Share dealing - merged

[tinker]

Dont forget companies who will benefit from low confidence, those connected to gold for starters.

[maqroll]

Buy gold. That way, when everything goes belly up in 3 months time, and there's a run on the bank, you'll have bartering loot.

[The_Rev]

Oh, and make sure you buy low and sell high.

[lapal_fan]

great advice Rev!

[TheDon]

Or sell high, buy low. You don't have to do it in that order! (although some people on here seem to think short selling is the work of the devil)

[The_Rev]

Well, it did kinda bring down the western world's economy in 2008.

[TheDon]

Well, it did kinda bring down the western world's economy in 2008.

It really didn't.

Even the SEC say they probably did wrong by banning short selling, saying "The costs appear to outweigh the benefits."

[tonyh29]

Well, it did kinda bring down the western world's economy in 2008.

You must be the first person on VT to not blame it on Thatcher .....

[leviramsey]

For now, I pretty much just rebalance my 401(k) every 45-135 days (when I rebalance, I randomly circle a date on the calendar).

I strongly suggest picking up some Benjamin Graham... The Intelligent Investor is a good for the more lay investor while Security Analysis is perhaps a better choice for a professional.

[Corleone]

Dont invest in pumpkins in November

[theunderstudy]

I've got shares in my company, that's it. (Got in 2009) When I'm a bit bored in a few years I may start to do this properly.

[Dale]

You must be the first person on VT to not blame it on Thatcher .....

Her too... :wink:

[leviramsey]

For now, I pretty much just rebalance my 401(k) every 45-135 days (when I rebalance, I randomly circle a date on the calendar).

I strongly suggest picking up some Benjamin Graham... The Intelligent Investor is a good for the more lay investor while Security Analysis is perhaps a better choice for a professional.

I'll quote here the Mr. Market parable (and the subsequent summary of Chapter 8 of The Intelligent Investor). There may be no more important passage an investor (note that Graham makes a distinction between investment and speculation) will ever read:

Imagine that in some private business you own a small share that cost you $1,000. One of your partners, a certain Mr. Market, is very obliging indeed. Every day he tells you what he thinks your interest is worth and furthermore offers either to buy you out or to sell you an additional interest on that basis. Sometimes his idea of value appears plausible and is justified by business developments and prospects as you know them. Often, on the other hand, Mr. Market lets his enthusiasm or his fears run away with him, and the value he proposes seems to you a little short of silly.

If you are a prudent investor or a sensible businessman, will you let Mr. Market's daily communication determine your view of the value of a $1,000 interest in the enterprise? Only in case you agree with him, or in case you want to trade with him. You may be happy to sell out to him when he quotes you a ridiculously high price, and equally happy to buy from him when the price is low. But the rest of your time, you will be wiser to form your own ideas of the value of your holdings, based [for instance] on reports from the company about its operations and financial position.

The true investor is in that very position when he owns a listed common stock. He can take advantage of the daily market price or leave it alone, as dictated by his own judgment and inclination. He must take cognizance of important price movements, for otherwise his judgment will have nothing to work on. Conceivably, they may give him a warning signal which he will do well to heed -- this in plain English means that he is to sell his shares because the price has gone down, foreboding worse things to come. In our view, such signals are misleading at least as often as they are helpful. Basically, price fluctuations have only one significant meaning for the true investor. They provide him with an opportunity to buy wisely when prices fall sharply and to sell wisely when they advance a great deal. At other times he will do better if he forgets about the market and pays attention to his dividend returns and to the operating results of his companies.

Summary

The most realistic distinction between the investor and the speculator is found in their attitude toward stock market movements. The speculator's primary interest lies in anticipating and profiting from market fluctuations. The investor's primary interest lies in acquiring and holding suitable securities at suitable prices. Market movements are important to him in a practical sense, as they alternately create low price levels at which it would be wise to buy and high price levels at which he certainly should refrain from buying and probably would be wise to sell.

It is far from certain that the typical investor should hold off from buying until low market levels appear, because this may involve a long wait, very likely the loss of income, and the possible missing of investment opportunities. On the whole, it may be better for the investor to do his stock buying whenever he has money available, except when the general market level is much higher than can be justified by well-established standards of value. If he wants to be shrewd he can look for the ever-present bargain opportunities in individual securities.

Aside from forecasting the movements of the general market, much effort and ability are directed on Wall Street toward selecting stocks or sectors (Graham uses "industrial groups" here, but I have substituted modern terminology --LR) that in matter of price will "do better" than the rest over a fairly short period in the future. Logical as this endeavor may seem, we do not believe it is suited to the temperament of the true investor -- particularly since he is competing with a large number of professional traders and financial analysts who are trying to do the same thing. As in all other activities that emphasize price movements first and underlying values second, the work of many intelligent minds constantly engaged in this field tends to be self-neutralizing and self-defeating over the years*.

The investor with a portfolio of sound stocks should expect their prices to fluctuate and should neither be concerned by sizable declines nor excited about sizable advances. He should always remember that market quotations are there for his convenience, either to be taken advantage of or ignored. He should never buy a stock because it has gone up nor sell one because it has gone down. He would not be far wrong if this motto read more simply: "Never buy a stock immediately after a substantial rise nor sell one immediately after a substantial drop."

*: Jason Zweig, in his commentary on this chapter, notes that one is highly unlikely to win by beating the pros at their own game; the vast majority of the pros don't even win at their own game.

[ender4]

i'd sell any spare gold now....

i think once the USA agrees to raise the debt-celing, the price of gold will fall.

(of course, if the USA defaults, then price of gold may double, but i think the chance of them defaulting is 0.000001%)

[tonyh29]

i'd sell any spare gold now....

Is that you Gordon ? :winkold:

[ender4]

i have a Maple Leaf gold coin.

I was given it as a wedding present, and it was worth around £200 when i got it.

Its now worth £1,000.

[markavfc40]

i'd sell any spare gold now....

Is that you Gordon ? :winkold:

:yawn:

[ender4]

My Standard Life shares have bounced back.

bought £6000 worth a couple of years ago, now they are worth £6000 again.

and my Lloyds shares are still making a big loss - bought £4000 worth, now worth £3000.

need it get back to 45p to break even.

[Nigel]

Got rid of all mine a couple of weeks back.

Its not a good time for shares at the moment, and the next few months will be very tough, but the good news is there will be some fantastic buying opportunities coming soon!

[VBM]

personally I would advise anyone who doesn't know that what they are doing not to randomly start investing in the market directly, by buying individual shares.

Not just because the markets are usually efficient (IMO of course), but rahter their investment aims, would probably be better served by drip feeding regular amount into a low cost tracker fund wrapped in an ISA.

In my experience any lay persons analysis of why a stock might move is usually either incorrect or already priced in.

Also if you are thinking of getting involved in some trading, and not value investing, then you would be better served to use spread betting platforms, as the transaction costs of direct investment will eat into someone who is just having a dabble, and massively erode and returns.