This is the second learning lesson in which I will be sharing my thoughts and please bear in mind this is not financial advice. This is a series of articles where I will focus on topics of what others have done previously and to find possible ways to improve on their positions.

If you have not read the first learning lesson, click here to read it. 😀

Disclaimer: All information stated below are only for illustration purposes. It's not a call to buy or sell any financial products. Please perform your own due diligence before investing as always. 

Here, I will share the first real-life example of the following issue that this person is facing.

seedly.com

Background Analysis:

• From this case, there is about 20K SGD on hand in cash that is available now to invest into anything. 
• Risk-averse and prefer to put into somewhere relatively safe and stable
• Money will be required for home renovation
• Time duration to invest is about 1 year. 
• Besides Singlife, any other ways to invest?

First and foremost if you are using Singlife and treating this as a form of investment, I think you are wasting your time. Singlife has been reducing its interest rate returns for the past year. Now it's at 1.0% p.a. return and I expect them to drop this figure closer towards 0% return in the future. 

singlife.com

I will like to reiterate and emphasize that Singlife is not a pure investment product for goodness sake. It's a hybrid insurance cum 'investment' product that tries to promote to you a low-hanging carrot of the brilliant benefits of buying insurance and savings at the same time without having you put in time and effort to study about investments. Obviously, it's their Marketing department marketing strategy to get more people on board to sign up and be a member of this platform. 

We cannot always use the bank's saving account interest rates as a form of yardstick and be the benchmark of what might be a better alternative investment return. Banks are giving us a ridiculous savings interest of 0.05% p.a. Just look at the table below. Even by depositing 650K into the savings account, they will not even reward you with a higher interest rate and you still get to enjoy only 0.05% p.a. regardless of how much you plan to put in. 

DBS

Now comparing Singlife with the bank's savings account, getting a 1% p.a. return seems to be a good deal. But I beg to differ on this notion. Because there is something called inflation my friend. I covered this topic before. If you have not read it yet, click here to read it. 

MAS

Click here to read more on the rate of inflation in Singapore.

Taking reference from the MAS (Singapore's Central Bank) in August 2021, the MAS Core Inflation rose to 1.1% on a year-on-year basis. 😕 It's +1.1% inflation!!!!! 

Putting your money into a 1.0% p.a. Singlife product is going to reduce your purchasing power by -0.1% on a year-to-year basis. Please think twice if you want to put your eggs into Singlife. 

For me, any interest rate returns of less than 3.0% p.a, I will just ignore and don't care about it. The returns are just too little. 

Going back to the case

Background Analysis:

• From this case, there is about 20K SGD on hand in cash that is available now to invest into anything. 
• Risk-averse and prefer to put into somewhere relatively safe and stable
• Money will be required for home renovation
• Time duration to invest is about 1 year. 
• Besides Singlife, any other ways to invest?

20K SGD is a sum big enough to invest into something and get a good return of investment after 1 year. 

I will skip Fixed Deposits, 1 year T-bills or bonds, savings account, cash management accounts, etc.

Moving Forward:

Robo-Advisor:

In a hypothetical situation, I will take the 20K and invest in either Stashaway or Syfe Robo Advisors. To me, this is quite clear as I have used both products before and their returns are good enough to achieve this objective in 1 year's time. 

Both Stashaway and Syfe are licensed and regulated by the MAS in Singapore as stated on their websites. This fulfils the relatively and somewhere safe and stable risk levels that the author is looking for. 

You can check their websites to find out more.

Click here if you have not read my reviews on Syfe and Stashaway.

There are many different plans on both platforms, choose one which suits your risk level and comfort level. Please take note, choose and focus on 1 plan only as concentration is the key to building wealth and 1 year is not a very long time to play with 2 plans. 

For me, I know how both works so I will be very aggressive and choose the Stashaway 36% highest risk level plan or Syfe Equity 100 plan.

Split 1 year into 12 equal months. Dollar-cost average a fixed amount monthly till expiry in 1 year time. With 20k, each month I will DCA 1666 SGD into the plan and wait for it to grow. Possible to reach greater than 7% return per annum after factoring in the platform's monthly management fees of xxx amount. How cool is that! 😎

For me personally, I did it for about 1 year and got back a 10% return for doing nothing every month other than to deposit money and just click into the dashboard to see my money grow while I sleep and do other things in life.

One strong reason for choosing Robo-Advisors is the unit of measurement (UOM) is in SGD which is just investing using fiat dollars. It provides convenience as I do not need to change to USD or a Crypto stable coin to invest.

