Two important life lessons when investing in stocks

It must have been 20 years since I attended a remisier course leading to an examination that would enable me to become a full-fledge remisier. After all, I had just completed an MBA course and, this would enable me to skip one of the two remisier modules, thus short-cutting my way to become a remisier should I chose to be one. Just like any other school-leavers after a few years of work on the same job, I was contemplating and exploring a career change. I was no rookie in stock trading (I say trading because I was really trading) at that time. By that time, I probably had already had 6-7 years of stock investing experience as a client. My personal objective to attend the course was very simple. Even if I decided not to take the examination (in the end, I did not), I might still be able to learn a one or two things about the stock-broking industry. I believe the course fees must have been about $200-$300 and the whole course was taught over a period of about 2 or 3 days (can’t exactly remember). As I have already been working for several years, it was a small sum to pay to learn something, perhaps to help me develop another career path, just in case.  After all, I had already paid or have been paying for several high-ticket items, such as my MBA course, marriage plans, housing renovations, car loans, insurances,  etc.,  and many of those things that crossed into our path after we left school. So, in comparison, it is not going to break an arm or leg to pay for the fee to attend the course.


That was a long time ago, and frankly, I had forgotten most of the things that the practice remesier taught. If you ask me today, I think the lessons were pretty boring. They were just brute facts that were to be dumped into our minds and for us to re-produce them during examinations. The hand-out notes were no better. They came in the form of a ring-bind and were about one-inch thick in black/white photocopies in fading print on half-yellowish papers and were not exactly organized. These two factors would have been an ideal condition to put one into a good sleep within the first 10 minutes after sitting down especially given the nice air-conditioning environment and after a long day’s work. But still, there were at least 30-40 eager attendees listening attentively to the lessons.  Perhaps, there were one or two key reasons for this. Firstly, at that time, all the trades have to go through a broker. Whenever we buy or sell stocks, whether they are many board lots or just one board lot, they still have to be handed by a broker or remisier, who have to physically key in our trades. So, a remisier or a broker had a very important role to play in the whole transaction process if we bought or sold securities at that time. Thus, becoming a remisier was an ideal dream that many people were trying to get their hands on. The other reason, a very important one, was that stock market at that time had been enjoying about 7-8 years of boom, except for a temporary disruption due to the 1st Gulf war in 1990. (I actually have an important lesson to share for this episode as well, but I will leave it to another session in order not to digress too much from the subject matter.) It was a lucrative career if one was able to get into it. Can you imagine each transaction of about 1% commission in just 2 minutes of telephone conversation for just one counter! After all, the memories of the great boom of the 90s around 1992 to 1994 had not faded in people’s mind yet.


The point that I wanted to make was not because of the teacher or the notes. It could even be that I had been day-dreaming in most parts of the course. But there were two points that the teacher pointed out that still had a bearing on me in all the investing years that followed. They were actually off-the-calf sharing and were not part of the lesson proper. He shared with us some stories of people (without quoting names or mention anybody specifically, of course) who became bankrupts after losing big in the stock markets.  It was demoralizing. Here, we are trying to learn something to become a remisier, and there the teacher was telling us about bankrupt stories. Perhaps, he just wanted us to be mentally prepared when we entered this industry. But still, he ended up with a positive note. Based on his personal experience, he shared with the class that there were generally two types of people that do not do too badly in stock investing. They are:

(a)    People who do not trade on contra.

(b)   Those that are “one-lotters”.  (Yes, he really said “one-lotters”.)     

At that time, I did not think much about what he said as they were just passing mentions to inject some life into the lesson.  No offence to those who play contra or on margin, I never play contra. I pay for my trades faithfully and on time. So I cannot share very much on the experience of contra. Perhaps, he was coming from a point of view as a remisier, and that he had to take on the financial risk when clients did not pay on time. However, later checks with another one or two broker seemed to confirm this point. Frankly, the purpose of checking was not to talk down or expose those who like to play on contra. I have no authority to do that. I just wanted to know how I could develop my investing character not to be along those lines that exhibited high chance of losing money. The 2nd point was more impactful for me. Apparently, he had coined the term “one-lotter”. I could not find it in an English dictionary.  He meant to class those people who only buy or sell one lot of a counter whenever they make a transaction. Previously, one board lot refers to 1,000 shares and not 100 shares as it is now.  Basically, he was referring to the fact that some people buy or sell only 1,000 shares no matter how good or how bad the market was. It suited me right from the start. Think about it, when we first graduated from school, our salary was close to $2,000 per month for a fresh graduate. Even after some years of working, it was probably $3k to $4k per month. After deducting for our CPF, provide some pocket money to parents, monthly payments for some high-ticket items, I am not sure if I could even save $500 per month in the first year or $1,000 after some years after I graduated from school. How many board lots of a counter can we really pay per trade? At most one. Even for some high-priced stocks, we still needed to save for several months before we could even buy the first board lot. At that time, for example, Cycle and Carriage (C&C) (not yet known as Jardine C&C) was trading at slightly above $10, and OUB (a bank subsumed by UOB) was trading around $8.50. But as I look back in history, taking on one board lot at a time may not be a bad idea. Many of the stocks that I have accumulated today in many thousands of shares were the results of buying one board lot at a time. It may not be the fastest way to riches, but it certainly is a safe and conservative way. Do not underestimate its cumulative power. It enables us buy on dips and picking up opportunities that might have slipped through the fingers of many.


Stock investing is a journey. It is not an end by itself. The stock market will outlive any of us. The investing journey may be long and arduous, but each small step that we take, we are one step nearer to where we want to be.  I am thankful to the teacher for the off-the-calf sharing.  They turned out to be more useful than the lesson proper as I looked back in history. They helped shaped my investing style in the later years. To be continued…. 

Brennen has been investing in the stock market for 27 years. He trains occasionally and is a managing partner for BP Wealth Learning Centre. He is also the author of the book – “Building Wealth Together Through Stocks” which is available in both soft and hardcopy.