Results of my first foray into stocks trading - Pass *sort of*

After the minor debacle with Milan Station (1150.hk), I decided that it was a good time to take stock of what I've learnt so far over the last 2 months.

As such, my remaining open position with Shifang (1831.hk) was closed with a loss of HKD$26 and the total profit/loss was calculated.

Having started my first trade with Jimei (1159.hk) on 9 Mar and ending with Shifang on 29 April, I conducted a total of 13 trades (buy and sell) on 11 different stocks and had a nett profit of HKD$946.

While this is not a very big amount (when converted into SGD, it's about $167), but when compared with my initial capital of $3K, this gives me an ROI of 5.65%.

I've also just completed my prototype stock trading and evaluation system and will be testing it out in the next phase of my trading journey.

Stay tuned :)

Use of moving averages as stop loss levels?

Got this inspiration while reading another book (Invest Like a Shark by James Deporre).

My current profitable trade in Brightoil (933.hk) has seen quite a fair amount of profit. I think I will try this method to establish my stop loss levels once the current one placed yesterday expires this evening.

My second open trade in Yuhua (2728.hk), while (slightly) profitable, is tying up quite a fair portion of my total portfolio. As such, I've tightened up my stop loss to $1.02 (quite substantial with little leeway for any price decrease) to get out.

Youyuan (2268.hk) was my previous trade that I closed at $1.77. If I had used this method instead, I would have been stopped out at $1.795 due to the long lower  shadow on 31 Mar. Otherwise I would have still been in the running for this share.

However, if we look at Jimei (1159.hk), the very first stock that I bought that stopped me out on the very same day, the stock volatility would have easily kicked me out of the trade as the price penetrates the 30-EMA levels too frequently.

Jimei (1159.hk) - Buy #1 in HSI

With little research and understanding I actually had the guts to buy a stock (Jimei 1159.hk) I knew little about. Bought yesterday late afternoon and was stopped out this morning when the market opened.

Total damage - (2.22 - 1.98) x 500 shares = hkd 122 = S$22

Lessons
1. Study the stock more before buying - don't just trust your system
2. Check ask and bid before committing - Google finance is 15 minutes
3. Know the daily trading range of the stock to avoid being stopped out - the price is now 2.14. Refer to point 1.
4.  Having a stop loss works to avoid stupid mistakes like these if lessons 1 to 4 are learnt
5. Investing small amounts in the real market teaches more effectively than learning from pure paper trades