Australian (ASX) Stock Market Forum

Scaling Up Investments

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Thank you very much indeed divs4ever you have been more than helpful, you are a star. I truly appreciate your time.

I now have lots of ideas to help me with my investing and i really do appreciate the insights you shared. I think thats very intelligent to closely look at what kind of director is running a business and there background to get an understanding of what they might do with the company. I agree that a fairly stable income is always important. Something i never considered and i find very enlightening is worker morale i think that is very important and something i might have overlooked. Taking a more active view into what is happening in the company, rather than financials, competitors and looking into the directors is very sensible. Thanks again for your support with this it means alot.

Can i kindly ask i know in March 2020 we did not foresee the Coronavirus and markets dropped heavily but rebounded in around 4 - 5 months in some sectors. Do you kindly please know how we might be able to predict the next market crash and generally how do you protect yourself from something like this? I know some people short shares (bet on stocks declining) in times when markets are going down, not something i am interested in but kindly wanted to know if you had any insights on this please? Market crashes worry me but should not if i am selecting shares for the long term. Thanks again for your time and support divs4ever you have been amazing, i really appreciate everything. I sincerely hope you are doing well and are happy.
 
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Thank you very much indeed divs4ever you have been more than helpful, you are a star. I truly appreciate your time.

I now have lots of ideas to help me with my investing and i really do appreciate the insights you shared. I think thats very intelligent to closely look at what kind of director is running a business and there background to get an understanding of what they might do with the company. I agree that a fairly stable income is always important. Something i never considered and i find very enlightening is worker morale i think that is very important and something i might have overlooked. Taking a more active view into what is happening in the company, rather than financials, competitors and looking into the directors is very sensible. Thanks again for your support with this it means alot.

Can i kindly ask i know in March 2020 we did not foresee the Coronavirus and markets dropped heavily but rebounded in around 4 - 5 months in some sectors. Do you kindly please know how we might be able to predict the next market crash and generally how do you protect yourself from something like this? I know some people short shares (bet on stocks declining) in times when markets are going down, not something i am interested in but kindly wanted to know if you had any insights on this please? Market crashes worry me but should not if i am selecting shares for the long term. Thanks again for your time and support divs4ever you have been amazing, i really appreciate everything. I sincerely hope you are doing well and are happy.
re - March 2020

on the contrary , i have some health issues , i was watching China like a hawk as soon as they started reacting ( over-reacting ?? ) to the virus , i quickly worked out why Wuhan was important commercially and started adjusting my strategy ( including buying into KGN in Jan 2020 ) now the rebound was what caught me by surprised , i never expected so many governments to be so irrational about spending and rescue packages

BUT MORE IMPORTANTLY i was already alarmed at what i was watching in September 2019 with the 'Repo madness ' which had all the hallmarks of a credit crunch , and given that is was concerned about a credit crunch i was already sitting on SOME cash , only about 5% but 5% goes a long way if you pick wisely ( or are just lucky like me )

i look at a LOT of alternate media , and yes there is a lot of garbage mixed in with genuine information , but that genuine information is EARLY ( not passed for public consumption by your government after days of talk-festing )

now DOWN isn't all bad it gives you a second ( or third ) bite at good stocks ( if you choose to )

remember i am looking for stocks that survive and pay dividends ( most of the time ) as long as that div. yield ( on MY buying price ) is healthy i don't care if the share price is $1 or a $100 ( or in MQG's case $26 or $200 .. HOWEVER if MQG were to drop near $20 again i would be tempted to buy more in the right circumstances )

now if you have leverage ( a margin loan ) ( i don't ) that stock price and lending value become much more important

now crashes ARE important , apart from buying opportunities , they take out weak companies ( and force mediocre companies to lift their game ) .. well at least they did before 2020

now before March 2020 i played with BBUS , BBOZ and BEAR with some success , but got caught with the last parcel of BBUS ( annoying but not financially crippling )

now most of the time , i am taking profits ( rescue the investment cash ) at sensible levels ( up 140% to 150% ) regardless of whether the market is worried or rallying ( takes the panic out of trying to sell down when everyone else is , i strongly prefer to sell INTO a rally rather than trying to pick a top )

if those guys with charts do better , good for them , they put the extra work in , they deserve it

now one of the benefits of inheriting that portfolio ( AND the paperwork ) was the paper-work on shares no longer listed .. companies like TAA , Ansett ( both airlines ) McDonnell & East ( clothing and apparel ) Red Comb ( stock foods ) Nylex ( renamed Moulded Products ) Poseidon Nickel ( the infamous one ) Mount Isa Mines

NONE of these were small companies , so even BIG companies fail ( or get taken-over )

so apart from maybe the big 4 banks , you have to factor in the chance of potential failure

by the way my trading platforms are both on 'budget levels ' ( no margin loans , no exchange traded options , no internationally listed shares ) not even Iress ( because the ISP is so erratic it is just glitchy )

all that said , my 30 year old pocket calculator works just fine , and with it i can do enough

another thing is most directors do NOT do much in the company they come to meetings to advise on strategies , and sometime provide useful contacts , and hopefully make sure all the regulators are being followed

Executive directors directly affect the company policy and decisions but the others might only show up for less than a dozen meetings a year ( so some directors sit on the boards of multiple companies , they are not devoted to a single company )
 

Value Collector

Have courage, and be kind.
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Thank you very much indeed divs4ever you have been more than helpful, you are a star. I truly appreciate your time.

