Intended For Success

This topic has been deep in my thought and in my heart for many past months. As a Managing Director of a thriving manufacturing company and being in the business for many years, the questions of where we stand has always came back again and again.

The Questions of the place of the heart in the Business World. Especially in the Past Few Months where more and more businesses are conducted without any heart attached. What I mean the cruelty of human being and the extend of it in trying to accumulate wealth for themselves.

Cases like the followings are really heartbreaking to learn of:

1. The total recall of the toys by Mattel that causes one of the factory owner in china to hang himself and committed suicide because he did not know that his trusted friend has decided to make more money for himself by providing unsuitable paint for these toys that is very dangerous and posed a health hazards to the children.

http://www.msnbc.msn.com/id/20254745/

2.  China Egg Cancer Scare - 1,159 kilograms of salted red-yolk eggs, all produced in Hebei Province, were seized in Beijing because they contained the carcinogenic dye Sudan-IV which was fed to ducks to produce red-yolk eggs, which are sold at a higher price at market. No one know how long has these suppliers been doing these tricks and they do not care how many people can die only how much money they can earn.

http://www.china.org.cn/english/MATERIAL/189808.htm

These 2 cases just happened to be exposed and they are happening in China, however I see that these problems do not just happen in China alone but these also happen in developed country such as America, Europe, Australia, Singapore and many more.

In fact, recently it happened to me, as my family are health freaks, we eat brown rice most of the time. I have noticed that the brown rice that I have been eating in my office looks strange as it looks rather purplish in colour. However due to my ignorant, I did not question my staff where she bought those rice from.

Until my sister and my father make the same remarks, so attention is drawn and we decided to buy our own packet of brown rice to see if the colour will be the same as the one we ate in the office. We also learnt that the rice in our office left a purplish coloured water upon washing before cooking which does not happen with the rice that we bought ourselves.

Only then we realized that the seller of the rice has dyed the rice to sell it at higher price to our office staff without considering the harmful effect it might bring to the consumers.

It is really sad to learnt that there are people out there who will do anything to earn money. Although admitted that it is not easy to run a business the Right Way, as there are people who will try to persuade you otherwise or put you in a position of difficulty that you have to choose to do the Right Things and Lose the Business or Get the Business but in doing it you Lost your heart.

Well, it is to my believe that lost business can be recovered, but a Lost Heart needs a Miracle to recover. I really encourage all business people to start thinking about this aspects in managing your business and I believe that your business will grow leaps and bounds without you giving up your heart.

Options has always been a intriguing subjects and somehow very confusing to a lot of people. In this post, I will try to simplify and explain it in a lay man terms, for call options and in my next post, I will explain on Put Options.

We actually uses a lot of call options in our daily life. We just do not realize it or it is not called “Call options” here are some of the normal call options most people encounter in their daily life but they just do not realize it.

For examples:

1. When you are buying a house, you place a booking fee of 1% or a sum of money so that the seller cannot sell it to another person for a certain period of time until you come up with the payment of the  downpayment of 20% or more to carry on with the purchase, however when you decided on the next day that you have made a bad choice as that house value you realized is not worth the sales value, you can decide to stop the purchase process and forfeited your booking fee of 1% or so.

By placing the booking fee, you became the buyer of  the call option which is the right to purchase the house at the agreed price for a limited time. While the seller of the house being in possession of the physical house became the seller of the call option, he sells you the right to buy his house and therefore he has the obligation to deliver the physical house to you upon the full payment of the house given.

2. Shopping Vouchers - is another type of call options that we uses a lot in our life but we just do not realize it. We bought a shopping voucher normally with specific value in each of the voucher that will be valid until a certain time. You became the buyer of the call options in this case and the merchant became the seller of the call options. What happens when you did not use your shopping voucher till the end of the validity date? You will not be able to use those vouchers anymore as they became worthless and you lost all the money paid to buy those vouchers.

