Lots of newbies asked me about CFD (Contract For Difference)... I compiled it here for all to read rather than answer individually.
CFD is simply an agreement to exchange the difference in value of a particular share between the time at which a contract is opened and the time at which it is closed. It is an arrangement made in a futures contract whereby differences in settlement are made through cash payments, rather than the delivery of physical goods or securities.
CFDs are generally versatile trading vehicles, giving you full access to market movements without having to own the underlying instruments. CFPs are fast replacing traditional share dealing as the vehicle of choice for flexible, cost-efficient trading. You can trade shares, forex, stock indices and many other markets on margin. You can also trade a wide range of forex contracts, with spreads starting from as low as just 2 pips, as well as round-the-clock stock indices and a selection of other markets. All under one trading account.
Qn is To LONG or To SHORT?
CFDs are especially powerful in the BEAR markets. With CFDs you can buy or sell at the quoted price, to profit from rising or falling markets. Other methods of shorting shares are often inconvenient and expensive. CFDs can be used to trade an extremely wide range of financial products and this means they offer a way to easily start dealing across a large cross-section of the market. For example, if you have an interest in Singapore and US indexes, the level of Wall Street, and the exchange rate of the US dollar against the euro, you can deal all of these markets with one CFD provider on one account.
The new & flexible way of trading is very similar to normal share dealing in two respects. You deal at the cash price of the share, and pay a commission which is calculated as a percentage of the value of the transaction. Our standard commission rate for Singapore shares is just 0.2% (see Contract Details).
When you open a position, however, you do not have to pay for the full value of the shares. Instead you put up a deposit, from just 10% of the contract value. This means you can trade up to ten times your initial capital.
When you close your position, the difference between your opening contract value and your closing contract value is realised. So just as with buying shares or trading futures, the degree to which you are correct in your CFD trading affects how much you make or lose.
Geared products like CFDs can help you make the most effective use of your investment capital, but it is important to appreciate that the amount you could lose relative to your initial investment is greater for geared products than for non-geared products.
Tuesday, April 15, 2008
Tuesday, April 8, 2008
Merril Lynch still hold 100 million shares of Jade !!
As what I have posted this morning? That is the same Qns market watchers are asking now? Why did the BIG BOYS want to buy when Jade is declining sharply like a high falling knife? Who do you want to be? A millionaire will be in the making if you know how to ID the gem....
ML sold 100 million Jade @ $0.22 and still have 100 million. Who can absorp 100 million shares of Jade tomorrow, if ML wants to sell?
=DJ Merrill Sold Large Volume Of Jade Tech Shares Tues - Source
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SINGAPORE (Dow Jones)--Merrill Lynch & Co. (MER) sold about 100 million Jade Technologies Holdings Ltd. (530.SG) shares Tuesday, likely in a move to unload collateral pledged to it by troubled Australian broker Opes Prime Group Ltd., a person familiar with the matter said Friday.
The sale could be a blow to Jade President Anthony Soh, who had placed 295 million shares with Opes Prime to back a loan taken to fund his takeover of the Singapore-listed software company.
"The daily volume for Jade is usually a few million shares, but Tuesday it was around 196 million," the person told Dow Jones Newswires.
"Merrill sold about 50% of what went through, mostly at S$0.22 a share."
Soh Wednesday said he may not have sufficient resources to complete the S$0.225-a-share offer after Opes Prime was put into receivership with A$1 billion ($918 million) owed to creditors.
Apart from the 295 million shares, Soh continues to hold 156 million shares representing 16% of Jade, which he manages.
Merrill Lynch and Australia & New Zealand Banking Group Ltd. last week began selling shares that Opes Prime had pledged to them.
It''s unclear how many of the 295 million shares wound up with Merrill Lynch and ANZ.
Merrill Lynch said Friday that it no longer has any exposure to Opes Prime as it has sold the shares received from the broker.
Merrill Lynch couldn''t be reached for comment about the Jade share sale.
Jade last traded at S$0.22 Tuesday before trade was halted.
- Dow Jones Newswires; 65 6415 4153
ML sold 100 million Jade @ $0.22 and still have 100 million. Who can absorp 100 million shares of Jade tomorrow, if ML wants to sell?
=DJ Merrill Sold Large Volume Of Jade Tech Shares Tues - Source
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SINGAPORE (Dow Jones)--Merrill Lynch & Co. (MER) sold about 100 million Jade Technologies Holdings Ltd. (530.SG) shares Tuesday, likely in a move to unload collateral pledged to it by troubled Australian broker Opes Prime Group Ltd., a person familiar with the matter said Friday.
The sale could be a blow to Jade President Anthony Soh, who had placed 295 million shares with Opes Prime to back a loan taken to fund his takeover of the Singapore-listed software company.
