Class Action

Hmm...class action is a corporate action where companies had to pay clients who had previously purchased or have sold off their shares during a certain period and is deemed to have compensation due to some issues.

For example, Royal Dutch Shell has the following class action, that shareholders who had purchased during this period of April 8, 1999 till March 15, 2004 will be eligible for this compensation. Do remember to keep your brokage record or receipts.

Source: http://www.shell.com/home/content/investor/reserves_settlement/us/us_reserves_settlement.html

Orders for HK market

There are more order type in HK market than SGX. Do look up your brokage provider as they have a better explaination on this order types or HKEx.

Orders for Matching period

Both Auction orders, limit and market, can only be used during the matching period.

Auction market order
For auction market order, its a market order that will be filled at the prevailing market price during the matching period and enjoy a matching priority than auction limit order.

Auction limit order
For auction limit order, the price will only be filled at that price or better. After the matching period ends, the order will converted to a limit order. If the limit price deviate away from the current trading price by more that 9 bids or more, the order will be rejected. Thus one will need to monitor the order.

Orders after matching period

Both limit and enhance limit orders are orders that will be filled at a better price or the limit price submitted by you. So whats the different for enhance limit order? Oh, theres another Special Limit order as well.

Enhanced Limit Order (ELO):
An ELO allows matching of up to five price queues at the same time. The input order price of an ELO can be matched up to four spreads better than the best price on the other side of the market. Any unfilled quantity of an ELO after matching will be converted into a Limit Order at the input order price.

Special Limit Order (SLO):
A SLO matches up to five price queues (i.e. the best price queue and the next four queues each at one-spread away) as long as the traded price is not worse than the input limit price. Any unfilled quantity of an SLO after matching will be cancelled by AMS/3.

More information about ELO and SLO is available on the Hong Kong Stock Exchange (HKEX) web site.
Source: http://www.dbsvonline.com/English/index.asp

Think it will be better if there are numerical examples which show the working of ELO. Will update again.

Day high and low price for US stocks

It seems that prices recorded for the day high and low, the relevent engines or stock price updates you see in websites which provide free price quotes, actually consider the best high and low prices for all the the various US exchanges. What do i meant?

For example, websites which provide free price quote shows counter X has a day high of 6.42 at around 11pm SGT. Your initial order for 6.4 wasnt filled. And you will ponder why?

The reason is the price quotes in these websites, perhaps brokages, their engine quote all the high and low price in all the exchanges that the counter is trading.
However, the order submited to your particular exchange, lets say, NYSE, at that point of time, was only trading 6.10, for counter X, despite the websites and engines show a day high for 6.42. This high price is recorded as it is the highest price among all the US exchanges that is trading at the point of time for counter X, but for NYSE, the price didnt penetrated this price of 6.42.

Haha..hope im making sense here.

Corporate action - Reverse Stock Splits

What i learn from corporation actions, is that for every action, there must be a reason...haha...what crap im talking. Well...just recently RBS have a reverse stock split for 20 to 1 share, meaning for every 20 shares you have, it will be reduced to 1 share, of course, there will be a price adjustment.

At first, the share price will be unusually high, but if you do proportional or ratio calculation, actually it may not be better off also.

There will be implications for the corporation actions. Whether is it good or bad for the stock, you will have to ponder what is the reason or intention of this corporation action taken.

Reverse stock splits are often seen as negative corporate actions because they are a tactic used by companies that have seen their share prices fall into the $1 range and, therefore, run the risk of being delisted from stock exchanges that have minimum share price rules. For example, if a company is listed on the Nasdaq and its shares fall below $1, it runs the risk of being delisted; companies sometimes reverse split to increase share price, allowing them to continue to trade on a reputable stock exchange
Source: http://www.investopedia.com/ask/answers/06/reversestocksplit.asp

News on RBS corporation action
http://seekingalpha.com/article/105148-will-royal-bank-of-scotland-s-reverse-split-help-its-share-price

RBS Release details
http://www.investors.rbs.com/investor_relations/announcements/ReleaseDetail.cfm?ReleaseID=344152

Daylight Saving Time (DST)

Hmm...didnt realise the impact of this DST. It delays the opening time for foreign markets, but also affect FX market also in a way as it confuses the traders what hours to use despite FX is tradin 24-7 till sat.



