This week we met up with our Dealing Director, Mr CS Tan to get the insights of being in the industry and his very own footsteps. He came from a little different background as what most of us started off as he began with his involvement in a bank’s internal audit in the stockbroking department. That was where he got his involvement in the market and learnt the trade. Fast forward to almost 3 decades he is currently the Dealing Director of Malacca Securities Sdn Bhd.
Well, let’s step into the life of Mr CS Tan!
Could you briefly explain to the readers your experiences in the industry as well as your philosophy of the business?
I started my journey in the industry as a Key Back Office Management staff right after leaving my 10 years in the commercial banking industry. Back then, I was always involved with fire-fighting, process re-engineering and automation of back office processes. It was then in 2007 that the authorities liberalized the stock broking industry with fully negotiable brokerage rates for online trading, that was when I saw a tremendous potential for the smaller stockbrokers to embrace “internet broking” and to be able to compete with the IBs and banks. I then started launching the Web-based Internet Broking with very competitive rates and it was well received by traders and investors, and hence the popular motto “One tick to profit” becomes a reality. This caused a major shift in the landscape of the stock broking industry to more aggressive promotion of the online trading.
I’ve always worked with “Dedication and Passion“, and strongly believe that I can make a difference. This is in line with our company’s business philosophy, to create a pool of informed investors and to equip them with better knowledge and tools to enhance their skills. Stock broking, being a people’s business, clients are definitely the center of our plans as our services have to meet the demand and the requirement of the clients. If we are able to facilitate individuals to make more money through active trading and longer term investments, we trust that the client will stay with us.
How has your journey in Malacca Securities been so far? Share with us your experiences and contributions to the company.
Contrary to popular believe, Malacca Securities has actually been established for more than 50 years, established since 1963 it is one of the oldest stock broking company in Malaysia.
In 2012, we launched a company-wide transformation program, riding on the ‘internet wave‘ to become the leading online stockbroker in Malaysia today. Then on, we made extensive changes to our products, which result in our 3 main products today; the silver, flexi-gold and T7 accounts. We also embarked on an aggressive expansion of branches to reach our clients in all parts of the country as well as an improvement in our IT capacity, continuity and IT security structure.
In 3rd quarter last year, we’ve also launched the Islamic Stockbroking Window to better serve our muslim clients and those who prefer to invest in Shariah complying stocks.
Early this year, we launched Discretionary Trading (DT) Services to help manage our clients portfolio with a cost-effective structure and no management fee. This service is unique in the sense that we apply both Technical and Fundamental analysis tools to trade for clients depending on the risk profile of the client and their investment goals. The trading strategies are proprietary and well-documented with oversight review committee reviewing the progress of the trading position regularly. It is most suitable for those clients who does not have the time or knowledge to invest directly in the market or those who prefer professional help to manage their hard earn savings but not meeting the minimum fund size asking by the private fund management company.
What trading/investment strategies would you recommend to investors?
Traders, being short-term in nature and thus do not emphasize too much on fundamentals and thus factors such as momentum and trends are definitely more important considerations. These traders should also have great precision and good knowledge of the market sentiment. Whereas long-term / value investors focus more on dividends, bonus, future earnings growth and valuation of the company.
To make money in the stock market, a trader or investor has to first know their investment goals, risk appetite and also the time horizon of the investments. Those younger individuals with smaller capital but bigger risk appetite can consider riskier portfolio and shorter time frame investments as there is always a strong desire to expect higher returns from trading. Whereas, individuals that are risk averse should focus on high-grade investable portfolio with strong dividend payout records or earnings growth potential.
If an individual has little or no knowledge on the trade at all, it is best to start small and learn the trade or alternatively let the professionals handle the trade for them. Not to forget that there are courses on stock trading, as it is always cheaper to pay for the courses than to learn through trial and error with direct investments in the stock market which is riskier when the knowledge about investment is at very low level.
What trading strategies would you recommend to traders?
Trading essentially means short-term, hence I would suggest position trading or swing trading as it can generate substantial returns for the savvy traders. It is not easy to be a day trader. It takes much effort and is time-consuming. I would say, the shorter the time frame in holding a stock, the more skills and accuracy it requires. Not many individuals are able to understand the Stock Market Operations, Volume price analysis which are of paramount importance for traders to master in order to make money. Furthermore, with players such as smart money equipped with algo- trading programs and fast news accessibility it isn’t easy at all for ordinary traders to win the game. In M+ Online, we came up with M+Live Beat which offers live streaming of stocks with a trending technical price formation criteria with 30 minutes chart prompting and alerting traders of the up trending stocks. In short, to make money in the market, one must do their homework, screen for potential up trending stocks, check the fundamentals, current valuation and equip oneself with the latest news.
Any word of advice for traders?
Invest in a proper educational program to learn about the market operations and the right investment strategies. There is always risk in the stock investment, but higher risk doesn’t always promise high returns; knowledge, experience and skills do.
As Muhammad Ali puts it – “Champions aren’t made in the gyms. Champions are made from something deep inside them – a desire, a dream, a vision.“
Huge thanks to Mr CS Tan for his time! We hope you guys got something from the interview. Guess we can conclude that investment/trading isn’t an easy thing, but with the right mindset and will to learn; you can go places.
That concludes our first “This is my trading strategy.” series! Tune in next time as we ask others on their trading strategy and insights. If you do have someone who you’d like to hear about from in this series, drop us an email at email@example.com