#161. Unit Trust Agents And Your Investment 2

Does Your Unit Trust Agent Know What Time It Is?

Following up from the previous article, here is another story.

My sister-in-law told me that she has lost money in a previous bout of unit trust investment. Tsk tsk. What a pity. 

I can only sympathise with people who have put their money with 'clever' unit trust consultants. Then I moved on and said, "It's all about timing in investment. The keyword is timing." 

Do you know that many unit trust agents don't really care about 'timing'? 

Put yourself in their shoes. I can't blame them. They are in this profession full time and depend on the income to live their lives. Money has to go into their bank account every month. Who wants to go dry for months when the market is not conducive to buy? As such, when market is swinging downwards, they will still tell you to keep investing and buying. 

Buying in a down trend disguising as dollar cost averaging technique

I know in my previous articles on dollar cost averaging, I have mentioned that it is to be used for long term investment. However, I realised that people are not always keen to invest further

 when they see the market crashing down. And it takes a long time for the market to recover to the previous pristine prime level once it hits the bottom. People just lose that kind of patience and sell their investment at a loss. Thus, people like my sister-in-law says she lost money in unit trust investment. She may even vouch not to invest ever again in unit trust.

Can't really blame them. Both the unit trust agents and those like my sister-in-law.

The unit trust agents will ask you to continue buying and say that you should apply the dollar cost averaging technique. This will guarantee that income keeps pouring into their bank account. Again, timing is not a friend for them. 

Now, I am not saying all unit trust agents are like that. Some really go for timing. Look for these agents if you want to be profitable in your investment.

For investors, not all of them are fond of dollar cost averaging. In fact, I don't believe in the put-your-money-in-monthly dollar cost averaging anymore. As mentioned by W.D.Gann, in a bearish trend, price can dip lower. He said it would be quite foolish to keep putting in your dollars in a losing investment. I can't agree more. When a price goes lower, there is a reason for it. And that reason can be because the whole world's economy is going down. Would you want to keep adding money to a losing investment? The better choice is to cut a quick loss and move the funds out.

Where are your unit trust agents?

Another story I heard is about a relative who is a unit trust agent. He confessed that the current troubled times have taken a toll on his income. His clients are losing money. People are scared to invest at this moment. No one to invest, no income for him. How would you sleep at night when your clients are losing money? I certainly can't sleep easy. 

Well, during the last few years when times are good, unit trust agents will call you and say "See, I told you. Good thing you listened and invested. You are making yourself fat profit now."

Now the times are bad, where are your unit trust agents?

Do you hear them calling you and saying, "I am terribly sorry, it's my fault. I should have advised you to sell your investment while it is profitable." They will never admit that. They take the glory when you make profit and curse the market when you suffer a loss.

Most likely you will only hear, "Hey, don't worry. Market is down now, it is an opportunity for you to buy at a low price. Continue to do the dollar cost averaging. That is the smart thing to do. We shall see fatter profit when the market moves up. It's all a cycle."

When market is down, they will push you for more investment. Can't blame them. 

A good investment consultant should be a wealth augmentor. A wealth augmentor helps you to increase the size of your funds. Because, after all that is the purpose for investing. You invest to make money. 

Every Tom, Dick and Ali is now a financial advisor or investment consultant. But they are not truly a wealth augmentor. Only a wealth augmentor can still help you to make money even when the market is down. They know when to buy and when to sell. As simple as that.

Timing is crucial in investment

Most unit trust consultants don't read enough and never read at all on investment strategies. They only follow the conventional ways purported by the unit trust industry - to buy at anytime and hold for long term, the longer the better. This method may not always be a good one to follow. You may still lose money even if you hold it for a long, long time. Or make only a very small profit.

Look at the chart above for KLCI from 1.1.2000 to date (January 2009). The arrow shows that if you just listen to the unit trust agent who does not care about timing, you will be suffering a lost despite a long period of investment. The wise thing will be to buy and sell at the right time as shown. 

Invest to make money. Happy investing. 

#160. Gold Investment And Tetrahedron Update 8

Let's Buy Gold

In the last Gold Investment Update series, I have shown as above that the gold price is going up after forming the third triangle in a tetrahedron formation. The gold price then marches in an upward direction. I ought to kick myself for not adhering to the Gold Tetrahedron Theory and bought when the price made an immediate upward swing at the base of the triangle.