DST for US, UK Equities market in SG/HK timing
Source: http://www.dbsvonline.com/English/index.asp

SGX Extended Contracts

Another new deriativies will be lanuched next year.

One can long or short and hold on to this open position till the end of the month, the last working day for the month. Margin will be required and of cos, there will be margin calls etc. Will update more once more information is available.

The key features of ES contracts are:
- Each contract will be for 35 days, starting from the 25th of each month until the last trading day (LTD) of the contract month, i.e. the 31st of the following month.

- If the 25th and/or 31st are non-trading days, the contract will start from and end
on the last trading days before those dates. For example, an ES contract that starts trading on 23 January 2009 will have its LTD on 27 February 2009.

- Settlement will take place by way of delivery of the underlying securities on LTD plus three days (LTD+3). If bought on the first day of the ES contract, this gives investors up to 38 days to settle the contracts with the actual securities – 35 days longer than for normal securities investments.

- Margins, which are a fraction of the full trade value, are required to be paid to trade ES contracts. The margins range from 5% to 20% of the cost of one lot of the underlying stock. The full amount of the trade is payable on settlement day, which is LTD+3.

Source: http://info.sgx.com/webnewscentre.nsf/b9c790d0d5ba5d2548256dcf0049ce28/48256838002f07b1482574f80019600c?OpenDocument

CPF counters

If you wonder which shares can be settled using CPF, here is the link.

http://info.sgx.com/webstocks.nsf/CPF+Investment+Scheme+Stocks?OpenView

This information is important as not all platforms offered by brokeages automatically reject orders that cant be traded using CPF. Thus always do your homework to avoid disputes.

CFD providers and counter list for SG market

CIMB
https://sgcfd.cimb.com/emidas.html

KIM ENG
https://www.kecfd.com/markets.asp
https://www.kecfd.com/pdfs/CFD%20Initial%20Margin%20SGX.pdf

PHILIPS CAPITAL
http://www.poems.com.sg/cfd/sic.html
http://www.poems.com.sg/cfd/attachments/PhillipCFDCounterList.pdf

LIM & TAN
http://www.eq.com.sg/

CMC MARKET
http://www.cmcmarkets.com.sg/en/content/about_us/index.jsp
http://www.cmcmarkets.com.sg/repository/docs/sg/Product_Schedule_Singapore.pdf

SAXO MARKETS
http://www.saxomarkets.com.sg/private/cfds/Saxocfds.aspx

IG MARKET
http://www.igmarkets.com.sg/
http://www.igmarkets.com.sg/content/files/shares_list.pdf#page=127

Will continue to update this list if found new information..but of cos, please do check out various sources or email the CFD provider if you seek further information. As for which provider is better, i wont know since i didnt try all of them. But one variable one can consider is cost of transaction, list of shortable counters (thats important), the relability of the platform in terms of price entry, order types (different order types for different platform)

Each provider also requires different requirements to open an account, so do read up and see which is better for you.

Trading OTC markets

Over the counter (OTC)
In general, the reason for which a stock is traded over-the-counter (OTC) is usually because the company is small, making it unable to meet exchange listing requirements. Also known as "unlisted stock", these securities are traded by broker-dealers who negotiate directly with one another over computer networks and by phone.

As such, OTC stocks are generally unlisted stocks which trade on the Over the Counter Bulletin Board (OTCBB) or on the pink sheets. Be very wary of some OTC stocks, however; the OTCBB stocks are either penny stocks or are offered by companies with bad credit records.
Source: http://www.investopedia.com/terms/o/otc.asp

My Opinions
Hmm..means even small businesses can be listed and raised funds in this markets. But its very high risk. Reason?

