Kate, <<It seems that you have a very disciplined approach to your investments- something I'm trying to cultivate. I'm curious if you ever do any short term/position type trading and if so, what criteria you use to enter and exit trades. (?)>>
Allow me a moment of reflecting on a glorious past:0)
achamchen.com
Message 12403144
December 28th, 1999
No rationale, logic, valuation. Just speculation in its purest and most daring form. A sand castle built on a deck of cards, supported by a shimmering mirage of riches that can be.
...
Message 12402354
December 28th, 1999
... I feel like a person who had overindulged in sex; I have, as they say, shot my bullets, and now only got the thermonuclear bombs, which are not particularly or typically useful in trading battles.
My 'gamble' is my current high allocation to that burdensome and low yielding asset category called cash and near-cash.
What scares me is that I am actually considering going short, not as in buying put, but in selling naked calls and selling shares I do not own. Never did before, always a first time.
Message 12402641
December 28th, 1999
Oops, just got more bullets. Just bought bravely into Golden Power (603 in Hong Kong) as they resumed trading after 5 day suspension of trade due to PCCLF and Hikari Tsushin bought 51% of it to be used for holding company purpose (invested companies outside of Japan).
Not getting a lot of work done these days. Where are those Pachinko machines?
Message 12414549
December 29th, 1999
Golden Power (603) power strokes to 13.5 noon time today, a reasonable 48% rise in 24 hours. Sold half, and buying 1049 (Celestial Securities) at 0.95 as it will be the first publicly traded brokerage w/ i-net trading of HK shares. The Boom.com and others are not public. With the US based experience, this is, so far, indeed like reading tomorrow's Wall Street Journal today. Son is right about his Time Machine, just on a much more glorious scale.
Richard Li of PCCLF is throwing a 20 million party with Whitney Houston and other megastars for the Millennium night. I guess the man has cause to celebrate. This is the 1920s all over again. 1925 or 1929?
Message 12404275
December 29th, 1999
Conservatism, me, one who even dares to contemplate shorting this crazy market. Edwin-san, you are, however, correct in detecting my overall bearish bias and reluctant bullishness on my thermonuclear bombs.
January does not concern me much, March does. We all become technicians first, science fiction writers later, soothsayers next, then, finally, astrologers. February is a month to start shorting until we feel margin poor, and August is for going long until we feel cash poor.
Message 12414778
December 30th, 1999
Like I mentioned before, there is no need to investigate the share trading in HK. If it goes up like a rocket, it is being manipulated, being readied for a cash call. Hong Kong is a wonderful place where capitalism in its origin 1920s form co-exist with 60+% cellular phone penetration (kids included).
Macao is nice too. The Macao Club just sent me a flyer to sign up for free cruises all weekends during 2000, food included. The ship, complete with swimming pool and all, leaves HK for open sea and the gambling starts. As my wife and I do not gamble, we figure we will just watch the action and read a good book, maybe check out a few movies. Wife will accompany as there appears to be quite a few single girls on board.
Communist China is never so in danger as when they embraced these two tiny specs of islands. Imagine what an embrace of Taiwan can do!
Message 12424137
December 30th, 1999
Mact, Good morning, additional observations ... as today is an impromptu declared public holiday called last minute by the concerned HK government, to close the banks and watch what happens with Australia tomorrow morning, and it is also Starbuck ice coffee time. If the lights go out in Sydney, a historic buying opportunity will have presented itself.
Yesterday, the taxi driver did ask for and accept stock tips from me. Earlier, my 70 year old mom visiting now tried to understand from me what EMC's business was (she does e-mail and surf for info), and my father in-law (who does not use i-net) had bought and mis-sold MYPT, in at 13, out at 25, leaving US$ 500k+ on the table, and he still could not tell me what the company does, nor could he tell me what the closing price is. My office administrator is following my trades, my broker is passing around my trades as his own ideas (ever since my initial lucky (nay, studied) 9984 buy in November of 1998). My neighbor and I talked Golden Power while putting out the garbage, speculated on a joint purchase of the apartment on the third floor of our 3 story building, and discussed his Malaysian friends wanting to place money with him to speculate with in Hong Kong (free capital movement is so very important to the continued prosperity of our little island). And finally, other asset classes are being talked about in the press as follow-ons to i-net frenzy (recent spat of biotech buzz, etc), and this is inevitable as the maniac fever runs its course, affecting other assets.
I am on page 69 of "Devil Take the Hindmost" by Edward Chancellor (purchasable at Amazon, of course), and at the bottom of the page, from the year 1720, by an anonymous pamphleteer, in great clarity ...
