Retire Rich

Thursday, January 30

What is Retail Treasury Bond (RTB)? Month No. 2 Save 10% from your salary challenge

What's up mga Kababayang OFWs? We are at the end of the month na naman. Make sure not to forget our "Save 10% from your Salary Challenge."

I planned to invest in Retail Treasury Bond (RTB) the savings that I will be getting from January 2020 salary.

So ano nga ba tong RTB?

Retail Treasury Bonds (RTBs) are medium to long-term investments issued by the Philippine government. They form part of the Government’s program to make securities available to small investors.

Whether you’re an individual or a corporation, RTBs allow you to invest and grow your money with very low risk of losing. It’s considered a fixed income security, which means that you earn a fixed interest rate based on the principal market given on a quarterly basis.

This is for investors looking for:

A low-risk investment
An accessible investment
A higher-yielding investment

It's a low risk talaga dahil ang government ng Pilipinas ang nanghiram eh! Sino nga ba naman ang puwedeng mag imprenta ng pera? So I think this is a good investment. So I will try this one.

What are the terms of offering?

Issuer: Philippine Government through the Bureau of the Treasury (BTr)
Maturity Date: February 11, 2023
Issue & Redemption Price: At par (or 100%)
Interest Rate: 4.375% (subject to 20% final withholding tax except for tax-exempt institutions)
Interest Payments: Quarterly
Minimum Investment: Minimum of PhP5,000.00 and in integral multiples of PhP5,000.00

So, mga OFW's what are you waiting for? Sali na sa "Save 10% from your Salary Challenge" and sabay tayong subukan ang RTB!

Sources:

Bureau of the Treasury: https://www.treasury.gov.ph/rtb/
Security Bank - Retail Treasury Bonds (RTB): https://www.securitybank.com/personal/investments/fixed-income-securities/retail-treasury-bonds-rtb/

Daldalan with Don Juan: On stocks trading, stock market and life in general

Rey Tecson Saving , Stock Trading

On Sunday I had the opportunity to meet my friend Don Juan. We drove to Kuwait City, ate breakfast at Jollibee and went to the seaside. On our way, we talked about the stock market, stocks trading and about life in general.

Pasensiyahan ninyo dahil medyo napahaba ang aming kwentuhan.

We seldom talk nowadays as we are now working from different companies. We used to work in one company before. Below is the first part of our daldalan. I will upload the second part soon. I split our daldalan in two as it is too long to be in one video. Anyway, if you want to know when and how we got into the stock market just click the play button above.

In the video description I provided a link to OFSI and Trader's Lounge.

Let us learn together, one word per day

Rey Tecson Investing , Stock Trading

I will write a series of posts about the meaning (in simple terms) every jargon involving the stock market. I might do also YouTube videos on some how-to things also involving the stock market. Example: How to open a stocks broker account? Or how to open a Philippine bank account? Like BDO.

Let us continue learning something. Improve ourselves. Improve on how to handle our hard-earned money. Dahil hindi biro magtrabaho sa abroad.

OFW's should go home and retire someday with something. Most of us OFWs work abroad, not as a choice but because we don't have a choice. Most of us went out of our country with "nothing". We should at least go home, retire, with "something".

I know that investing in the stock market is difficult. In the stock market, you will be able to earn money very fast (if you know what you are doing) and lose money very fast (if you are ignorant). You don't know where to begin. My friend, the key is education. You need to educate yourself. You need to study. You need to learn about it before getting your hands dirty on it.

Nowadays information is scattered on the internet for free. All you have to do is filter and fact check that information and absorb what will help you. Let's begin with terminologies first. As I told above, I will be writing a series of posts about stock market terminologies.

While we are studying the stock market by reading, researching, watching videos, we can start something else on the other side. Let's start by having a bank account first. Open one bank account, if you don't have one.

I think the most practical choice is BDO or BPI as they have an online banking system that can be used to open and fund a stockbroker account later on. BDO itself has its own stock trading platform that can be associated with its bank account.

I will create a YouTube video on how to open a bank account. Stay tuned.

Why IPO sucks?

