Trading the people.

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Comparisons of CC5 down counting of S5006P1812B in daily and half-daily graphs.

In this post, CC5 down counting were used in daily and half-daily graphs of S5006P1812B (PUT warrant on SET50 Dec 2018 series B by PTSEC). The countings were to gauge exhaustion of the down trend. As of 20180807, the counting down have reached number 11 on both time frame. It's worth to monitor further development.

Investors who want to learn how to read market stories from the charts can consult me (Dr. Nimit Chomnawang) at [ m.me/nimit.chomnawang ].

[ ลืมตลาดไทยที่เล็กจิ๋ว เอาห้าพันบาทไปลองลงทุนในตลาดโลกกันดีกว่า ]

Use of Forex Insight Pro to help in binary option trading.

In this post, Forex Insight Pro (FIP) for MT4 was used to help planning in trading EURUSD binary option. The platform of binary option trading could be from any borkers on any devices, each one has slightly different rules and facilities. The FIP was set to have EMA(5,10,20) ribbon, MACD(12,26,9) increasing (green) / decreasing (red) colors on EMA40 line. Upward green triangles were for local max points and downward red triangles for local min points. Red vertical lines were for MACD < Signal and green vertical lines were for MACD > Signal. Upward green arrows were for EMA5 > EMA10 and downward red arrows were for EMA5 < EMA10. The CCX counting was set to 5. The CC5 down numbers were below the prices while the CC5 up numbers were above the prices. We need to be very selective in binary option trading. The discipline in this case is to be very patient and wait for entries at the right occasions only. This historical example was for the CALL option. The trade setup began when we saw a red vertical line or MACD < Signal, a red downward arrow or EMA5 < EMA10, a flipping downward of EMA(5,10,20) ribbon and a start of CC5 down counting. These confluence of factors told that the market was going down. We need to wait until the selling pressure dries up before placing a CALL option. The CC5 down counting went on while the EMA ribbon spread wider and downward. Local max and min points occurred during this stage could be used to gauge the likelihood of trend reversal. By creating a trend line that connected a new local max point to the previous and higher one. This was called Supply line 1. The Supply line 1 guided the downtrend until the CC5 down = 12 and a local min point were seen. In this stage, the RSI7 indicator was below 30%. The price broke above the Supply line 1 and went side-way to the right to consolidate the strength. During this period, another local max point was used to create the Supply line 2. When the price broke above the Supply line 2 and the EMA(5,10,20) ribbon ( green upward arrow or EMA5 > EMA10 ), a CALL 15 minutes binary option was placed. Fifteen minutes later, the call was in the money with a 80% gain.

Investors who want to learn how to read market stories from the charts can consult me (Dr. Nimit Chomnawang) at [ m.me/nimit.chomnawang ].

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Learn investments planning from EA weekly as of 20180731.

In the week of 27 March 2017, the weekly chart of EA broke above a supply line. The higher low had been seen. The RSI7 had been at below 30% and climbing up. the high of that week was 27.75 THB. A close above this price would be a good buying point. Confirmed by flipping upward of the EMA ribbon (5, 10, 20), the price had gone up largely along the EMA5 line after that. About a month later, the price closed above a supply line formed by local max points of the previous all-time-high point and the recent high point. Long-term investors would keep track of this stock to see if it formed a new supply line from most recent local max points, by hand or by software helper such as the Forex Insight Pro's Local max-min tool. The price of EA had gone super largely to make a new all-time-high of 71.25 THB in the week of 15th January 2018. A month later another lower high point was formed. These local max points formed a new supply line that acted as a resistance. Due to the huge gain already obtained and the high speed of price rally. This should be accepted as a good profit taking point. 

After unsuccessfully attempted to go beyond the newly formed supply line, the price gave up, closed below EMA5 line and took an elevator to get back to the ground of 27.75 THB. As of now, the EMA ribbon still spread downward. The EMA5 has not crossed the EMA10 line yet. It would take very long time for the price of super stock under big correction to climb up significantly again.

Investors who want to learn how to read market stories from the charts can consult me (Dr. Nimit Chomnawang) at [ m.me/nimit.chomnawang ].

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Reading stories in WPH daily chart as of 20180606.

