A word of caution

tubal · 1 A word of caution Tue Aug 16, 2011 6:41 pm

tubal

Vice President - Equity Analytics

Posts : 1047
Equity Stars : 6273
Reputation : 243
Join date : 2011-01-27

Though I am trying my best to keep away from here, I couldn't help but notice how everyone is drooling over the new SEC announcement and decided to wade in for one last time.

Have you taken the time to analyze the notice fully? Who really benefits from it?
Have you considered who would be buying more shares from the market because of this announcement?
Are you really sure that you want to pay 20% more for a share tomorrow than what it was yesterday?
Have you looked at the recent big price movements (eg GRAN, TAFL, EAST, WAPO) and compared the price movements with the financials? Who has been selling these shares and who has been buying?

sapumal · 2 Re: A word of caution Tue Aug 16, 2011 6:52 pm

sapumal

Vice President - Equity Analytics

Posts : 1105
Equity Stars : 6526
Reputation : 65
Join date : 2010-07-30

Yeah. We know about SEC since years. What to do Tubal. we don't have other incomes. Needs to live with CSE

2011_NewComer · 3 Re: A word of caution Tue Aug 16, 2011 7:05 pm

2011_NewComer

Senior Manager - Equity Analytics

Posts : 559
Equity Stars : 5554
Reputation : 77
Join date : 2011-03-10
Location : Colombo

tubal wrote:Though I am trying my best to keep away from here, I couldn't help but notice how everyone is drooling over the new SEC announcement and decided to wade in for one last time.

Have you taken the time to analyze the notice fully? Who really benefits from it?
Have you considered who would be buying more shares from the market because of this announcement?
Are you really sure that you want to pay 20% more for a share tomorrow than what it was yesterday?
Have you looked at the recent big price movements (eg GRAN, TAFL, EAST, WAPO) and compared the price movements with the financials? Who has been selling these shares and who has been buying?

Nice to have you back tubal Smile

True

One good sign I see is that, today foreign buying is higher than sales.(after a long time I guess). What's your idea about that? Not sure whether the volume is high enough.

Gaja · 4 Re: A word of caution Tue Aug 16, 2011 7:06 pm

Gaja

Associate Director - Equity Analytics

Posts : 3127
Equity Stars : 9674
Reputation : 260
Join date : 2011-01-27
Age : 40
Location : Colombo

I am also waiting for some shares to go up!

godswen · 5 Re: A word of caution Tue Aug 16, 2011 7:10 pm

godswen

Senior Manager - Equity Analytics

Posts : 469
Equity Stars : 5509
Reputation : 65
Join date : 2011-02-02

Tubal!

mono · 6 Re: A word of caution Tue Aug 16, 2011 7:11 pm

mono

Vice President - Equity Analytics

Posts : 1167
Equity Stars : 6285
Reputation : 93
Join date : 2011-01-21
Age : 102

tubal wrote:Though I am trying my best to keep away from here, I couldn't help but notice how everyone is drooling over the new SEC announcement and decided to wade in for one last time.

Have you taken the time to analyze the notice fully? Who really benefits from it?
Have you considered who would be buying more shares from the market because of this announcement?
Are you really sure that you want to pay 20% more for a share tomorrow than what it was yesterday?
Have you looked at the recent big price movements (eg GRAN, TAFL, EAST, WAPO) and compared the price movements with the financials? Who has been selling these shares and who has been buying?

one more post until number 1000 bounce

Academic · 7 Re: A word of caution Tue Aug 16, 2011 7:22 pm

Academic

Senior Manager - Equity Analytics

Posts : 454
Equity Stars : 5432
Reputation : 103
Join date : 2011-01-23

Simply limit of broker credits is determined by "net liquid assets - T+3 exceeds". However, since SEC had extended 50% credit clearance deadline, current credit limit of a brokers is determined by

"net liquid assets - uncleared credit occurred before December 31"

So fund supply to market will not increase by total net liquid assets with all brokers!

Few things to get clarified here.

Current aggregate net liquid asset with brokers
Amount of uncleared debt occurred before December 31.

Note that a broker cant increase net assets by borrowing from a third party or parent, as liabilities are deducted from assets in calculating net liquid assets.

P.S. When I say Net Liquid Assets here it means without deducting credit to clients.