"The daily volume for Jade is usually a few million shares, but Tuesday it was around 196 million," the person told Dow Jones Newswires.
"Merrill sold about 50% of what went through, mostly at S$0.22 a share."
Soh Wednesday said he may not have sufficient resources to complete the S$0.225-a-share offer after Opes Prime was put into receivership with A$1 billion ($918 million) owed to creditors.
Apart from the 295 million shares, Soh continues to hold 156 million shares representing 16% of Jade, which he manages.
Merrill Lynch and Australia & New Zealand Banking Group Ltd. last week began selling shares that Opes Prime had pledged to them.
It''s unclear how many of the 295 million shares wound up with Merrill Lynch and ANZ.
Merrill Lynch said Friday that it no longer has any exposure to Opes Prime as it has sold the shares received from the broker.
Merrill Lynch couldn''t be reached for comment about the Jade share sale.
Jade last traded at S$0.22 Tuesday before trade was halted.
- Dow Jones Newswires; 65 6415 4153
Monday, April 7, 2008
JADE - A Rare Gem to Catch?
Rare opportunity to get 100% profit return easily. My gut feel that this could be a catch... qn is who is buying the big volumes sold from ML today and tomorrow?
SGX yesterday declared Catalist-listed Jade Technologies a designated security, prohibiting any selling of the shares unless the seller can show he holds sufficient quantities.
SGX said the condition was not applicable to shares that have been bought on contra, adding the designation was to ensure 'orderly trading' in the market.
Investors are fearing a heavy selldown after Jade's group president Anthony Soh pulled the plug on his takeover bid for the company on Saturday, admitting that with two-thirds of his shares in Jade pledged to a failed Australian broker, he was no longer able to guarantee sufficient funds were available to facilitate the offer.
Dr Soh yesterday confirmed in an interview with BT that the offer is under internal investigation by the Securities Industry Council. The role of OCBC Bank, which quit as financial adviser to the offeror on April 1, when the storm broke, may also be reviewed.
SGX said shareholders who had accepted the offer from Dr Soh will have their shares transferred back to their accounts today when trading resumes. Trading has been halted since Wednesday.
Early last month, Dr Soh made a 22.5 cents a share conditional offer for Jade, stating he owned about 46.5 per cent of the company. Last week, it emerged he had pledged two-thirds of his stake, or about 30.5 per cent of Jade's share capital, to Australian broker Opes Prime as security for margin loans.
But under the agreement, ownership of the shares may already have passed to Opes and when it failed, on to its secured creditors. Dr Soh and other clients of Opes claim they believed their shares had only been pledged and that they retained beneficial interest but Opes is now known to have lent those shares to banks as security for financing.
With a much smaller shareholding than thought, Dr Soh said he could not guarantee he had the extra $67 million to satisfy full acceptances of the offer.
Dr Soh told BT that Opes had operated what seemed a very attractive lending regime, providing 60 per cent credit on the value of even small cap stocks. He first pledged about 140 million Jade shares last October and had drawn down the full amount of about $25 million in loans.
When the price of Jade shares tanked in late January, Dr Soh pledged about 150 million more shares to make up the shortfall but did not borrow any more money. 'It was a very fluid arrangement but it came at a very heavy price.'
He said he suspected Opes had been lending shares to third parties after finding out in February that about 40 million of the 295.5 million shares pledged had been moved to another account. Dr Soh visited Melbourne three times in late February and early March to confront Opes's chief executive officer Laurie Emini. 'Each time he said in front of his staff that I was the beneficiary.'
Dr Soh claimed he knew of 'five to 10 other clients of Opes' in Singapore who like him had pledged shares in locally listed companies to Opes to secure financing. He is now taking part in a class action to get compensation. 'There is probably no doubt that I've lost the shares.' Dr Soh put his paper losses at about $40 million.
He said that the fundamentals of Jade have not been affected, adding he was in discussions with a Chinese buyer and a big US investment bank to come in as partners in a coal mining project in Indonesia.
A recent independent report included in the now withdrawn offer for Jade had put the value of the coal concession at about $1 billion.
SGX yesterday declared Catalist-listed Jade Technologies a designated security, prohibiting any selling of the shares unless the seller can show he holds sufficient quantities.
SGX said the condition was not applicable to shares that have been bought on contra, adding the designation was to ensure 'orderly trading' in the market.
Investors are fearing a heavy selldown after Jade's group president Anthony Soh pulled the plug on his takeover bid for the company on Saturday, admitting that with two-thirds of his shares in Jade pledged to a failed Australian broker, he was no longer able to guarantee sufficient funds were available to facilitate the offer.