Stocks:

Cryptocurrency:

For the more adventurous people, 1 year is also sufficient to invest in Cryptocurrency. But the obvious downside is you first have to convert your fiat money (SGD) into a stable coin (eg. USDC) then you decide what you want to do with those coins. After 1 year, you have to then convert back your crypto coins into fiat money (SGD) and use this sum to pay for the house renovations.

Of course, this brings with you a higher risk and more time is required to do your own research to find out how to maximize your returns using Cryptocurrency. 

Please avoid using Liquidity Mining (LM) as 1 year is a short period of time and you will be subjected to the 'Impermanent Loss' as the time horizon to invest is very short. 

Can focus on doing staking for coins that are able to stake. Those that cannot stake eg. BTC or LTC, you can deposit your coins into a lending platform and they will just reward you with interest rates according to the proportion that you deposit with them. There are a few platforms such as Celsius Network etc.

For stable coins: eg. USDC your returns will be solely based on the platform's interest rates. This one you can straightaway convert your fiat money into the stable coin of your choice in lump sum as stable coins prices are fixed at around 1 USD.

For non-stable coins: eg. BTC/ETH etc your returns will be based on the platform's interest rates as well as the price appreciation of the Cryptocurrency itself. For this, remember to dollar cost average in and out to average down on your purchase price. Never ever one lump sum buy into a particular price as that will increase your overall risk and you will take a slightly longer time to break even if the overall Crypto market is experiencing a bear market or at the accumulation stage. 

There is no right or wrong way to invest. It really depends on how comfortable and knowledgeable the person is and he/she will take the necessary actions that work best for them.

Referral Links:

I personally use this platform to buy stocks and options.

Tiger Broker (click to sign up)

New sign-ups for an account and make your first deposit of a minimum 2000SGD to earn a free Apple (AAPL) share which will be deposited directly into your Tiger Broker account.

Welcome Gifts:

1. 1 x Free share of Apple (AAPL) (when you deposit min $2k, limited time only)
2. 500 Tiger coins (for the redemption of commission-free trades / stock vouchers)
3. 60 Commission-Free normal stock trades (expiry within 180 days)

Reach out to me to find out more!

This past week (26th to 30th July)  made a total profit of 397 USD in Stock Options Trading. 

After 30 days of Options Trading, made a total of 1435 USD in profits. 

If you have yet to read my week 3 options trading article, click here to find out more. 😉

My Options Progress Week 4 out of 4

This is an intermediate level investing article requiring experience in buying and selling Stock Options to digest the information which I will share below.

To reiterate the purpose of doing this 30 days challenge is to inform and educate beginner investors with less options trading experiences on what options trading could potentially be like. 

There are still risks involved and proper research has to be performed for all investments including options. Be mentally prepared to cut losses when required and at the end of the day, you can suffer losses or make profits depending on your strategy and emotions.

Disclaimer: All information stated here are only for illustration and educational purposes. Its not financial advice to buy or sell any financial products. Please perform your own due diligence before investing as always. 

Week 4 Progress 26th - 30th July 2021

• Each market trading day I would spent at most 3 to 4 hours doing research and monitoring the prices to buy and close the options.

• No speculating on ‘meme’ stocks. To trade in a systematic manner.

• To make it clear, the market opening hours at my side is 9.30pm to 4am (GMT +8).

• Below are the options trades that I bought and closed for the past week.

This past week (19th to 23th July)  I made a total loss of 166.78 USD in Stock Options Trading. 😒

The first week (6th to 9th July), I made 58.01 USD profits and in the second week (12th to 16th July) I made 1,146.81 USD. 

If you have yet to read my week 2 options trading article, click here to find out more. 😉

My Options Progress Week 3 out of 4

This is an intermediate level investing article requiring experience in buying and selling Stock Options to digest the information which I will share below.

To reiterate the purpose of doing this 30 days challenge is to inform and educate beginner investors with less options trading experiences on what options trading could potentially be like. 

There are still risks involved and proper research has to be performed for all investments including options. Be mentally prepared to cut losses when required and at the end of the day, you can suffer losses or make profits depending on your strategy and emotions.

Disclaimer: All information stated here are only for illustration and educational purposes. Its not financial advice to buy or sell any financial products. Please perform your own due diligence before investing as always. 

Week 3 Progress 19th - 23th July 2021

• Each market trading day I would spent at most 3 to 4 hours doing research and monitoring the prices to buy and close the options.

• No speculating on ‘meme’ stocks. To trade in a systematic manner.

• To make it clear, the market opening hours at my side is 9.30pm to 4am (GMT +8).

