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Fitting Trading Into a Busy Lifestyle

Fitting Trading Into a Busy Lifestyle

Trading is an activity that can be rewarding, exciting, and challenging. Trading is also considered to be the hardest game in the world. However, it also requires time, attention, and discipline. For many people, finding the time and energy to trade can be difficult, especially if they have a busy lifestyle. 

How can one fit trading into a busy schedule without sacrificing their quality of life? Here are some tips and strategies that can help.

Choose the right market and time frame

One of the first steps to fit trading into a busy lifestyle is to choose the right market and time frame that suit your availability and preferences. Different markets have different characteristics. Each one has its own unique amount of volatility, liquidity, trading hours, and fees. For example, the forex market is open 24 hours a day, five days a week, and offers low transaction costs and high leverage. However, it also involves high risk and requires constant monitoring of currency movements and news events. On the other hand, the stock market is open only during specific hours, depending on the country and exchange, and offers a wide variety of instruments and sectors to choose from. However, it also involves higher transaction costs and lower leverage.

Similarly, different time frames have different implications for trading. For example, trading on shorter time frames, such as minutes or hours, requires more frequent analysis, entry, and exit decisions, as well as more stress and emotional pressure. On the other hand, trading on longer time frames, such as days or weeks, requires less time and effort, but also less opportunities and slower returns.

Therefore, you should choose the market and time frame that match your goals, risk tolerance, personality, and schedule. For instance, if you have a full-time job that occupies most of your day, you may want to trade on longer time frames in the stock market or the forex market during off-peak hours. If you have more flexible hours or work from home, you may want to trade on shorter time frames in the forex market or the futures market during peak hours.

Plan your trades ahead

Another way to fit trading into a busy lifestyle is to plan your trades ahead of time. This means doing your homework before the market opens or after it closes, depending on your chosen time frame. You should conduct your technical analysis, fundamental analysis, news research, and risk management to identify potential trading opportunities, entry points, exit points, stop-loss levels, and position sizes ahead of time. You should also have a trading plan that outlines your trading strategy, rules, and objective – all of which should be in sync with the time and effort you can realistically give.

Planning your trades ahead can help you focus on just executing the trades onces the opportunity appears. It can also help you stay focused and disciplined on executing your trading plan without being distracted by market noise or external factors.

Use Technology Wisely

Technology can be a great ally or a great enemy for traders who have a busy lifestyle. On one hand, technology can help you access the market anytime and anywhere through various devices and platforms. You can use online brokers, trading software, mobile apps, alerts, signals, indicators, charts, and other tools to facilitate your trading process. You can also use automation tools to execute your trades automatically based on predefined criteria.

If automation isn’t suitable for you, alerts can be the better alternative. Even when you’re in the office or somewhere else, alerts will help you find out if significant moves are happening in the market.

Is it possible to trade successfully while being a busy person?

The answer is most definitely yes! Many well renowned traders have achieved success even as they have other responsibilities to attend to. The Market Wizard Tom Basso perfectly explained it in the Investa Summit 2023 that trading doesn’t need to be all-consuming. According to him, the best strategy will always be the one that you can execute based on your circumstances. Finding that strategy means figuring out what your edge is in the market, and developing a set of rules that will help you turn it into profits.

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Are Stock Screeners Essential for Traders?

Stock screeners are tools that allow traders to filter and sort stocks based on various criteria. Commonly these are factors like price, volume, market cap, earnings, and more. They can help traders find potential trading opportunities, identify trends, and analyze the performance of different stocks.

But, are stock screeners essential for traders? In this article, we will explore some of their benefits and limitations.

Benefits of using stock screeners

Stock screeners can offer A LOT of advantages for traders, such as:

– Saving time and effort: Stock screeners can help traders narrow down their search from thousands of stocks to a few that meet their criteria. This can save a lot of time and effort that would otherwise be spent on manually scanning through stock charts and financial statements.

– Finding hidden gems: Stock screeners can help traders discover stocks that are undervalued, overlooked, or have strong growth potential. These stocks may not be widely covered by the media or analysts, but they may offer attractive returns for traders who are willing to do their own research.

– Testing trading ideas: They can also help traders test their trading hypotheses and strategies by applying different filters and indicators to see how they affect the results. For example, a trader can use a stock screener to see how stocks with high dividend yield and low debt perform compared to stocks with low dividend yield and high debt. By coming up with different lists, it becomes easier to compare the performance of the two sets of stocks.

Limitations of using stock screeners

They are not perfect tools, and they also have some drawbacks that traders should be aware of. Here are some of the challenges that come with using screeners.

– Missing out on opportunities: Stock screeners may not capture all the relevant information or factors that affect prices. For example, a stock screener may not account for news events, analyst ratings, insider transactions, or market sentiment that may influence the demand and supply of a stock. Generally, stock screeners should be a part of the process towards finding opportunities. 