Options whether call or put has validity date which we traders called expiry date of the option. When you think about it, actually our life do involve a lot in buying a call options, such as buying a prepaid parking tickets, prepaid one year access to recreation park or to the zoo, prepaid phone cards, buying our home appliances by placing a deposit first and full payment upon delivery.

In many events of our life, we actually in one form or another transact with buying or selling an “option” though the terms is not at such.

Call Options in Stock Market or in future market works in the same manners as the above. When you buy a call option, means you have the right to buy the stock which is the underlying asset of that options at the later date with limit to the expiry date of the option contracts at the agreed price

When you buy a call option, you have the Right to Buy the underlying stock - The key word here is the Right to Buy which means you are in control which also means you can decide whether to buy or not to buy. When you decided to Buy the stock, what you need to do is just Exercise your options, as a buyer you exercise your right.

However as a Seller, when you sell a call option, you no longer have the right, but now you have an OBLIGATION that you should fulfilled by delivering the asset when the buyer of your call option decided to use his or her right to buy the underlying stock. Which is called assignement - this is what happen when someone exercise their right, your call options has got assignment. As a Seller you have been assigned to fulfilled your obligation.

Call Options is not as complicated as it sounds but you need to be real careful when you are trading options as it can become a very expensive learning experience.

Hope that this brief explaination can help to interest you more to know about one of the most flexible and powerful financial instrument available.

The Trend is uprising. As I look through Newspaper in Singapore, in Indonesia, in Thailand and believe it is the same in other countries, I saw many people are selling their course on how to trade with options. Sad but truth is that these people who are selling you the dream of getting rich overnight, are not really interested in teaching you the truth about the trade but rather your money in your pocket.

Options is one of the most sophisticated financial instrument available today in the market. It is highly leverage and it is highly flexible in applications. Options can be a double edged sword to your investment if you do not know how to use it. Those people selling the course on options trading may not really realize what they get those people into, because a lot of them do not really know what they are talking about.

It took me 2 years to make my options trading profitable, guess what after going through more than 3 very expensive courses about option trading, I realized that those people are just “Super Sales People” but they are nothing more than that. Even if they are as good as what they claim to be, definitely they are not interested to teach you what they know about options trading.

In fact if you want to really learn about options trading, there is a place where you can find really excellent materials on options trading and even much better than what these so called “options guru” are giving you. and it is even better because it is for FREE. Yes, guess what after 2 years and after spending more than $15,000, I have found a better and Free way to learn about option.

Learn all about Options Trading for Free at the following website:

1. theocc.com
2. 888options.com

These two website is definitely important websites you always want to put in your explorer bookmarks if you want to trade options (of course besides IntendedForSuccess.com). Guess what? I have learn much more from these 2 sites than from those expensive courses I have paid.

Well I am one of those who are quite sick and tired with all the promises advertise by these so called gurus. So I am very determine to share a lot of stuff about options in this Blog.

Do stick around and from time to time you will learn how to manage your investment risk with Options.

This is a story taken from one of the book I read, but just could not remember which one was that? if any one of you know it, please let me know so that I can give a credit to the writer. But anyway I think this is a really good story. It goes something like this:

There was a young man who desire to achieve success. He knew that he needed a teacher to show him the way to success. So he asked around who would be the best person to coach him and show him the way to success. After asking around, many referred him to an old man up in the mountain who was known to be very wise and respected in that town. But the journey is not easy and he has to be prepared to be rejected by the old man after the hard journey to the mountain.

But this young man is determined to find the answer and set forth to look for this old man. After a long journey up to the mountain, the young man finally meet the old wise man. Understanding the intention of the young man, the old wise man asked him how serious is he in achieving success, and the young man reply him as serious as it can be and whatever it takes.

So this old wise man asked the young man to follow him for a walk to a beautiful lake and upon reaching the lake, the old wise man told the young man that the key to success is in the lake, he has to go nearer to the lake and look inside it. The young man look into the lake and was confused because he cannot find anything there except his own reflection. The old man told him to go nearer and put his face nearer to the water to find the key to success and still the young man could not find anything that can give him the key to success but just a plain clear water of the lake.