Expecting the price to drop dead yesterday when the price was moving lower but it didn't. Look at the chart below.

I stayed up till 2am this morning (30 January 2009) watching the price bounced back up. Crossing my fingers and hoping that the price would cross the red line, yet it didn't. This morning I immediately decided that this bullish trend still has some oomph left and head straight to the nearest Public Bank. Price in the chart is showing USD906.50. The bank sold it to me at RM107.62.

If all the analysis are correct, we might see gold price continues to skyrocket to USD980-USD1000 region. I would be happy even if it reaches the USD980 point.

Price is not the factor to consider in investment

Now, I know the price is high at this point. Even the bank teller was telling me "Price is very high now. Do you want to buy?" People are scaring $#!t and even chickening out when I give the buy signal. 

Well, shall I listen to the young bank teller (who may not have done any analysis at all and just based her judgement on price alone) or trust my own thorough analysis?

I remember the late great master trader W.D.Gann had written something like this: In a bullish trend, no price is too high. In a bearish trend, no price is too low.

If you based your investment on mere price alone without studying the charts, it is like when you hear the thunder and say "Oh, it is going to rain." But do you know when it is going to rain? It could be an hour from now, it could be two hours from now. Or never. Just hearing is not enough, you got to go out and look at the clouds, stick your thumb in the mouth and hold it up in the air, feel the wind and temperature. 

Study the charts first, not just looking at the price and concluding a decision to buy or sell.

The analysis I provide here is not comprehensive. I am reserving the other information for my book. Other analysis are showing a buy signal. It's an overdue signal. The signal was a few weeks ago but the momentum is still strong and might last a while more. 

Take your chances. I am not forcing you to be with me. If you do, may the force be with us. 

#159. Gold Investment And Tetrahedron Update 7

Learn How To Invest Profitably With Tetrahedron

In a previous article (Update 2), I have shown that after 3 triangles forming a tetrahedron shape, the price will move up. Yes, the triangle did form and the price went up. I made a profit when I sold it on 2 January 2009.

However, I have wrongly estimated the triangle. In the first chart above, the triangle seems too small compared to the other two. Not in balance. Thus, I am revising the third triangle now. Also, another wrong estimation was the expectation that the triangle base would come down lower to below USD800 price region. This didn't happen.

And I went back to Elliot Wave and analysed it again. The Elliot Waves have shown to me that the movement will be on a move up to reach quite a high price within the coming two months.

All is not gone yet. Yes, we have missed the boat at USD825 or lower level. Price has reached USD898.10 as I write this, but there is still a chance for a retracement.

I know, you could have made about 4% (after minusing the Public Bank Gold Investment Account buying and selling spread difference) within a short time! Michael will be saying "I told you so." Haha. This is one of those times, when we will humbly accept our defeat. Well, there are still opportunities.

I will enter a buy position in full power once the price retraces lower. All my analysis has now confirmed that the market is on an uptrend. Previously I was cautious of buying because the signs were not right.

Who is with me in the next buy?

#158. Best Date To Start Work For 2009

Happy Chinese New Year Gong Xi Fa Cai

Every year the Chinese people are interested in which date will be the best to start work after the Chinese New Year holidays.

Many Sifus (Masters) commercialised this idea by printing books and selling them. What a wonderful way to make money. There are Masters that will even advise you not to go out at all on Day 1 of Chinese New Year. I kid you not!

I have been an avid student of Feng Shui myself. My studies on Feng Shui and Bazi (a Chinese astrology method) begins with the study of Yijing (I-Ching). The study of Yijing is a must for anyone who wants to learn Feng Shui and Bazi.

Yijing is the foundation of all Chinese astrology and geomancy. It is from Yijing that Feng Shui and Bazi theories are developed.

In the study of Yijing, there are 8 trigrams (3 lines drawing) that form the Bagua. The combination of any two of these trigrams become a hexagram (6 lines drawing). Each line is either a broken line (dash dash) or a solid line (one straight line).

When 2 trigrams are combined to become a hexagram, we can say the combination is good or not by looking at the 'elements' of each trigram.

