About Daniel Chia
Daniel Chia has always been fascinated by numbers. A Cambridge graduate who earned his Masters in Mathematics and Statistics from Harvard University, Daniel spent nearly a decade at Sovereign Wealth Funds and Hedge Funds. He was a key part of the Quantitative Trading Team at GIC, and was a Portfolio Manager at Asia’s largest systematic macro hedge fund, where he built and traded systematic models predicting and exploiting market sentiment and bias. The experience Daniel has gained through his academic and professional career has helped him identify and build a tool to overcome the largest obstacle standing in the way of good investment decisions.
1. Tell us more about yourself and how you got started in your career in the financial industry?
I’m Daniel Chia, a professional investment manager for the last 10 years with a life long interest in portfolio management. I’ve always been interested in finance, first from a mathematical perspective (I’m a math major), but I’ve gained more experience, from a behavioural perspective, i.e. how sentiment and greed/fear can affect your approach to the markets.
2. What are your views on trading vs investing? Many young people want to earn quick money from trading. Do you have any advice for them in terms of growing their wealth?
To me there is no difference between quick money and slow money. The most important thing in the end is ensuring that your strategy can take risk smartly and make money.
I think that the difference between trading and investing is:
a) holding time of assets and
b) liquidity of assets.
The risks are different. I’ve seen many traders burn out as they are 24/7 in the markets and also long term investors panic when the market turns and liquidity dries up to the point that they are looking for a return of their capital, not a return on capital. As you grow your wealth, it helps to know what risks you are most comfortable with.
Traders quickly learn that the markets have no rules, and the only rules that can be controlled are those that the traders impose on themselves. This can be overwhelming for new beginners as they cope with the psychological impact of taking risk and potentially losing money. The priority of any trader is to survive. This means being able to adapt to the markets, and eliminating as many rookie bad habits as possible. Each error eliminated is money saved, and each dollar saved can be put into taking risk. What is the one bad habit that most beginner traders make?
They Can’t Stop Watching Prices!
This is counter-intuitive: every trader will tell you that “Each Trade is Important”. When I started trading, I too took this adage literally and tried to watch prices all the time. Literally, all the time, in front of a Bloomberg, staring the numbers flash green and red. I was looking at charts, calculating profit and loss all time. I realised in due time that this was a bad habit, and possibly the worst habit I could have. It made me unable to turn off, built anxiety, and worst of all, caused me to doubt my own investment strategy. It sapped energy from when I really needed to be active, during major market moves which occur only during 5% of the time I spent watching markets. This problem becomes more dangerous with the introduction of mobile trading apps, meaning that traders are now able to watch prices wherever they are. Many traders are now unable to switch off from prices, and the pressure to adjust on the fly means they deviate from their strategies and trade more frequently.
3. What are your own personal investments or trading strategy? Are you more short term or long term?
When I started trading I was reactive, finding market strategies that reacted to tactical events and changes in outlook and sentiment.
As I gained experience I found it more sustainable to be predictive, building longer term themes and strategies in the markets and finding times when overreaction occurs for good entry and exits. I’ve been able to build quantitative models that can do some of the work for me, which really helps.
Now I’m trying to be more proactive, the best trades in the market are those that I personally can influence and improve, and I am trying my best by setting up and leading a start-up - Call Levels.
4. How would the new app, Call-levels, help us in our own personal trading and investments?
Call Levels is the simplest tool you can have that fulfils the most basic need of the market. To be able to set price alerts easily and receive them reliably is something everyone needs.
To survive in the markets you have to make sure your tools are simple and work well. And we aim to be the most reliable tool in the market. We have had fund managers tell us that alerts in Call Levels were comparable to their $3,000+ a month Bloombergs - we’re constantly trying to improve the product to make it even better!
Call Levels is extremely simple, you cannot price watch, because there are no flashing prices, but you can set prices so that you can be aware of the market, but only when it moves. Price watching, especially when there is nothing happening in the markets, is bad, it tires you, makes you anxious, and takes your attention away from the 10% of the time when the market really moves and you need to be there.
5. Where can they get the app now?
It is out available on iTunes for iOS users. bit.ly/call-levels. Any feedback will really help at this early stage!
6. The app will be available for Android users as well as the introduction of equities and indices feature soon. When will it be released?
We are targeting Jan 2015 for Android with Equities and Indices.
7. Lastly, since you’ve been in the financial industry for many years, do you have any advice for young people who would want to join the financial industry as their career?
Be honest, humble and keep trying to learn and find out more. And keep in mind that wealth is more than money, do remember your health, friends and family. To help that do try Call Levels, we watch the markets so you don’t have to!
To find out more about the Call-Levels App, do visit their website at: https://www.call-levels.com/
They are looking for feedbacks on the App itself and also any suggestions on additional features which you think is useful to be included in the App. Comment below to leave your suggestions or send me an email at firstname.lastname@example.org.
I think the app is something that is very useful and easy to use for us who trade or invest in the markets. I'm personally looking forward to the equities feature which will be released in Jan 2015. We were also talking about the possibility to include additional features such as alerts based on P/E, P/B ratio or any others. Feel free to give your suggestions. Share it with your friends and family. Download and try out the free app today!
Enjoyed my articles?
You can Subscribe to SG Young Investment by Email
or follow me on my Facebook page and get notified about new posts.