. I only look at charts for blue chip companies that are not volatile and have seasonality and are growing slowly. That’s where technical trading works and that’s what it was built on!!

Another great posting on this amazing blog is the following. I have highlighted the important points.

Tuesday, September 06, 2005 Technical Analysis Tutorial - 20 Rules To Stop Losing Money -

This is really good advice, especially for you out there who believe that reling on technical trading is going to make you money. Technical Analysis Tutorial - 20 Rules To Stop Losing Money -

20 Rules To Stop Losing Money

1. Don't trust others opinions -
It's your money at stake, not theirs. Do your own analysis, regardless of the information source.

2. Don't believe in a company -
Trading is not investment. Remember the numbers and forget the press releases. Leave the American Dream to Peter Lynch.

3. Don't break your rules -
You made them for tough situations, just like the one you're probably in right now.

4. Don't try to get even -
Trading is never a game of catch-up. Every position must stand on its merits. Take your loss with composure, and take the next trade with absolute discipline.

5. Don't trade over your head -
If your last name isn't Buffett or Cramer, don't trade like them. Concentrate on playing the game well, and don't worry about making money.

6. Don't seek the Holy Grail -
There is no secret trading formula, other than solid risk management. So stop looking for it.

7. Don't forget your discipline -
Learning the basics is easy. Most traders fail due to a lack of discipline, not a lack of knowledge.

8. Don't chase the crowd -
Listen to the beat of your own drummer. By the time the crowd acts, you're probably too late…or too early.

9. Don't trade the obvious -
The prettiest patterns set up the most painful losses. If it looks too good to be true, it probably is.

10. Don't ignore the warning signs -
Big losses rarely come without warning. Don't wait for a lifeboat to abandon a sinking ship.

11. Don't count your chickens -
Profits aren't booked until the trade is closed. The market gives and the market takes away with great fury.

12. Don't forget the plan -
Remember the reasons you took the trade in the first place, and don't get blinded by volatility.

13. Don't have a paycheck mentality -
You don't deserve anything for all of your hard work. The market only pays off when you're right, and your timing is really, really good.

14. Don't join a group -
Trading is not a team sport. Avoid stock boards, chatrooms and financial TV. You want the truth, not blind support from others with your point of view.

15. Don't ignore your intuition -
Respect the little voice that tells you what to do, and what to avoid. That's the voice of the winner trying to get into your thick head.

16. Don't hate losing -
Expect to win and lose with great regularity. Expect the losing to teach you more about winning, than the winning itself.

17. Don't fall into the complexity trap -
A well-trained eye is more effective than a stack of indicators. Common sense is more valuable than a backtested system.

18. Don't confuse execution with opportunity -
Overpriced software won't help you trade like a pro. Pretty colors and flashing lights make you a faster trader, not a better one.

19. Don't project your personal life -
Trading gives you the perfect opportunity to discover just how screwed up your life really is. Get your own house in order before playing the markets.

20. Don't think its entertainment -
Trading should be boring most of the time, just like the real job you have right now.

Vinny0 comments to this post

If you have got this far you are doing well and do have an interest in this stuff!! Well done.

Ok now to RIMM.

Here is what I took from the 200 price target.

I will make comments on the highlighted parts below.

a) Enterprise functionality…watch the webcast..they cover it all…I don’t think anything is missing!

b) Lower price means more competition for Nokia and HTC. So the analyst is alluding that RIM is premium based market and will not put pressure on RIM. This is bullshit because the 199 price point directly is pitched at RIM and RIM is main competitor to iPhone. Not HTC or Nokia.
The lower priced iphone is going to put margin pressure on RIMM’s top earning phones including their up coming touch phone. Yup they have an iphone copy in the works!

c) Battery life and bandwith…this is why these financial jerkeys should stick to their numbers and why we can out play them ;) Blackberry servers strip content before delivering to your phone. This is both email and web pages. Surfing on the blackberry sucks. The new 3G blackerry’s will allow full access, the iphone will out class in both battery life and bandwidth depends on what you are downloading if there is no stripping. for reference on upcoming 3G rimm phones.

d) RIM will continue to grow…but critical to the stock price, margins will decline for next few years….short baby short!!

e) Misek obviously has a 3G iphone to compare to the Bold…yeah right…..