I now have lots of ideas to help me with my investing and i really do appreciate the insights you shared. I think thats very intelligent to closely look at what kind of director is running a business and there background to get an understanding of what they might do with the company. I agree that a fairly stable income is always important. Something i never considered and i find very enlightening is worker morale i think that is very important and something i might have overlooked. Taking a more active view into what is happening in the company, rather than financials, competitors and looking into the directors is very sensible. Thanks again for your support with this it means alot.

Can i kindly ask i know in March 2020 we did not foresee the Coronavirus and markets dropped heavily but rebounded in around 4 - 5 months in some sectors. Do you kindly please know how we might be able to predict the next market crash and generally how do you protect yourself from something like this? I know some people short shares (bet on stocks declining) in times when markets are going down, not something i am interested in but kindly wanted to know if you had any insights on this please? Market crashes worry me but should not if i am selecting shares for the long term. Thanks again for your time and support divs4ever you have been amazing, i really appreciate everything. I sincerely hope you are doing well and are happy.
A wise man once said.

“When a manager with a great reputation a great manager meets a business with a reputation for bad economics, it’s the business that will keep its reputation”

What that means is that some businesses are going to struggle regardless who manages them, and some wiall thrive even with poor managers.

The trick is to find businesses that can be run by an idiot, because sooner or later as idiot will be in charge.
 
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Thank you again for all your time writing your posts divs4ever you truly are a wonderful person. I really do appreciate the time you took to write you posts and helping me with my investing. I am truly sorry about your health problems and i do hope they can be managed well without impacting your life too much.

Your post was a really inspiring read, in particular how market crashes are important for buying opportunities and taking out weak companies and forcing mediocre companies to life their game. I particular like that you take profits at sensible levels regardless of whether the market is rallying or worried. I think thats really sensible and very clever advice, i appreciate you sharing it.

I do hope we can stay in touch i think you are a wonderful person and you have really took the time to help. I truly hope it helps others reading this thread. I do hope you have a pleasant weekend and i will let you know how i get on with my investing. I will be walking my relatives dogs this weekend and catching up with a friend in Starbucks. I might even check the stock on this company as last time i went in i noted that the prices are really increasing, having a cappuccino now there is really expensive.
 

Value Collector

Have courage, and be kind.
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Thank you again for all your time writing your posts divs4ever you truly are a wonderful person. I really do appreciate the time you took to write you posts and helping me with my investing. I am truly sorry about your health problems and i do hope they can be managed well without impacting your life too much.

Your post was a really inspiring read, in particular how market crashes are important for buying opportunities and taking out weak companies and forcing mediocre companies to life their game. I particular like that you take profits at sensible levels regardless of whether the market is rallying or worried. I think thats really sensible and very clever advice, i appreciate you sharing it.

I do hope we can stay in touch i think you are a wonderful person and you have really took the time to help. I truly hope it helps others reading this thread. I do hope you have a pleasant weekend and i will let you know how i get on with my investing. I will be walking my relatives dogs this weekend and catching up with a friend in Starbucks. I might even check the stock on this company as last time i went in i noted that the prices are really increasing, having a cappuccino now there is really expensive.
The first couple of minutes of this video explains how you should think of market crashes, and why you should look forward to them.

 
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A wise man once said.

“When a manager with a great reputation a great manager meets a business with a reputation for bad economics, it’s the business that will keep its reputation”

What that means is that some businesses are going to struggle regardless who manages them, and some will thrive even with poor managers.

The trick is to find businesses that can be run by an idiot, because sooner or later as idiot will be in charge.

sadly , when i read that quote , i now cringe and think of WOW ( and i don't mean Brad , but there is still a lot of improvement needed , maybe Brad can re-float the Titanic )

however decades but when i worked at WOW their problem was middle management was the problem , and sadly many got promoted

but there are some other clear examples still listed on the ASX
 
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The first couple of minutes of this video explains how you should think of market crashes, and why you should look forward to them.


in my two experiences in a decent downturn ( 2011 and 2020 )

i notice a problem of too many places to watch , i tried tight watch-lists , but it is tough work working how much money goes where , and there are always good solid stocks that you missed ( say instead of the WBC i bought in 2020 and sold late 2021 )
 
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For a different take on scaling investments, look up Nick Sleep, one of the earliest fundies to invest in Amazon.
Sleep developed his own framework after studying decades-earlier stuff done by maths and science boffins at the famous Sant Fe Institute. Some of these old duffers had even worked on THE bomb at Los Alamos.
 
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It will be interesting to see what happens to the DOW tomorrow. Our market being closed today will have time to digest what happened to Wall st Friday and what will happen tonight. If the American market tanks again, we are sure to follow, which i believe may be cause to seriously start looking at where the market might be heading, and if a big fall happens, it may create an opportunity to scale up in certain stocks
 
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according the investing.com.au the ( ASX ) SPI future are currently minus 158 points while US futures are down about another 0.3%

BUT that is no guarantee of indications to tomorrows open or trend during Tuesday

ALSO commodity futures affect the Australian market quite a bit , a reversal ( to current commodities futures ) MIGHT have the ASX trying for that new record again

but don't panic if chasing an individual stock in a volatile market sometimes your favourite gets dumped in a rallying market , i sometimes suspect long/short managers when there is no new company news
 
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