Rey Tecson Stock Trading ,

As a newbie in stocks trading, let me share my gruesome experience participating in IPO's. First, let us talk about what is IPO.

What is IPO?

According to Investopedia is an initial public offering (IPO) refers to the process of offering shares of a private corporation to the public in a new stock issuance. Public share issuance allows a company to raise capital from public investors. The transition from a private to a public company can be an important time for private investors to fully realize gains from their investment as it typically includes share premiums for current private investors. Meanwhile, it also allows public investors to participate in the offering.

In other words, a private company will now become a public company by offering company shares to the investing public.

IPO's dirty little secret

Little did I know about IPO's dirty little secret and I participated in with a chartist mindset. I realized how stupid I am after reading the blogpost of Ms. Gandahko about IPO's which I reblog on this blog. You can read it [here].

Well, IPO's are not necessarily not good to participate. For long term investors who knew how to scrutinize a company by thoroughly researching, reading company reports and all --- is okay. And they invest for the long term.

But from a trader's point of view, I should have not participated in as there's no technical data or price history to study. It's really a gamble if the price will go up or not on the first trading day. I'm a trader, I have no plans keeping the stock for a long time especially if it's showing a loss.

Greed

Well, the whole motivation for my IPO participation was greed. Not being able to buy KPPI IPO due to oversubscription. As you know, KPPI soared to the moon for three days. In the next IPO, I made sure that I will be able to buy shares. AXELUM, HOME. And I did get shares.

My plan for AXELUM was to sell at the moment it shows gain prior to a price dive --- if it nose dive. Well, it did go up for a few minutes but then came crashing down that I was not able to cut immediately. That intraday IPO was really a mind and body crippling experience. I literally froze.

I can't believe I lost, I reentered again (revenge trade) and lost again. The same happened to FRUIT.

Nine months out into trading, it turns out that my biggest losers were coming from IPO participation. Gladly, it didn't wipe out my entire account. I'm still okay with it. I'm really happy with the experience as it taught me never to do it again.

What I learned is that I should not buy IPO but it doesn't mean I can not trade IPO during the first trading day. As long as technical data started to show and you have the strategy to do it... then why not?

What about you? What's your IPO experience? Comment down below your experience.

Sources:

1. Investopedia. Initial Public Offering (IPO). https://www.investopedia.com/terms/i/ipo.asp
2. Gandakoh's Personal Trading Blog. IPO's dirty little secret. https://gandakohpersonaltrading.home.blog/2019/12/06/ipos-dirty-little-secret/

Save 10% from your salary challenge

Rey Tecson Investing , Reviews

Every new year we often like to start something. It can be about having a healthy diet, to exercise daily or to start saving money. Whatever it is, we wanted to start something during the new year. What about you? What are the things you wanted to start this new year?

This year I challenged myself to save 10 percent from my monthly salary for a period of 12 months. I started to save from my December 2019 salary. I made a video on YouTube about this challenge and I documented the savings I made. You can find the video here: https://youtu.be/IwWlhmXfvWA. I'm somehow committed to making a video every month documenting this challenge.

The challenge

If you want to save something from your salary this year try to take this challenge and join me. To start this challenge is a way to develop the habit of saving. You may start any percentage of your salary monthly. The important thing is that once you take up this challenge, you should commit a certain amount or percentage from your salary and save it monthly.

If your salary is given bi-monthly it doesn't matter as long as you commit every paycheck irrespective of the period.

Saving money is a matter of habit

In this way, you will be able to develop a habit. Besides this is the way of paying yourself first of what you've earned. Some may say that I buy something every paycheck as a reward for self's hard work. Some dine in a fine restaurant or buy a pair of shoes. Guys listen up! You're not paying yourself or rewarding yourself either. You paid someone else with your hard-earned money. I'm not saying don't buy something for yourself. But buying a pair of shoes monthly is gluttony!

"The Law of Success" Book

Let me provide you with an excerpt from the book "The Law of Success" by Napoleon Hill about the habit of saving.