Last edited by Academic on Tue Aug 16, 2011 7:25 pm; edited 1 time in total

Antonym · 8 Re: A word of caution Tue Aug 16, 2011 7:24 pm

Antonym

Vice President - Equity Analytics

Posts : 1090
Equity Stars : 7442
Reputation : 275
Join date : 2011-02-09

tubal wrote:Though I am trying my best to keep away from here, I couldn't help but notice how everyone is drooling over the new SEC announcement and decided to wade in for one last time.

@tubal: 'For one last time', did you say? Do keep wading in. I think this forum needs liberal doses of sanity, especially when euphoria threatens to take over.

tubal wrote:
Are you really sure that you want to pay 20% more for a share tomorrow than what it was yesterday?

Exactly my thoughts. For most traded shares, the SEC announcement has not improved the companies' profitability one bit... and their intrinsic worth remains the same.

I have been trying to buy low (when ASI was below 6,700) and will try to sell high (ASI above 7,500). At in-between levels, I will do nothing - because I am a lousy trader. No frenzied buying on credit for me!

Gaja · 9 Re: A word of caution Tue Aug 16, 2011 7:37 pm

Gaja

Associate Director - Equity Analytics

Posts : 3127
Equity Stars : 9674
Reputation : 260
Join date : 2011-01-27
Age : 40
Location : Colombo

tubal wrote:Though I am trying my best to keep away from here, I couldn't help but notice how everyone is drooling over the new SEC announcement and decided to wade in for one last time.

Have you taken the time to analyze the notice fully? Who really benefits from it?
Have you considered who would be buying more shares from the market because of this announcement?
Are you really sure that you want to pay 20% more for a share tomorrow than what it was yesterday?
Have you looked at the recent big price movements (eg GRAN, TAFL, EAST, WAPO) and compared the price movements with the financials? Who has been selling these shares and who has been buying?

Friend waiting for your next post!

RockStock · 10 Re: A word of caution Tue Aug 16, 2011 7:43 pm

RockStock

Manager - Equity Analytics

Posts : 223
Equity Stars : 5119
Reputation : 37
Join date : 2011-01-27

tubal wrote:Though I am trying my best to keep away from here, I couldn't help but notice how everyone is drooling over the new SEC announcement and decided to wade in for one last time.

Have you taken the time to analyze the notice fully? Who really benefits from it?
Have you considered who would be buying more shares from the market because of this announcement?
Are you really sure that you want to pay 20% more for a share tomorrow than what it was yesterday?
Have you looked at the recent big price movements (eg GRAN, TAFL, EAST, WAPO) and compared the price movements with the financials? Who has been selling these shares and who has been buying?

Good to see you back
Unfortunate developing situation is, Undervalued shares still remain undervalued,and Overvalued shares becoming more overvalued(CLND,EAST,) and taking the whole CSE to irrationality and bubble territory again. But I feel best thing would be letting the market to learn the lesson rather than over-regulating it.

sriranga · 11 Re: A word of caution Tue Aug 16, 2011 8:13 pm

sriranga

Co-Admin

Posts : 6822
Equity Stars : 23025
Reputation : 2855
Join date : 2011-02-01
Location : London

"Rockstock wrote:
Unfortunate developing situation is, Undervalued shares still remain undervalued,and Overvalued shares becoming more overvalued(CLND,EAST,) and taking the whole CSE to irrationality and bubble territory again. But I feel best thing would be letting the market to learn the lesson rather than over-regulating it."

@RockStock
I agree 1000 times with you - best thing would be letting the market to learn the lesson rather than over-regulating it.
Well said.

duke · 12 Re: A word of caution Tue Aug 16, 2011 8:27 pm

duke

Senior Manager - Equity Analytics

Posts : 552
Equity Stars : 5518
Reputation : 86
Join date : 2011-03-14

It's great SEC didn't dance to broker's tune. Credit should be backed by proper assets. Bad thing I see is that SEC requiring reports on a monthly basis. It should have been at least every week. Brokers are never to be trusted.
Now retailers can pay the broker charges + interest and if there's anything left you can have it. That is if the shares go up. If the shares go down pay the broker charges + interest and blame SEC.

I hope tubal's 1000th post will be a memorable one.