WPH took 6 months to settle before the market makers started their share accumulations. As I have posted about the concept of "stop hunting" for sometimes already, my eyes are now trained to see the locations of stop loss levels. The graph above shows locations of stop loss levels for those investors who entered the market too early. These stop-loss levels had been activated and the market makers had already bought the cheap shares from unwilling sellers. After two rounds of major stop hunting, the MACD indicator had turned from negative to positive zones. The public now has noticed the price appreciation. Since crossing to the positive side of the MACD is an important event in price recovery of a stock. Buying pressure had pushed the price up with a big gap at 2.80 THB. The price shot up over the market probe level occurred in January 2018 and retraced back toward the opened gap. This gap will be closed at 2.80 THB. I have labeled chart structures at various price levels for your investment considerations. From this chart reading, you can see clearly that knowing the stories  in the graph helps a lot in planing your investment.

Investors who want to learn how to read market stories from the charts can consult me (Dr. Nimit Chomnawang) at [ m.me/nimit.chomnawang ].

[ ลืมตลาดไทยที่เล็กจิ๋ว เอาห้าพันบาทไปลองลงทุนในตลาดโลกกันดีกว่า ]

Understand "Stop Hunting" concept in one minute.

Stop hunting is a very important concept in trading of anything. When you buy a goods or service, you want the buying price to be as low as possible. How could you get the cheapest price ? You must buy it from people who really need to sell it to get quick money from you. In stock or forex markets, you want to buy from people who are forced to sell their holdings to cover the damage due to their bad investments. 

On the left hand side of EURUSD pair in 1 minute chart above, many investors expected that the market was about to turn upward. So they bought the pair and set up their stop loss just below the price bars as shown in the chart with $ signs. This was opposite to what the market makers thought. They had a huge amount of buy orders to be fulfilled instantly and they had to have positions in their hands and they need to buy those positions at cheap prices. What they did was using some money to shift the price down very quickly to trigger the stop losses of other buyers ($$$$$$$$$$$$). So those buyers unwillingly sold out their positions to the market makers. The market makers kept buying until the supply dried up and the price slipped higher. When the public spotted this price appreciation, they joined buying the pair driving the price even higher. Who were selling positions to the public ? They were the market makers that supplied the positions to the public. This happens all the time in every markets of everything.

Investors who want to learn how to read market stories from the charts can consult me (Dr. Nimit Chomnawang) at [ m.me/nimit.chomnawang ].

[ ลืมตลาดไทยที่เล็กจิ๋ว เอาห้าพันบาทไปลองลงทุนในตลาดโลกกันดีกว่า ]

You had 9 months to buy PTT at lower than IPO price. It takes time for most IPO stocks to build up the share price.

Seventeen years ago (December 6th, 2001), IPO shares of PTT were distributed to the public through branches of 5 commercial banks. The shares were sold out within a few minutes. The big crowd of people lined up in front of the banks for hours did not get the shares. Most of them are now still think that the distribution process was unfair. The fact for this case was that they did not understand the IPO process and stock investment in general. The chart above shows that they had 9 months to buy PTT at lower price than people who managed to get the shares on that day. 

Most IPO stocks need time months or even years to build up their share prices. If the stocks were good ones, you could always buy them later on. Stop blaming others for your own ignorance.

Investors who want to learn how to read market stories from the charts can consult me (Dr. Nimit Chomnawang) at [ m.me/nimit.chomnawang ].

[ ลืมตลาดไทยที่เล็กจิ๋ว เอาห้าพันบาทไปลองลงทุนในตลาดโลกกันดีกว่า ]

Invest with a plan: A case study of FLOYD recent trading with a Beehive4 plan.

The Buddha taught that a man should build up his wealth righteously and gradually like bees build up their hive or ants build up their hill [ see the Sigalovada Sutta ]. This is his teaching on money management. Many gurus have said a lot about investing with good money investments. However, real examples have been rarely provided. In this post, I will take the readers to walk through this process with a real historical case study of investing in a Thai stock FLOYD using a Beehive4 investment plan. The Beehive4 plan consists of the following steps.

