And whatever you
do,
beware of the sharks in the ocean!
Actually... it seems as
though I need to "Sign in" to have edit access.... I can't find my
login name that you might have shared.... could you please re-advise?
|
Food for thought
Before you get too far through the great material below, here is a
little more food for thought:
Can I invest my SMSF funds in the share
market?
It might be possible to invest SMSF funds in the share market, either
for the long-term or maybe for short-term profits. It depends on a few
things, including the SMSF documented investment strategy. See some key
information here
in the Toolbox.
|
The
(disappointing) truth about blue chip stocks
Did you realise that:
- There is no strict definition of the term
blue chip.
- Blue chip stocks are not all they are
cracked up to be.
- Too many blue chip stocks fell
significantly during the GFC, so any investor/trader who relied on good
capital gains would have been disappointed.
- Even blue chip stocks can tumble, and
stay stuck below recent highs for years.
See lots
of details and some real charts explaining all this about
blue chip stocks.
And what's the conclusion? It might be worth spending a little more
time to find investable stocks further down the list of stocks.
|
About
the
share markets
The Australian market
Australian
market
operators - Since late October 2011 there have
been two share market
operators
in Australia (ie. an organisation which offers a facility whereby the
orderly exchange of company shares and derivatives can take place):-
Web
page portal
listing lots of web pages for daily use to check on the
market, and to help with research.
Share
Market GEMS (summary list) - A summary list of
cliches and infamous share market tips (is 2 pages when printed).
The Toolbox Members full version
(MA*) includes more details and explanations for these share market
GEMS.
Lotsa Web Links (MA*)
- A pdf file
listing over 200 different and useful web sites on a
whole range of investing and trading topics.
Robert has more publications available.
Some for free and others for just a very
modest fee. Many are free to Toolbox Members.
SPI Futures - Information about
the SPI (Share Price Index) futures contract, and a downloadable PDF file.
|
The
share market indexes
See
market index details and history for more information about:
- General information about our
share market indexes
- "top stocks"
- Market indexes and sectors
- ASX
Indexes - Composition - How are all the ASX
indexes, and
sub-indexes, made up?
- Which stocks are in each index?
- XJO - S&P/ASX 200
index
- XAO - All Ordinaries index
- Index re-balancing - recent S&P
news
- GICS codes (Global Industry
Classification Standard)
- Volatility
Indexes (VIX)
- More S&P information about
the Australian Market Indices.
|
Getting
started
Okay,
so you think you want to take more control of your investments, and
perhaps to mange your investments with a more hands-on approach. And
maybe even trade shares yourself. It can seem scary; but it doesn't
have to be.
"Learning
how to do it does cost time and money;
but it doesn't have to cost lots of money."
In very general terms, it is important to clearly understand a few
things like:
- How much money
is available for investing (ie. the funds)?
- Which asset classes
do I want to spread the funds across?
- What is my risk
tolerance?
Can I tolerate a lot of investing risk, or not? See the FiRT (Financial
Risk Tolerance) table in Brainy's eBook pdf number ST-2180 (see the Member version, or
the page-1 preview).
- Do I want to take the sensible step of
using Funda-Technical
Analysis?
- Investing Plan and
Strategy
- Who can help prepare a sound plan and strategy?
See some tips
for getting started, and more details in
some of Brainy's eBook (pdf) Articles.
- Professional advice
- What about the appropriate professional advice to assist with
planning and executing the strategy?
- Practise, practise and
more
practise - It can be very useful to gain some
confidence and experience in a safe environment. Use paper-trading
to test out a strategy, or use back-testing
and trading simulation to
test a strategy more vigorously.
Are you Share Market Ready? Take
a look at Robert's Share-Market-Ready
checklist.
"Try
to
find someone who seems fair and honest,
and who seems to make sense (sensible
investing)."
Interested in share price charts,
and how to read them?
Take a look at some charting software (like
BullCharts), or
consider learning about Technical Analysis (ie. charting).
Some
pointers
Many
people who start out learning about charting suffer from information
overload. Many people find that over a 2 or 3 year period they find out
various snippets of information about charting (Technical Analysis),
and their focus is distracted.
 Investing in
cyclical stocks? - One of the many strategies for
selecting stocks for investment is to monitor the economic cycle, and
the investment clock,
and to select either cyclical or defensive stocks as appropriate. See a
discussion on this approach.
Author Strategies
-
It is a very good idea to record
your "preferred" ideas and methods for "analysing" the market.
