The Philippine stock market -- one of region's laggards

Today, many are just beginning to see the great benefits and advantages to trading online as compared with trading in our market.

1. In the Philippines, short selling is still illegal even if a few brokers and big dealers are able to evade the law and short the market. But prices will go up and down. On average, 3 to 6 months moving up and 7 to 9 months going down. This means that for the majority of traders and brokers, there is nothing to do, no earning opportunities during 8 or more months of every year. Those who insist on trading despite the adverse situation are doomed to lose.

Compare this to Online Trading, where short selling is available all the time. And for Forex and some futures, we can trade 24 hours every day. Earning opportunities are available 12 months of every year and every trading day, the whole 24-hour day.

2. Here, after commissions which vary from client to client and taxes and other charges, turn-around costs would amount to some 1.7% or more of gross value. In Online Trading, turn-around costs are never more than 0.004% or just a 2 to 4-pip spread. A price rise of a mere 1% constitutes a great big profit, already.

3. In the stock market, margin is fixed at 50% of gross value compared with 0.25% or just 25 pips if we trade online.

4. Here, we have to call up our broker and he executes our orders. In Online Trading, we can key in our orders directly by using our own PC in the comfort of our home or office. No one to consult or screen our orders. No delays.

5. Here, we will be charged interest at banking rates based on our debit balance. Online, the charge is less than a very insignificant 1 pip equivalent value for every additional day that we hold on to our position.

6. Regarding liquidity, except for the few most active blue chip issues here, we might not be able to buy or sell significant volumes. Even a million peso order could take more than a day to complete. And the listed issues are comparatively few. In online trading, CFDs trade in the billions of dollars per day and Forex in the trillions. We can buy and sell as much as we want, very easily. And we can choose to trade shares, indices, commodities or forex. Moreover, there are always issues and products having their bull run.

7. Here, rumors fly but accurate and timely information are scarce and hard to come by. The information that filter down to us from our brokers are generally too late for trading purposes. And worse, here, the news is too often fabricated or manipulated or else its release is delayed by our corrupt government officials and unscrupulous insiders until after they have already loaded or unloaded their shares. In Online Trading however, we just have to tune in to Bloomberg, CNN or BBC or we can click our mouse to get all the news we want over the Internet or from your brokers.

But we don't even need to know the news. Provided that we have developed the necessary reading skills, we can consult our charts and trade just as profitably. All significant buying and selling will register in the charts and warn us even before the news breaks. Charts are free and are available in real time to everyone without any delay.

8. Of great help in the honing of our trading skills is the availability of demo trading facilities where beginners can learn from simulated trading without risk of losing real money.

9. Now, we don't need a lot of money to earn money. We can start to trade with as small as a $300 initial start up fund with FXCM.

Considering all these, it's no surprise that our market has long lagged behind its neighbors and the rest of the world while Online Trading continues to grow by leaps and bounds.

Latest developments:

1. As of July, 2007, the PSE Board has already approved a revised set of rules on short selling and has submitted the same to the SEC for final approval. See article http://www.gmanews.tv/story/51718/PSE-board-approves-short-selling-rules.

2. At least one broker is now offering online services.

For inquiries, send email to: forex300club@gmail.com

Blog Contents

Forex for $300
Play for money
The solution to your money woes
Introduction to online trading
The lifetime free hands-on training
FXCM and GCI compared
Interview with February’s King of the Micro Winner
Interview with March’s King of the Micro Winner
How to open a live account with FXCM
How to open a live account with GCI
Earn as you learn
9-Month demo summary results
Dealing desk policies, rules and procedures
The Philippine stock market -- one of region's laggards