• Read stories in the price chart of the asset of interest.
• Identify the price range in which we can buy the asset cheaply.
• Wait until that condition happens in the price chart.
• Set a level of account damage (stop-loss level) that we can afford if the investment turned bad. This should be less than 3% of the account value (present values of cash and equities in the account). Divide this possible damage with the buying price to get the corresponding number of shares we could buy. 
• Buy the asset, sell at loss when the stop-loss level is reached or take profit when the gain of 4% is obtained.
• Go on to look at other opportunities. 

The picture above shows FLOYD hourly prices. From left to right, we can see that the price was in consolidation phase slightly above the SMA50 white line. During this, some investors voluntarily buy shares from the market makers. In hope that the price will go up due to the news about breaking operating profits FLOYD had performed lately, they set their stop losses ($ symbols) under the price bars (and off-course everyone knew about these stop-loss levels). With enough buyers in hands, the market makers want to buy those shares back at cheaper prices. So they drove the price down rapidly so that the buyers got panic and activated their stop-loss orders (stop hunting). The lowest price the market makers obtained their shares was at 2.16 THB. When stop hunting like this occurs, experienced investors whose eyes had been trained can see those invisible stop-loss and stop-hunting levels automatically. They then will join the market makers to buy shares at these cheap prices and wait for the market makers's price manipulation and later on public panic buying. They then will take profits there at reasonable higher prices. The Beehive4 plan suggests that this higher price to be around 4%. After the trained Beehive4 investors had joined the market makers, a price manipulation was activated by heavy buying orders until the supply dried up and the price started to climb. At this point the public started noticing the new rally. They come to join the market maker's buying and that drove the price even higher very rapidly. The share price peaked out at 2.74 THB in a few hours later. By that time, the market makers had sold their shares to the public for profits of as high as 20% and the Beehive4 investors had sold their shares for 4% profits. You might think selling shares at only 4% profit was stupid as it climbed up to over 20%. I confirm that it was not stupid at all since nobody knew how far would the price go. Statistically, the rally almost always goes beyond 4% so the Beehive4 plan would take only 4% profit no matter how far would the price goes later on. 

When no more buyers showed up and the sellers were everywhere, the price surely plunged very quickly by jumping down across the gap from 2.60 THB to 2.46 THB and further. At 2.28 THB, someones bravely bought the shares and set their stop-loss levels just below that price. The market makers hit these brave buyers with another stop hunting down to 2.24 THB, collected their cheap shares and drove the price up again to 2.38 THB allowing another 4% profit opportunity. The cycle went on a couple more times each of which had stop hunting down to the ascending SMA50 white line. The price recovery showed a sign of saturation when it reached the gap near 2.46 THB.

I started spotting this stock when the major stop hunting and big rally to 2.74 THB had already occurred. It's well-known that a gap would mostly be closed. So the probability that the price would go up to at least 2.60 THB to close the gap was high. If the shares were bought at 2.48 THB, we could afford to lose up to 3% of the account size of 134,252 THB which was 0.03*134,252 = 4,028 THB. If we set a stop-loss level at the lowest price during the major stop hunt or 2.16 THB, we could afford to lose 0.32 THB/share. So, we could buy up to 4,028/0.32 = 12,587 shares. This number was rounded to 12,500 shares. We therefore needed cash of 2.48*12,500 = 31,000 THB for this transaction. This investing money was 31,000/134,252 = 23.1% of the account size. If we took profit at 4% or 2.58 THB, that would be 2.58-2.48 = 0.10 THB/share in profit or 0.10*12,500 = 1,250 THB. Note that our target was actually one spread below the gap closing level of 2.60 THB. With all things considered, the buy order of 12,500 shares of FLOYD was transacted on 20180518 10:18 at 2.48 THB. Stop-loss level was set to 2.16 THB and profit taking was set to 2.58 THB.

A few hours after buying 12,500 shares of FLOYD, the price suddenly shot up to 2.54 THB not far from the target price. Just two hours later the price plunged down abruptly and turned into another stop hunting for those buyers who set their stop-loss levels too tightly. This stop hunting did not hurt our investment since it was still far from 2.16 THB. The recent peaks of 2.74 THB and 2.54 THB had then set a supply line for the latest stop hunting to overcome. The first candlestick that completely broke above this supply line occurred on 20180525 09:00. This bar also broke above the SMA50 line before climbing up to hit the profit taking target at 2.58 THB as expected in the last trading hour of Friday 20180525. The return of 4% in seven calendar days was not a tiny one. It was equivalent to a lucrative compound interest of 685.58% per year. So if we consistently invest with a Beehive4 plan and  maximum possible damage of 3% of the account size, the wealth would be collected sustainably like the bees building their hive or the ants building their hill. Although, each chunk of material used by the insects is very little, the size of the home keeps growing rapidly.  

