A Closer Look – Stock Market Order Matching

How does order matching actually occur in the stock market?

Whenever you place an order in the stock market, your online broker will let you see all other orders currently queued for your chosen stock. 

This is the order board or quote screen that identifies the Buying (Bid) and Selling (Ask) parties into each stock choice. This stock quote screen lists on the left column the desire to buy and on the right column the desire to sell, showing the respective volume levels (or size) at each bid price level. 

The queue actually shows the precedence/sequence and thus of priority of execution of these orders, depending on their price, which you can use to adjust your own bid/offer price to get the desired priority.

People In Their 30s And 40s Fear Growing Old Without Money

Another Bro Bo Sanchez's inpiring invitation to invest in our own stock market in the Philippines and let your money grow effortlessly through time!

Make the stock market your giant piggy bank!

There's no better time to start now with a booming Philippine Stock Market.

Retire rich and generous!

Read more.

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STOCK PRICE : The Board Lot Table

What the heck is the board lot concept in the stock market?

This is one question commonly asked by new investors. They get intimated by this jargon that sometimes, they just get stuck in the process.

So let’s answer that question by presenting to you the single table you’ll ever encounter in your investing career-  the Board Lot Table.

Five Simple Investment Guidelines for Beginners

To start investing is a big move, not to mention that it’s a big challenge. But that fact doesn’t necessarily need to stop us in taking better charge of our finances with the help of the stock market.

There will surely be times when you’ll see big losses in your portfolio. 
It’s normal, but what makes it more painful and difficult for many people is how they react to that.

Most participants, when they land on that stage, become controlled by their emotions designed to sabotage them. They rush to click that sell button right away, and the next thing they know, they are big time three-dimensional losers.

A big 85% of the entire market participants practice it that way, the same percentage that loses money in the market.

Friend, that doesn’t need to be your story. You can have a more rewarding plot.

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You can be part of the 15% who make money in the market with so much less investment of time and energy and neurons and attention.

How?

I lay down some principles below that can guide you in your investment career. 
Take note and see that you’re always reminded with them.

How to save by spending

Saving is the prerequisite of investing. Unless you already have a big chunk of cash from your parent’s inheritance or you’re that one lucky winner of all those kinds of lotto, you would need to practice the act of saving to keep on investing. This is naturally the hard part at the start, but it doesn’t need to stop you there.

I spell-out below some ways that helped me mold my habit of saving.

Simplify. I am fortunate I was raised with a simple life.  The things I’m most delighted about are free. The silent beauty of nature, endless (sometimes non-sense) stories from friends, corny but full-laugh jokes shared, the startling behaviors of kingdom animalia, the relaxing breeze of a cold province puffed with wintry air, a stolen nap in a class during college, and a whole lot more.

Life seems complicated because people choose to make it that way. Especially now with the booming technology and consumerism around teasing us, people has more source of distractions than ever that really hide from us the things that really matter in the long run.  If you want to add more to your savings, you need to cut buying things you just throw away after short time of entertainment.

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Stock Prices in the Stock Market

Stock Prices and How to Use Them

Stock price is the voice of the stock market.  And as a voice, it gives you a hint of the status and present condition of any stock.

More than a number telling you the worth of a stock, price is actually a clanging cymbal that can guide you in your investing decisions. 
And so it’s quite imperative to have a closer look on this important figure whose swings and sways drive all market participants really crazy, whether small investors like you and me, or big time managers who run and control the funds of big foreign or international investment firm.

The Different Prices

Stock market deals with several types of prices. These prices obviously vary in each stock, but the principles governing them apply similarly to all of them. 

We can easily see some of these prices whenever we see quotes of a stock through your stockbroker, or through the website of the stock exchange – Philippine Stock Exchange (PSE) in the case of Philippine stocks.

Below is a sample stock quote fro CitisecOnline. 
For online stockbrokers, a stock quote is usually accompanied by some other related stock data that aid us in doing our analysis.  
Let’s tackle these prices one by one.

• MARKET PRICE 

This is the current price of the stock, and the simplest and most basic price we commonly encounter.

From the word itself, this is the price of the stock as dictated by the market.

And who is that market?

It’s the entire bush of participants trading in the stock market.

You’re actually one of them if you’re now investing.

As the stock’s current price, this is also the price shown in the colorful ticker flashing at the bottom part of your television in a news or business channel.

You can easily check the market price of any stock through your broker by checking the quotes of that stock.