Then they start to crystallise. One possibility is to find a "famous"
trader / author - someone whose ideas you like and feel comfortable
with. This includes the likes of: Alan Hull, Leon Wilson, Stuart
McPhee, Louise Bedford, Jim Berg, Frank Watkins, Daryl Guppy, Stan
Weinstein. These people are all Australian-based (except Stan W), and
they have all published a number of text books on the subject.
And
the BullCharts software has implemented many of their ideas and
strategies as either chart indicators, or market scans, or both. This
implementation is referred to as Author Strategies - see more detail here...
But,
one downside in heading down the track of reading books is that in a
couple of years time you will probably have a head full of even more
ideas and will be no closer to your goal. Many people find they have a
bookshelf full of books, that are only half read.
- Be comfortable with
spotting up trends and down trends.
- Start with the Weekly
Market Analysis page
in the Public area of the Toolbox. It includes just a small number of
indicators - MA, GMMA, Momentum, and Twiggs Money Flow (TMF).These are
key indicators, and very common (TMF not so common).
- Follow
the comments that are "on" the charts in the Weekly Analysis for Toolbox Members
every week (to do this you do need to view every chart so you can read
the comments on the charts). These are based on the items in
point 2
above. It is like an ongoing tutorial to help you understand
these key
indicators.
Why
would I buy shares?
This
is a good question. Some people prefer to invest money in managed
funds, or directly into property, or maybe share options or futures, or
perhaps forex (foreign exchange, currencies).
Many
people keep it simple, and stick to Australian shares - something they
can relate to, and which has some meaning for them. But before doing
this we should ask ourselves why we are doing it, and have a sound plan.
A type of investment plan and strategy is extremely important. There
are a number of eBook
pdf Articles on (Share Trading) strategies here.
|
Analysis?
- Fundamental, Technical, or
Funda-Technical
Analysis
What type of analysis methods should we use?
Fundamental analysis? Technical analysis? or what?
This a choice that befuddles many investors
and traders.
See more information about fundamental
analysis, technical analysis, and Funda-Technical
Analysis.
|
How
to pick winning shares/investments?
- Stick with something
you know.
If you don't understand the product, then either learn more about it,
or avoid it.
- Trends
-
If a stock's share price is trending upwards, then riding the trend can
be useful. But if the price is trending downwards, then why but it? On
the hope that it will stop trending down and turn up at some point? See
Trends details below.
- For more GEMS like these, see Brainy's Share
Market Gems.
- Take a look at Robert's
Weekly Watch List - which he shares with Premium
Toolbox
Members.
Trends
and Shares
Classical Dow Theory states that if a stock
is trending, then the trend
is in place "until it is confirmed to have ended". There is a Wall
Street adage - "the trend is your friend".  Learn
the characteristics of trends, and all about
how to pick an up trend. If you can spot a trend,
and ride the trend, it is possible to be profitable.
But you need to keep a good stop-loss
in place.
See Brainy's "3Ways
Rule" for details about trends.
**
- More trend-spotting details here.
Emotion
and psychology
The day-to-day and
week-to-week
performance of companies in the share market depends on the
underlying mood and sentiment of all the investors and traders who
participate in the market. When a company's share price rockets
upward, or dives downward, it is because enough of the market
participants have a strong enough view of the stock, or of the market
generally, to cause the share price to move.
See more details about the emotion and psychology drivers of
the share markets.
Which
shares to buy?
Some people follow fundamental analysis, and buy shares in a company
because they think they will go up in price. But
is this sensible?
Some people buy shares based on the price chart alone - if the price is
trending up, then they ride the trend because "the trend is
your friend". This is based on Technical
Analysis (also known as charting). There is a long list of eBook
pdf Articles on Technical Analysis.
And some people go for a bit of both - we call it Funda-Technical
Analysis. The first part of this strategy is all about
choosing stocks from a list of quality companies. Stocks with a proven
history of returning value on the shareholders equity, and which are
not over-geared, and which are also likely to have improved earnings in
the months ahead. More information in the eBook Article ST-2300
(MA*).
Support
and resistance
The two
terms support and resistance basically refer to price levels on a price
chart where the share price has paused in the past, and where it might
be expected to pause again in the future.
** -
Read more
here...
Stop Loss! - How to minimise
losses
The humble Stop Loss can help us enormously to
limit any losses, and thereby protect our hard-earned capital. This
includes the notion of an Initial Stop, and a Trailing
Stop.
But what is this thing, and how do we calculate a Stop Loss?
** - Read more
here...
Stock
liquidity - avoiding illiquid stocks
If you are serious about protecting profits, and utilising techniques
like a Stop Loss, then you need to be confident that when you decide to
sell your stock there will be a buyer there to buy it. Some stocks
trade only a few times each day, or worse still, a few times each week.