Investors who want to learn how to read market stories from the charts can consult me (Dr. Nimit Chomnawang) at [ m.me/nimit.chomnawang ].

[ ลืมตลาดไทยที่เล็กจิ๋ว เอาห้าพันบาทไปลองลงทุนในตลาดโลกกันดีกว่า ]

Sigalovada Sutta reveals how to build up the wealth righteously.

DN 31
PTS: D iii 180
Sigalovada Sutta
The Discourse to Sigala: The Layperson's Code of Discipline

Translated from the Pali by Narada Thera © 1996–2009
Alternate translation: Kelly/Sawyer/Yareham

Thus have I heard:

On one occasion the Exalted One was dwelling in the Bamboo Grove, the Squirrels' Sanctuary, near Rajagaha.

Now at that time, young Sigala, a householder's son, rising early in the morning, departing from Rajagaha, with wet clothes and wet hair, worshipped with joined hands the various quarters — the East, the South, the West, the North, the Nadir, and the Zenith.

Then the Exalted One, having robed himself in the forenoon took bowl and robe, and entered Rajagaha for alms. Now he saw young Sigala worshipping thus and spoke to him as follows:

"Wherefore do you, young householder, rising early in the morning, departing from Rajagaha, with wet clothes and wet hair, worship, with joined hands these various quarters — the East, the South, the West, the North, the Nadir, and the Zenith?"

"My father, Lord, while dying, said to me: The six quarters, dear son, you shall worship. And I, Lord, respecting, revering, reverencing and honoring my father's word, rise early in the morning, and leaving Rajagaha, with wet clothes and wet hair, worship with joined hands, these six quarters."

"It is not thus, young householder, the six quarters should be worshipped in the discipline of the noble."

"How then, Lord, should the six quarters be worshipped in the discipline of the noble? It is well, Lord, if the Exalted One would teach the doctrine to me showing how the six quarters should be worshipped in the discipline of the noble."

"Well, young householder, listen and bear it well in mind; I shall speak." — "Very good, Lord," responded young Sigala.

And the Exalted One spoke as follows:

"Inasmuch, young householder, as the noble disciple (1) has eradicated the four vices in conduct,1 (2)inasmuch as he commits no evil action in four ways, (3) inasmuch as he pursues not the six channels for dissipating wealth, he thus, avoiding these fourteen evil things, covers the six quarters, and enters the path leading to victory in both worlds: he is favored in this world and in the world beyond. Upon the dissolution of the body, after death, he is born in a happy heavenly realm.

(1) "What are the four vices in conduct that he has eradicated? The destruction of life, householder, is a vice and so are stealing, sexual misconduct, and lying. These are the four vices that he has eradicated."

Thus spoke the Exalted One. And when the Master had thus spoken, he spoke yet again:

Killing, stealing, lying and adultery, These four evils the wise never praise.

(2) "In which four ways does one commit no evil action? Led by desire does one commit evil. Led by anger does one commit evil. Led by ignorance does one commit evil. Led by fear does one commit evil.2

"But inasmuch as the noble disciple is not led by desire, anger, ignorance, and fear, he commits no evil."

Thus spoke the Exalted One. And when the Master had thus spoken, he spoke yet again:

Whoever through desire, hate or fear, Or ignorance should transgress the Dhamma, All his glory fades away Like the moon during the waning half. Whoever through desire, hate or fear, Or ignorance never transgresses the Dhamma, All his glory ever increases Like the moon during the waxing half.

(3) "What are the six channels for dissipating wealth which he does not pursue?

(a) "indulgence in intoxicants which cause infatuation and heedlessness; (b) sauntering in streets at unseemly hours; (c) frequenting theatrical shows; (d) indulgence in gambling which causes heedlessness; (e) association with evil companions; (f) the habit of idleness.

