All of us know Aesop’s fable of “The Tortoise and the Hare” and trading is pretty much like a race where individuals or institutions try to win profits in the market. As Phillip CFD strongly believes in education, a joint seminar was held with one of Singapore’s leading charting companies, Asia Charts, and one of PhillipCapital‘s top tier remisier, Henry Tjoa, on 19th February to equip attendees with the relevant skills to trade the stock market.
“One needs to look before he or she leaps and as such, understanding the current market direction is important,” said Tjoa who kicked-off the seminar with his perspective of the equity market. Tjoa commented to the crowd of over 200 people that there is currently a market correction on equities, which started since January due to funds moving out of USA and Europe. This could possibly explain why Asian markets were still on the downtrend. Nevertheless, the general consensus among the bulls is that the US markets will continue to outperform in the fourth quarter as the Fed shows no sign of increasing the interest rates in the year of the Rabbit.
“To ride on the stock market’s volatility, one needs the agility of a rabbit,” quipped Tjoa, “Thus, we can look forward to better market performance in the last quarter of 2011 due to the easing of inflationary concerns.” Tjoa also shared in this seminar how CFD (Contracts for Difference) can be used alongside normal stock trading as a hedging tool to minimise one’s losses or to maximise profits, thanks to the leveraging effect of CFD.
After Tjoa’s “Rabbit” portion came the “Turtle”, which was presented by Asia Chart’s COO and Chief Trainer – CK Ee. Ee taught the audience how to place trades via the turtle trading method. Turtle trading was founded in 1983 by the legendary commodities trader, Richard Dennis, who believed that one did not need a special gift in order to profit from trades. Interestingly to note, Dennis named his students “turtles” after visiting a turtle farm in Singapore!
Throughout Ee’s humourous presentation, he stressed to the audience that “the trend is your friend” and investors are able to strategise by buying on the upside or short on the downside of breakouts. The turtle trading strategy has two systems – a shorter term system based on a 20-day breakout and a longer-term system based on a 55-day breakout. The basic numbers to remember are 20 and 10; buy on the 20-day high and sell on the 10-day low, and vice versa for short trades. This strategy adequately covers how an investor can enter trades and to put in stop losses when trading. Ee mentioned that the turtle trading method worked with CFD trading in a dove-tail manner since CFD allows one to short. As such, an investor is able to leap profits on both the upside and downside of the market, allowing everyone to possibly win like turtles!
For enquires, kindly contact Phillip CFD on Tel +65 6336 3338 or email us at [email protected].com.sg.
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