Minimum Holding

[white_crane]

I know that there is a minimum (initial) purchase value of $500, but is there a minimum holding amount/value that you must maintain?

eg You hold 1100 shares in xyz company @ $1 each. Can you sell 1000 of those shares, leaving you with only 100 shares worth $100?

 

[So_Cynical]

I know that there is a minimum (initial) purchase value of $500, but is there a minimum holding amount/value that you must maintain?

eg You hold 1100 shares in xyz company @ $1 each. Can you sell 1000 of those shares, leaving you with only 100 shares worth $100?

I imagine if Stephen Mayne can do it...anyone can.

http://www.maynereport.com/images/2009/06/18-147RWADJ600.htm

http://www.maynereport.com/articles/2008/04/18-1611-3339.html

 

[jono1887]

I know that there is a minimum (initial) purchase value of $500, but is there a minimum holding amount/value that you must maintain?

eg You hold 1100 shares in xyz company @ $1 each. Can you sell 1000 of those shares, leaving you with only 100 shares worth $100?

I don't think there is a minimum amount you have to hold.

 

[white_crane]

So if you had limited funds and were able to make a successful trade you could sell off enough shares to cover your costs and retain the profits as a small number of shares. Let's say that the company pays dividends and has a DRP, you could then reinvest those dividends as shares and over time build up an investment for (practically) free. Does this thinking make sense? Has/is this been/being done?

 

[So_Cynical]

So if you had limited funds and were able to make a successful trade you could sell off enough shares to cover your costs and retain the profits as a small number of shares. Let's say that the company pays dividends and has a DRP, you could then reinvest those dividends as shares and over time build up an investment for (practically) free. Does this thinking make sense? Has/is this been/being done?

I do it all the time, pretty much always leave the profit in and add about 10% of my original capital...and then look at the whole position as a sorta half free carry....im buying bottoms not tops, so it makes sense to leave capital in as the cost base (SP) is so low.

 

[beamstas]

There is no rule against it, but no reason to do it.

If you are waiting for b/e then pulling your position, you are making it bloody hard to profit. You are assuming that you'll always be in a position to pull a trade at breakeven and leave a small number on. In reality you'd be better to let the whole position run into profit and sell the lot.

Your downside risk is a full unit of risk, but your upside potential is only a small portion of a position. Most people operate the other way, minimise risk and maximise gain.

Brad

 

[white_crane]

Thanks for the replies everyone.

Beamstas - firstly, let the position run. What I'm talking about here is if you only had a minimal amount of cash to spare. You could essentially begin to build up a holding (from a short term trade) until such time as you were in a better financial position. It's not much, but it's a start in some shares.

 

[nunthewiser]

search under my name and "free ride " free carry ' free hold ........ i have posted a few bits and pieces

please ignore the arguing in betweeen

may or may not suit you

i do not know how "unmarketable " parcel sizes go tho

 

[white_crane]

search under my name and "free ride " free carry ' free hold ........ i have posted a few bits and pieces

please ignore the arguing in betweeen

may or may not suit you

i do not know how "unmarketable " parcel sizes go tho

Thanks nunthewiser, I'll be reading through those. I saw your post on the "Exiting a trade" thread and combined with the enquiry about the minimum purchase parcel from another thread, that got me thinking. I had an idea about these, but alas I have lost my original line of thought. I'm just trying to get it back. lol