Earlier Today I Experienced Every Investor’s Worst Nightmare – Unable To Sell My Stock

One of an investor’s or trader’s worst nightmare happened to me earlier today, and is still happening now.

As everyone probably know, the US is officially in the bear market now, with the market dropping more than 20% from the recent high.

For Singapore, the index plunged from a high of 3281 in January to currently 2672, a 18.6% drop.

STI Index 12/3/20

We foresee that the market will drop even more as Singapore feels the aftereffect of the virus outbreak globally.

Earlier today, I wanted to take profit on some of my earlier positions simply because:

  1. We expect price to drop even more. Hence it will be better to lock in the profits and then buy in later at the lower price since the current price of some stocks we are holding is near our entry price.
  2. We want to increase our war chest to double down on other high quality counters which are trading at extremely good value now. 

However, something frustrating happened. Upon logging in my DBS Vickers account, I found out that my selling limit is too low! It’s ridiculous that my selling limit is only S$1500 and I can’t even sell the shares I own! This is probably the biggest nightmare for anyone. 

DBS Vicker’s Dashboard shows my bank balance and it should be able to sell my position

There are currently so many questions running through my head now:

  1. How did DBS Vickers assign the low selling limit? My Multiplier account has more than enough money and it is reflected on my DBS Vickers Dashboard – shouldn’t they have seen the balance is more than what I am trying to sell, ie a S$4000 position? 
  2. Shouldn’t DBS Vickers have access to the stocks I’ve bought through them, my default brokerage firm and that I can sell them through DBS Vickers?
  3. How are the selling limit set? 
  4. If my selling limit is low, shouldn’t they have sent a notification notifying me to take note of this?
  5. If they are not confident of my selling limit, why would they assign a S$168,000 buying limit for me?

So I went ahead to google how to get them to increase my limit, and it turns out I need to send in my latest bank statement, NOA, pay slip, or CDP statement.

What puzzled me is that, couldn’t DBS Vickers just look at the bank balance that is shown on the DBS Vickers Dashboard?

As a DBS shareholder, this is a triple whammy for me – while stock price has crashed, the DBS Multiplier Account made recent detrimental changes to me, forcing me to make investment trades via Vickers every month to earn higher interest, and now this happened – I can’t sell the shares I bought through Vickers.

What an irony.

In order to increase my selling limit, I went ahead to email them earlier today my CDP statement and NOA, but have yet to hear from them. 

So I called in.

However, I was held on the line for 20 minutes and the line is probably and understandably too busy because everyone is probably selling their stocks now. 

I contemplated heading down to the office, but upon reading the review on Google, I think I won’t be able to get the help I need. The reviews are brutal, with people calling DBS service center trash, and that the customer representative officers being rude and unprofessional.

So here I am, stuck and whining about DBS Vickers. Left with much frustration and even more questions.

And I am officially not a happy DBS shareholder now. Borderline angry.

Over the past 1 hour plus going through all these ordeal, trying to sell my shares to lock in the profit, trying to call in DBS Vickers, and at the same time writing this article, the 3 stocks I wanted to take profit on dropped even further nearing my entry price. 

What we can only do now is just wait for Vickers to restore the selling limit, and perhaps not taking profit on them anymore.

I wonder for those who have leveraged positions and they needed to sell all their positions urgently, if they are in this situation, they would be really really pissed at Vickers.

The good thing is that, earlier this week we manage to sell off a small portion of our portion to take some profit, so that’s probably some consolation. Should have just taken profit on all the positive positions I have.

This is probably gonna get even worse, so buckle up people.

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What Is The Ideal Stock Amount To Buy For The Brokerage Fees To Make Sense

One of the questions that I asked myself last time was that, what is the ideal position size for me in order for the fees to make sense. I tried googling this and couldn’t find any answers. 

This was a concern to me because there are sayings that the fees could kill you and even if you manage to identify a good stock, you will end up not making money after paying for the fees.

So how much stock should I buy in order for the returns to not be diminished by the fees?

So I thought it will be good to calculate and journal this down so that this can be a good future reference. 

For calculation purposes, we will be using the fees charged by our default brokerage DBS Vickers.

For DBS Vickers, here are the various fees imposed when you buy or sell a stock via their stock brokerage:

DBS Vickers Fees as of 13th December 2019

With this in mind, we draw out the various fees if we were to buy stocks worth between S$1,000 to S$10,000. Here’s the resulting table:

From the table, if you buy S$1000 worth of stocks, the total fees for you to buy and sell the stock will be S$54.36. What this means is that the stock will have to go up by 5.44% for you to breakeven.

Similarly, if you buy S$2000 worth of stocks, the total fees for you to buy and sell the stock will be S$55.21. For you to break even, the stock will now only need to go up by 2.76%.

Based on the table, you will see that, the more you buy, the percentage gain on the stock for you to break even will drop.

From the table too, it seems like the ideal position to be S$6,000, for you to enjoy a breakeven cost of 0.98%, which is less than 1%.

If you buy S$8,000 worth of stock, the stock will only need to increase by 0.68% for you to breakeven.

When Mr Budget first started buying via DBS Vickers, his average position was around S$2,500 to S$3,000. This is without the knowledge of the percentage needed to breakeven. Hence if you see Mr Budget’s portfolio, the stocks in which are in the S$2,500 to S$3000 positions are those that were bought more than 1 year ago. 

For now, our average position size is around S$4,000 to S$5,000, and if we are confident in the counter, may go up to S$6,000 to S$8000.

Hopefully we will be able to increase our position size to around S$8,000 to S$10,000 per counter in the future, so that the fees will be negligible.

What is your average position size? 🙂

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