"The additional rise of this stock above the true capital will be only imaginary; one added to one, by any rules of vulgar arithmetic, will never make three and half; consequently, all the fictitious value must be a loss to some persons or other, first or last. The only way to prevent it to oneself must be to sell out betimes, and so let the Devil take the hindmost."
The earlier part of the book described speculative events since the Roman empire days, and I observe that if one were to replace the nouns (i-net for gold, biotech for tulips, diving engines for cellular phone, treasure in South Seas for WTO in China, etc) and change the dates (1999 for 1720, etc), the resulting words can be published in Wall Street Journal and Barrons, with no loss of sense or education value.
I do (intellectually, at least) realize that 95% of i-net companies will no longer be around by half time, but I believe it would be criminal (not to mention irresponsible to imaginary offspring) not to play this game out and gather assets for an eventual retreat to a quiet sunny cove in Maui. Our education, experiences, and sense of historic and social relevance and duty dictate that we must contribute to the progress of i-net globalism, and as in all progressive moves, someone must eventually pay a price, even as we ourselves edge towards the emergency fire exit.
We are living in historically significant time and feeling invincible and vigorous. I felt this way once before, during 1990-1991 in Manila/Borocay, immediated after the 1989 TianAnmen event having diminished my consulting business in China, renovating (nay, flipping, in English, or stir frying in Chinese) buildings. My two Aussie partners and I started with risk capital of US$ 100k, got our NAV to US$ 7 million, and back down to US$ 100k, all in 18 short months. I learnt that bankers do use four letter words, and that "we successfully crossed the rickety suspension bridge over the deep gorge, after making proper judgment of the risks involved; and a hungry mountain lion stepped out from the rocks ...".
We got sunk in Manila by 45% per annum interest rate when Saddam invaded Kuwait, causing oil price to go up, tourism to dry up and 500k Filipinos to return to Manila from the Middle East, all looking for jobs.
[EDIT 2003.01.22 - Boracay looks like so achamchen.com ]
Message 12432932
December 31st, 1999
... Read the "Devil take Hindmost". The parallels are uncanny. All the signs are there. We are living in 'living history'. We probably have a good 12 months to go (I almost think 9984 will reach 800k in 2000 or not ever get there at all), and I believe the proper way to play this is no longer diversification, but massive bets on a few names of different maturity (9984 vs dotcom.com), take profit out as we go. Diversification is only good against quakes in a few names, not in a market cataclysm. I feel more energized than ever, as if my whole life was spent preparing for this one glorious trip out of the harbour.
On this basis, Golden Power is cheap and MSFT is dirt cheap, and Reuters is free.
Being scared is healthy, but it must not paralyze us. In the game of Quake, the guy who stops moving and the guy moving slowly are dead. The guy who moves fast and the guy hiding like a girl (I do no mean that all girls hide, so no offense meant) are alive, but rewarded differently.
...
Thus I have started to track some of the 'overpriced' and 'weak' plays, in view that they will be viciously shorted at the opportune moment (moment of massive frenzy), such as that may be indicated when the police is called out in force to keep order at IPO lotteries. There was a cover photo on Far Eastern Economic Review back in 1996, a few short months before THE ASIAN CONTAGION, where a crowd of cowering China IPO wanters in Shenzhen were kept in order by policemen wielding bamboo canes. The same month saw Taiwan stock exchange volume higher than NYSE, and tales of Taiwan punters transported to Bangkok each Sunday night to ramp stock, drink, eat, do the girlie bars and back to home on Friday afternoon.
The good events are still further down the program flyer, as we have not yet had a Bre-X situation.
achamchen.com
Message 12442393
January 2nd, 2000
Update on 603. Now I am like a critter caught in the headlights, recognizing substantial gains on Golden Power (603) for one day trade (in at 18, out at 23).
It is now 11:23am local time and I have only sold what 603 I bought today at open. Rolling part of proceeds into China Overseas Land (688) at HK$ 1.10/share, and awaiting rumored broadband announcement. Caveat Emptor.
No work is being done in the office at all. Danger, danger. All signs of mania present. Can not get through to HK Telecom 2288 (real time stock quote) line at all. Flying blind, but flying.
China Strategic (235) holds substantial PCCLF and sells at HK$ 0.45. The head of China Strategic is a master flipper when times are hot. I am not buying 235 as I draw the line somewhere. Red-chip plus Cyber-chip plus debt could prove too potent and toxic a mixture even for fast paced HK.
Message 12453701
January 3rd, 2000
Jonas,
I know less than you do about the company, but let me try to do what Michelda does - I say HK$10 target by January 10th, and then I am out of there. Caveat Emptor as I have no clue of what I am doing, just that I am flying at 60,000 kilometers per hour, 3 feet above ground, carrying oversized luggage, through the forest. Do not follow me on this one as I do not want the responsibility.