(a) "There are, young householder, these six evil consequences in indulging in intoxicants which cause infatuation and heedlessness:

(i) loss of wealth, (ii) increase of quarrels, (iii) susceptibility to disease, (iv) earning an evil reputation, (v) shameless exposure of body, (vi) weakening of intellect.

(b) "There are, young householder, these six evil consequences in sauntering in streets at unseemly hours:

(i) he himself is unprotected and unguarded, (ii) his wife and children are unprotected and unguarded, (iii) his property is unprotected and unguarded, (iv) he is suspected of evil deeds,3 (v) he is subject to false rumours, (vi) he meets with many troubles.

(c) "There are, young householder, these six evil consequences in frequenting theatrical shows. He is ever thinking:

(i) where is there dancing? (ii) where is there singing? (iii) where is there music? (iv) where is there recitation? (v) where is there playing with cymbals? (vi) where is there pot-blowing?4

(d) "There are, young householder, these six evil consequences in indulging in gambling:

(i) the winner begets hate, (ii) the loser grieves for lost wealth, (iii) loss of wealth, (iv) his word is not relied upon in a court of law, (v) he is despised by his friends and associates, (vi) he is not sought after for matrimony; for people would say he is a gambler and is not fit to look after a wife.

(e) "There are, young householder, these six evil consequences in associating with evil companions, namely: any gambler, any libertine, any drunkard, any swindler, any cheat, any rowdy is his friend and companion.(f) "There are, young householder, these six evil consequences in being addicted to idleness:

"He does no work, saying:

(i) that it is extremely cold, (ii) that it is extremely hot, (iii) that it is too late in the evening, (iv) that it is too early in the morning, (v) that he is extremely hungry, (vi) that he is too full.

"Living in this way, he leaves many duties undone, new wealth he does not get, and wealth he has acquired dwindles away."

Thus spoke the Exalted One. And when the Master had thus spoken, he spoke yet again:

"One is a bottle friend; one says, 'friend, friend' only to one's face; one is a friend and an associate only when it is advantageous.

"Sleeping till sunrise, adultery, irascibility, malevolence, evil companions, avarice — these six causes ruin a man.

"The man who has evil comrades and friends is given to evil ways, to ruin does he fall in both worlds — here and the next.

"Dice, women, liquor, dancing, singing, sleeping by day, sauntering at unseemly hours, evil companions, avarice — these nine5 causes ruin a man.

"Who plays with dice and drinks intoxicants, goes to women who are dear unto others as their own lives, associates with the mean and not with elders — he declines just as the moon during the waning half.

"Who is drunk, poor, destitute, still thirsty whilst drinking, frequents the bars, sinks in debt as a stone in water, swiftly brings disrepute to his family.

"Who by habit sleeps by day, and keeps late hours, is ever intoxicated, and is licentious, is not fit to lead a household life.

"Who says it is too hot, too cold, too late, and leaves things undone, the opportunities for good go past such men.

"But he who does not regard cold or heat any more than a blade of grass and who does his duties manfully, does not fall away from happiness."

"These four, young householder, should be understood as foes in the guise of friends:

(1) he who appropriates a friend's possessions, (2) he who renders lip-service, (3) he who flatters, (4) he who brings ruin.

(1) "In four ways, young householder, should one who appropriates be understood as a foe in the guise of a friend:

(i) he appropriates his friend's wealth, (ii) he gives little and asks much, (iii) he does his duty out of fear, (iv) he associates for his own advantage.

(2) "In four ways, young householder, should one who renders lip-service be understood as a foe in the guise of a friend:

(i) he makes friendly profession as regards the past, (ii) he makes friendly profession as regards the future, (iii) he tries to gain one's favor by empty words, (iv) when opportunity for service has arisen, he expresses his inability.

(3) "In four ways, young householder, should one who flatters be understood as a foe in the guise of a friend:

(i) he approves of his friend's evil deeds, (ii) he disapproves his friend's good deeds, (iii) he praises him in his presence, (iv) he speaks ill of him in his absence.

(4) "In four ways, young householder, should one who brings ruin be understood as a foe in the guise of a friend:

(i) he is a companion in indulging in intoxicants that cause infatuation and heedlessness, (ii) he is a companion in sauntering in streets at unseemly hours, (iii) he is a companion in frequenting theatrical shows, (iv) he is a companion in indulging in gambling which causes heedlessness."