"To advise one to save money without describing how to save would be somewhat like drawing a picture of a horse and writing under it, "This is a horse." It is obvious to all that the saving of money is one of the essentials for success, but the big question is: "How can I do it?" The saving of money is solely a matter of HABIT.

Health is Wealth - tara takbo tayo!

Rey Tecson Investing ,

Investing is not just building your wealth. You must invest in your health too. After all, health is wealth. Happy new year everyone!

Happy New Year!

Rey Tecson

Happy New Year mga Kababayang OFWs!!!

May the New Year bring to you and your family back home the love, and a light to guide you.

As the new year comes with all the happiness and good tidings, hope the joyful spirit keeps glowing in your heart forever.

As this year ends, I wish all the negativity and difficulties also end. May 2020 bring success and desired results for you.

This coming new year, I will be updating frequently this blog with more posts and updates. I will provide updates too of my progress with the"Save 10% from your salary challenge."

What is Trader's Lounge MAMA Strategy?

Rey Tecson Stock Trading ,

In the above video, I shared my own interpretation and execution of Trader's Lounge MAMA Strategy. A trading system that used MACD and ALMA indicators. I discussed the parameters and showed one of my trades using the strategy.

Links to Trader's Lounge YouTube channel, FB group, and website are provided in the video's description for your ready reference so that you will be able to learn the strategy directly from there in case the above video not clear to you.

Anyway, I will be posting more videos of my own trade executions using MAMA strategy. So hit subscribe button on my channel if you want to see those trades.

I lost 30% of my capital after 7 months of PSE stocks trading

Rey Tecson Stock Trading ,

It has been seven months since I embarked on a journey to learn stocks trading in the Philippine Stocks Market. I started this journey in March 2019. I've written my declaration [here]. From the start, I wanted to share this journey with those OFWs who shared the same goal -- to retire rich and go back to the Philippines for good. To those OFWs who wanted to utilize the capital market through stocks trading to achieve the above-mentioned goal.

I may or may not succeed in stocks trading. But I'm stubborn with my goal. I wanted to retire with "something" from "nothing'. I don't want to end up begging from someone for my needs during my retirement days. Not even to my relatives. Not even to my kids.

Stock Trading is just one vehicle to achieve this goal. The main vehicle, of course, is my monthly paycheck as an OFW, which will be gone during retirement. I need sources of income after retirement. It could be a passive or active income in nature. Stock trading could be one, and I'm still learning/searching for other sources of income.

This blog is my journal and documentation of my success or failure in my stock trading journey. If you are an OFW who embarks on the same journey, then join me and let's learn together.

So far, I lost a total of 30% of the capital I allotted to stocks trading. In my own assessment based on the current PSE market conditions, and as a newbie, I'm still happy I survived without wiping out the whole account. What about you? What is your assessment based on your own trading performance in relation to the current market condition? I'm listening to your assessment too. Feel free to comment below.

I would like to thank Traders Lounge, a facebook group I joined. I followed the 8K challenge to minimize risk while still learning to trade. This group's advocacy is super! They wanted to help traders for free. Absolutely free. A few words from Ms. GandaKo or Nadie Importante, the leader of Trader's Lounge.

"Everything I do is for free. I was once a newbie. I went to a whole lot of depression and crying my first three years due to losses and someone helped me out for free. So everything I do now is me paying it forward," GandaKo wrote on her FB post.

So, if you wanted to learn for free and know the gruesome truth about stocks trading... Go and join the group. Below are the links.

Although I lost 30% of my portfolio in return I learned the following so far from my own research, readings, and learnings from Trader's Lounge.

Risk management.
Solid trading system.
Trading strategies.
Trading Psychology.
Indicators.
Patterns.
Time Frames.

I'm looking forward to the year 2020 to somehow start getting profitable on my trades and in the same manner that I'm optimistic that the stock market will get better.

I also created a YouTube channel so that I can share charts of my every trade. Win or Loss trades I will be sharing. I assure you. Unlike those mentors, gurus luring newbie traders to their paid seminars only showed the winning side of their trades.