Dr Soh yesterday confirmed in an interview with BT that the offer is under internal investigation by the Securities Industry Council. The role of OCBC Bank, which quit as financial adviser to the offeror on April 1, when the storm broke, may also be reviewed.
SGX said shareholders who had accepted the offer from Dr Soh will have their shares transferred back to their accounts today when trading resumes. Trading has been halted since Wednesday.
Early last month, Dr Soh made a 22.5 cents a share conditional offer for Jade, stating he owned about 46.5 per cent of the company. Last week, it emerged he had pledged two-thirds of his stake, or about 30.5 per cent of Jade's share capital, to Australian broker Opes Prime as security for margin loans.
But under the agreement, ownership of the shares may already have passed to Opes and when it failed, on to its secured creditors. Dr Soh and other clients of Opes claim they believed their shares had only been pledged and that they retained beneficial interest but Opes is now known to have lent those shares to banks as security for financing.
With a much smaller shareholding than thought, Dr Soh said he could not guarantee he had the extra $67 million to satisfy full acceptances of the offer.
Dr Soh told BT that Opes had operated what seemed a very attractive lending regime, providing 60 per cent credit on the value of even small cap stocks. He first pledged about 140 million Jade shares last October and had drawn down the full amount of about $25 million in loans.
When the price of Jade shares tanked in late January, Dr Soh pledged about 150 million more shares to make up the shortfall but did not borrow any more money. 'It was a very fluid arrangement but it came at a very heavy price.'
He said he suspected Opes had been lending shares to third parties after finding out in February that about 40 million of the 295.5 million shares pledged had been moved to another account. Dr Soh visited Melbourne three times in late February and early March to confront Opes's chief executive officer Laurie Emini. 'Each time he said in front of his staff that I was the beneficiary.'
Dr Soh claimed he knew of 'five to 10 other clients of Opes' in Singapore who like him had pledged shares in locally listed companies to Opes to secure financing. He is now taking part in a class action to get compensation. 'There is probably no doubt that I've lost the shares.' Dr Soh put his paper losses at about $40 million.
He said that the fundamentals of Jade have not been affected, adding he was in discussions with a Chinese buyer and a big US investment bank to come in as partners in a coal mining project in Indonesia.
A recent independent report included in the now withdrawn offer for Jade had put the value of the coal concession at about $1 billion.
Wednesday, March 26, 2008
Singapore Share Market Summary (260308)
Reports to check out:
GOLDEN AGRI-RESOURCES
Splitting shares, splitting hairs
CHT HOLDINGS Second Opinion
Hold, but not by choice
*****
Market:
The STI went down 4.97 pts to close at 2,995.22.
Volumes were at 1.47 bln at a value of S$1.56 bln. This means on average each share is worth $1.061.
Gainers and losers were 1 to 1.
*****
Stories of note:
TEE INTERNATIONAL
Gets S$109 mln Marina Bay Sands contract
LOW KENG HUAT
To be more selective in tenders
ASCENDAS REIT
Buys CGGVeritas Hub for S$18.25 mln and Rutherford and Science Hub for S$51.52 mln from Ascendas companies
ASIA PACIFIC BREWERIES
Expands production capacity of Hanoi brewery in Vietnam
Spends US$1 mln to increase capacity from 30 mln litres to 46 mln litres
HENGXIN TECHNOLOGIES
Issues summons to ex-CEO and ex-director for breach of contract
SWIBER
Shipyard delivers floating crane barges to OBT Holdings
GOLDEN AGRI-RESOURCES
Splitting shares, splitting hairs
CHT HOLDINGS Second Opinion
Hold, but not by choice
*****
Market:
The STI went down 4.97 pts to close at 2,995.22.
Volumes were at 1.47 bln at a value of S$1.56 bln. This means on average each share is worth $1.061.
Gainers and losers were 1 to 1.
*****
Stories of note:
TEE INTERNATIONAL
Gets S$109 mln Marina Bay Sands contract
LOW KENG HUAT
To be more selective in tenders
ASCENDAS REIT
Buys CGGVeritas Hub for S$18.25 mln and Rutherford and Science Hub for S$51.52 mln from Ascendas companies
ASIA PACIFIC BREWERIES
Expands production capacity of Hanoi brewery in Vietnam
Spends US$1 mln to increase capacity from 30 mln litres to 46 mln litres
HENGXIN TECHNOLOGIES
Issues summons to ex-CEO and ex-director for breach of contract
SWIBER
Shipyard delivers floating crane barges to OBT Holdings
Monday, March 24, 2008
FREE Seminar for Internet Newbies
Hi,
"How A Complete 'Internet Newbie' Went From Zero to $408,072 in Online Sales In Less Than 5 Months - Without A Website And With ZERO HTML Knowledge!" Once you discover this "amazingly simple" system, you too could be making money from the comfort of your home - and avoid the rising travelling costs in Singapore!