What i observed, from trading OTC, you wont be able to know the buying and selling price in queue for this market unlike equity markets such as NYSE or SGX, where brokeages offered services to see the queuing volumes and prices offered.

You may be queuing to buy at 0.05c for that counter, and the order may not be filled even if the platform shows that your price has been penetrated.

To know if the stock is a OTC counter, normally they have a stock symbol will end with a .PK or . OB, depending where it is traded, i guess...haha..will need to confirm this detail.

Risks of OTC
Although stocks quoted on the OTCBB must comply with SEC reporting requirements, other OTC stocks, such as those stocks categorized as Pink Sheets securities, have no reporting requirements, while those stocks categorized as OTCQX have met alternative disclosure guidelines through Pink OTC Markets.

The OTC market presents investment opportunities for informed investors, but also has a high degree of risk. Many OTC issuers are small companies with limited operating histories or are economically distressed
Source: http://en.wikipedia.org/wiki/Over-the-counter_(finance)

Readings on FAQ on OTC Mtk trading:
http://www.pinksheets.com/pink/faq.jsp#investor

Stop orders

Recently learn this new order...haha..kinda sad that only few brokerage offer this option.

Stop order allow traders to key in a price which he want to buy or sell. Isnt that same as a limit price?

Hmm..kinda off...the difference is this

If you key in a stop buy order at 1.00 and a limit price order at 1.00. If the price is to hit 1.00, both orders will get penetrated. But in the case, if the price is to gap when the market opens, the price hit 1.2, the limit order at 1.00 will not be filled but the stop buy order will be filled as the price penetrated 1.00 and get filled at the market price of 1.2 at that point of time.

Disadvanatage of stop order is that, there will be circumstances that your order may be filled at a higher buying price or cut loss at a lower selling price as there is no limits once the price penetrated further than expected or anticipated.

Thus there is another type of order known as Stop limit order, where one can determine the stop limit at the entry and exit point. But think this type of order isnt free. Haha...one will have to subscribe. Perhaps there are brokeage which offer free stop limit orders usage in their system...just im unaware of it.

Do spend time researching on different orders types in the trading platform given by your brokeage. They will definitely better better explaination than mine version. :)

Will correct and update on this post once i familarise on this order type.

CFDs

Recently just started exploring CFDs, Contract for Differences, a derivative product where one can "short or long" the market without involving trading with the mother share but playing with the price flucuations.

If one participate in CFDs, one doesn't participate directly in the market by buying and selling the mother share itself. One is actually betting with the broker, the broker will earn the commission fees, while borrowing shares from its inventory to hedge its position.

One can long or short CFDs and the price is the same as the mother share.

Assuming if it's a bear market,if one have the patience and cash, you want to have a long position, you "feel" the price is cheap, you buy...but how long will the share appreciate or see day light, break resistance? 2nd thing is that your cash will be locked in the share. Are you planning to be a long term investor by choice or by circumstances?

One can short using CFDs, in this bear market, to earn a relatively safe returns as the stock is going down trend and of cos, there will be probability that it will go uptrend then you will have to learn to cut losses and cover your position.

When choosing brokeage to trade CFDs, do know that different brokages some offer a longer list of shortable shares, some counters lack liquidity, thus will need for a higher initial margin.

Remember, CFDs are leverage products and there will be margin calls if there are increase unexpectated volatility.

For now, i will continue to explore and share if i have future experiences.

Cum and Ex date

If one buys shares during the cum dividend period, one will be entitled the dividends.

He or she can sell the shares on the Ex date, and still be entitled to the dividend.

Question, if one buys on the cum dividend date, and contra (sgx mkt) in the next day, which happens to be the ex dividend date, will one be entitled to the dividend still?

Ans: Yes, but most likely the share price on the ex date will drop.

Preference shares in SGX

Have you notice that are some share with weird percentages in their names like the following: OCBC BLK 4.2%NPCS 100 or DBS BK 6% NCPS 10.

These are actually preference shares with no maturity date. These shares offer dividends percentages as reflected in their counter names.

