Newbie Lessons - All your questions answered

[prawn_86]

Sir O (or others),

Whats your thoughts on ways for those starting out to make sure they are beating inflation with their returns, but not with enough saved to make it worthwhile purchasing a property?

 

[Albi]

Thanks all guys and girls, ladies and gentlemen and all of my ASF friends for your advice. Yeah it is quiet depressing that I could not be successful in my share trading. I think my luck is not working. Instead of making research, getting advice, my shares are still down except one, from which I got profit. I will ring ATO. Thanks
Albi

 

[youngone]

Sir O (or others),

Whats your thoughts on ways for those starting out to make sure they are beating inflation with their returns, but not with enough saved to make it worthwhile purchasing a property?

What about the Aussie $$. Its going very strong atm. im a noob too

 

[explod]

Sir O (or others),

Whats your thoughts on ways for those starting out to make sure they are beating inflation with their returns, but not with enough saved to make it worthwhile purchasing a property?

This is a connundrum. Foremost guidance in this direction and at this level borders on financial advice.

Second there is no "make sure".

If I was wanting my Son to go forward I would say, you need ballance and you need stability. Focus on companies essential to the general community.

A good food stock that is performing reasonably, say WOW, Woolworths, mainly dividends but growth equal to inflation. A solid coal producer. A power producer.

In all investments the sector must be performing well with a medium term good outlook. The company also, trending up. Little or no debt, and they can be found.

Some in term deposits but not tied up too long.

He he he. Some gold, some silver in physical form whilst it is trending up.

Get to know your local Real Estate Agent and talk to him and the staff, get to know them and learn well before you embark.

Diversification ballance is tricky, too many stocks etc and you can lose sight of where you are going, too few and you risk your equity base.
Just a small brief, hopefully others can add.

 

[gt88]

Hi all,

Ive read a lot of people say that you should do your own research into companies. What resources do people use? At the moment I currently have a read of the annual report (more specifically the financial reports) and look through the Commsec financial data section. What other resources should/can I use to investigate into companies and its industry.

Cheers

 

[Frankie]

Hi gt88,

E*TRADE has some great tools that help me research companies. You can find these tools under the Quotes and Research tab on their website.

I though I’d share below 2 tools I find really useful:

1) ANALYST RESEARCH
You will find a number of analysts that offer their stock recommendations! Some of the topics covered include – stocks to watch, stock of the week, market outlook etc

2) BASIC STOCK FILTER
The stockmarket is comprised of many different sectors - energy, financials, health care etc. This filter helps me find stocks recommended for the sectors I'm interested in. Let’s say I'm looking for a “strong buy” in the energy sector. This filter will provide me with a list of stocks that have been researched by Aspect Huntley.

 

[joea]

Hi gt88,


1) ANALYST RESEARCH
You will find a number of analysts that offer their stock recommendations! Some of the topics covered include – stocks to watch, stock of the week, market outlook etc

Frankie.

If you take one of these stocks, and trade a position. What % profit do you achieve by the recommendation, as compared to what you would achieve with your own plan. i.e. if you were following the stock yourself.?

In other words you would be grading your trade.

 

[Frankie]

Hi joea,

Are you asking whether I believe my own company research can provide better results than the research I can get from my analyst?

If so, the answer is a big fat NO!​

When it comes to company research I'm really just as clueless as the next guy. There just ain't enough hours in the day to go through the fundamentals of every firm. I believe that smart traders let others do the research for them.

Research firms have the people, the resources and the money to do all the fundamental research I’ll ever need.

This is what I do. I bring up a chart for each stock recommended on my providers list. If I see a chart I like, I set my profit and loss targets based on the price action of the chart. By doing this fundamental and technical analysis are combined together.

Why waste countless hours in life searching for good companies to trade in when someone else can do all of this for me?

 

[joea]

Hi Frankie.

No, I mean when they give you the recommendation do you get the info. in time to make the most of the price movement or is the recommendation just for the stock, and you make the decision when to buy in.
Some recommendations come with a price to buy and the value of the stock.

I also get a recommendation from a broker, but they generally have discussions with the company then give a overview of the opportunity.
But these are for emerging stocks.
I actually think there is a much better service from some of these guys now than there was a few years ago.
And I agree with you, to go through all the figures yourself is painful. I got a mate doing that, and he spends more time going over the figures than actually trading.

Anyway good on you if you are getting the results.

Cheers

 

[Frankie]

Hi joea,

You’ve brought up a really interesting topic of discussion when it comes to stock picks.

There are 2 types of research analysts.

Broad analysts
Specific analysts​

The broad analyst produces a list of stock picks with a broad recommendation to buy, hold or sell various stocks.

The specific analyst goes one step further and tells you what price to buy and what price to sell the stocks recommended.

My trading plan is simple.​

I want to trade in and out of the same stock over a long period of time. Stated simply, I want to take “bites” out of a developing trend.

