A Guide to Investment in Stocks and Shares

(Out of print - You probably can get it in the local Singapore Library as I did in the picture)

Paperback: 124 pages

Publisher: Educational Publications Bureau Pte Ltd (1984)

ISBN-10: 9971023539

ISBN-13: 978-9971023539

Wong Yee managed to condense the essentials of stock market trading into this small book. Given that this book has been published 20 years back, it goes to show that there are some age-old advice we should all follow. I summarize them as follows:

o Big players dominate/manipulate the market to profit

o The way to conquer the market is to first conquer your emotions.

o Know when to take profit and when to cut losses

The author also goes on to explain financial statements, charts/trends and some crucial accounting ratios we ought to pay close attention to, like P/E ratio, liquidity and profitability ratios.

I enjoyed the real life examples given of the bear markets in the 1980s and 1990s because they are locally (Singapore) orientated for me to pick up some tabs. Other than that, quite a bit of the information is outdated – the Straits Times Index, Singapore stock market trading system etc.

The most interesting information I garnered was the author’s Bull Market Analysis (bull phase pattern).

• A bull run typically consists of 3 phases of 3 upthrusts each.
• Each phase has a correction after each upthrust; the last being a consolidation.
• A correction is characterised by a dip of at least 20% of the increased gain during the uptrend.
• A consolidation is a huge correction.
• Upthrust 2 is the shortest while upthrust 3 is the longest.
• Upthrusts are characterised by huge activity and high volume.
• A bear raid follows the final upthrust of the 3^rd phase.

Interestingly as well, there is no apparent pattern (unpredictable rebounds and uncertain low points) to a bear raid hence it is not recommended to trade during a bear market.