Research in Motion
Speaking of Blackberries, there seem to be many parties running to the defense of Research in Motion today despite Apple’s emphatic embrace of the Blackberry business market in Jobs’s pitch. The stock is up $1.26, or 1%, today, at $135.37.
Richard Windsor with Nomura Securities, writing from London, observes in a note on Apple that “We do not think that this will affect RIM very much as Apple remains very far away from offering the level of enterprise functionality that Blackberry does.” Be that as it may, the $199 price “moves the i-Phone much closer to the mainstream and will raise competition for both Nokia and [Taiwanese smartphone maker] HTC in the smartphone market.” Research in Motion shares are Likewise, analyst Peter Misek with Canaccord Adams writes that Apple will be unable to match the Blackberry’s security, battery life, bandwidth efficiency, “backend IT support,” among other things. He thinks Apple will do very well selling 20 to 30 million iPhones next year, but that RiM may sell 50 million Blackberries. Misek also tosses in his personal experience, noting that he thinks download speeds for Web pages are faster on the Blackberry Bold (that’s the 3G device). Misek has a “Buy” rating on RiM and a price target of $200.

Good luck with the trading!!! :)

Tuesday, June 10, 2008

Playing it make it big!

Heres a good article to get you excited and pumped about trading and making it a way of life.

Note the amount he starts off with and what he is estimated to be worth today and the time period.

Like I have said a few times. The amount you have does not matter to much to make this a way of life. You just have to play big (% wise) initially ;) You no doubt get burnt but its those who put it on the line that also have the chance to make it big. The more conservative you are, the less likely you are to make anything meaningful. Of course you need some smarts, intuition and a pinch of waffle magic to boot!

Wednesday, February 13, 2008

End Of Housing Boom?

Hi All,

Here is some interesting reading for you all about the property market. The opinion of the first person interviewed matches the same opinion I have about the potential risks in the current housing market (median house pricing that is) environment, both in Australia and NewZealand.
The second person interviewed has the opposite view. You choose where you sit and feel free to drop me a note on why you swing either way.

It's worth a read if you have some time.


Associate professor school of Economics & Finance, University of Western Sydney

Has the market reached tipping point?

It's actually several markets, and one of them - the working/ lower middle-class suburbs of Melbourne and Sydney - is past tipping point and in decline.

Wealthy suburbs in Sydney and Melbourne may be on the verge, with the declines in the stockmarket bringing to an end the "turn it into bricks and mortar" approach to locking in share trading profits. There may be some major declines there, as people who are being cruci- fied by margin calls are forced to liquidate.

Overall, the market has to be topping. Our bubble almost turned in 2004 - and if it hadn't been for Howard's doubling of the first home buyers grant and halving of the rate of capital gains tax (when owners sell an investment property), it probably would have. Those populist policies restarted the bubble as it began to falter. It might have another year left in it, by which time house prices would have tripled in less than 20 years - whereas the dreaded consumer price index (and wages!) has risen by just over 50 per cent.

When it does turn, what's in store?

It has to fall at least as far as the US market will, and probably a lot more. Some conservative pundits think US prices need to fall another 25 per cent to restore pre-bubble valuations, and they've already fallen 8%.

That means a 33% decline from a peak that's 30% lower than ours. Given that our economy is in slightly better shape than theirs, it still puts a minimum on the price decline needed of about 33%, and a maximum of 50% could apply if the China boom comes to an end.

Rates hit 17% under Keating. So 7% isn't nearly as bad - is it?

For mortgage stress to be the same today as it was in 1990, mortgage rates would need to be 3%! So 7% now - and 8-10% on mortgages themselves - is three times worse than 17% under Keating.

Is it time the Government bit the bullet on capital gains tax breaks/negative gearing?

Definitely. But the cautious approach of tinkering with rebates and subsidies is bound to win out over the hard policy of removing, once and for all, the incentives that have so distorted our housing market.

This would be predictable, timid, and ultimately useless policy. Almost every such trick simply boosts some sector of the market's demand capacity - when what we need to do is drive down the demand price.

Removing capital gains and negative gearing would slash demand, but the Government will hold off because many people who still anticipate real estate profits would scream blue murder. So to placate the winners, the losers will suffer.

We've heard a lot about "mortgage stress", but it's often associated with traditional "battler" locations. Is this going to change?

Yes. The stockmarket collapse and the margin calls that are part and parcel of it will cause the top end to tank - possibly more severely than the battler end. This market decline still has legs, and it will take the upper housing market with it.

What's in store for renters - won't higher rates fuel rent and thereby inflation?

Yes! This is the comical thing about trying to control inflation using interest rates. The three main contributors to the latest CPI figure in order were transportation (5.6%), financial and insurance services (4.9%), and housing (4.8%). With them removed from the index, the rate might well be still within the RBA's target range.

Of course, at some point the rates will turn the screws so thoroughly that the economy will tank, and then distress sales will drive prices down.

Where to for rates?