– Getting biased results: A trader may use too many or too few filters that may either exclude or include too many stocks in the results. By trying to perfect the filters too much, the results could already be losing efficacy.

– Following the crowd: Stock screeners may lead to herd behavior among traders who use similar criteria and indicators to select stocks. This may result in increased competition and reduced profitability for those stocks. Therefore, traders should always use their own judgment and creativity and avoid following the crowd blindly.

Should you use them?

Stock screeners are useful tools that can help traders find and analyze stocks based on various criteria. With the vast amount of assets available to be traded, they can be deemed essential for traders of any level. 

Just remember that screeners will always come with limitations. It’s important to remember that it will only remain as a tool – how effective it is towards finding solid trades will still depend on the skill of the trader.

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Investing Through Fractional Shares

Fractional shares are portions of a stock that are less than one full share. For example, if a stock trades at $1,000 per share, but you only have $100 to invest, you can buy a fractional share of 0.1 of that stock. Fractional shares allow you to invest in high-priced stocks that you may not be able to afford otherwise. They also enable you to diversify your portfolio even with small amounts of money.

How to Buy and Sell Fractional Shares

Not all brokerage firms offer fractional shares, but most popular brokers often have them. Each broker has its own minimum investment amount, eligible stocks, and fees for fractional share trading. You should compare the different options and choose the one that suits your needs and preferences.

To buy fractional shares, you need to open an account with a broker that offers them and fund it with the amount you want to invest. Then, you can select the stocks you want to buy and enter the dollar amount or the fraction of a share you want to purchase. The broker will execute your order at the best available price and credit your account with the shares.

To sell fractional shares, you need to place a sell order with your broker and specify the dollar amount or the fraction of a share you want to sell. The broker will execute your order at the best available price and debit your account. You will receive the proceeds from the sale in your account balance.

Pros and Cons of Fractional Share Investing

Fractional share investing has several advantages and disadvantages that you should be aware of before deciding to invest in them. Here are some of the main pros and cons:

Pros

  • Accessibility: Fractional shares make it possible for anyone to invest in high-priced stocks that they may not be able to afford otherwise. For example, if you want to invest in Amazon, which trades at over $3,000 per share as of October 20212, you can buy a fractional share of 0.01 for $30.
  • Diversification: Fractional shares allow you to diversify your portfolio with small amounts of money and create a balanced mix of stocks across different sectors, industries, and market caps. For example, if you have $500 to invest, you can buy fractional shares of 10 different stocks instead of buying whole shares of one or two stocks.
  • Dividend reinvestment: This also enables you to reinvest your dividends automatically and compound your returns over time. For example, if you own a fractional share of 0.5 of a stock that pays a dividend of $1 per share, you will receive $0.5 as a dividend and use it to buy more fractional shares of the same stock.

Cons

  • Liquidity: Fractional shares are not traded on the open market, but through your broker’s platform. This means that you may not be able to sell your fractional shares at any time or at the price you want. You may also face delays or errors in executing your orders due to technical issues or market volatility.
  • Costs: You may incur fees or commissions from your broker, depending on their pricing structure and policies. These costs can eat into your returns and make fractional share investing less profitable than buying whole shares.
  • Taxation: Fractional shares may trigger capital gains or losses for taxable investors when they sell them or receive dividends from them. These tax implications can affect your after-tax returns and tax efficiency.

Conclusion

Fractional share investing is a way to buy portions of a stock that are less than one full share. This can make the stock market more accessible, diversified, and rewarding for small investors who do not have enough money to purchase whole shares. However, fractional share investing also involves some challenges and costs, such as liquidity, fees, and taxation. Therefore, it is important to understand the benefits and drawbacks of fractional share investing and how to apply it to your own portfolio.

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Why are Index Rebalancings Done?

An index is a collection of securities that represent a certain market, sector, or asset class. For example, the $PSEi consists of the top 30 companies in the Philippines. On top of this, it aims to reflect the state of the economy. However, since a lot of things can happen over a span of time, index rebalancing are done in order to better reflect economic progress.

What is an Index Rebalancing?

First of all, an index is made when stocks are bundled together. These stocks are called the constituents of the index, and the index aims to track the price changes of the entire group.

Index rebalancing refers to adjusting the weights or composition of the securities in the index on a regularly scheduled basis. The frequency and method of doing so depends on the type of the index. For the Philippine index, the goal is to track the biggest 30 companies with adequate representation from each industry. The index also takes into account the free-float of the stock. The $PSEi usually rebalances stocks. An index rebalancing of the $PSEi is done as the free-float adjusted market capitalization of stocks change. 

Why is an Index Rebalancing Important?