Lastly, in this coming new year, my focus would be the following:

Trusting the system I learned.
Fine-tuning execution, with the goal to eliminate emotion.
Backtesting, forward testing, screening.
Risk management first.

Merry Christmas and a happy new year!

IPO's dirty little secret

Rey Tecson Stock Trading ,

Below is a reblog from Gandakoh's article:
"IPO is the initial public… you know what, if you are a trader I don’t need to explain to you what an IPO is. If you don’t know what an IPO is then this post is not for you. Go to google. Research what an IPO is and come back to my post.

When you hear the word “IPO” what comes into your mind? Stories about how if you invested in URC at few pesos it is now one hundred plus. Stories that you could double or triple your money in a few days after an IPO. Well, it's true. There are some stocks that went from 2 pesos per share to hundreds. Take for example HVN. The IPO price is somewhere above ten pesos. Its 10.5 pesos I believe. It was 10.5 pesos per share three years ago and now it's over 400 pesos. Imagine how many luxury cars or houses on hills you could have owned if you invested 500 thousand pesos on it. (this was an actual line a stockbroker friend of mine told his client) These things do exist but think about it like this. Take, for example, Manny Pacquiao. 8-division world champion. A billionaire. He became rich from boxing. For every one Manny Pacquiao there are maybe 400 boxers who are broke or never made it in boxing. It may not only be 400, but it may also be more. So, in every successful IPO stories written or you have heard, there are a lot of unsuccessful ones. Chp debut at 10.75 and now priced under 3 pesos. Dmw, mrsgi…there are just too many…

Take a look at these charts. These are what we had this year alone.

But of course there is KPPI this year.

For some strange reason, many investors line-up to buy IPO’s. Di makatulog kakahintay makakuha ng shares. Alam ba talaga nila binibili nila?

Maraming negosyo ang nangangailangan ng pondo para lalong lumago. Ayaw nila sa bank dahil sa interest rates at mas ninanais na mag IPO sa PSE. First time na e bebenta nila sa publiko ang parte ng kumpanya nila which are called shares and marami naman ang excited makakuha ng shares ng mga kumpanya na yun na mga traders.

But, think about why a company would want to go from private to public. Why would they do that?“Going public involves a mountain of paperwork, auditing, and ongoing reporting requirements. And that’s not even including the millions of pesos it takes to go through the whole process.

So, why would a company go through all of that trouble? If a company is successful, it probably means that everyone within the company is making money, right? Why would they want to sell off part of their business to the public? Well, there are a variety of reasons. The major reason is so the company can get liquidity… or rather, so the early company founders and investors can get liquidity” -Cody Shirk

“…the basic business of finance is buying low and selling high, and it is sometimes hard to resist the secondary cynical explanation for going public, which is that you do an IPO to top-tick the market for your stock and sell at the very high point of hype.” -Bloomberg

Think about that for a second, if you are buying an IPO. As an investor, you are literally putting money into the pockets of those early founders and investors.

That isn’t always a bad thing. There are many, many companies that have gone on to be very successful after their IPO. Investors who bought those companies are very happy, as those stock prices have continued to go up.

But, there is another side. How do you know why a company is going public? Is it so they can get more capital into the business so they can continue to expand? Or is it because they are simply trying to cash out at the public’s expense?

IPOs are usually seen as (or made to look like) a great way to make windfall gains in a short period of time. The steps are very simple:

Buy stocks in an IPO.
Wait for the listing day.
Those who missed the IPO would rush to get their hands on the “hottest stock” in the market.
You sell your holding to them on the day of listing and make windfall gains. Simple, right?

According to Mr shrivastav, IPO is always a bad investment. Here is why:

Firstly,there is always a conflict of interest between sellers of IPO, and buyers of an IPO.

An investor make profit when it buys stock at cheaper valuation and sell when valuations are fair or expensive.

On the other hand, when a company comes with an IPO, it wants highest valuation for the IPO so that they are able to raise maximum capital for the shares issued.

So there is a clear conflict of interest between the IPO issuers and subscribers.

