HSI Put Warrant Purchased

One of my vices is having delusions about making a living as an active trader of investments (shares, commodities etc). Needless to say, the urge to trade actively is one that should be (and usually is) constantly suppressed. Occasionally I allow myself to play with relatively small amounts. So far this year I have made 4 short term trades. Three have made money and one has lost money for a small net gain. I suppose I could say that it is not doing me any harm.

As examples: I lost money on a silver trade in August and made some money buying put warrants on the Hang Seng Index in March.

Today I purchased some HSI put warrants (15499) at HK$0.161 in the expectation that the HSI will weaken in the short term as the initial optimism over China's stimulus package falls away.

Negative equity is back

This should not come as a surprise to anyone but the number of negative equity cases in the housing market is back to an estimated 10,000. Most of these would have been people who purchased in the first eight months of this year with less than the standard 30% deposit.

Given the well regulated nature of the Hong Kong banking sector, banks can only lend up to 70% of property's value. Buyers who want to borrow more must either get insurance ( from the Hong Kong Mortgage Corporation) or go to a finance company for a second mortgage. Both of these are expensive options. However, given that banks have become more conservative in valuing properties for mortgage purposes some home buyers have been forced to resort to them. In effect it is the most marginal buyers who are now facing negative equity.

There is, as yet, no indication that mortgage defaults are rising from the extremely low levels experienced over the last few years.

Lastly, during the SARS epidemic at the end of the Asian financial crisis in 2003, negative equity cases peaked at an estimated 103,000 cases.

Book Review: Time: A User's Guide

Like many people, I find that time management is one of the areas of my life that seems most difficult. The pressures of trying to accommodate all of the things one either has to do or would like to do into a busy schedule, over which I seldom seem to have any control, is a constant source of frustration. I've been grappling with this issue from much of my career. Traditional time management books and lectures seem to be of little use. Even good ones do not really explain why we feel like we are under so much time pressure. Late last year I made a conscious decision to try and address the time issue. Some of the techniques I decided to adopt were picked up from other books or searching the internet. A few are mentioned below. Stefan Klein is the first writer (at least that I have read) who explains why we get so stressed about time management.

Klein's book explains why people often complain about the lack of time in their lives and offers suggestions to help people address the issue. The book looks at the differences between long term and short term memory, how we respond to stimuli and the negative effect of distractions to getting things done. These points are important in explaining how inefficiently we often use the time which is available. Along the way, Klein also explains why attempts at multi-tasking not only do not work but are also counter productive and the differences between night owls and day larks.

Klein offers some practical advice for managing time issues better - not only to make better use of time but to reduce the feelings of stress that seem so common in our society. Klein's six suggestions are:

1. exercise a degree of control over your schedule. The more control over your schedule, the less stress you will experience and the easier it will be to get things done;

2. live in harmony with you biological clock. Night owls and day larks work to different schedules and trying to fight your body's natural clock is counter productive;

3. cultivate leisure time. Create some free blocks of time to destress and switch off from short term stimuli (such as mobile phones and blackberrys);

4. experience the moment. Even when you are bored and have nothing to do (waiting in line), simply observing and thinking about your surroundings can help;

5. learning to concentrate. The mind cannot concentrate on two things at once. Avoid multi-tasking - it is counter productive;

6. setting priorities. While time management books will often talk about things being urgent or important, Klein suggests comparing the consequences of not getting things done as a means of determining priorities.

Some of these will be difficult to achieve. Trying to schedule uninterrupted blocks of leisure time is not easy if you work in a demanding job and have young children at home. Still, having been attempting some of these techniques even before reading the book, I can confirm that they do work. Some of the examples I have been putting in to practice during the course of this year include:

(i) turning off my mobile phone, set my office phone to bust and turning off my computer monitor at work for short blocks of time (15-20 mins). This gives a perceptible boost to my productivity;

(ii) scheduling some "me" time each day. If I am stuck in the office until 2 am one day to meet a deadline, I will take time out the next day or so (during office hours if need be) to go to the gym, browse the bookshop, dash home to pick up one of my children from school etc. Put differently, I make sure that for at least 2 or 3 days a week, one or two things that are important to me take priority over anything else.

Time: A User's Guide is highly recommended.