Index rebalancing is important for several reasons:

  • It ensures that the index reflects its intended market segment or investment theme accurately and consistently over time.
  • It prevents the index from becoming too concentrated or skewed towards certain stocks, sectors, or regions that may have performed well or poorly in a given period.
  • It reduces the tracking error and improves the performance of index funds or exchange-traded funds.
  • It provides opportunities for investors to buy low and sell high by rebalancing their portfolios in line with the index changes.

What are the Challenges of Index Rebalancing?

Index rebalancing also involves some challenges and costs, such as:

  • Transaction costs: Rebalancing requires buying and selling securities for funds, which incur commissions, bid-ask spreads, and market impact costs. These costs can reduce the net returns of the index and its followers.
  • Market timing: Rebalancing can cause price distortions or volatility around the rebalancing dates due to increased trading activity.
  • Information leakage: Rebalancing may reveal information about the index composition or methodology to other market participants, who may exploit it for arbitrage or front-running purposes.

How does this affect your portfolio?

If you are an investor in the Philippine stock market, the biggest thing you have to take into account is that price action will often be affected by impending rebalancings. Before the announcement, stocks that are about to be dropped tend to sell off even before the news comes out. Likewise, stocks that are about to be included can experience increased buying. The adage “buy the rumor, sell the news” often comes true with rebalancings locally. As such, make sure to pay close attention to how prices move as an index rebalancing nears,

Your trading or investing activities shouldn’t revolve entirely around them, but paying attention to them could help you save money from some losses, or even take advantage of bullish price action!

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The Importance of Insurance Policies

Insurance is a way of protecting yourself and your loved ones from the financial consequences of unexpected events, such as accidents, illnesses, natural disasters, lawsuits, or death. By paying a small amount of money, you can transfer the risk of loss to the insurer, who will pay you or your beneficiaries a certain amount of money (called a benefit) if the insured event happens.

Insurance can help you achieve peace of mind, financial security, and a better quality of life. Here are some of the reasons why insurance policies are important:

Insurance can help you cover the costs of unexpected losses

Life is full of uncertainties and risks. You never know when something bad might happen to you, your property, or your business. For example, you could get into a car accident, your house could catch fire, or your health could deteriorate. These events can cause significant damage that will require a lot of money to recover from them.

Without insurance, you would have to bear the full cost of these losses out of your own pocket. This could put a huge strain on your finances and your well-being. You might have to use your savings, borrow money, sell your assets, or reduce your standard of living to cope with the situation. You might even end up in debt or (hopefully not) bankruptcy.

With insurance, however, you can avoid or reduce these financial burdens. The insurance company will pay for all or part of the costs of the insured losses, depending on the terms and conditions of your policy. This way, you can save your money for other purposes, such as investing, saving, or spending on your needs and wants.

Insurance can help you grow your wealth and achieve your goals

Insurance is not only about protecting your wealth, but also growing it. Some types, such as life insurance, annuities, and endowment policies, can also serve as investment or savings vehicles that can help you accumulate money over time. These policies can offer you a guaranteed or variable return on your premium, as well as tax benefits, depending on the type and features of the policy.

With insurance, you can use the money that you save or earn to fund your dreams and aspirations. They can help you buy a house, start a business, or retire comfortably. You can also use the money to create a legacy for your family, such as leaving an inheritance.

Is it worth it?

Insurance is a vital part of your financial planning and well-being. It can help you cover the costs of unexpected losses, protect your family and your future, and grow your wealth and achieve your goals. 

Just make sure to choose the best insurance policy plan that fits your goals!

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5 Lessons We Can Learn From Warren Buffet

Warren Buffet is a legend in the world of investing and business. He is the chairman and CEO of Berkshire Hathaway, a massive conglomerate that owns dozens of companies in various industries, such as insurance, energy, transportation, retail, and technology. He is also one of the richest people in the world, with a net worth of over $100 billion.

But Warren Buffet is not just a successful investor and businessman. He is also a wise, generous, and humble person. He has shared his insights and advice on many topics, such as money, life, and happiness. He has also donated billions of dollars to various causes and pledged to give away most of his fortune to charity.

Here are five lessons that we can learn from Warren Buffet.

Invest in yourself 

The first and most important lesson that we can learn from Warren Buffet is to invest in ourselves. Buffet believes that the best investment we can make is in our own education, skills, and talents. He once said:

“There is one investment that supersedes all others: Invest in yourself. Nobody can take away what you’ve got in yourself, and everybody has potential they haven’t used yet.” 

By investing in ourselves, we can improve our knowledge, abilities, and confidence, which can help us achieve our goals and dreams. We can invest in ourselves by reading books, taking courses, learning new things, and seeking mentors and feedback.