Fresher · 13 Re: A word of caution Tue Aug 16, 2011 8:30 pm

Fresher

Moderator

Posts : 1498
Equity Stars : 7504
Reputation : 163
Join date : 2011-02-04

Market P/E was slowly returning to better levels. now it's back to square one.

NightStalker · 14 Re: A word of caution Tue Aug 16, 2011 8:34 pm

NightStalker

Senior Equity Analytic

Posts : 83
Equity Stars : 4923
Reputation : 3
Join date : 2011-02-10

duke wrote:It's great SEC didn't dance to broker's tune. Credit should be backed by proper assets. Bad thing I see is that SEC requiring reports on a monthly basis. It should have been at least every week. Brokers are never to be trusted.
Now retailers can pay the broker charges + interest and if there's anything left you can have it. That is if the shares go up. If the shares go down pay the broker charges + interest and blame SEC.

I hope tubal's 1000th post will be a memorable one.

I was wondering whether to open a post saying Tubal's and Dukes nightmare has come true Very Happy

Well I am sensing another bubble to ensue in the near future. What will happen next is very clear since I have followed most of ur posts on what happens when CSE runs on credit. The real question is what type of a carrot is this? Will SEC pull some fast moves even when they check the brokers reports end of the month. Because there should be a blood bath end of the month to clear credit to appease SEC by the brokers.

All that being said Million dollar question is if I am to be greedy just for this week what are the gambling stocks you recommend which have some what of good fundamentals? CSD.FLCH,PAP,NTB?

rijayasooriya · 15 Re: A word of caution Tue Aug 16, 2011 8:41 pm

rijayasooriya

Senior Vice President - Equity Analytics

Posts : 1827
Equity Stars : 6804
Reputation : 134
Join date : 2011-05-25
Location : Matara

It is good that SEC has not danced either to brokers tune or high net worth investers tune who might have waited for bargain hunting.That monitoring system must be functioned properly.SEC should be really active on this matter.

cseguide · 16 Re: A word of caution Tue Aug 16, 2011 8:46 pm

cseguide

Vice President - Equity Analytics

Posts : 1332
Equity Stars : 6369
Reputation : 56
Join date : 2011-04-20

---------I agree 1000 times with you - best thing would be letting the market to learn the lesson rather than over-regulating it.---------
very Well said.
I think there are great number of shares in the market trading very low PE values. there are plenty of opportunities in the market. If we get this year for 8 months market movement is still flat. (I mean net market increment).
We should not look at the market always with negative attitudes. we should look at it positively. Even with lots of economic concerns us market has come to positive tertiary now. time to time market will adjust within the system. no need to over regulate it. hope for the best. happy trading for all

UKboy · 17 Re: A word of caution Wed Aug 17, 2011 2:48 am

UKboy

Senior Vice President - Equity Analytics

Posts : 1943
Equity Stars : 7329
Reputation : 391
Join date : 2011-02-08
Location : Earth

tubal wrote:Though I am trying my best to keep away from here, I couldn't help but notice how everyone is drooling over the new SEC announcement and decided to wade in for one last time.

I hope that your best is NOT good enough to keep you away from this forum. I guess 99% members would like to read your posts. I must thank you for your ability to tamed few of the biggest raging bulls in this forum.
Your comments are badly missed on some of the companies results in this quarter..! I'm pretty sure you know what I meant Wink

tubal wrote:Have you taken the time to analyze the notice fully? Who really benefits from it?

Tubal talking about this is just wasting time.

tubal wrote:Have you considered who would be buying more shares from the market because of this announcement?
Are you really sure that you want to pay 20% more for a share tomorrow than what it was yesterday?

Again talking about this is just wasting time.

tubal wrote:Have you looked at the recent big price movements (eg GRAN, TAFL, EAST, WAPO) and compared the price movements with the financials? Who has been selling these shares and who has been buying?

This market conditions is good only for extremely talented traders. Rumors again will play a major role.
There are plenty retailers ready to buy the junk at top.

econ · 18 Re: A word of caution Wed Aug 17, 2011 3:27 am

econ

Global Moderator

Posts : 1479
Equity Stars : 8418
Reputation : 94
Join date : 2011-01-27

duke wrote:It's great SEC didn't dance to broker's tune. Credit should be backed by proper assets. Bad thing I see is that SEC requiring reports on a monthly basis. It should have been at least every week. Brokers are never to be trusted.
Now retailers can pay the broker charges + interest and if there's anything left you can have it. That is if the shares go up. If the shares go down pay the broker charges + interest and blame SEC.