Looking at the intense desire of this young man, the old wise man told the young man to look even closer into the lake. As the young man face almost touch the water, suddenly the old wise man hold the young man neck down into the water, caught by surprise the young man struggle trying to catch a breath, but the old wise man even pushed the young man face even deeper into the water. As the young man is choking and swallowing the lake water, the old man releases his hold bring the young man head out of the water and as the young man is trying to catch his breathe, the old man pushes him down again into the water.

At this moment the young man realizes that his life is at risk and he struggles even harder and harder and finally choking and swallowing the lake water, the young man manages to escape the hand of the old wise man. The young man screaming at the old man saying that he is crazy and he is mad for trying to kill him.

However with such calm the old wise man reply “son, you have found the key to success. When your desire for success is as great as your desire for the breathe of air you need to stay alive, then you will be successful”. Suddenly it dawn on this young man that he has really learn a great lesson of life.

Now my friend, how strong is your desire for success whatever your definition of success it is. If you desire it strong enough, it will come to you. If you really really want it, then you will find a way to find it. Great Success Starts with A Dream carried out with such intense that it becomes a REALITY.

In managing your finances, it is important to know how you can make your money work harder than you. Most people work hard for money while at the same time they do not know that their money is shrinking with time. Why because any money that does not grow, SHRINKS. It is because of this one enemy of your money “inflation”.

What is this “inflation”? Inflation simply means the rate in which the value of money decreases over time - this is a lay man terms. This means a burger costing $0.50 ten years ago now is costing you $1.50. So what is the inflation rate? $1.50/$0.50 = 3 which means it cost you 3 x more money to buy a burger now than 10 years ago. The price has increased by 300% over the past 10 years which means per year inflation rate would be 30%. If this is the case that means the value of your money decreases by 30% every year. Which will also means if you have a saving of $100,000 ten years ago and you did nothing about it, now would have only worth $30,000.

Of course the example I have given is extremely illustrated. But can you imagine working hard year after year and saving all that you can, only to realize that you do not have enough. It is therefore important to know how to grow your money in rate higher than the inflation rate and not by working harder but by making your money work for you. For that reason it is very important for anyone who wanted to achieve financial success to understand this basic rule in growing your money “Rule of 72″

This is a simple rule whereby you can know the time and the rate of growth require to double your money. Let’s say that you put your money in the bank and your bank gives you an interest rate of 5% per year (not many banks out there can give you this rate), so to know how long it will take you to double your money, you just need to take 72 and divide it with 5, 72 / 5 = 14.4 Years isn’t it too long? what happen if the interest rate is higher? let us assume it at 20% per year. 72 / 20 = 3.6 Years. Why is it 3.6 years and not 5 years? 20% x 5 = 100% right then why is it you can achieve it at a faster rate? This is called the power of compounding.

At this moment, I had to caution you though that, the power of compounding can works against you. Lets take the example of Credit Card rate which is averagely at 24 % per year, which means every time you borrow money from the bank or from the credit card companies, you are making their money double and cutting your money or wealth by half in less than 3 years. That is why this concept is very important for you to understand for a better financial life.

How do you use this rule 72 in actual life situation? By understanding the nature how your money works, it is important to know the rate of return for any place you are going to put your money into. The higher the return, the faster your money grow and the harder it will works for you. Now that you know placing your money in the bank will not help your financial problems, so you need to look for other alternatives.

Most people afraid to look at higher return because of the myth or belief that higher return will also means higher risk. This is not necessary true. We will discuss on risk in another topics. In any case if you want to grow your money faster, you definitely need to look for a higher return according to the Rule of 72. Now that you understand this, I hope that this rule help you to solve much of your investment decision you need to make.

Cheer to your Financial Success.

Leo Enoch