If the issuer sells the IPO at highest valuation, it will be a great disadvantage for a buyer. Since issuers have the pricing power during the IPO, there is no way a subscriber can negotiate (the only way is to let the company get listed and wait for the prices to decline till they reach reasonable valuations)

Secondly. Company owners have much better insight of the real valuation, as they are the insiders, and they can manipulate the numbers and draft the prospectus to paint a rosy picture about the company.

On the other hand, since a subscriber has little to almost no information about the company’s real valuation, he has no other way but to rely on the prospectus, and financial statements of the company which are mostly window dressed. This again puts subscribers at real disadvantage, which means the game is already rigged in favor of issuers.

Finally, IPOs are never bought, they are always sold. and most of them take advantage of the market sentiment and time their issues when positive sentiments in the market are at its peak and people are willing to buy anything for any price, expecting to make windfall gains, without looking at the valuations.

No wonder why you will find a plethora of IPOs in a bull market and fewer in a bear market."

You may read the original article here: https://gandakohpersonaltrading.home.blog/2019/12/06/ipos-dirty-little-secret/

I've been trapped and was able to get out at three instances participating in an IPO.

First was AXLM, I bought an IPO, the price plummeted during the listing day, able to exit at a minimal loss. My emotions kicked in, re-entry at a lower price but then again it plummeted at a lower price and so ipit for how many days, till I cut my losses. Then the price went south again.

The second was HOME. So far, I'm good, no big losses at this time but the hovered within the IPO price. Time-wise! I can say naipit pa din.

Third was FRUIT. I did not buy at IPO price. No plans for buying really. But saw the price rose to the skies during noon market break. Greed kicked in, bought at a high price, unable to get out immediately. I cut my losses too far south. Revenge trade bought again at a lower price, but then again the price dived down south. So, ipit till now.

With the above Ms. Ganda Koh's article, I think it's clear. I just outright avoid IPO from now on.

Cropital reinvestment update

Rey Tecson Investing ,

Kumustamos mga kababayang OFWs. The below video is an update to my Cropital capital reinvestment.

Five Reasons why I got big losses on my trades

Rey Tecson Stock Trading ,

I reviewed all of my losing trades. I focus on my biggest loser each month from April to September 2019. The following are the reasons why:

1. No specific trading system

This is the main reason for the month of April and May for my big losing trade. These were the months where I'm still testing almost all indicators that I know from the books I read. I still have no concrete trading system. I just simply put a cut loss point and bought small positions. Naturally, my entries were wrong leading to cut losses as my cut point was hit. The moment I vacillate (in cutting losses) this leads to bigger losses.

2. Not respecting cut loss point

Obviously, the moment I disrespected my cut loss point -- the bigger the losses. Most of the time, the price of my stocks did not go back up. The worse thing is that if it goes back up, it somehow justifies why I disrespect my cut point. The next time I disrespected my cut loss point -- and the price did not go back up -- sigurado na mapapacut ako sa mas malaking lugi na.

3. Impulsive buying

This happens when I keep on watching those stocks that move higher during the trading hours. The tendency is I bought it at a higher price mostly in the morning. Then the price moved to the opposite direction or just a simple pullback which is supposed to be the ideal buy point -- it is when I cut -- only to see it moved back up. Aray ko po!

4. Ignoring the allowed position sizing against portfolio size (poor risk management)

Whe I impulsively buy stocks, the position allocation also is neglected. This is the worse thing I did to my account. This is fatal especially if combined with ignoring cut loss points.

5. Lack of focus during the trading day

I'm a person that can not focus on one single thing. I have the habit of doing certain things while doing another thing in the middle of it. It is a habit I somehow adapted from my work -- multi-tasking. I think I need to focus and do nothing during trading hours -- which is next to impossible because I have a day job. Maybe a system that lets me buy EOD and sell positions before I go to work?

Book bundle:

The latest update on my stocks trading journey

Rey Tecson Stock Trading ,

Time flies.

The last update I made on this blog was on May 2019.

Well, I would like to update regarding my progress with the journey I embarked from April 2019 – stocks trading.

Here’s the summary:

April 2019 – Loss

I lost 0.6% of my portfolio.
It was a very minimal loss as traded conservatively.
I’m still learning by reading a variety of books about stock trading.
I traded conservatively as I still have very limited knowledge.