This is not the sort of stock that we want to be holding.
Learn more about stock liquidity, and what the consistently successful
traders and investors do in this regard. See more details here.
How
to maximise profits?
There are two opposing points of view about profits, and how to
maximise them. Some people set a profit target which might be an
arbitrary percentage amount above the current price - say 20%. By
selling out here for a profit, it is possible to keep the profit, but
potentially miss out on a much larger profit.
Some
people prefer to "let the profits run". By maintaining a sensible Stop
Loss, and monitoring the position, it is generally safe (but not
always) to let the profits run.
Above all - have a plan and
strategy
It is very important to have a documented investing / trading plan, and
one or more strategies.
See more
details about plans and strategies...
|
Share
"trader" or share "investor"?
Are you "carrying on a business
of share trading"? (in ATO terminology)
Are
you a "share trader" or a "share investor"? This question often arises,
and there is much published on this topic. The actual and precise
distinction
might get down to semantics such as your desire to "own a part of the
company", as opposed to temporarily owning an item which you can soon
sell for a profit. Many books with slightly differing views have been
published.
Technically, a share investor
typically holds shares for a longer period of time, and pays capital
gains tax on any profit (or claims a capital loss on losses). On the
other hand, the share trader typically holds shares
for the short term
with no consideration of the impact of capital gains, and might be
happy to pay income tax on the profits.
However, the
Australian Taxation Office is the body in Australia that will decide
whether an individual is an "investor" or a "trader", and how any
profits will be taxed (and how any losses might be dealt with). The
defining criteria are not clear.
See the Australian Taxation Office web site and
more details with this Google search.
Online
share trading and investing
These days, trading or investing online is all the go! But there are
traps and pitfalls. Who can you trust? See the comments at right.
Without proper preparation, the trading/investing journey can be a very
short one. Many people embark on trading or investing with little
preparation, on the understanding that it is easy, and that the profits
will flow. But the truth is that it is not so easy.
Proper planning and preparation includes a good Trading Plan, and a
sound and tested Trading Strategy. Without this, you might as well be
gambling. More information about plans and strategies is included in Robert's
Articles.
Also see the section above on getting
started, and ask yourself if you are really Share
Market Ready? Take
a look at Robert's Share-Market-Ready
checklist.
Actually...
it seems as though I need to "Sign in" to have edit access.... I can't
find my login name that you might have shared.... could you please
re-advise?Who
can you trust?
While some operators are very trustworthy, there are some who are only
concerned with emptying your wallet.
Here are some
good questions for your financial adviser or stock broker.
Fads will come and go, and hype will sweep through the markets. And
people will get swept up by a range of promises.
There are many claims "it's easy", "make money in your spare time",
"fulfill your dreams".....
But, beware of the sharks in the ocean!
|
Seminars
and workshops
Robert periodically runs seminars and
workshops
to explain the share market and how it works. His Share
Market Secrets seminar (aka Boot Camp) is
a good starting place. Or his Blue
Chip Price Chart Secrets seminar (aka
Technical Analysis/charting introduction).
Why does
Robert run seminars and workshops for a living?
and not stick to share trading? Here
is the answer...
A
quick word about some of the other courses and seminars, especially the
free ones. Some of these trainers are touting a specific product, or an
expensive follow-up training course (without naming any). So take care.
By all means go along to the free ones - nothing ventured nothing
gained.
|
More
information
Good Books -
There are many books available. Here is a short starting list, and a
plug for a good book shop.
Robert's Share Market Gems and
cliches - Robert has compiled a list of useful
cliches and snippets of useful
information about the share market. It has taken a few years to learn
all this, but it is summarised here for you.
How about a Sensible
Approach
to Sensible Investing? Now, is that a
good idea?
Have you seen a sensible approach lately?
Are you ready for the next Bear Market?
They come around faster and more often than we care to admit. Robert
has prepared some notes entitled "Beware
the Share Market Bears! - They are never far away".
Are you Share Market Ready? Take
a look at Robert's Share-Market-Ready
checklist.
Interested in share price charts,
and how to read them?
Take a look at some charting software (like
BullCharts), or
consider learning about Technical Analysis (ie. charting).
Interested in seeing more eBook Articles
about the Share Market, and Share Trading? Details
are here...
Share Market Toolbox -
More
information about Brainy's Share Market Toolbox - a great collection of
useful articles, eBooks, charts, tools, commentary and web links to
advance your understanding of the share market, no matter whether you
are investing or trading.
How to
become a Toolbox member - Information about how to
become a Toolbox Member.
|
|
Brainy's
Share Market Toolbox -
an arsenal of weapons to help
you tackle the market.