Thus spoke the Exalted One. And when the Master had thus spoken, he spoke yet again:

The friend who appropriates, the friend who renders lip-service, the friend that flatters, the friend who brings ruin, these four as enemies the wise behold, avoid them from afar as paths of peril.

"These four, young householder, should be understood as warm-hearted friends:

(1) he who is a helpmate, (2) he who is the same in happiness and sorrow, (3) he who gives good counsel, (4) he who sympathises.

(1) "In four ways, young householder, should a helpmate be understood as a warm-hearted friend:

(i) he guards the heedless, (ii) he protects the wealth of the heedless, (iii) he becomes a refuge when you are in danger, (iv) when there are commitments he provides you with double the supply needed.

(2) "In four ways, young householder, should one who is the same in happiness and sorrow be understood as a warm-hearted friend:

(i) he reveals his secrets, (ii) he conceals one's own secrets, (iii) in misfortune he does not forsake one, (iv) his life even he sacrifices for one's sake.

(3) "In four ways, young householder, should one who gives good counsel be understood as a warm-hearted friend:

(i) he restrains one from doing evil, (ii) he encourages one to do good, (iii) he informs one of what is unknown to oneself, (iv) he points out the path to heaven.

(4) "In four ways, young householder, should one who sympathises be understood as a warm-hearted friend:

(i) he does not rejoice in one's misfortune, (ii) he rejoices in one's prosperity, (iii) he restrains others speaking ill of oneself, (iv) he praises those who speak well of oneself."

Thus spoke the Exalted One. And when the Master had thus spoken, he spoke yet again:

The friend who is a helpmate, the friend in happiness and woe, the friend who gives good counsel, the friend who sympathises too — these four as friends the wise behold and cherish them devotedly as does a mother her own child. The wise and virtuous shine like a blazing fire. He who acquires his wealth in harmless ways like to a bee that honey gathers,6 riches mount up for him like ant hill's rapid growth. With wealth acquired this way, a layman fit for household life, in portions four divides his wealth: thus will he friendship win. One portion for his wants he uses,7 two portions on his business spends, the fourth for times of need he keeps.

"And how, young householder, does a noble disciple cover the six quarters?

"The following should be looked upon as the six quarters. The parents should be looked upon as the East, teachers as the South, wife and children as the West, friends and associates as the North, servants and employees as the Nadir, ascetics and brahmans as the Zenith.8

"In five ways, young householder, a child should minister to his parents as the East:

(i) Having supported me I shall support them, (ii) I shall do their duties, (iii) I shall keep the family tradition, (iv) I shall make myself worthy of my inheritance, (v) furthermore I shall offer alms in honor of my departed relatives.9

"In five ways, young householder, the parents thus ministered to as the East by their children, show their compassion:

(i) they restrain them from evil, (ii) they encourage them to do good, (iii) they train them for a profession, (iv) they arrange a suitable marriage, (v) at the proper time they hand over their inheritance to them.

"In these five ways do children minister to their parents as the East and the parents show their compassion to their children. Thus is the East covered by them and made safe and secure.

"In five ways, young householder, a pupil should minister to a teacher as the South:

(i) by rising from the seat in salutation, (ii) by attending on him, (iii) by eagerness to learn, (iv) by personal service, (v) by respectful attention while receiving instructions.

"In five ways, young householder, do teachers thus ministered to as the South by their pupils, show their compassion:

(i) they train them in the best discipline, (ii) they see that they grasp their lessons well, (iii) they instruct them in the arts and sciences, (iv) they introduce them to their friends and associates, (v) they provide for their safety in every quarter.

"The teachers thus ministered to as the South by their pupils, show their compassion towards them in these five ways. Thus is the South covered by them and made safe and secure.

"In five ways, young householder, should a wife as the West be ministered to by a husband:

(i) by being courteous to her, (ii) by not despising her, (iii) by being faithful to her, (iv) by handing over authority to her, (v) by providing her with adornments.

"The wife thus ministered to as the West by her husband shows her compassion to her husband in five ways:

(i) she performs her duties well, (ii) she is hospitable to relations and attendants10 (iii) she is faithful, (iv) she protects what he brings, (v) she is skilled and industrious in discharging her duties.

