Questions from a stock market beginner

[Market Depth]

ahhh i think i do.
i have CBA too.. from not as long ago..
but for me atm it's ANZ
so basically the idea is that you never sell all of the shares.. but you 'earn' by selling portions of it off at highs to gain cash. THis is repeated a number of times with the long term aim of basically increasing the number of shares owned in the company?

so if you don't mind me asking what % of the total do you sell?

thanks for the ridiculously quick reply btw !

It will differ from person to person. I generally don't sell a percentage, it's more a number of shares. CBA as an example I bought after the GFC at 1000 shares@ $26 and sold 500 when they reached $55. So the remaining 500 is still worth the same as when I bought the original 1000, but they are 'Free shares'. I just pocket the $27000. Recently I bought 500 cba again for $49 and I'll sell 445 at around the $55 mark and pick up another 50 shares for free, this is on top of my 'Original Holding' in CBA.

 

[ChaoSI]

hmm i think i understand. but this particular method is just one of your own devising?

that is a pretty interesting way of doing things in the CBA instance (which i also bought in at that price but i'm just a small time fella hahaha) your "money invested" as such has remaind the same but you now have 27k extra in pocket hence the 'free shares"
(sorry if i'm belaboring the point.. just clarifying..)

so do you always do this method with your 'core positions' ?

 

[Market Depth]

I'm sure others would do what I do. It works well when you buy into the right stockmarket correction, ie. 1987 and 2008-2009 when fundamentally good companies can be bought for good prices. It also helps with my dividend reinvestment over the longer term. So instead of taking my dividend as a cheque I reinvest for more shares of the value of my dividend.

I've spent many years following certain companies, I've followed some for 25 years, and I know them well, and how they trade, so 'Core' postions I buy are usually built up over time, and at the right time. You need to watch certain companies very closely, to gain a better understanding of what the prices are doing, so you know when to buy in and when to sell some.

 

[ChaoSI]

thanks for that M D.
think i learned something really valuable today and that's cos of you.

i've had CBA and ANZ for some time now so i *kinda* know how they move (as much as you can know by looking at a chart with an empty head ) but i think i understand what you mean.
I also do the DRP too which has helped of course.

haha being such a small time investor i don't have quite the money to move about as you and tend towards the more cautious. So that method you talked about gave me something to think about that appeals to my 'i don't know anything so better safe than sorry' approach to shares (being psych trained i'm better suited to understanding people rather than the roiling maelstrom which is the financial markets)


just wanted to say a HUGE thank you again for answering my questions so promptly!

 

[Market Depth]

(being psych trained i'm better suited to understanding people rather than the roiling maelstrom which is the financial markets)

This quote here is what trading the market is all about. You actually know more than you think. You just need learn how to harness what you know about people, and you can profit from that in the market.

 

[Market Depth]

haha being such a small time investor i don't have quite the money to move about as you and tend towards the more cautious. So that method you talked about gave me something to think about that appeals to my 'i don't know anything so better safe than sorry' approach to shares (being psych trained i'm better suited to understanding people rather than the roiling maelstrom which is the financial markets)


just wanted to say a HUGE thank you again for answering my questions so promptly!

We all started somewhere. I honestly believe if you continue trading for your entire life journey, YOU WILL WIN! No question about it. It's a numbers game. The reason people don't win in the market, is because they quit. There will be times when you wished you'd never made a trade in the first place. 'Ignorance is Bliss' as they say. You just have to get back in there and finish what you started. Till you end up in a box

 

[ChaoSI]

This quote here is what trading the market is all about. You actually know more than you think. You just need learn how to harness what you know about people, and you can profit from that in the market.

hahah yeah after i rwote that it did seem that was the case.. i'll qualify that with how a single person acts and thinks rather than the tug of war of millions haha

but that's for the confidence boost. i'm pretty terrible with the technical stuff so i guess playing to my strengths would be to keep an ear out on what people are saying because if they're saying it.. they're thinking it and (for the less disciplined) they'll act on it. that's a bit cryptic haha

but yeah you're right.. constantly going at it you'll win out even if you play it safe.
i have AWC and CSR atm and they push my whole portfolio into the red (i'll blame mum for buying these shares but i'm in no hurry for the money so i have the luxury of leaving them there to rot (or regrow) as it were)

til i end up in a box.. how delightful


i'm still working through the other sticky "all your questions answered" atm. but i thought i'd ask another question that's..... a bit silly really.

IF you know when the dividend payouts are going to happen couldn't you *technically* buy X amout of the stock at a price you know will be accepted wait for the dividend to be paid and then sell? and assuming minimal fluctuation at the time nothing worth mentioning... couldn't you gain a minimal amount of money that way?

 

[burglar]

... IF you know when the dividend payouts are going to happen ...

I have heard it said that there is some beer money in this strategy.
From personal observation, SP drops by amount of dividend on ex-dividend day.

 

[addison]

I have heard it said that there is some beer money in this strategy.
From personal observation, SP drops by amount of dividend on ex-dividend day.

i did one of these recently, just for the experience of it, was nice to get a dividend but got caned on the sp drop so wouldnt bother with this strategy again, too costly

 

[Starcraftmazter]

Hey

I've been thinking about the prospect of creating some software which looks over various worldwide news sources (on the web) and finds anything relating to a given list of companies (let's say ones I have money in, or am watching).

Obviously I would presume major finance companies would have this sort of thing, but I'm wondering whether there's any public/free software that does this (ie. I don't want to waste time replicating something which already exists and is readily available).