Invest in what you understand 

The second lesson that we can learn from Warren Buffet is to invest in what we understand. Buffet is famous for his value investing approach, which involves buying undervalued companies that have strong fundamentals and competitive advantages. He also avoids investing in businesses that he does not understand or that are too complex or risky. According to him, he doesn’t “look to jump over 7-foot bars: I look around for 1-foot bars that I can step over.” By investing in what we understand, we can reduce our chances of making costly mistakes and increase our chances of making profitable decisions. We can also enjoy our investments more and have more confidence in them.

Be patient and long-term oriented 

The third lesson that we can learn from Warren Buffet is to be patient and long-term oriented. Buffet is not interested in short-term gains or market fluctuations. He is focused on the long-term performance and potential of his investments. 

By being patient and long-term oriented, we can avoid being distracted or influenced by emotions, noise, or trends. We can also reap the benefits of compounding, which is the process of earning interest on interest over time. This can make a huge difference in our wealth and returns over the long run.

Be frugal and humble 

The fourth lesson that we can learn from Warren Buffet is to be frugal and humble. Buffet is known for his modest lifestyle and his disdain for extravagance and waste. He still lives in the same house that he bought in 1958 for $31,500. He also drives his own car and eats at McDonald’s. According to him, 

“If you buy things you do not need, soon you will have to sell things you need.” 

By being frugal and humble, we can save more money, avoid debt, and live within our means. We can also appreciate what we have and be grateful for our blessings. We can also avoid being arrogant or greedy, which can lead to bad decisions and outcomes.

Give back to society

The fifth and final lesson that we can learn from Warren Buffet is to give back to society. Buffet is one of the most generous philanthropists in the world. He has donated more than $37 billion to various causes, such as education, health, and social justice. He has also pledged to give away more than 99% of his wealth to charity. Why does he do this? Warren Buffet says that “the society is responsible for the fact that I can make this kind of money. It makes sense to give it back.” He also said, “If you’re in the luckiest 1% of humanity, you owe it to the rest of humanity to think about the other 99%.” By giving back to society, we can make a positive difference in the world and help others who are less fortunate. We can also find more meaning and purpose in our lives.

These are some of the lessons that we can learn from Warren Buffet. He is not only a great investor and businessman, but also a great teacher and role model. By following his example, we can improve ourselves, our finances, and our society.

Laban lang, ka-Investa!

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Saving Money on Vacations: Tips and Tricks for a Budget-Friendly Vacation

Uy may long weekend na parating sa October! Tapos December malapit na rin! Saan kayo magbabakasyon? Pero teka… handa na ba budget mo?

Traveling is one of the best ways to experience new cultures, learn new things, and have fun. However, traveling can also be expensive, especially if you don’t plan ahead and look for ways to save money. Fortunately, there are many tips and tricks that can help you go on a budget-friendly vacation!

Book in Advance

One of the easiest ways to go on a budget-friendly vacation is to  book everything ahead of time. Booking in advance can help you find the best deals, avoid price surges, and secure your spot. You can use online tools and apps to compare prices, find discounts, and get alerts for cheap flights and accommodation.

Another benefit to doing so is that you’ll ultimately be prepared on your vacation. Spontaneous activities are usually what eat up the funds of travelers. While you should have some spontaneity, it should be balanced with already having plans so that you don’t go way out of you means.

Find Cheap Flights and Accommodations

Finding cheap flights and accommodation can make a big difference in your travel budget. Aside from booking in advance, even small changes can help you save big as you go on a budget-friendly vacation.

For flights, it’s usually possible to find cheaper fares if you look hard enough. The most common way is to fly with low-cost airlines. However, another trick many don’t know is that you can set alerts on Google Flights or other trackers to let you know if prices just dropped. Sometimes the money saved can be minute. However, if you’re lucky enough a substantial drop could occur.

Explore Different Platforms

What many don’t know is that prices for the same accommodation or activity can often change depending on where you’re looking. Different online platforms like Agoda, Booking.com, and others often have different prices. If you diligently compare the available pricing, you’ll most likely find cheaper offers than the first one you find. Heck, if you’re really diligent you can even check what rates are when you book directly with hotels or agencies. Effort goes a long way towards making a budget-friendly vacation possible.

Make Use of Travel Rewards Cards

If you travel frequently, you can take advantage of these. Travel rewards cards often provide you incentives in the form of points, miles, or cashback for your vacation purchases. You can even use travel rewards cards to access perks such as airport lounges, free checked bags, and travel insurance. However, make sure to choose a travel rewards card that suits your travel style, spending habits, and goals. It’s always best to know if the rewards you’ll get are worth for what the cost of owning the card is. If you’re not sure, you can always compare the different credit cards available here.

Lastly, stay within your means

Traveling and going on a vacation is something we should all be looking forward to. However, don’t fall for the traps of “minsan lang naman ‘to” or “sige itodo ko na yung gastos ngayon lang naman.” 

Have fun, but make sure to be responsible as well! It will go a long way towards making you at ease and comfortable, even after you get back home.

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