"In these five ways does the wife show her compassion to her husband who ministers to her as the West. Thus is the West covered by him and made safe and secure.

"In five ways, young householder, should a clansman minister to his friends and associates as the North:

(i) by liberality, (ii) by courteous speech, (iii) by being helpful, (iv) by being impartial, (v) by sincerity.

"The friends and associates thus ministered to as the North by a clansman show compassion to him in five ways:

(i) they protect him when he is heedless, (ii) they protect his property when he is heedless, (iii) they become a refuge when he is in danger, (iv) they do not forsake him in his troubles, (v) they show consideration for his family.

"The friends and associates thus ministered to as the North by a clansman show their compassion towards him in these five ways. Thus is the North covered by him and made safe and secure.

"In five ways should a master minister to his servants and employees as the Nadir:

(i) by assigning them work according to their ability, (ii) by supplying them with food and with wages, (iii) by tending them in sickness, (iv) by sharing with them any delicacies, (v) by granting them leave at times.

"The servants and employees thus ministered to as the Nadir by their master show their compassion to him in five ways:

(i) they rise before him, (ii) they go to sleep after him, (iii) they take only what is given, (iv) they perform their duties well, (v) they uphold his good name and fame.

"The servants and employees thus ministered to as the Nadir show their compassion towards him in these five ways. Thus is the Nadir covered by him and made safe and secure.

"In five ways, young householder, should a householder minister to ascetics and brahmans as the Zenith:

(i) by lovable deeds, (ii) by lovable words, (iii) by lovable thoughts, (iv) by keeping open house to them, (v) by supplying their material needs.

"The ascetics and brahmans thus ministered to as the Zenith by a householder show their compassion towards him in six ways:

(i) they restrain him from evil, (ii) they persuade him to do good, (iii) they love him with a kind heart, (iv) they make him hear what he has not heard, (v) they clarify what he has already heard, (vi) they point out the path to a heavenly state.

"In these six ways do ascetics and brahmans show their compassion towards a householder who ministers to them as the Zenith. Thus is the Zenith covered by him and made safe and secure." Thus spoke the Exalted One. And when the Master had thus spoken, he spoke yet again:

The mother and father are the East, The Teachers are the South, Wife and Children are the West, The friends and associates are the North. Servants and employees are the Nadir, The ascetics and brahmans are the Zenith; Who is fit to lead the household life, These six quarters he should salute. Who is wise and virtuous, Gentle and keen-witted, Humble and amenable, Such a one to honor may attain. Who is energetic and not indolent, In misfortune unshaken, Flawless in manner and intelligent, Such a one to honor may attain. Who is hospitable, and friendly, Liberal and unselfish, A guide, an instructor, a leader, Such a one to honor may attain. Generosity, sweet speech, Helpfulness to others, Impartiality to all, As the case demands. These four winning ways make the world go round, As the linchpin in a moving car. If these in the world exist not, Neither mother nor father will receive, Respect and honor from their children. Since these four winning ways The wise appraise in every way, To eminence they attain, And praise they rightly gain.

When the Exalted One had spoken thus, Sigala, the young householder, said as follows:

"Excellent, Lord, excellent! It is as if, Lord, a man were to set upright that which was overturned, or were to reveal that which was hidden, or were to point out the way to one who had gone astray, or were to hold a lamp amidst the darkness, so that those who have eyes may see. Even so, has the doctrine been explained in various ways by the Exalted One.

"I take refuge, Lord, in the Buddha, the Dhamma, and the Sangha. May the Exalted One receive me as a lay follower; as one who has taken refuge from this very day to life's end."

Notes

1.

kamma-kilesa, lit., 'actions of defilement.'

2.

These are the four agati, 'evil courses of action': chanda, dosa, moha, bhaya.

3.

Crimes committed by others.

4.

A kind of amusement.

5.

The Pali original has here "six causes" as two compound words and one double-term phrase are counted as units.

6.

Dhammapada v. 49: "As a bee, without harming the flower, its color or scent, flies away, collecting only the honey..."

7.

This portion includes what is spent on good works: gifts to monks, charity, etc.

8.