Perhaps there are some online services that do precisely this as well. Are there any, and if so, how good are they in terms of breadth (covering a large amount of worldwide news sources) and speed (getting the information to you as soon as it appears)? Are they worth the money?


Would anyone recommend a list (the bigger the better) of some noteworthy news websites which would be useful for this sort of endeavor? (free or paid if they are worth it).

If there's any other comments (I'm pretty new to this) about my plan, then those would be welcome

Thanks

 

[Starcraftmazter]

Few other things I forgot to ask (sorry for double post);

1. On Bell Direct (where I've recently made an account), I have read the following:

Am I required to inform the share registry my Tax File Number (TFN)?
It is not required, although recommended, for you to inform the share registry of your TFN. If you do not inform the registry, you will be taxed to the highest marginal tax rate for any dividends you receive. Please note that we do not automatically notify any share registry of your TFN.

I am wondering how/where I can do this?

2. Is the 4 digit PIN BD sent me to use on trades on their website have anything to do with CHESS?

3. Maybe related to 2; What is a CHESS PID, and how do I find out if I have one / how do I get it?


Thanks

 

[davede]

Hey

I've been thinking about the prospect of creating some software which looks over various worldwide news sources (on the web) and finds anything relating to a given list of companies (let's say ones I have money in, or am watching).

Like your entrepreneurial attitude. However Google Finance does this and it is for free. enter a stock code in Google Finance and it will pull a chart and related info from news sources (basically doing a google search and pulling in the results). It is handy but some of the info is not as related as you might hope.

As for your other questions:

1. & 2. contact bell direct and ask them.

3. PID aka Chess Sponsor's ID is your broker ID that they use for purchasing shares on your behalf. You don't get one or need one.

Regards,

Dave

 

[Starcraftmazter]

Like your entrepreneurial attitude. However Google Finance does this and it is for free. enter a stock code in Google Finance and it will pull a chart and related info from news sources (basically doing a google search and pulling in the results). It is handy but some of the info is not as related as you might hope.

Ah, thanks mate. Is it usually pretty fast? Also, is there a way to get those notifications by SMS? (Or merely the fact that there is some sort of "news")?

 

[Frankie]

I am a big user of Google News.

On the top left tool bar of the Google home page I click on the heading “News.” I then type my selected company in the search box, then hit enter.

On the left hand side I can choose news for my company that has occurred in the past hour, day, week etc

I find this a great way of keeping up to date with news for my selected companies. It gives me much more insight than just reading the company announcements for my selected stock.

 

[Tanaka]

I am a big user of Google News.

On the top left tool bar of the Google home page I click on the heading “News.” I then type my selected company in the search box, then hit enter.

On the left hand side I can choose news for my company that has occurred in the past hour, day, week etc

I find this a great way of keeping up to date with news for my selected companies. It gives me much more insight than just reading the company announcements for my selected stock.

You can also simply type in 'ASX:BHP' and it will take you straight to the google finance section for news and charts about BHP for example

 

[Frankie]

Another thing worth mentioning is Google Alerts.

This allows me to type in my stock and receive an email when new news comes out about my company.

 

[AnthonyJ]

Howdy all,

I have recently started a SMSF and as I am a beginner, I am planning to put the cash into a few managed funds for a 3-5 year period. This will (I hope) give me an easy first step while I continue to grow in knowledge of the share market.

Just putting it out there to hopefully get some feedback (not financial advice), although I know everyone has their own opinion.

These are the short list of the funds I am looking at;

Wilson HTM priority growth
Lime street capital Hi-alpha fund
Strategic Elements (pooled development fund)

Any thoughts will be appreciated.

 

[Starcraftmazter]

Howdy all,

I have recently started a SMSF and as I am a beginner, I am planning to put the cash into a few managed funds for a 3-5 year period. This will (I hope) give me an easy first step while I continue to grow in knowledge of the share market.

Just putting it out there to hopefully get some feedback (not financial advice), although I know everyone has their own opinion.

These are the short list of the funds I am looking at;

Wilson HTM priority growth
Lime street capital Hi-alpha fund
Strategic Elements (pooled development fund)

Any thoughts will be appreciated.

SOR is excellent long term investment IMO. On the other hand, I would not root for managed funds investing in shares at the moment. I'm new myself though, so don't take my advice as gold.

I would however highly recommend you read these very recent articles (best read from oldest to newest as they are in a series)
http://macrobusiness.com.au/category/superannuation/

 

[Julia]

Howdy all,

I have recently started a SMSF and as I am a beginner,

You are a beginner and you've started a SMSF???
I don't wish to be intrusive but if you've set up a SMSF you will have had to have enacted an Investment Strategy.
What does this describe?

Could you perhaps say what your reason is for setting up a SMSF?
Most people do it because they believe they are capable of achieving a better return than most fund managers. That doesn't seem to be the case in this instance.

 

[AnthonyJ]

You are a beginner and you've started a SMSF???
I don't wish to be intrusive but if you've set up a SMSF you will have had to have enacted an Investment Strategy.
What does this describe?

Could you perhaps say what your reason is for setting up a SMSF?
Most people do it because they believe they are capable of achieving a better return than most fund managers. That doesn't seem to be the case in this instance.

Thanks for your concerns.
With a 4.05% 5 year average return on my previous super fund, I thought that I could do better. The funds I have been researching have well over 4 times this return over the previous 5 years. I do not intend to be an over night trader extraordinaire, but following my investment strategy of investing in managed funds for a 5 year period and looking at putting the earnings then into property I hope will do better than the 4.05%.
I am on a steep learning curve and appreciate any help I hope to find hear in the beginners lounge.