From the 8 trigrams, they are divided into 2 Wood element trigrams (one Yang and one Ying), 1 Fire element trigram, 2 Earth element trigrams, 2 Metal element trigrams and 1 Water element trigram.

The interaction between the trigrams will determine whether it is good or not when the hexagram is formed. For example, a combination of a metal and a wood trigram denotes a clash or fight. Because metal cuts wood, therefore it's like an axe chopping wood.

Fallacy and myth of best day to start work

The practice of naming best dates to start work is fast becoming a popular one. Now, in the study of date selection, all dates consist of a combination of elements.

The year has a combination of two elements. For example in the year of Ox in 2009, it is a combination of ying Earth and ying Earth. It can be considered a favourable and peaceful combinations because both elements are alike.

When the theory of Yijing is used in dates, each of the 5 basic elements are expanded further to have ying and yang. Thus in total there are 5 times 2 (ying and yang) = 10 different elements.
The month, day and hour too have their own combinations. And between year, month, day and hour, there may be a clash in the elements. Imagine 8 different elements (2 for year, 2 for month, 2 for day and 2 for hour) combining.

Anyway, what I would like to put forward is this, yes, some Sifus may say that (for example) on day 3 all the elements are favourable because the combination is good. But do you think just because you start work on a favourable day, the whole year will be a prosperous one?

Based on my explanations above, I hope you have understood that in every 365 days of the year, there may be days that are not favourable in their combinations. You may have chosen a good day to work but that doesn't guarantee that the rest of the 364 days will be a favourable one.
Put another way, when you drive for 365 kms, just because you start well on the first km, do you think the rest of the 364 kms will be a smooth ride? You will never know. Accident can happen along the way.

There are people who chose a good date to start their business, do you think this will bring them good wealth in their business forever?

We might be born on the 'wrong' dates according to these Sifus. Do you think we will face bad luck everyday of our entire lives? Many people have been cheated by this kind of Sifus because the Sifus told them they have to pay them to do this and that to clean the ill luck.

There is a cycle of bad luck and good luck just like how the stock market is. No one have bad luck forever. If you don't do something to improve your knowledge on personal finance, then you may always be poor (bad luck).

Feng Shui is a logical study. We need to apply some common sense. Do not listen to any Sifu without questioning the logic behind the practice.

Be practical, just keep your spirits high all the time especially in this economy climate. Pray that you become healthier, happier and wealthier. Put in effort to improve your health through exercise and healthy eating habits, be cheerful at all times and improve your knowledge on personal financial management. Study some authentic Feng Shui yourself so that you won't be cheated by these scam Sifus. Most of all, improve your knowledge on invesment and trading to make you wealthier.

May you have a healthier, happier and wealthier Chinese New Year!

#157. Gold Investment And Tetrahedron Update 6

Where Is The Price Heading To?

Michael Tsen made a comment on my Gold Investment and Tetrahedron article Update 5 and showed us the chart above. He added the red lines and made the comments:

"seems like could have bought at 825 and profit take at 875, could that be correct ?"

Well, I like the way you think, Michael. 

To analyse whether the gold price is going up again, we have to draw the red lines differently. Also, while you may think at US$825 is a good point to buy, you also need to be able to know where the price may end up in. 

It's similar to driving a car. You know where to start, and you also need to know where is your target destination. 

Would it be a wise to buy at US$825 and sell at US$875? Do a quick calculation and see what's the profit. It's only about 6%. And if I invest with Public Bank Gold Investment Account, the spread is already 4.2%. That'll leave with only 1.8%. Would that be worthwhile to take a risk?

Anyway, back to the above analysis. I have seen the price going up on 16 January 2009. However, I didn't take a position because my other methods of analysis have not confirmed that it's a buying point. 

I have also half expected it will go up when I compared it to the Elliot Waves. Indeed, the chart made an upturn going up. Now, I just need to have a few more confirmation on my other analysis before I call for a buy. This is one those times, when you are not certain, don't trade. Wait till the signs are clear.

Well, again, time will tell whether I am right or wrong. 

As an ending note or foot note, the red lines above are not totally wrong. They are more suitable for another analysis called 'the triangle'. 