Message 12452907
January 3rd, 2000
The problem, and a nice problem it is, is that as 9984 rises, I am running out of other stocks to sell to counterbalance 9984's effect on my allocation to equity. My maximum bullishness is not allowing me to watch allocation discipline going out the window. Now, the only thing left for me to do is to fasten the seat belt, close eyes, scream, as the 9984 roller coaster sets off for the peak.
Message 12463559
January 4th, 2000
I put on my life vest, as we are now officially out of the home port. I do not worry about how to get back to home. I only need to think about what I am going to do.
(0) Last night I sold off my USA based China Telecom (CHL as opposed to 941 in HK). I like the dual time zone tradeble positions.
(1) Took a look at the galley, and I see ...
9984, SNE, MSFT/VSIO, 50% of original CHL, 50% of original INTC, RTRSY, 50% of original CMCSK, HSBC, MBK, a ML i-net fund that plays the IPOs and has large position in 9984 - and these constitute my 'investments' as opposed to 'speculation'), one encumbered but meaningful position in AMGN, one meaningful speciulative position in TCL (1070), a residual position in Golden Power (603), and a bunch of meaningless subscriptions to annual reports (YHOO, SFE, AOL, EMC, CSCO, LU ...), plus a middling hedge in NEM longs and puts. Of the above, 9984 now accounts for 60% of total value, depending on what time of day it is in Tokyo.
(2a) Plannned for today: unload 50-100% of 1070 position at open and ask questions later, following the rule ... the boat may explode, do not pray, jump.
(2b) Sell 10% of 9984 at market open, and buy 10% at market close; if trading shut down due to limit down, then buy sftbf in US. May do so again tomorrow.
This tact should net some marginal cash and get me into a dual time zone position in 9984 (never bought sftbf so far) as the volatile times ahead is better dealt with on 12 hour basis.
(3) Definitely will not short anything.
Message 12494921
January 7th, 2000
Hi Edwin, I am writing this more to collect my wits.
You are correct. I am concerned. A bad market definitely does affect my psychology and no one likes to lose net worth, principal or unrealized gain.
My caution, or bearish stance, is indicated by earlier announced sales of RMBS, INKT, VERT, ICGE, etc earlier (apparently too early) to Founder, part of 9984, Yahoo Call, AOL, INTC, MSFT, now SNE, general retreat to cash, as well as my recently renewed willingness to trade 9984 on intra-day basis.
I am prepared to buy back all of the above shares (as in the case of Visio puts now) at lower prices (not ?the bottom?, just lower prices). I do not believe that the tech rally is over (if I did, I would be out of 9984 already).
I view the game as an absolute game, not as a relative game. In 1998, the Indonesian guy who lost 98% gave me no comfort even though I only lost only my then year-to-date gains and kept intact my beginning of year principal. The game continued with my bet in 9984 and increased US tech shares in November. Staying on the side line for long is not my tradition, as I believe there are always investment opportunities, even in the most dismal of times. The world is a big place.
My earlier but recent postings on mania phenomenon and game theory served to remind myself on what this game is all about. My retreat to cash was to prepare for later games. My enormous but very short and successful bets in Golden Power (603), China Overseas (688), and the ill-fated but limited damage holding of TCL (1070) was to take advantage of what I believed to be a temporary mania within the overall context of a bull market.
I believe this current phase is simply an inevitable correction in Nasdaq?s rapid (vertical for many shares) 33% rise within the past 60 days. The entirety of the rise may be re-traced in the correction, but I will not wait that long before starting to buy.
On the other hand, I am not sure that the overall bull market is not over (no one can say) and so my re-entry into the market will be paced, some rapidly, and some via puts. I need to see the foundation not crack (trade deficit must improve, debt must come down, interest rate must have risen already, etc). Money is difficult to come by, not always as simple as buying today, and selling tomorrow for more. I am cautious: for a man with no money, $10k is a lot, and so when we have $10k, take care of it.
Many of us in HK treat investment as an activity where we only have to engage in the pure mechanics of holding, trading, timing and betting. I know people who moved house 4-5 times within a 2-3 year period, trading apartments as if trading stocks. Now I know folks who sold their apartments and choosing to pay seemingly exorbitant rent until their hoped for real estates collapse. These guys are all investing or speculating or gambling, and the label can only be determined after we know the outcome. We are all hyper, and from other observers in the world, we are odd. There is a lack of intellectual content to the activity, and this is wrong.
Investment should be an activity that we learn and think about, engage in, adapting to the changing reality of the market, sometimes holding, sometimes trading, sometimes out and out betting, and some times sit on our cash and watch the world go by.
There, I feel better.
Chugs, Jay |