"The symbolism is deliberately chosen: as the day in the East, so life begins with parents' care; teacher's fees and the South are the same word: dakkhina; domestic cares follow when the youth becomes man, as the West holds the later daylight; North is 'beyond' (uttara), so by help of friends, etc., he gets beyond troubles." — (Rhys Davids)

9.

This is a sacred custom of the Aryans who never forgot the dead. This tradition is still faithfully observed by the Buddhists of Sri Lanka who make ceremonial offerings of alms to the monks on the eighth day, in the third month, and on each anniversary of the demise of the parents. Merit of these good actions is offered to the departed after such ceremony. Moreover after every punna-kamma(good action), a Buddhist never fails to think of his parents and offer merit. Such is the loyalty and the gratitude shown to parents as advised by the Buddha.

10.

lit., 'the folk around' (parijana).

Provenance:

©1985 Buddhist Publication Society.

From Everyman's Ethics: Four Discourses by the Buddha (WH 14), translated by Narada Thera (Kandy: Buddhist Publication Society, 1985). Copyright © 1985 Buddhist Publication Society. Used with permission.

This Access to Insight edition is ©1996–2009 John T. Bullitt.

Terms of use: You may copy, reformat, reprint, republish, and redistribute this work in any medium whatsoever, provided that: (1) you only make such copies, etc. available free of charge and, in the case of reprinting, only in quantities of no more than 50 copies; (2) you clearly indicate that any derivatives of this work (including translations) are derived from this source document; and (3) you include the full text of this license in any copies or derivatives of this work. Otherwise, all rights reserved. For additional information about this license, see the FAQ.

How to cite this document (one suggested style): "Sigalovada Sutta: The Discourse to Sigala" (DN 31), translated from the Pali by Narada Thera. Access to Insight, June 7, 2009, http://www.accesstoinsight.org/tipitaka/dn/dn.31.0.nara.html.

How did the Buddha teach on personal finance ?

The Buddha once told Dighajanu, a layman, that there are four things which are conducive to a man's happiness in this world:

* He should be skilled, efficient, earnest , and energetic in whatever profession he is engaged, and he should know it well (utthana-sampada).

* He should protect his income, which he has thus earned righteously, with the sweat of his brow, from thieves, etc. (arakkha-sampada).

* He should have good friends who are faithful, learned, virtuous, liberal and intelligent, who will help him along the right path away from evil (kalyana-mitta).

* He should spend reasonably, in proportion to his income, neither too much nor too little, i.e., he should not hoard wealth avariciously, nor should he be extravagant - in other words, he should live within his means (sama-jivikata). 

Then the Buddha expounds the four virtues conducive to a layman's happiness hereafter:

* Saddha -- He should have faith and confidence in moral, spiritual and intellectual values.

* Sila      -- He should abstain from destroying and harming life, from stealing and cheating, from adultery, from falsehood, and from intoxicating drinks.

* Caga    -- He should practise charity, generosity, without attachment and craving for his wealth.

* Panna  -- He should develop wisdom which leads to the complete destruction of suffering, to the realization of Nibbana.

(Angguttara-nikaya, IV:280)

Sometimes the Buddha even went into details about saving money and spending it, as, for instance,
when he told the young man Sigala that: 

He should spend one fourth of his income on his daily expenses (including
charity donations),  invest half in his businesses (and investments),  and put aside
one fourth for any emergencies.

(Sigalovada-sutta, Digha-nikaya No.13)

Again, when speaking to Anathapindika, the great banker, the Buddha said that a layman, who leads an ordinary family life, has four kinds of happiness.

* The first is to enjoy economic security or sufficient wealth acquired by just and righteous means.

 
* The second is spending that wealth liberally on himself, his family, his friends and relatives, and on meritorious deeds.

* The third is to be free from debts.
 
* The fourth happiness is to live a faultless and a pure life without committing evil in thought, word or deed. 

The first three are economic and the Buddha finally reminded the banker that economic and material happiness is "not worth one sixteenth part" of the spiritual happiness arising out of a faultless and good life. 

(Anguttara-nikaya, III: 44)

Adapted from "Leading A Buddhist Life" by Ven. K. Sri Dhammananda.

See also "Sigalovada Sutta, Digha-Nikaya No.13, Suttanta Pitaka".

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