I hope tubal's 1000th post will be a memorable one.

For you brokers are never to be trusted . Can you trust SEC ?

smallville · 19 Re: A word of caution Wed Aug 17, 2011 3:49 am

smallville

Associate Director - Equity Analytics

Posts : 4119
Equity Stars : 10099
Reputation : 530
Join date : 2011-02-03
Location : Back on Earth

If any of you would understand that this credit clearence is not a blessing in disguise, use your brain more than you've ever used in coming days, months..
The system goes with some money which is not available on the system it self...
My question is sustainability of this act..

Slstock · 20 Re: A word of caution Wed Aug 17, 2011 4:15 am

Slstock

Director - Equity Analytics

Posts : 6610
Equity Stars : 13367
Reputation : 1158
Join date : 2011-01-22

Yes, we should not this euphoria carry us away too much. If buying, concentrate on undervalued fundamental counters after study. Best to not get in with over priced momentum shares as "someone" might decide to unload killing the retailers again.

Let us not make same mistakes we made in the past. A solid fundamentally driven CSE will sustain longer than a pumped up one.

maalinda · 21 Re: A word of caution Wed Aug 17, 2011 9:18 am

maalinda

Manager - Equity Analytics

Posts : 254
Equity Stars : 5148
Reputation : 15
Join date : 2011-01-27

Good to see you and interesting eye opening topic.

sajeethk · 22 Re: A word of caution Wed Aug 17, 2011 9:32 am

sajeethk

Senior Manager - Equity Analytics

Posts : 585
Equity Stars : 5401
Reputation : 21
Join date : 2011-07-16
Age : 47
Location : Indonisia

but still no brokers given their credit facility limits to their clients so hw we can get hw much credit we can get from the broker... still my broker say he dont have the details..

stockdad · 23 Re: A word of caution Wed Aug 17, 2011 11:02 am

stockdad

Senior Equity Analytic

Posts : 50
Equity Stars : 4724
Reputation : 8
Join date : 2011-07-21

rijayasooriya wrote:It is good that SEC has not danced either to brokers tune or high net worth investers tune who might have waited for bargain hunting.That monitoring system must be functioned properly.SEC should be really active on this matter.

Are you sure that high net worth people are not benefitting from this latest directive.
Friend, they are the real beneficiaries as brokers can't practically extend credit to all clients
as total credit limited to Net Liquid Asset Position of broker. In arriving at this figure what is already lent prior to 31-12-2010 and o/s as at now will be deducted.
So what they can lend as new credit is really limited. As they cannot give credit to everbody they will be selective. All the ppl going on a buying spree witout realising the actual position will be the sorry losers again and HNWI will be happily profiting from this foolishness.

rijayasooriya · 24 Re: A word of caution Wed Aug 17, 2011 11:12 am

rijayasooriya

Senior Vice President - Equity Analytics

Posts : 1827
Equity Stars : 6804
Reputation : 134
Join date : 2011-05-25
Location : Matara

stockdad wrote:

rijayasooriya wrote:It is good that SEC has not danced either to brokers tune or high net worth investers tune who might have waited for bargain hunting.That monitoring system must be functioned properly.SEC should be really active on this matter.

Are you sure that high net worth people are not benefitting from this latest directive.
Friend, they are the real beneficiaries as brokers can't practically extend credit to all clients
as total credit limited to Net Liquid Asset Position of broker. In arriving at this figure what is already lent prior to 31-12-2010 and o/s as at now will be deducted.
So what they can lend as new credit is really limited. As they cannot give credit to everbody they will be selective. All the ppl going on a buying spree witout realising the actual position will be the sorry losers again and HNWI will be happily profiting from this foolishness.