Because this is controlled by the market, and that this market changes its mind anytime it wishes, market price as a result endlessly changes during trading hours.  

This can also be called the Last Price of the stock, or the price in which the last trade was made. (I notice I just use redundant definitions HAHA)

But what does a market price really tell you about a stock?  

More than anything else, a market price whispers to you the perceived value of the stock by the market, or the price the market is willing to purchase the stock, which results from how people feel and think of the stock.  
Thus, it gives you a hint on whether it’s a cheap (or overvalued) stock when compared to its fundamental or book value.

• OPENING/CLOSING PRICE

This is quite straight forward. It’s the price of the stock when the market opens and closes respectively.

Closing price therefore is also the Last Traded Price or LTP (the price when the security was last traded) in a trading day, while the opening price is the First Traded Price of the stock (the price when the security was first traded). Ssssh, don’t ask PSE about the First Traded Price, I just really made up that term. HAHA

The Opening and Closing Prices of all stocks are determined during the Pre-Open and Pre-Close periods respectively.  You can get the time for this market period here. 
There are  rules  (or algorithms) followed in determining  the opening and closing price of a stock, which depends on the price and volume of all pending orders during the Pre-open and pre-close periods respectively.

How will these two figures help you?

Closing price, together with opening price will tell you the summary of the price journey story in a trading day. Together with the volume data, you can get an idea on how the market actually responded to the stock, and how far the market is willing to go for the stock.

(Related to this is the Adjusted Closing Price or ACP or the Closing Price of a Security with adjustments made due to some corporate events.

• PREVIOUS PRICE

Another clear-cut definition, previous price is the closing price of the stock the previous trading day. You can use this then in assessing the present price with its most recent historical price. With this, you can compare the present performance of the stock relative to its previous price.

• HIGH and LOW PRICE

High and Low Price is the highest and lowest price attained by the security during the trading hours. 
It gives you the price range in which the stock moved during the trading day, and thus an idea on the extent of the perceived value of the stock.    

Some people leverage on this by doing range-trading: buying a stock at its perceived low price and selling it within the day at its perceived high price. Participants called momentum traders have this strategy to maximize their profits. 

• BID and ASK/OFFER PRICE

This is how a market participant tries to put his say in the value of a stock.

Bid price is the price offered by an interested investor who is willing to buy, while the Offer or Ask Price means the price offered by an owner willing to sell a security. 
These bid and ask forces are the ways how the market shout out its voice in dictating the market price.

Related to this are the Best Bid and Offer or BBO. These are the highest buying price and lowest selling price respectively that are prioritized in the order matching processand are therefore lined up in the queue first.

• FLOOR AND CEILING PRICE

Floor and ceiling price is the lower and upper threshold set by the PSE for any order for said security in a trading day. That means a stock will never attain a price outside this range in that trading day. These are limits set by the exchange, and can be easily calculated from the previous closing price using the following formula:

        Floor Price = 0.5 x Closing Price

        Ceiling Price = 1.5 x Closing Price

As a result, in any trading day, any stock can only be up or down by at most 50%.

If you’re lucky, you can actually catch a stock hitting this maximum inter-day rise, though it’s obviously very risky given that most of the stocks having this spectacular change are commonly penny stocks. I actually have known someone who has really made his fortune by riding in a stock that had gone up by 50%, though after few consecutive days.

• DYN T LOW and DYN T HIGH

These are another threshold limits set by the PSE in affecting the market price using the concept of Dynamic Threshold. 
Dynamic Threshold means the permitted difference in price between two Last Traded Price updates for a given security. In the picture above, the Dyn T Low and Dyn T High therefore sets the highest and lowest next match price for every Last Traded Price. The next trading price should fall within this interval. This in effect controls the extent of jump of a stock price within the trading hours.

• BEST PRICE

Lastly, this best price means the best available price for a Security for order matching purposes. All order matching are done by the Philippine stock exchange using the best price available at the time the matching was made. Because of this ‘best price’, your buy order can be done with your order price or lower (if there’s such available), while your sell order can be matched at your order price or higher (if there’s such available). The stock exchange will automatically look that best price for you once you enter your order in the list.

There you go! 
That too many prices huh? 
With these prices in mind, you now have more idea on the most important figure of the stock market!

Have fun investing!

PS: Get all the basics of investing in the Philippine Stock market! Download your free copy of Investing in the Philippine Stock Market for Beginners!

