HWZ Forums

Login Register FAQ Mark Forums Read

Brokerage conflict of interest - brokers want you to lose money

Like Tree7Likes
Reply
 
LinkBack Thread Tools
Old 17-06-2017, 09:48 AM   #1
High Supremacy Member
 
wahkao3's Avatar
 
Join Date: Mar 2005
Posts: 26,458
Brokerage conflict of interest - brokers want you to lose money

Brokerage conflict of interest - brokers want you to lose money

i just learnt of the conflict of interest with brokers, particularly CFDs
Summary as below

- 90% of retails traders lose 90% of their money within 90 days
- given this statistics, your broker often take the other side of the trade and statistically they will make money
- Except for HFT, real professional traders do not trade frequently. They adopt a fundamental view , not technical view. 80% FA, 20% TA.
- brokers do not want you to be a professional trader. They hope you day trade in and out of the market as often as possible. Notice how most of their marketing encourages trading rather than investing ?
- they charge you commissions
- they charge you spreads
- and worse of all, they charge financing charge around 3% ear, on daily basis


what you all think? come in discuss.
wahkao3 is offline   Reply With Quote
Old 17-06-2017, 10:43 AM   #2
Senior Member
 
athulican's Avatar
 
Join Date: Mar 2009
Posts: 1,599
Don't trade lor.
athulican is offline   Reply With Quote
Old 17-06-2017, 10:54 AM   #3
Master Member
 
funkid's Avatar
 
Join Date: Sep 2014
Posts: 3,418
Brokerage conflict of interest - brokers want you to lose money

i just learnt of the conflict of interest with brokers, particularly CFDs
Summary as below

- 90% of retails traders lose 90% of their money within 90 days
- given this statistics, your broker often take the other side of the trade and statistically they will make money
- Except for HFT, real professional traders do not trade frequently. They adopt a fundamental view , not technical view. 80% FA, 20% TA.
- brokers do not want you to be a professional trader. They hope you day trade in and out of the market as often as possible. Notice how most of their marketing encourages trading rather than investing ?
- they charge you commissions
- they charge you spreads
- and worse of all, they charge financing charge around 3% ear, on daily basis


what you all think? come in discuss.
knn jjww again.

did the broker point a gun to ur head and forced ur to trade ?
funkid is offline   Reply With Quote
Old 17-06-2017, 11:02 AM   #4
High Supremacy Member
 
wahkao3's Avatar
 
Join Date: Mar 2005
Posts: 26,458
Don't trade lor.
yes, i dont trade
good luck to those who do
their broker will love them deep deep
V_for_Vanilla likes this.
wahkao3 is offline   Reply With Quote
Old 17-06-2017, 11:16 AM   #5
Member
 
Join Date: Apr 2010
Posts: 414
Just to share my on my investing in stocks.

During first 3 months of trading, I lose more than $15k (on paper value). Subsequently, paper lost getting bigger and bigger. As a result, lost more then 25k (paper value). As times passed, my paper loses become positive again and now on the positive side.

As I mainly trading on banks share, I learned to hold instead of 'playing' contra.

Am still learning to value investing.
17smiles likes this.
lsm_83 is offline   Reply With Quote
Old 17-06-2017, 11:22 AM   #6
Supremacy Member
 
Shihtzu's Avatar
 
Join Date: Apr 2005
Posts: 5,975
trading daily is so stressful and you are always trying to beat the people doing it. Those people doing it sometimes might have insider news of what's happening too.

I buy when its cheap and just hold with a super long term view. eg. I bought some technology stocks in the states and never look at it much
17smiles likes this.
Shihtzu is offline   Reply With Quote
Old 17-06-2017, 11:43 AM   #7
Arch-Supremacy Member
 
plexxor's Avatar
 
Join Date: Aug 2006
Posts: 19,402
don't believe your broker lor
plexxor is offline   Reply With Quote
Old 17-06-2017, 01:26 PM   #8
Member
 
Join Date: Sep 2015
Posts: 212
Just to share my on my investing in stocks.

During first 3 months of trading, I lose more than $15k (on paper value). Subsequently, paper lost getting bigger and bigger. As a result, lost more then 25k (paper value). As times passed, my paper loses become positive again and now on the positive side.

As I mainly trading on banks share, I learned to hold instead of 'playing' contra.