To answer your question above, it is totally ok if I miss the initial publication of my analyst buy recommendation. In fact, I prefer to enter the stock recommended some time after the initial publication date!

Why?​

I want to see evidence that the stock recommended is heading in the direction that my analyst predicted before jumping in. The price action provides me confirmation that my analyst has done his homework.

 

[gt88]

Is there anyway to find out how many options a company currently has outstanding? I know you can look at the annual report but that shows the options for that prior period. I'm want to find out how many options are outstanding at present. Is this information attainable? If so, where can I get my hands on it?

Cheers

 

[gt88]

Just in regards to my post above (sorry the edit button was available), I want to know how the EPS for dilution is calculated. If we take Forge Group (FGE) as an example, they have 7,522,527 options outstanding used to calculate the dilution EPS. At note 5 they show the options balance at 30/06/10 for the managment which is 3,410,000. How do they come up with 7,522,527?

 

[pixel]

Is there anyway to find out how many options a company currently has outstanding? I know you can look at the annual report but that shows the options for that prior period. I'm want to find out how many options are outstanding at present. Is this information attainable? If so, where can I get my hands on it?

Cheers

Hi gt88,
while there may be easier tabulations put out by some data providers or brokers, this is what I do. It's free and as up to date as can be.

Visit the ASX website and look for Announcements on the left:
http://www.asx.com.au/asx/statistics/announcements.do

Type in the code of the company in question and ask for the full year; for Neptune Marine, NMS, I get:
http://www.asx.com.au/asx/statistics/announcements.do?by=asxCode&asxCode=nms&timeframe=Y&year=2010

Then browse down to the most recent Appendix 3B - for NMS it's this one:
http://www.asx.com.au/asx/statistics/displayAnnouncement.do?display=pdf&idsId=01115998
That PDF will show all instruments currently on issue: Shares, listed and unlisted Options, complete with expiry dates and strike prices. Unless the company secretary has made a mistake in adding up, that set of numbers will give you the most accurate and reliable figure for shares on issue and potential dilution.

 

[Albi]

Hi
I have bought a small punt of arw share in spp and they also gave options at no cost for each share. I dont have any knowlege how the option works. I know that 1 option is equal to 1000 shares. Am I right? If I have to buy the ARW shares, how can I utilise my options. Do I have to contact company to buy shares. I do online, but I didnot see anything that is asking if you have options of that company already.
Thanks in advance.

 

[pixel]

Hi
I have bought a small punt of arw share in spp and they also gave options at no cost for each share. I dont have any knowlege how the option works. I know that 1 option is equal to 1000 shares. Am I right? If I have to buy the ARW shares, how can I utilise my options. Do I have to contact company to buy shares. I do online, but I didnot see anything that is asking if you have options of that company already.
Thanks in advance.

This kind of (company) options is different from the ETOs that you appear to refer to. A company option, e.g. ARWO, simply gives you the right to buy one share at the strike price on or before end date.
ARWO options have a strike of 1c and expire in December 2011. Therefore, you can (but don't have to) convert those options into shares by paying 1c per conversion. As to "How", you will receive (I already have received) a 1-page form that you can use to exercise that right. All you have to do is fill it out, attach a cheque, and you'll receive a holding statement, saying you're owning shares instead of options.

Of course, you can also and just as easily instruct your broker to sell the options. They are trading at roughly the difference between ARW's share price and the 1c strike/ conversion amount.

 

[matthewdean]

You only have to pay tax on your profit, for example.

If you bought some shares for $1000+$30 brokerage and later sold them for $1300 - $30 brokerage you have made a capital gain(profit) of $240.

you have to pay tax on the $240 so it will be added to you income for that year.

One thing that will change this is if you have held for more than 12 months. If you have held for more than 12 months you will get a 50% capital gains discount. Meaning only half your gain is taxable so only $120 will be added to your taxable income.

This is the information Ive been after for the past hour!
Cheers my friend.

 

[pierrebfg]

Hi Everyone,

This is proberly a easy question but can someone advise where I can get for any certain stock the daily price, daily high, daily low and daily volumn?
I know on the ASX website I can get this info for the last 5 days it has traded but where can I get this info for a bigger time frame? (1 month, 6 months, 1 year)

Thankyou regards Wes

 

[Tanaka]

Google Finance - just type 'ASX:BHP' into google and it will take you there. for highs and lows make sure you change the settings to candle sticks

 

[pierrebfg]

Thanks Tanaka

 

[burglar]

Hi Everyone,

This is proberly a easy question but can someone advise where I can get for any certain stock the daily price, daily high, daily low and daily volumn?
I know on the ASX website I can get this info for the last 5 days it has traded but where can I get this info for a bigger time frame? (1 month, 6 months, 1 year)

Thankyou regards Wes

My online broker, Netwealth, has 1 year history (rolling) with open, close, high, low, volume & value.
Free to join, but need to link to your bank account and some rigmarole too.