PS2: All of the prices above are too many to really dwell on. For a longer-term horizon of investing in the stock market, what matters most  to you is your entry price (the buy below price) and your target price (or the price you sell). TrulyRichClub gives you these prices for their focus stocks! What's great, from six original recommendations, now they have 10 stocks to invest on with their Strategic Averaging Method (SAM). That's more companies working for you!

How to get dividends

There are two ways of making money in the stock market.

I have summarized them here.

Capital appreciation, or share of prices going up, is the most common, and sometimes the most abused, way of growing your money.

But dividends are also a great machine for squeezing the most out of your money’s potential.

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So how do you avail of a dividend?

When Should You Start Investing?

Let me make this short and sweet.

In my previous blog The Easy Way of Investing - Peso Cost Averaging, I shared the hassle-free ultra-mega easy way of investing in the stock market which would require only three hours of your time every year.

That blog actually emphasized the stage of planting, religiously putting fixed amount into your investment at fixed intervals over a long period of time.

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So this blog shows the potential harvest of that healthy habit.

THE TRADING HOURS - When to post your stock orders?

A stock market is like a clean hand of a cute little child - it opens and it closes. HAHA

Poor analogy, I know, but you get the point.

The main difference though is that while a baby’s clean little hands can open and close anytime the baby wants, a stock market on the other hand has scheduled opening and closing time. During this trading time, you will be able to see the actual movement and fluctuation of stock prices of all the companies listed in the stock exchange to aid you in entering your real-time buy or sell orders. 

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Costs of Trading in Philippine Stock Market- How much will you need for your first order?

Do you think you’re too small to begin investing?

Think again!

One of the common misconceptions about investing in a stock market is the initial thought that it’s only a game for the rich guys. They believe that they need to be millionaires first, or close to that, to actually start making their money work hard for them.

Of course that’s one of the biggest financial illusions you can ever believe.

While it’s true that there are people in the upper class playing in this battlefield, that doesn’t mean it’s an exclusive playground for them.

Credentials Needed???

A friend actually asked me if one would need any credential to dive into it.

I gave a short answer:  “Appreciating your asset to produce more assets, much like a tree bearing it sweet fruits, that’s the only credential your will ever need”. 

If you’re like that, you’re very welcome to this financial vehicle. Allow me to sing your first lullaby. 

Personally, I started investing with a humble 10k initial deposit. Many hard-core players would really laugh at me, but I was more than happy just giving it a try. And looking back I just couldn’t imagine the journey that little initial amount had unraveled. It was year 2010, the same year I finished my college and landed on my first job. A sweet new voyage for a new phase of my life.

Regular (25k) vs EIP (5k) Opening Accounts of CitisecOnline - What's the difference?

Regular (25k)  vs EIP (5k) Opening Accounts of CitisecOnline - What's the difference?

When opening a stock trading account in Citiseconline (COL), one will notice the two options provided for potential investors.

It’s the 5k and the 25k minimum initial deposit.

In their site, the 5k is also called the EIP account, while the 25k is called the regular account.

So what’s the difference between the two???

How To Join Bo Sanchez' Truly Rich Club

TrulyRichClub prides itself with its top winners in the years 2010-2011. You can see the list below.

TRULY RICH CLUB TOP 10 STOCK WINNERS – DEC 2011 STOCKS UPDATE REPORT

STOCKS	STOCK SYMBOL	TIME RECOMMENDED	TIME HELD	PRICE RANGE	YOUR RETURN
Lepanto	LC	Dec 2010 to May 2011	5 Months	P0.34 to P0.85	150%
Jollibee	JFC	Mar 2010 to May 2011	14 Months	P47.50 to P94.45	98%
Security Bank	SECB	Mar 2010 to  May 2011	14 Months	P53.00 to P96.20	81%
DMCI	DMC	Sep 2010 to May 2011	8 Months	P27.25 to P44.80	64%
Int’l Container	ICT	Sep 2010 to May 2011	8 Months	P32.40 to P48.70	50%
First Gen Co.	FGEN	Mar 2010 to May 2011	14 Months	P9.80 to P14.78	50%
Megaworld	MEG	Jul 2010 to May 2011	10 Months	P1.54 to P2.30	49%
Nickel Asia	NKL	Oct 2010 to May 2011	8 Months	P15.00 to P22.40	49%
Ayala Land	ALI	Mar 2010 to May 2011	14 Months	P11.25 to P16.64	47%
Energy Dev’t Co.	EDC	Mar 2010 to May 2011	14 Months	P4.85 to P6.49	33%

Below summarizes what you’ll receive as a member, its mechanics, and other surprises for your membership.