#156. Gold Investment And Tetrahedron Update 5

Time Your Buying And Selling To Make Profit

On my last gold investment update (Update 4), I have shown that the price of gold is coming down purely based on the above chart analysis.

Today, the price is around US$825 level. Price has dropped almost US$50.

You may ask now, when is the right time to buy? Stay posted and keep reading my blog. I will update you in the next instalment when I see the right timing. I still believe the price can drop lower this month, despite the news saying that the coming Chinese New Year will increase the demand in gold and raise price up.

Lately I have some discussions with some people in the unit trust industry on investment. Generally, the view of the unit trust industry is still on performing regular dollar cost averaging. They call for dollar cost averaging buying on a monthly basis irregardless of the price. My opinion is you should buy only when the time is right. The right time is when the price is low.

To understand when the price is already at the lowest, we need to study the charts. Most of the unit trust consultants do not study the charts the way I study it. Without the knowledge of studying charts, they brushed away technical chart analysis saying that it is impossible to know the top and bottom of a market cycle.

Coming soon, a 'Gold Investment Secrets' book from Carson Ding

I am in the midst of compiling a book on my gold investment techniques. The information in the book will discuss in detail the things I mentioned on this blog.

As Joker said in the movie Dark Knight, "If it is worth doing, it is worth doing for money." (However, I am no joker. Haha-ha-ha.) Yes, you will be able to buy the book and learn how I accurately timed the market on 2 January 2009.

You can see in the chart above that 2009 opened with the gold price at the peak and thereafter declines to the current level. I sold my gold investment on 2 January 2009 and made an 11.9% profit within 66 days.

And for the first time, you will be able to discover some techniques never seen before. What you see here on the blog is only a brief discussion on charts. There are other ways of analysing charts including timing that is not revealed here.

From my chart analysis experience, I have learned that we should ignore the news that we read on the media. We should ignore the so called views from the 'experts' that often appear on interviews on the TV. Or when the 'experts' give their views and the newspaper prints a one-liner quote - for example, you may read "In 2009, the average price of gold will be US$910."

What does that mean to you? Does that you mean you should now rush out to buy gold at US$825 level and hope to sell at US$910? Hoping and praying do not make you money. Hoping and praying that the market will move in your direction? The word 'average' means that price can go up high and reach a very low, low. And in averaging out, you get a price of US$910. Why shortchange your profit when you could buy at a low, low price and sell at the top?

Don't listen to the media. A wiser choice will be to do your own analysis and buy based on your analysis.

By the way, would you be interested in the book? Do you want to read it in ebook or hardcopy?

#155. Gold Investment And Tetrahedron Update 4

Learn To Identify The Ups And Downs Of The Market


In my previous Update on 2 January 2009, I have shown that the gold price will come down. At that time, the price was US$871.08. And I have only based this analysis on using the chart alone as well as applying the Elliot Wave technique.


If you have read my previous articles on this series of Gold Investment And Tetrahedron, there is no mention at all on 'fundamental news'. Some investors are still arguing about fundamental news versus technical chart analysis. I will not go into this kind of argument. Whatever works for you, right?


Amazing isn't it, the way the price moved? Seems like there is an invisible natural force causing the gold market to move predictably. And seems like the fundamental news are just supporting the price movement, and not the other way around. It seems like the way the price has moved was not caused by any fundamental news.

Now, below is today's chart.

The price has come down to US$854.72. The price may go down further in the coming weeks. Again, I based this on the Tetrahedron theory and Elliot Wave. Price will go down further and will offer a new opportunity for investors.

The next point that the price could possibly go to will be at US$835 level. If the price breaks below the first support level, we could probably see price touching the US$820 level. At this moment though, it's too early for me to 'see' when we can have the buy opportunity again.

Using the Tetrahedron theory, do you think we will see another triangle shape forming in the chart as shown above? Time will tell and show us.

Keep on reading my blog to stay posted on new updates.

#154. 2009 Financial Plan

How To Plan And Grow Your Investment In 2009

Since it is the new year, isn't it a good time to plan for something? Whether it's your new year resolution, or something more important like your investment plan. Investment is like going for a holiday. You got to have a plan. You have to know where you want to take your investment to. And to have this investment plan, you would need to draw up a map. An investment roadmap to help you stay on course and grow your money.