• At the later half of last week, the S&P 500 was experiencing a mini correction and this continued forward into the following Monday (19th) of this week.

• The correction in price was at most a 3.3% decline from 15th to 19th July.  

• However, from the 20th July onwards the market correction was short-lived with the reversal occurring so fast and swift.

• This was how the S&P 500 looked like for the past week as shown below. The stock market had recovered and continue to rise over the next 4 days till Friday. 

• S&P was holding strong at the 50 day EMA support line (yellow line). It went down and swiftly bounced off that support line and continued its rise upwards.

• Below are the options trades that I bought and closed for the past week.

19th July 2021

• From what I observed in the stock market, it was experiencing a correction on the 15th and 16th July. I sat back and waited, decided not to put in any orders. 

• On 17th July, the stock market continued to drop downwards which constituted about -3% in prices, it was just a bloody red mess across all sectors. 

• I looked at that first candle at 9.30pm (GMT +8), in the US is 9.30am when the market opened and decided to place my Buy Put Options on AAPL, V and SPY. 

• I have my reasons so usually I don't do Buy Put Options, but I went ahead with it. 

• Throughout that day, these options were still slightly profiting. 

• However, as the day went on, I noticed that the selling momentum had dropped drastically. It started to plateau and moved sideways instead of going down. 

• At 12am, I saw the market continued to dropped slightly and made the decision to continue to hold on till the next day and didn't exit in any of my Buy Put Options positions. 

20th to 23 July 2021

• On the 20th July during pre-market from 4pm - 8pm (GMT +8), I saw that the prices in the market started to move upwards. That was not a good sign for sure. 😐

• I started to plan my exit strategy for my Buy Put Options, knowing from past experience that I had to act and close the orders swiftly to minimize total loss.

• At 9.30pm (GMT +8) when the market opened, I continued to observe the market movements and true enough, it continued its pre-market movement and it went up.

• This meant that most probably the price correction had already ended and the public was rushing in to buy stocks at discounted prices. 

• I waited for 20 mins to see if there was any change in the candle stick pattern. No changed occurred and the market was very bullish. I decided to execute my exit plan and close my Buy Put Options one by one from 9.50pm onwards to cut losses. (This was also based on past experience and I knew right away that I needed to get out asap). 

• Once I exited the Buy Put Options, I wasted no time and immediately place orders to Buy Call Options for the same companies that I had just exited for the Buy Put Options. 

• Usually for beginners, once they just burnt their fingers in the market, they would take a break from the market to heal from the emotional losses and monetary losses. But I have experienced this situation a couple of times before, so I knew instinctively that I had to dive into the market right away and ride onto the upward market trend which I did. 

AAPL

• My strike price was at 144 USD.

• I bought at the first circle and exited on the second circle.

• Bought two lots of AAPL at first and decided to average down to buy one more lot.

• Decided to exit at the price of around 148 USD per share as its going very close to AAPL's all time high price at 150 USD per share. 

SPY

• My strike price was at 430 USD.

• I bought at the first circle and exited on the second circle.

• Decided to exit at the price of around 437 USD per share as its going very close to SPY's all time high price at 437 USD per share. 

• It not only reached that price but broke through and went even higher thereafter. 

TWTR

• My Sell Put Option worked according to plan and I got +98% of the premiums. 

• Twitter's second quarter earnings came out after the closure of the 22nd July market. There seemed to be some big movements during post market (circle part) but overall I felt that it didn't had much of an impact on its share price just saying. The price was already surging upwards before the earnings were published after 22nd July market closure. 

• Just as what I have expected which is news coverage as such are just noise. Do not let this cause a distraction to your emotionally or to alter your investing plan just for this. Always stick to your investment plan objectively to buy and sell as always.

Will update week 4's which is the final week of stock options trading progress next week! 😁

This past week (12th to 16th July)  I made a total profit of 1,146.81 USD in Stock Options Trading. 😁

Last week (6th to 9th July), I made 58.01 USD profits in Stock Options Trading. If you have yet to read my week 1 options trading article, click here to find out more. 😉

This is an intermediate level investing article requiring experience of buying and selling Stock Options to digest the information which I will share below.

To reiterate the purpose of doing this 30 days challenge is that I want to inform and educate beginner investors with less options trading experiences on what options trading could potentially be like. 

There are still risks involved and proper research has to be performed for all investments including options. Be mentally prepared to cut losses when required and at the end of the day, you can suffer losses or make profits depending on your strategy and emotions.

Disclaimer: All information stated here are only for illustration and educational purposes. Its not financial advice to buy or sell any financial products. Please perform your own due diligence before investing as always. 