What you’ll get

The Truly Rich Club - Your Financial & Spiritual Guide

Truly Rich Club - A Review

I rarely give recommendations.

Reason? My name is at stake. And my integrity has been one of my real treasures.

That’s why I’ve been very selective of anything I suggest to anyone. Especially those involving money. If I could just contain it in myself, I would do so.

But not with the Truly Rich Club.

I have subscribed to Truly Rich Club for more than a year now.  That was since the time when I finally graduated in college and shortly landed on a job.

If you remember in my first blog, the first time I received my salary was the same point I became the richest person in my life. HAHA

It was funny, I know,  yet at the same time liberating. Anyone who has received his first income can relate to that “first paycheck syndrome”.
But since I was not used to handling that much for the first time, I knew at once that I needed to learn some things so I’d get comfy having that blessings in my hand moving forward.

That’s where the Truly Rich Club made its needed entry in my financial journey. I am so grateful and thankful that I met this club at a fittingly time I needed it.

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What Truly Rich Club gives you

TrulyRichClub is primarily known for its Stock Update Report.

It is a brief report guiding all its members investing in the Philippine stock market.

It’s an easy-to-read article telling its member-investors everything they need to know in their stock market investments, without the use of financial jargon.

Specifically, it shares when and what stocks to buy and sell, the “buy below price” and “target price” for each of these stocks, the expected upside, and the current status (gain/loss) of the stock portfolio.

All of those information in a neatly-laid-simply-written piece of writing.

At the present, it brings into play the easy-to-follow method of investing, called SAM, short for Strategic Averaging Method.

But Truly Rich Club is not just about growing your finances. Stock investing is just a small part of it.

Receive all these exciting freebies upon being a member of the club. (You can get the details here)

1. Receive 2 PowerTalks every month (instant access via MP3)
2. Receive Bo’s Success Mentors Collection (1 every 3 months for 1 Year)--FREE
3. Receive 2 WealthStrategies newsletters every month--FREE
4. Receive Daily GodWhispers Email--FREE
5. Receive How To Be Truly Rich Seminar--FREE
6. Receive How To Conquer Your Goliath Ebook--FREE
7. Receive How To Turn Thoughts Into Things Ebook--FREE
8. Earn Passive Income by being Bo’s Affiliate in the TrulyRichClub
9. Earn Passive Income with Bo’s other Internet Work
10. Receive Bo's Very Practical Ebook, My Maid Invests In The Stock Market...And Why You Should Too.--FREE
11. Receive Bo's Stocks Update. --FREE

You see, with the kind of material it gives, it’s a powerful system that rests on a larger financial and spiritual education.

More than growing your money, it actually really nurtures your values and mindset, the central heart and hub of all your thoughts, habits and actions…

Prepare to Change

Just to warn you, it's s not your usual club. Because it will challenge the way of your thinking. Much like a self-transformation manual, you’ll undergo a complete system overhaul.

It will tell you the things you need to learn, and the things you need to unlearn.

The reality is that there are stuffs in our habits, or worse, housed in our subconscious, that continue to either uplift us or sabotage us.

Those are the things we acquired in our past years existence, and that remain with us.

The truth is that we almost automatically act, react and respond based on those things stored in our subconscious. 
Much like an instinct. 
We’re so used to it that it has become part of ourselves. 
We can no longer notice it, but it’s certainly there. 
And it continues to smoothly dictate and interfere with all our decisions and actions.

And that set of beliefs is what the Truly Rich Club will target to revamp.

When you think of it, most of the times, the real battle is really not between us and the external, but the internal fight struggling within us.
Before any external victory, that internal war has to be won first. 
And because the Truly Rich Club targets that core, it becomes powerful gears for supportive massive changes to come.

The Challenge with Change

Let me revive the engineer in me at this point.

Men of science know about the concept of inertia.
It’s that innate resistance of anything (that has mass) to change its state of motion.
Everything just doesn't want to change its motion.

Isaac Newton put it nicely in his first law: “A body at rest will remain at rest; a body in motion will remain in its uniform motion.”

How to alter that? The great guy added “…unless acted upon by an external force”.

Though real change has to begin from the internal, it’s always ignited by something external.

