Originally Posted by stl67
Before the banker did the risk profile with me, we have a few chats and then/finally he explained to me that we need to adjust the risk profiles if I want to do ELN and some riskier products. The rest as you know lah, most bankers will protect themself and will say at the end of the day, it is our call. So you are right that I half blindly do the risk profile assesment with them and I must say I am a riskier person.
Honestly, I am also worry of the FED removing the QE and then interest rate starts to climb. So far I have no exit plan for this except that I need to ensure that there is enough liqudity to service the mortgagea, even in the worst case situation. My excel skill quite good, so I did future Cash flow projections to ensure there is always liquidity provided that those fix coupon securities do not default.
Liquidity will ensure holding power just like businessman and the prove? For eg, during the Lehman crisis, I forced sell 1 of the condo so that I can continue floating and move on. (No point looking back).
This time round, I am more prepare. Why? My 2 equity loans (1 my own and the other family shared and I am majority) are fully paid so my take is that the chance of margin call is slimmer. I might be wrong.... After thinking for so long, I really have no idea on how to generate more $$.. so decided to take some risk...
As always, I appreciate your advice and contribution.
You are a impatience risk taker. U better stop further investment until U hv a clear mind. I suggest you redo your risk profile at least 3 times at different day or week to reconfirm what U really want to achieve. Do it seriously with your whole family member in mind. Then stick to it.
You cannot hv "As long as I dont lose, I am happy" mentally. Yet U go for high risk ELN/FCN which can drop >50%. worst case ZERO. US$1.3m is really too much. I only hv 300k.
As for you having 2 equity loan to buy risker investment product. Although the margin call is very slim. But it can be a very painful slow death & may cause bad relationship among your family member. Your ELN/FCN convert to shares & share keep going down & equity loan interest keep going up & U refuse to cut loss. Your wealth painfuly slowly go down . This painful sernarios can happen.
I hv gone through 97/98 & 08/09. My mistake is like everybody. Human memories tend to forget about the past mistakes. I hv forgotten the 97/98 crsis. I repeat it again. Luckily I hv the courage to cut loss.That why I survive. Like what Spanish Philpsopher George Santayana says. "THOSE WHO CANNOT REMEMBER THE PAST ARE CONDEMNED to REPEAT IT" I tell myself NOT to be condemned again by reminding myself through writing in this forum.
A successful traders are those who are courageous & fast in cutting loss when investment goes wrong.
PATIENT PATIENT PATIENT is only advise I can give U. To Buy stock at low floor, U need to be patient. Opportunities will come. Just be more patient.
rdgs,
Vic
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