My Options Progress Week 2 out of 4

Week 2 Progress 12th - 16th July 2021

• Each market trading day I would spent at most 4 hours doing research and monitoring the prices to buy and close the options.

• 1204.82 USD / 9 days (week 1 & week 2) / 4 hours = A rate of +33.46 USD per hour for the time being.

• I was already anticipating a correction to occur in the stock market and it really happened this week. Thus, I decided to close all my stock options positions on Tuesday, 13 July 2021, don't delay any longer and take profits.

• Wednesday, Thursday and Friday was spent on just monitoring the market in the general. Didn't do any Buy Put Option except for just that TWTR Sell Put Option. 

• This was how the S&P 500 looked like for the past week as shown below. It was moving sideways then the correction occurred at the second half of the week. 

• Below are the options trades that I bought and closed for the past week.

• I took a calculated risk as I saw that the price of SPY got chance will peak just high enough for me to exit and make a profit. 

• When the SPY price peaked on Tuesday 13th July, I decided to close and exit my entire SPY call option to take profit as I don't see how the price of SPY will go any much higher than current before correcting.

MSFT

• My strike price was 275 USD.

• This was the same case as the SPY option where I bought my first call option lot (blue circle area) at a super overvalued premium amount. 

• Then the next thing I knew was that the price dropped. I didn't panic as I knew I had some time on my side as the option will expire the following week so I still could manage the time decay.

• When the price dropped, I decided to buy more lots (orange circle area) as its cheaper now. At the same time, I average down my premium cost for the options.

• When the price rose (brown circle area), I decided to exit and take profit based on my strategy. 

• I didn't bother to wait a day later or longer to see if the price could go even higher (it actually did went up higher alittle) as I didn't want to take the risk. 

BABA

• My strike price was 207.5 USD.
• If I held it longer, I would have gotten a higher profit.
• Though this one I bought and sold on the same day, it was to mitigate the risk that the price will erratically drop further. 

• My strike price was 65 USD.

• This one I bought about 45 mins too early in that day. Should have waited longer to see the trend and where it was heading.

• Decided to exit as the S&P and QQQ index prices were declining rapidly. These created huge fear and selling pressure for most stocks including this one. 

• Not a wise move to do a Sell Put option in the midst of a market correction.

1. Wyckoff Distribution Theory

• I came across this phenomenon called the Wyckoff Distribution which literally blows my head off after I read more about this. 

• Click here to read more about the theory created by Richard Wyckoff.

• This is geared more towards technical analysis and the psychology of prices in the market.

• Wyckoff Distribution was created to educate uninformed investors like you and I to reduce the chances of losing such money in the stock market. It uses a 4 stages model to explain the rise and drop in asset prices as shown.

https://school.stockcharts.com/doku.php?id=market_analysis%3Athe_wyckoff_method

• It makes sense on how the supply of Bitcoin (BTC) might be manipulated so that a certain group (eg. the whales 🐳) who were more informed, strategic and powerful could deceive those who were less informed playing their cards to raise and drop the price of Bitcoin (BTC) in a short span of time to create a 'Fear Of Missing Out' (FOMO) and 'Fear, Uncertainty and Doubt' (FUD) effects. 

• I believe that among your circle of friends there would be someone talking about Bitcoin. Even people who usually do not invest would just jump in and open an account to buy some BTC etc which was unthinkable. 

• This was a plan to rip-off the maximum amount of money possible from us, normal retail investors who are invested into cryptocurrencies.

• Of course we must not forget that during this period of time, there were other media factors contributing to the surge in prices such as Tesla buying into bitcoin, Elon Musk constant twitting about Bitcoin and Doge coins and other institutions such as Square and Paypal also announced to enter into the cryptocurrency space. 

• All these news and media created enormous amount of 'Hype' and 'FOMO'. There were so much media coverage predicting BTC prices going up to 50K USD and even 100K USD to the moon 🚀🌙 etc 

• I still remembered that it was common for certain days to see BTC prices going up or down by 3000 USD to 5000 USD and that was the norm at the period of time. 

• This is unlike now in the period of June / July 2021 where BTC price fluctuation has clearly slowed down from those days.

• In the chart for the entire year of 2020, Bitcoin (BTC) and other cryptocurrency prices were in the 'Accumulation Stage' where prices were increasing and decreasing at a constant steady state (small fluctuation) with little abnormally in price movements. 

• However in early December 2020, with the hype building up, BTC price started to surge up quickly and a price breakthrough above the resistance level occurred at the 20k USD price level.