Up for the next six months to a year, as the RBA pursues its inflation obsession, and then down like a brick in hot pursuit of a declining economy. This is where the US is now, and we are only time away from joining them.

Friday, January 18, 2008

Bernanke Testimony

I love listening to this guy cause he speaks in english. Greenspan had a habit of talking in a foreign language.
Here's the link to the transcript. He briefly describes in layman terms, what caused the so call "subprime credit crisis/crunch".
He also talks about the current hot topic (media and coming elections/primaries) in america about fiscal stimulus to stop the US going into recession.
The testimony is normally also televised on cnbc etc, although its about 2am our time. The transcript below does not include question time which is often worth listening to as well.

The Senators are not the smartest people but they ask questions that a typical Jo would ask.

Anyway, I stand by what i have said previously, expect a slow down in the global economy over the next two years. Recession is absolutely on the cards in America (I can't give you a % on this, but will tell you that it depends on China and I have been hearing that China should see single digit growth this year after more than a decade of double digit growth) you may start hearing about a slow down or even recession in Australia by years end depending on how bad the US situation gets and how quickly China does slow down.
If there is a protracted slowdown in the US, this will impact all investment vehicles in Australia which means, currency, commodity prices, equities and yes housing as well.

Having said that, this is the time to be saving up your pennies and looking for an opportunity to jump into the markets. US equities in the second to later half of this year but only selected sectors, I still love tech's. Aus equities in the end of 2009, but i would look at shorting the Aus market now and into the later part of 2009 and into Aus housing about 2010/11 (this does not mean you should not buy property - there will be certain sectors of the housing market that will do OK) which will be about six years from 2004 which was the last peak of the housing market. Housing cycles historically have run 7-10 years. This one will run closer to the 10 year mark.
And if people tell you that Sydney housing doubles every 10 years (agents tell me this non-sense all the time), tell them to show you the numbers. From my study, typically the median house price in Sydney increases approx 50% every 10 years (approx 4% compounded annual growth) (based on historical figures prior to the 1998-2004 housing boom which I believe saw average median housing increase approx 128%). I believe 128% growth is unsustainable unless we (Australia) become the next China some how (which could happen in the future, well into the future at the moment)! I dont know much about the other cities in Australia as I dont follow them so feel free to comment about your end of the world.
NZ housing also I don't have a lot of exposure to but generally NZ runs the same course as Australia with a slight time lag.

On the interest rate front expect the interest rates to increase in Australia in Feb by 0.25% and then interest rate cuts in the first half of next year and probably for the whole of 2009 as the Aus economy starts to loose steam (regardless of what happens in the US - although US will compound the slowdown if they dont see throw their mess).
If interest rates don't go up in Feb, expect the Australia economy to start slowing down earlier than I was expecting and of course the fall out from the other investment vehicles will follow shortly there after.

Anyway, enough of my babble. Feel free to drop me your thoughts.
Hope you all and your family members are well.
You all have a good weekend.

Tuesday, July 17, 2007

Stocks of Interest

Today I am interested in the following due to market position. I have not looked at financial fundamentals which should dictate fair value, entry and exit prices.
  • NTAP - has got a bashing of late and the CEO has said that concentrating on software and services and also that long term the opportunities are still vast.
  • LOGI - released the in-air mouse. They continue to concentrate on building new products that can be used in an innovative manor and peripheral usage in the home continues to grow as more devices become digital and are connected.

Tuesday, May 02, 2006

Adobe Systems, Inc. Company Information -

Adobe Systems, Inc. Company Information -

This is an interesting comparison of products between Microsoft and Adobe and which ones may impact Adobe when Microsoft does launch them. Basic Summary - low impact to Adobe's core business.

Thursday, April 27, 2006

Samsung Scores Major Deal for New Apple iPod Digital Lifestyle Magazine @

Armhy and mips are both designers of chips that are used in the embeded market. Both have their chip designs being used by major chip vendors who supply chips into the mas market consumabes.
Both these companies are 'buys' and will continue to profit from the growing tech consumer mass market.
One to watch!

Samsung Scores Major Deal for New Apple iPod Digital Lifestyle Magazine @ "Samsung made public at the SEMI Strategic Business Conference that they held a contract with Apple. Jon Kang, senior vice president in marketing at Samsung Semiconductor Inc., said “I knew PortalPlayer would take a dive, I knew that we would win this design.' Samsung’s chip is inspired by ARM Holdings plc. 32-bit processor technology, with Kang referring to the company as being the “PortalPlayer Killer”. Executives for Samsung noting that they supply the majority of NAND flash for Apple’s iPod, further elaborating “We’ve been working with Apple a long time, it’s a huge win for us.”"