May 2019 – Loss

I lost another 3.52% of my portfolio.
Total accumulated loss is now 4.12%.
I traded heavily as I wanted to apply what I learned from the various stocks trading books I read. I have also enough time due to shortened work timings during the month of Ramadan.
I completed around 22 trades. I realized that the broker was the winner in this case. Without the broker’s commission – the outcome should have been break-even. Well, this is minus some game.
I have no concrete system yet. I used every indicator that I understood from what I read. I mostly used, moving averages, MACD, RSI and support/resistance.

June – Insignificant gain.

I adjusted and corrected the mistakes I made during the month of May.
I no longer trade heavily.
I applied strictly also what I learned about size allocation based on portfolio size.
I only allowed 1% of my portfolio, as a general rule, to risk per trade.
Although I have not found a concrete trading system that will work for me, I'm surprised at the improvement I made.

July 2019 -- Another loss.

Since I did not found yet a trading system or trading set-up that works for me, my batting average was very low at 20%. I lost 8 out of 10 trades.
I violated also another cardinal rule by not respecting my cut loss point. Dr. Alexander Elder wrote on his book The New Trading for A Living -- "A trader is the weakest link in any trading system." I really believe in this. It is useless to have a rule that you don't respect. It is really hard to police your own self. I need to improve in this area.
In the next month, my plan is to adhere to my cut loss point and backtest a system that seemed to work out for me - the triple screen trading system and the system being taught by a very generous trader at Trader's Lounge- Ms. Gandah Ko. Salamat po sa mga taga Trader's Lounge lalo na po kay Ms. Gandah Ko for advocating free learning. My salute po.

August 2019 - A minimal loss.

After backtesting and the above-mentioned systems, my gain percentage improved. However, my greatest enemy was myself. It's really hard to conquer yourself. Just one trade that I disrespected my cut loss point -- the end result was a net loss for this month.
Respect your cut loss point. Respect your cut point. Respect your cut loss point.
Respect your cut loss point. Respect your cut point. Respect your cut loss point.
Respect your cut loss point. Respect your cut point. Respect your cut loss point.
Respect your cut loss point. Respect your cut point. Respect your cut loss point.
Respect your cut loss point. Respect your cut point. Respect your cut loss point.
Damn! I really need to hammer my head to put this in my mind down to my fingers to execute the sell button when cut loss point is hit.

September 2019 - Still a loss?

Well yeah, it's still a loss.
I respected my cut loss point.
I followed the system.
But it seemed the market was very difficult. I mean, I don't know about the veteran traders, maybe they're still profitable.
I don't want really to put a lot of weight regarding news about "trade war" or "instability in the Middle East" because I relied on the chart alone. Ganoon daw dapat pag chartist/trader eh.
But the setups are there but it doesn't materialize. If it materializes naman, you have to sell with minimal gain because the set up says so.

Let's see po what's ahead of me this October 2019. Sana naman makabawi. My accumulated percentage loss is somehow alarming na.

On my next post, I will share the outcome of my first ever IPO participation. I will detail the experience po.

Sa mga vets dyan. Mag advice naman kayo sa comment section kung saan ako pwede mag improve. Thanks.

Thursday, January 30

So ano nga ba tong RTB?

What are the terms of offering?

Sources:

Thursday, January 16

Monday, January 13

What is IPO?

IPO's dirty little secret

Greed

The challenge

Saving money is a matter of habit

"The Law of Success" Book

Friday, January 3

Tuesday, December 31

Saturday, December 28

Wednesday, December 25

Saturday, December 7

Thursday, October 10

1. No specific trading system

2. Not respecting cut loss point

3. Impulsive buying

4. Ignoring the allowed position sizing against portfolio size (poor risk management)

5. Lack of focus during the trading day

Wednesday, October 9

April 2019 – Loss

May 2019 – Loss

June – Insignificant gain.

July 2019 -- Another loss.

August 2019 - A minimal loss.

September 2019 - Still a loss?

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