Here's what you'll learn in this exciting FREE Seminar Worth USD497:
- The REAL TRUTH Behind Making Money Online - And Why Many Get This Wrong
- Reasons Why NOW Is The Best Time To Get Started Online
- Learn Why You Shouldn't Miss This 'Golden' Window Of Opportunity
- How To Sell On The Internet Even Without A Website
- How To Make Money Online Even If You Don't Have Your Own Products
- Irrefutable Proof Of REAL People Making Money Online - You Could Be One of Them
- And Much Much More!
Date: 26th March 2008 (this coming Wednesday)
Venue: Sheraton Towers Level 2 (5 Mins walk from Newton MRT)
Time: 7:30pm – 10pm (registration starts @ 7pm)
Seats: ONLY for the FIRST 50 REGISTRATIONS !
I have gotten 5 tickets ONLY and will be attending. If you are interested, I have 4 tickets spare to be given to you or your friends to attend this FREE seminar. Email me with your name and contact with the nos of tickets required now.
"How A Complete 'Internet Newbie' Went From Zero to $408,072 in Online Sales In Less Than 5 Months - Without A Website And With ZERO HTML Knowledge!" Once you discover this "amazingly simple" system, you too could be making money from the comfort of your home - and avoid the rising travelling costs in Singapore!
Here's what you'll learn in this exciting FREE Seminar Worth USD497:
- The REAL TRUTH Behind Making Money Online - And Why Many Get This Wrong
- Reasons Why NOW Is The Best Time To Get Started Online
- Learn Why You Shouldn't Miss This 'Golden' Window Of Opportunity
- How To Sell On The Internet Even Without A Website
- How To Make Money Online Even If You Don't Have Your Own Products
- Irrefutable Proof Of REAL People Making Money Online - You Could Be One of Them
- And Much Much More!
Date: 26th March 2008 (this coming Wednesday)
Venue: Sheraton Towers Level 2 (5 Mins walk from Newton MRT)
Time: 7:30pm – 10pm (registration starts @ 7pm)
Seats: ONLY for the FIRST 50 REGISTRATIONS !
I have gotten 5 tickets ONLY and will be attending. If you are interested, I have 4 tickets spare to be given to you or your friends to attend this FREE seminar. Email me with your name and contact with the nos of tickets required now.
Tuesday, March 18, 2008
Last week US Carlyle Capital collapsed! Now Bear Stearns! Is it a BEAR trend?
If Hedge Fund can bring down Bear Stearns to worth merely current US$2per share (highest was US$ 170) or $261 millions, why not other financial institutions? Look like Wall Street is turning into a graveyard zone soon!
Fed is doing his best to keep the credit crisis from declining with a series of Rate Cut or concerted Central Bank $$ injection to stem the current financial turmoil.
Will rate cut and $ injection able to steer fear among investors worldwide about other banks' similar exposure to the troubled credit markets?
Financial Storm has led investors to look into alternatives and pushed up :
1. GOLD - to the HIGHEST above US$1000
2. Crude Oil - above $100 (hedge against falling US$)
Tomorrow morning (19/3/08) will like to see FED Rate Cut again. The millionaire $$ question is how much? 0.25%, 0.5% or even 1%?
My view is that regardless what level of rate cut... BEAR WILL stage a Technical Rebound in response to it. However these rebounds may not be sustainable when subsequently when oversold stocks start to fully price-in rate-cut factor.
Remember CASH is KING now especially in BEAR MARKET.
Looking forward, avoid LONG in stock. Instead trade in Index CFD which profit could be obtain in both way.
Fed is doing his best to keep the credit crisis from declining with a series of Rate Cut or concerted Central Bank $$ injection to stem the current financial turmoil.
Will rate cut and $ injection able to steer fear among investors worldwide about other banks' similar exposure to the troubled credit markets?
Financial Storm has led investors to look into alternatives and pushed up :
1. GOLD - to the HIGHEST above US$1000
2. Crude Oil - above $100 (hedge against falling US$)
Tomorrow morning (19/3/08) will like to see FED Rate Cut again. The millionaire $$ question is how much? 0.25%, 0.5% or even 1%?
My view is that regardless what level of rate cut... BEAR WILL stage a Technical Rebound in response to it. However these rebounds may not be sustainable when subsequently when oversold stocks start to fully price-in rate-cut factor.
Remember CASH is KING now especially in BEAR MARKET.
Looking forward, avoid LONG in stock. Instead trade in Index CFD which profit could be obtain in both way.
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