Am still learning to value investing.
Same here as well, I am just slowly coming to terms with the basics of knowing what are the characteristics of an undervalued stock. There are other variables like Gearing, Company Portfolios, historical Dividend Per Share, etc, besides just looking at a P/B ratio

Like for example, I bought some REIT shares of a company this week because of its strong historical Dividend Yield. If I had paid attention to its historical Gearing ratios, I might've decided against buying it Thankfully the current company's report said it was looking to reduce its future Gearing ratios down to 36-37%, by selling off a couple of its properties that are not contributing returns. I was also fortunate to discover that the stock was undervalued, albeit by only 5%

Morale of the story: Do Your Own Due Diligence
17smiles is offline   Reply With Quote
Old 17-06-2017, 01:44 PM   #9
Arch-Supremacy Member
 
chainer9999's Avatar
 
Join Date: May 2009
Posts: 16,812
Come on la Wk3. 90 percent of traders lose money. Then the other 10 percent leh? Will have such problems about comms and such?
chainer9999 is offline   Reply With Quote
Old 17-06-2017, 01:48 PM   #10
Great Supremacy Member
 
Sinkie's Avatar
 
Join Date: Jan 2009
Posts: 72,007
Brokerage conflict of interest - brokers want you to lose money

i just learnt of the conflict of interest with brokers, particularly CFDs
Summary as below

- 90% of retails traders lose 90% of their money within 90 days
- given this statistics, your broker often take the other side of the trade and statistically they will make money
- Except for HFT, real professional traders do not trade frequently. They adopt a fundamental view , not technical view. 80% FA, 20% TA.
- brokers do not want you to be a professional trader. They hope you day trade in and out of the market as often as possible. Notice how most of their marketing encourages trading rather than investing ?
- they charge you commissions
- they charge you spreads
- and worse of all, they charge financing charge around 3% ear, on daily basis

what you all think? come in discuss.
Lol big big! If u can beat the market returns exponentially, I think your Brokers will be following you instead of going against u

Thanks for the weekend joke
Sinkie is offline   Reply With Quote
Old 17-06-2017, 02:17 PM   #11
Supremacy Member
 
Join Date: Mar 2008
Posts: 5,609
As I mainly trading on banks share, I learned to hold instead of 'playing' contra.

Am still learning to value investing.
bank stocks are not for fast in fast out, you would have to hold a few months to allow the price to move up from your entry price.
typically the best time to sell is perhaps during Q2 prior to CD.

value investing is more than just buying at 52 weeks low and selling and 52 weeks high, it also includes the business fundamentals of the stock during the 52 weeks low pricing range.
criteria to which why the price is at a discount also plays a part.
__________________
are you going to finish strong ?
simon_84 is offline   Reply With Quote
Old 17-06-2017, 02:36 PM   #12
Great Supremacy Member
 
Sinkie's Avatar
 
Join Date: Jan 2009
Posts: 72,007
knn jjww again.

did the broker point a gun to ur head and forced ur to trade ?
I think wahkao3 next thread will be

- Government wants all singaporean to lose money
- They hope you spend as often as possible. Notice how most of our advertisement or marketing on TV encourages you to spend rather than save ?
- they charge you gst
- they charge you erp
- they take away your earning and put into cpf
- they keep raising minimun sun so u can't touch your cpf
- they tax u
- and worse of all, they charge you interest for using your own cpf to buy housing

what you all think? come in discuss.
Sinkie is offline   Reply With Quote
Old 17-06-2017, 11:08 PM   #13
High Supremacy Member
 
wahkao3's Avatar
 
Join Date: Mar 2005
Posts: 26,458
Like for example, I bought some REIT shares of a company this week because of its strong historical Dividend Yield.
dont be hard up over dividends!!!
wahkao3 is offline   Reply With Quote
Old 17-06-2017, 11:11 PM   #14
High Supremacy Member
 
wahkao3's Avatar
 
Join Date: Mar 2005
Posts: 26,458
bank stocks are not for fast in fast out, you would have to hold a few months to allow the price to move up from your entry price.
typically the best time to sell is perhaps during Q2 prior to CD.

value investing is more than just buying at 52 weeks low and selling and 52 weeks high, it also includes the business fundamentals of the stock during the 52 weeks low pricing range.
criteria to which why the price is at a discount also plays a part.
haha banking stocks. i dont like big banks. i like small ulu ulu banks
for example, wolverine.
i camped at wolverine for 1 year already......

Wolverine can buy?Buy liao can huat?
wahkao3 is offline   Reply With Quote
Old 17-06-2017, 11:13 PM   #15
High Supremacy Member
 
wahkao3's Avatar
 
Join Date: Mar 2005
Posts: 26,458
I think wahkao3 next thread will be

- Government wants all singaporean to lose money
- They hope you spend as often as possible. Notice how most of our advertisement or marketing on TV encourages you to spend rather than save ?
- they charge you gst
- they charge you erp
- they take away your earning and put into cpf
- they keep raising minimun sun so u can't touch your cpf
- they tax u
- and worse of all, they charge you interest for using your own cpf to buy housing

what you all think? come in discuss.
i didnt pluck all these points out of thin air. I am not so clever.
i got these info from a reputable former goldmen sachs trader.
wahkao3 is offline   Reply With Quote
Reply
Important Forum Advisory Note
This forum is moderated by volunteer moderators who will react only to members' feedback on posts. Moderators are not employees or representatives of HWZ. Forum members and moderators are responsible for their own posts.

Please refer to our Terms of Service for more information.


Thread Tools

Posting Rules

Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are On

HardwareZone
Rewards