• There were a total of 5 peaks that occurred as seen in the chart and the last peak started to lose momentum before panic selling and profit taking took place quickly. The price of BTC and other cryptocurrency started to crash down like an avalanche and that brought us to where the price currently is hovering at today, back to the 'Accumulation Stage' of the Wyckoff Distribution. 

3. Wyckoff Distribution with BTC Price Chart Overlay

• Here I attempted to overlay the Wyckoff distribution over the 1 year BTC price chart as shown below.

• Furthermore, the BTC price 20 days (green colour line) and 50 days  (yellow colour line) Exponential Moving Average (EMA) are moving below the 200 days (red colour line) EMA line indicating bearish patterns at this moment of time. 

• Phases A, B, D and E of the Wyckoff Distribution chart falls nicely on top of the BTC price chart. 

• Only Phase C was not aligned and slightly off as mentioned that the Wyckoff is a theoretical distribution to explain the drop in BTC price in May 2021 and also depending on the time frame you use to do the overlay.

• We know that the price of BTC has fallen and it has gone back to the "Accumulation Stage" of the Wyckoff Distribution. It will take some time for people in general to forget about this crash, to regroup and gain back their confidence to invest into Cryptocurrency.

• Here I show the overlay of the Wyckoff Distribution right after the panic / profit sell-off period using the 1 year BTC price chart as well.

• You can clearly see that prices will remain at this range for a long while before we start to see some form of 'uptrend stage' like the one that we experienced at the beginning of this year. 

• Lastly, you can see from May 2021 to 11 July 2021 the movement of BTC's price has slowed down in momentum. 

5. Takeaways

• Having the ability to identify at which stage (either 1, 2, 3 or 4) of the Wyckoff Distribution is that particular stock or cryptocurrency's price you are planning to place an order is currently at.

• Once you have identified, you will be able to make the necessary decision accordingly to wait or enter depending on multiple factors that are in play.

• Don't FOMO to buy into something when the price suddenly shoots to the moon.

• From the chart, its clear that the price will always go up and down in this wave like pattern. The same pattern repeated several times during this period. 

• If you have missed the first wave's peak price, there is bound to be a second wave peak or even a 3rd wave peak coming soon. 

• Do not have to rush in to buy the stock / crypto at the highest peak with the mindset that 'I have to get in to go to the moon now' 🚀🌙, its now or never that the price will blast off and its not coming down to the low levels again. 

• Prices as steep as what you seen in the beginning of the year for Bitcoin will surely come down somewhere in the future when some people start to exit their positions to take profits or those who panicked and sell off their positions. 

• After which that is the appropriate time to go in and scoop up some BTC coins at discounted prices.  

Disclaimer: All information stated here are only for illustration and educational purposes. Its not financial advice to buy or sell any financial products. Please perform your own due diligence before investing as always. 

I took reference from this person's work. Feel free to click onto his video and listen to his detailed explanation of the Wyckoff Distribution. View here.

I will be doing a 30 days Stock Option Trading challenge and posting here all of my trade results. 

At the end of the 30 days, I could be walking away with a loss or a profit depending on my strategy and emotions for the current 30 days of trading. 

This is to give you an idea or basic understanding of what options trading could do potentially. 

Disclaimer: All information stated here are only for illustration and educational purposes. Its not financial advice to buy or sell any financial products. Please perform your own due diligence before investing as always. 

Background

• For those who are not familiar with Options Trading, besides purchasing stocks in the stock market, retail investors like us can also purchase options in the stock market.

• Options is available in the US market. Unfortunately Options cannot be traded in the SG market.

• Whenever you buy an option, you are essentially buying into a contract of shares of a company / ETF. 

• The unit of measurement (UOM) in each contract is called lots. Each lot size is minimum of 100 shares in that particular company or ETF index. If you buy two lots, means 200 shares of that company / ETF.

• Each options contract that you purchase has an expiry date. During the expiration of the options contract, if your strike price is "in the money", you will make money when you close the contract and if its "out of the money" you will lose money when you close the contract.

• You can buy a Call option at a certain strike price. When the current stock / ETF price is higher than your strike price, you will start to earn money on your options and vice versa when the price is below your strike price.

• You can sell a put option at a certain strike price. When the current stock / ETF price is higher than your strike price, you will earn a fixed premium amount upon contract expiry. 

Market Outlook 6th - 9th July 2021

• S&P 500 was showing a normal see-saw upward trend with price corrections occurring on the 6th July and 8 July which was for 2 out of the 4 trading days.

google.com

• Will update week 2's progress next week! 😁
• Click here to read