OCBC preference shares

http://www.ocbc.com.sg/global/investorrelations/Gco_Inv_PrefShareBond.shtm



The Maturity date for this perference share is perpetual.


Reference: http://stquote.sgx.com/live/st/STStock.asp?stk=O

DBS preference shares details
http://www.dbs.com.sg/investor/prefshares/

Something new i just figure out today

Order types in foreign mkt

All or nothing

All or nothing simply means the quanitiy will be filled but price will not be guarantee...while limit price order will means the price will be guaranteed but the quantity will not be necessary be filled.

Got it?

If you choose limit price, day order, and the order is partially filled and the market close for the day, you have to pay for the commission and brokeage charges for whatever amount is filled.

Good till date
Your order will be open from a date till another date. The position can last for a range of 30 days.

Question: Is it 30 working days, market days or calendar days?

Hmm..i also not sure..have to research on that.

Ok...got some answers...to be exactly, its calendar days, considering all weekends. The critical thing is that if the last day, the 30th day must fall in a market day.
But wait, how abt public holiday in the 30 days, is it counted as a calendar day??...have to check again

Searching for the symbol in SGX

Sometimes you may encounter problem in finding the symbol for the share trading in SGX. You know of the name, but unaware of the symbol. Heres a tip:



Simply use your cursor and point to the stock u want, refer to the left corner of the website..dala...you got the symbol..haha..just a information.

Naked shorting in SGX

Just recently, i just learn this term, naked shorting.

Shorting refers to selling the shares first w/o owning the shares. But one can do naked shorting and covered shorting.

Shorting is disapproved in SGX and one need to cover his/her position by the end of the trading day.(How about other markets?)This practise is naked shorting.

While there is a "non naked" shorting means borrowing shares from brokeages, and paying them back the difference. CFD is the term, contracts for difference. And only certain brokages offer this services.

Non board lots trading in SGX market

There are shares such as SIA 200, OCBC preference shares NPC 100, Creative 50, these shares trade in terms of the volume as stated in their counter.

Sometimes, ppl who trade 5 lots SIA 200 and wanting to sell them under SIA as 1 lot. This means submitting the order as a different symbol. If the SIA 200 is a free balance, most likely i guess, one can sell it as a board lot under SIA symbol.

Ok back with some answers..as long you have the appropriate number of shares for that 1 lot of SIA, you can sell them under the different symbol as the quantity is right despite having the counter not being a free balance.

Free balance simply means you have paid for the shares.

Market price in foreign trading

Have you ever wonder why in US markets, when you key in market price, you wont necessary get the price you want?

Just my guess...beware im not totally sure..just an experience and will improvise my entries.

Prices stream to your brokeage (each brokage differs) may not be live stream and prices you see in your trading platfrom may be averages as the same counter may be listed in different exchanges. In US alone, there are many exchanges, thus the average price is computered into the system.

When the order is submitted, the order have to be routed to the exchange, thus the time taken for the order to be routed from your system to the exchange, if the counter is a fast trading stock, the price you see in your system may have differ and the price filled by the exchance will be higher or lower depending on the market condition of supply, demand, volume and price changes.

There are also different situations why the price wasnt filled as US have aution and dealer markets, each have different rules, and as well as your orders, is it a all or nothing order or market price order or etc...so much more..

Do contact your brokage to know why your price is filled at a different price if your price do get penetrated.

Intention of this blog

I have been wanting to write down my experiences as a private noobish trader as well as what i do. Being able to write down, reflect on it, i may able to gain much more as i will think through abt how exactly the trading world works and what actually its not and the unique cases which i encounter.

Is trading a passion or a ticket which im eligible to use to get out of this rat race? I'm not sure...

Beware that information from this blog is not intented to be taken seriously as a advice or recommendations...but can be read casually...you do realise its a blog not a financial website...im blogging as a identity of a average person learning the ropes of this trade and sharing this experience.

Most likely in this beginning stage of blogging, my entries will be messy with no sense of catorgising, once i know whats my contents are focus at, i will organise in a searchable manner.