Rational share strategy

grey_gym_sock

marathonic wrote: »

If your total invested was a constant $12,000, your minimum commission would remain a constant 1% annually.

yes, you can look at it that way. though you would also incur higher run-off costs if you wanted to wind down your portfolio gradually.

IMHO, it's just too high at 1% ... at a higher level of investments, it would become reasonable.

marathonic

grey_gym_sock wrote: »

yes, you can look at it that way. though you would also incur higher run-off costs if you wanted to wind down your portfolio gradually.

IMHO, it's just too high at 1% ... at a higher level of investments, it would become reasonable.

I'm not disagreeing with you - it all depends on your style of investing.

As you say, index trackers are available at much lower costs. If index tracking is your preferred investment style, that's fine.

However, this is not comparable to index tracking. To a certain extent, it's comparable to an actively managed fund (except managed by yourself).

With lower investments, the commissions are higher as a percentage of your overall portfolio and the savings over a fund are minimal. I'd consider it more of a learning experience which, at the end of the day, is better done when the portfolio value is lower.

When you get to higher portfolio values, that's where the savings kick in.

FWIW, I traded a lot in the sale of Options as well - but that's a whole different topic and not relevant to this thread.

In my opinion, the direct method is best suited to those that view stock selection as a sort of hobby and like to compare company reports, listen to conference calls, etc.

If you see reading annual reports as a chore, you're better just investing in funds.

One of my methods of investment for smaller companies in the US was to look at the top holdings of a few actively managed funds and note down the ones that appeared most consistently. I'd then figure out what sectors each of those belonged to and then study their financial reports to see profitability, sales growth, etc.

One of the things that I liked about US companies is that the company information is so much more freely available than with comparable European companies.

Radiantsoul

marathonic wrote: »

I'm not disagreeing with you - it all depends on your style of investing.

As you say, index trackers are available at much lower costs. If index tracking is your preferred investment style, that's fine.

However, this is not comparable to index tracking. To a certain extent, it's comparable to an actively managed fund (except managed by yourself).

I guess the OP is not really looking for any kind of diversification or to follow a particular fund or style though. It seems they just want to place a bet on the price of Debenhams shares moving relatively rapidly in a given direction(perhaps when the results exceed analyst expectations). It strikes me this is more a spreadbetting tactic and I feel that their stop loss limits are likely to make this a short term affair.

Glastoun

Yep, that's about the size of it - and very slow it is too. I kind of wish I'd put £50 on a horse and banked the rest, but hey ho....

Is it worth listening to analysts on any of this stuff? This kind of matches my thinking:

http://www.4-traders.com/DEBENHAMS-9590219/strategies-strategies/The-GBp-80-7-support-area-is-tested-35035/

But there were analysts back in January saying to buy at 110p and it dropped 35% since then. And I'm sure you could find an analyst somewhere to back your opinion, however extreme it was.

A friend of mine always said that economists are very good at predicting what has just happened.

srcandas

Glastoun wrote: »

YI kind of wish I'd put £50 on a horse and banked the rest, but hey ho....

Perhaps this investment business is not for you

Just go and have fun and forget about it. Comeback 30th September and have a look. You may be nicely surprised.

Keep looking at it and you'll either get tempted to sell on an early minor rise or depress yourself. Iin the first case you'll also get depressed as it rises higher than your sell price

Remember it is only money and life is short

Glastoun

I'm happier with a wok than an oven, you're right.

srcandas

Glastoun are you still with your Debenham's shares?

Now at 91.6 I hope you haven't jumped ship.

Just wanted to say thanks as without your post I wouldn't have considered them as shares or for shopping. But the shares are doing well and I called into a store and got some good stuff

Any more shares in mind :rotfl:

Glastoun

Ha! No I sold within two weeks of buying, losing my selling fee but having made back my buying fee, with a lesson in minding fees on low value transactions. The main reason for selling was that I couldn't cope with having price updates every 15 seconds, and my spirits would rise and fall with every +0.1% and -0.1%. Literally, too much information.

If you think I have some kind of naive/beginners/Rain Man/Good Will Hunting skill on this, I moved the money (along with some other existing money) into some Japan funds which netted me more than the Debenhams shares would have, and after reading too many positive articles in more and more mainstream publications about Japan have diversified it out into US small companies which I think will be a steadier growth, and some resources and frontier funds which have to go up at some point in the future. I tried to buy Schroder Global Healthcare but HL wouldn't let me.

As for share recommendations, try and buy Morrisons shares on Valentines Day (not next year, the one just gone).

Glastoun

srcandas wrote: »

Glastoun are you still with your Debenham's shares?

Now at 91.6 I hope you haven't jumped ship.

Just wanted to say thanks as without your post I wouldn't have considered them as shares or for shopping. But the shares are doing well and I called into a store and got some good stuff

Any more shares in mind :rotfl:

I guess they're at 104p now huh, hope you're happy with yourself.

I put my SIPP transfer into Black Rock Consensus 100, (luckily) at the bottom of the recent trough so that's up 7% already. Think my trading days are over.

Meanwhile I bought 7 ties for thirty quid - how do they do it?