An external thought, an external advice, an external experience, an external story, an external word.

The greatest people of history were once timorous citizens apprehensive of everything, until they bumped into that one outside force that pushed them to do great things they never thought of doing before.

And that’s what I think Truly Rich Club can do to your life.

It will inspire you to create your life the way you want it to be.

It will teach you to re-examine yourself and help you remove the not so useful excess baggage you may still have.

It will teach you to discipline yourself, begging you to do your monthly investments.

It will share with you practical wisdom you can right away apply to your life.

And it will constantly remind you of your commitment to yourself, your values, and your dreams.

In our present world where we’re practically surrounded by all sorts of short-term pleasure pursuits every moment, it’s not difficult to easily lose sight of our real long-term needs and desires as humans.

We can be happy at those short periods of time, but when everything has settled, it’s the more lasting contentment and satisfaction we find we really yearn for.

The True Riches

Seemingly ironically, while Truly Rich Club helps you become more faithful stewards of God’s material blessings, it constantly points you to the real riches of this life.

More personally, it taught me to always put priority to my relationships, to be ever grateful with everything I have, to be patient, to be a loving person, to be a more generous man, to be a blessing, to enjoy life and to enjoy people.

A part of me seemed born again.

Yes it all sounds mushy, but it’s true.

And when you have such joy invigorating inside, you just can’t help but to give others the same chance of having that experience.

May you have a fantastic and prosperous 2012!

Happy New Year my friend! May God bless you more!

PS1: Below table shows the top 10 winners stock picks of Truly Rich Club. More than showing off the past success and victories of the system, it’s an inspiration to encourage new and existing members to stick with the system and be faithful to their monthly investments with the present stock recommendations. It’s a way of reminding everyone that their patience and discipline will one day pay off.

TRULY RICH CLUB TOP 10 STOCK WINNERS – DEC 2011 STOCKS UPDATE REPORT

STOCKS	STOCK SYMBOL	TIME RECOMMENDED	TIME HELD	PRICE RANGE	YOUR RETURN
Lepanto	LC	Dec 2010 to  May 2011	5 Months	P0.34 to P0.85	150%
Jollibee	JFC	Mar 2010 to May 2011	14 Months	P47.50 to P94.45	98%
Security Bank	SECB	Mar 2010 to May 2011	14 Months	P53.00 to P96.20	81%
DMCI	DMC	Sep 2010 to May 2011	8 Months	P27.25 to P44.80	64%
Int’l Container	ICT	Sep 2010 to May 2011	8 Months	P32.40 to P48.70	50%
First Gen Co.	FGEN	Mar 2010 to May 2011	14 Months	P9.80 to P14.78	50%
Megaworld	MEG	Jul 2010 to May 2011	10 Months	P1.54 to P2.30	49%
Nickel Asia	NKL	Oct 2010 to May 2011	8 Months	P15.00 to P22.40	49%
Ayala Land	ALI	Mar 2010 to May 2011	14 Months	P11.25 to P16.64	47%
Energy Dev’t Co.	EDC	Mar 2010 to May 2011	14 Months	P4.85 to P6.49	33%

PS2: Jumpstart your year!

Download Bo Sanchez' "My Maid Invests In The Stock Market... And Why You Should Too" [PDF] (Brief Version) for FREE.  You'll learn how to use the Stock Market to achieve financial freedom and grow in financial abundance. Also, get Bo's "TrulyRich" newsletter for FREE!

PS3: Who is Bo Sanchez? He’ the mastermind of Truly Rich Club.

I will never forget his birthday, since it’s just a day after mine. J

Aside from that, we have lots of similarities.

We love to live a simple life, we’re amazed by nature, and we both like to share stories. 
We’re actually both weird and crazy.

I don’t know if I commit sin, but sometimes I’m thinking if I could be his son. HAHA.  

Get to know the guy behind the Truly Rich Club! http://bosanchez.ph/

PS4: Get Wowed Or Your Money Back—Guaranteed!

Bo is really confident with it. He wants you to experience the blessings of an exclusive Gold Member in his TrulyRichClub.
If during the first month of your membership, you didn’t find the material he sent you a powerfully inspiring Wow experience, then simply tell it—and the club will return your money.  No questions asked.  And you can keep all the great stuff he sent you (worth $251.50 value) as his FREE gift to you for just trying.

You can give it a try and receive all these 11 big Blessings. Join the TrulyRich Club.