A Great Story

Some years ago, I was working as a mortgage sales person at a big bank. There was this lady that year in and year out, she would win the Best Salesperson Award. She was asked to reveal her secret.

She admitted that in the beginning she was a poor sales person. Every month, she fails to meet her sales quota. Then one day, things change. She discover a way to be the best.

Now, in sales, every 1st of the month your sales quota is reset to zero. Then along the month, whenever you bring in some sales, your amount begins to grow. When it comes to the mid of the month, you supposedly should have achieved half of your sales quota. If you have not, you would work hard and start making more calls to achieve your quota before the month is out.

But the above is not the way if you want to be the best sales person.

The super sales lady shared with us: Always plan for the following month.

She explained further that you have to call your prospects and clients this month for the following month's sales. Don't expect that if you call them today, you will get the sales within the same month. It hardly happens.

She planned who she wanted to call this month. And then deliver the sales results the following month. That means she planned one month ahead. She was able to know roughly by the end of this month whether she could achieve her sales quota for the following month. If she could not, she would then still have time to catch up in the first two weeks of the following month. She was always ahead of the game compared to others.

How To Plan Your Investment Growth

So now you have read the above story, how can you apply what you have learnt? If you want to see your investment grow, you got to first have a plan.

The way I plan is simple. Let's say I target to grow my wealth by 20% this year, then I got to look for the best investment tool to make that kind of return. And to break it down into smaller achievable target, I can further divide 20% into 12 months. That means, on average we need to make a return of about 1.7% to achieve our yearly target.

Now, if you have read on my gold investment, you would have seen that I have made 11.9% return within less than 3 months of investment.

In this case, if you are able to achieve a good return, you ought to set your yearly target higher. Perhaps 20% is too low. Maybe let's target higher and aim for a growth of 50% in our investment this year. That means, an investment that starts with RM20,000 will see it become RM30,000 at the end of this year. Now, this is reminding me of my work in that big bank. The boss will always set your target higher when you are able to achieve your target.

OK, now 50% return in this year means you got to achieve about 4.2% per month. Doesn't it look more achievable when you break it down to 12 monthly targets? Now if I have achieved 11.9%, that means I am ahead by a few months. I just need to continue to make 4.2% each month now to achieve my target of 50%.

Another Way

Another way to look at and plan your investment growth is to have a target sum. Say you want to go for a holiday at the end of the year and it will cost your RM10,000 for your whole family; and you also would like to have RM10,000 extra from your investment. That means you want to make RM20,000 this year. This time we are looking at the sum amount instead of percentage.

So to achieve RM20,000 return, you should check how much money you have for investment. This money will also include all the money that you are going to get throughout this year either from your employment or other work that you do. That means the money that comes later in the year will add to your capital for investment and help you grow your investment even faster.

Once you have the amount that you think you can set aside for investment, you got to work out the percentage of growth that this RM20,000 is going to be for you. For example, if you have RM20,000 for investment and you want to make another RM20,000 from your initial investment, that means that is a 100% return. That also means you want to double up your money. Maybe 100% looks like a lot. But think again, maybe in the mid of the year you might get a bonus from your employment for the sum of RM10,000. That would mean you have RM30,000 for investment from the mid of the year onwards. That would mean your percentage will change. RM20,000 of RM30,000 is 67%. So you got to divide 67% by the remaining 6 months of the year. That's about 11.2% each month for the remaining 6 months.

Stay Focused

Staying focused in your target is important. However, don't be emotional when you don't achieve the targeted return. Some months things may not work out. Revise your plan accordingly if things do not go your way. Remember to know when to take your profit even when your target is not met. Remember that the market is bigger than your target. You need to yield to the market and follow the flow. Take profit when it is time.

Market will go up and down. When it goes up, make the most out of it.

When the market goes down, look for other investment to achieve your target. For example, when gold market is down, probably the Public Index Fund is going up. Place your money with the winner. Do not stick to just one kind of investment. Best to find two different investments that move in opposite direction. That way when one is down, you still can use the other to achieve your target. A good example is US Dollars and Gold. They move in opposite directions.