HNWI always get benefitted brother whether others like it or not.But this decision will prevent force selling and it triggers the bull market.That is bebeficial for all of us.It does not mean that I agree with what happening now.(Retailors are going after speculative shares) After this euphoria market will consolidate as there is no force selling.

stockdad · 25 Re: A word of caution Wed Aug 17, 2011 11:44 am

stockdad

Senior Equity Analytic

Posts : 50
Equity Stars : 4724
Reputation : 8
Join date : 2011-07-21

rijayasooriya wrote:

stockdad wrote:

rijayasooriya wrote:It is good that SEC has not danced either to brokers tune or high net worth investers tune who might have waited for bargain hunting.That monitoring system must be functioned properly.SEC should be really active on this matter.

Are you sure that high net worth people are not benefitting from this latest directive.
Friend, they are the real beneficiaries as brokers can't practically extend credit to all clients
as total credit limited to Net Liquid Asset Position of broker. In arriving at this figure what is already lent prior to 31-12-2010 and o/s as at now will be deducted.
So what they can lend as new credit is really limited. As they cannot give credit to everbody they will be selective. All the ppl going on a buying spree witout realising the actual position will be the sorry losers again and HNWI will be happily profiting from this foolishness.

HNWI always get benefitted brother whether others like it or not.But this decision will prevent force selling and it triggers the bull market.That is bebeficial for all of us.It does not mean that I agree with what happening now.(Retailors are going after speculative shares) After this euphoria market will consolidate as there is no force selling.

Oh Brother,
Who told u No Forced Sale now.
SEc has NOT REMOVED this condition.
All they have done is to allow brokers to provide credit to clients to the extent of their Net liquid Asset Position, whereas earlier brokers were not allowed to.
But it is a very small number of brokers who can provide credit to their clients and that too not to
all clients as the total available amt of credit is restricted as per SEC directive.
So it is the same story again.
All those portfolios who do not get broker credit and if outstanding for T+5 will be FORCED SOLD.
This is the actual situation.
Actually SEC directive has very limted practical benefit.

Last edited by stockdad on Wed Aug 17, 2011 12:02 pm; edited 1 time in total

Sponsored content

Name*:
Phone number:
Email address*:
Comments*:
* - required fields	Learn

Name*:
Phone number:
Email address*:
Comments*:
* - required fields	Learn

Latest topics

A word of caution

1 A word of caution Tue Aug 16, 2011 6:41 pm

tubal

2 Re: A word of caution Tue Aug 16, 2011 6:52 pm

sapumal

3 Re: A word of caution Tue Aug 16, 2011 7:05 pm

2011_NewComer

4 Re: A word of caution Tue Aug 16, 2011 7:06 pm

Gaja

5 Re: A word of caution Tue Aug 16, 2011 7:10 pm

godswen

6 Re: A word of caution Tue Aug 16, 2011 7:11 pm

mono

7 Re: A word of caution Tue Aug 16, 2011 7:22 pm

Academic

8 Re: A word of caution Tue Aug 16, 2011 7:24 pm

Antonym

9 Re: A word of caution Tue Aug 16, 2011 7:37 pm

Gaja

10 Re: A word of caution Tue Aug 16, 2011 7:43 pm

RockStock

11 Re: A word of caution Tue Aug 16, 2011 8:13 pm

sriranga

12 Re: A word of caution Tue Aug 16, 2011 8:27 pm

duke

13 Re: A word of caution Tue Aug 16, 2011 8:30 pm

Fresher

14 Re: A word of caution Tue Aug 16, 2011 8:34 pm

NightStalker

15 Re: A word of caution Tue Aug 16, 2011 8:41 pm

rijayasooriya

16 Re: A word of caution Tue Aug 16, 2011 8:46 pm

cseguide

17 Re: A word of caution Wed Aug 17, 2011 2:48 am

UKboy

18 Re: A word of caution Wed Aug 17, 2011 3:27 am

econ

19 Re: A word of caution Wed Aug 17, 2011 3:49 am

smallville

20 Re: A word of caution Wed Aug 17, 2011 4:15 am

Slstock

21 Re: A word of caution Wed Aug 17, 2011 9:18 am

maalinda

22 Re: A word of caution Wed Aug 17, 2011 9:32 am

sajeethk

23 Re: A word of caution Wed Aug 17, 2011 11:02 am

stockdad

24 Re: A word of caution Wed Aug 17, 2011 11:12 am

rijayasooriya

25 Re: A word of caution Wed Aug 17, 2011 11:44 am

stockdad

26 Re: A word of caution

Sponsored content

New topics