Just like the super sales lady that target different customers when her regular customers could not help her achieved her target, we should constantly look for different investment products to achieve our target.

Happy planning. Tell us how you make your 2009 financial plan and investment plan.

#153. KLCI Chart And Elliot Wave Update 2

Following my first article on the discussion of KLCI Chart and Elliot Waves, here is the second update.

If you remember the Elliot Waves of 5 waves up (1-2-3-4-5) and 3 waves down (A-B-C), then you can see that the we might have possibly reached the bottom of C.

As with the technique used in my discussion on gold investment, two red straight lines are drawn to indicate the upward resistance and downward support lines.

KLCI is going up!

Now, the upper red line is important to take notice here. It looks like the KLCI chart is going to breach the upper red line anytime soon. This is exciting! It is indicating an opportunity to make some good profit.

Once the KLCI breaks above 900 points (it closed just a few points shy of 900 at 894.4 on 2 January 2009), we can expect further upward movement. And then a new cycle of upward Elliot Waves will be seen ~ 1-2-3-4-and-5!

From C now to the new wave 1, we can expect around 15% to 20% of upward movement from the 900 points. In other words, if you buy Public Index Fund, you can probably make about 15% of profit within 6 months time.

You would probably make more if you have a greater risk tolerance and go for funds like Public Growth Fund and Public Aggressive Growth Fund.

Of course, here is my disclaimer, I might be wrong with the above analysis. Only time can prove whether we will see the uptrend in the KLCI chart within the next 6 months or so. So, if you dare to take a bit of risk and bet on the funds, I wish you a prosperous new year! And if you make a good profit, don't forget to send some donation my way.

Happy investing.

Updated 5 January 2009:

The KLCI has crossed the 900 level and at 2-month high.

#152. Gold Investment And Tetrahedron Update 3

Learn When To Sell And When To Buy

Howdy! Happy New Year to you all!! I have promised that this blog is not just about unit trust investment when I say ~ Scoop up some valuable tips too on other investments along the way. At this moment, I am so into gold investment and would like to share with you my findings and experience.

In my first article on Gold Investment And Tetrahedron I showed that I took a long (buy) position on gold at RM86.03 per gram from Public Bank Gold Investment Account.

I showed on the second update how the price has gone up.

And now, if you have followed the gold price closely yourself, you will see that the price has rocketed quite well. At this time of writing, the gold price is at USD871.08. I took the chance to short (sell) my investment at Public Bank for the price of RM96.29 per gram. If you are reading this, you might take this as a queue to short your investment too if you have followed my advice in the first article.

Phew! A cool profit of RM10.26 per gram! That's 11.9% profit! Not bad for a short time of investment. This shows that even amidst this economy downturn, if you have the knowledge, you can still turn in a handsome profit.

Why is it time to sell?

We might not know 'when' to sell our investment, but with the demonstration below, I hope you will know 'why' it is time to sell.

You may be interested to know why is it time to sell? Well, there are ups and downs in investment. The market as I always say is cyclical. Sometimes, we must learn to take profit when the reason is right. Now, I may be wrong for selling now. Price may go up further. But at 11.9% profit, I reckon it is a handsome profit. I will wait for the next round when the price is low again. After all, price moves up and down. There will always be a chance to buy again at a low price.

Looking at the gold price chart above, you can notice two straight blue lines forming a 'triangle' and some red arrows markings.

The chart below shows a bigger zoomed in version of that part.


The form the blue straight lines, I connected the two tops of the gold price graph as shown by the two red arrows on the top (pointing downwards). And for the bottom blue straight line, I connected the two bottoms of the gold price graph. Again, those bottom points are marked by the two red arrows at the bottom (pointing upwards).

And inside the ellipse (oval red line) you can see a bigger red arrow. This arrow shows that the gold price graph has dipped below the bottom blue straight line. Following the Elliot Wave theory, the five waves up have already formed. And now will be a time for the graph to move south. Again, I might be wrong in my analysis.

Thus, when the gold price graph breaks through the bottom blue line, I take it as a signal that the price is ready to fall. The price may dipped a little to USD860 region. And would be a good time to buy again then. In the near term (next 6 months), gold price is still bullish as people turn to gold as a safe haven when the US economy is bearish.

Happy buying and selling.