Some newbie questions

drunkntigr · 14 October 2008

With the recent stock market fall I am led to believe that this monday morning was the best time to buy shares.

HOWEVER, I have no idea what shares to buy, nor where is the best place to research or the best resource about shares.

I'm looking at throwing around 5k to 10k.

Should I do my reserach first before I buy some 'cheap' shares atm, or is it too late now as the shares aren't that 'cheap' anymore, and I'm holding a bigger risk that the shares will fall again.

And what broker does everyone use? Commsec?

And what is the deal with these electronic brokers, if I say buy, does it buy the shares immediately? And four hours later in the day, and it's gone up $0.10, can I sell it instantly?

doctorj · 14 October 2008

drunkntigr said:
With the recent stock market fall I am led to believe that this monday morning was the best time to buy shares.

No one knows the future - for every buyer, there's a seller who's opinion differs.

No one can offer you specific advice here; it's against the law. That said I'd encourage you to do your homework and take your time.

The chart I've attached below is a quick example of how it doesn't always pay to rush. You could have bought the day after the crash in 1987 and hardly made a penny until the bottom in 1993. On the other hand, very few people would have picked the bottom, but many still made money.

The right side of the chart is open ended and a new datapoint is added every day so it's never 'too late'.

With regards to your questions about Commsec and electronic brokers, that is something people here can help you with. Searching for Commsec here at ASF is a good place to start.

seasprite · 14 October 2008

doctorj said:
No one knows the future - for every buyer, there's a seller who's opinion differs.

No one can offer you specific advice here; it's against the law. That said I'd encourage you to do your homework and take your time.

I agree , it is imperative that you know what type of company you want to invest in , it's cash on hand , number of shares on issue , if they plan on issuing more shares , if they plan on having a share buyback , what their future earnings are , what their debt level is , what other world indices are doing eg Dow/FTSE , who the tea lady is , you name it .

People are still nervous/cautious at the moment.
A bad company announcement tends to lower the share price and also a good announcement happens to be doing the same in these times.
Until good announcements start pushing prices up and holding up , I can only suggest make sure the swing bridge has all the planks firmly attached from the sideline before crossing the crocodile infested waters.

Sean K · 14 October 2008

drunkntigr said:
And what is the deal with these electronic brokers, if I say buy, does it buy the shares immediately? And four hours later in the day, and it's gone up $0.10, can I sell it instantly?

If there is a sell match for the price you want to buy then the trade goes through immediately and you should see the shares appear in your account. You can sell them the next second if you like. Nice way of keeping the brokers and tax man in business if you're only dealing with small numbers.

Takes a bit of study and practice to understand all the nuances. If you have a friend who trades get him/her to show you how it all works for real, live.

Reealjrd · 14 October 2008

Well if you want to earn huge profit in your investment this is the right time for you as the rate of all the share are not too much you can easily purchase them but remember purchase different sector shares to minimize the risk of loss. That would be all from my side and now its all your destiny where it takes you.

skyQuake · 14 October 2008

Reealjrd said:
Well if you want to earn huge profit in your investment this is the right time for you as the rate of all the share are not too much you can easily purchase them but remember purchase different sector shares to minimize the risk of loss. That would be all from my side and now its all your destiny where it takes you.

Not necessarily the right time now, DYOR. If you want to take a gamble, then sure, feel free to add juice to the next downleg. Rate of shares are low? I assume you mean they're cheap. Cheap is relative, would it still be cheap 20% lower? How about 50% lower from now?

Purchasing from different sectors won't give you much protection when bloody EVERYTHING is falling. With $5~10k you can't afford to diversify. Buy in 4 sectors? $50 round trip means you're down $200+slippage. Gotta make 2~4% just to break even.

Read the beginners section; theres a lot of good stuff there that may hopefully answer your questions.

Sunburnt Land · 14 October 2008

Do your own research, but don't let the pessimists deter you from building a portfolio of quality stocks for the medium to long term. Everyone has an opinion. But some are always negative, basically predicting the world is going to end. They're the ones that will miss out on the best part of any bounce or recovery. Be careful, patient, and don't get greedy.

Expect volatility in the months ahead. There will be wild swings up and down. IMO, we've seen THE bottom. Monday was a good time to buy, but last Friday was even better

tech/a · 14 October 2008

Sunburnt Land said:
we've seen THE bottom.

Just want to single this out.

I think we have seen "A" bottom not "THE" bottom.

Reealjrd · 15 October 2008

skyQuake said:
Not necessarily the right time now, DYOR. If you want to take a gamble, then sure, feel free to add juice to the next downleg. Rate of shares are low? I assume you mean they're cheap. Cheap is relative, would it still be cheap 20% lower? How about 50% lower from now?

Purchasing from different sectors won't give you much protection when bloody EVERYTHING is falling. With $5~10k you can't afford to diversify. Buy in 4 sectors? $50 round trip means you're down $200+slippage. Gotta make 2~4% just to break even.

Read the beginners section; theres a lot of good stuff there that may hopefully answer your questions.

Market is never going to be like this for long few months back it has touched sky limits. We all must know first that market is not in a single way different from gambling. I am saying market as gambling to short term investment or intraday trading In gambling you have to take risk to earn profit and same with market. This is probably the right time to invest. Now every stock market is showing some positive signs. If anyone wants to take full advantage this is the right time.

No one guarantee whats going to happen in next hour. is the market is going to crash? Or going to relief a bit? Its all fortune. If you invest for long time then I guarantee no one is going to suffer loss.

seasprite · 15 October 2008

Reealjrd said:
This is probably the right time to invest. Now every stock market is showing some positive signs. If anyone wants to take full advantage this is the right time.

Banking results are out next week in the USA , I agree with tech/a , we havent seen the bottom yet.

benhua · 24 October 2008

Hi everybody,

What does exaclty mean this thing for trust unit / security ?

"STAPLED SECURITY PAID TO $1.00, $2.00 UNPAID"

Thank you a lot

Julia · 24 October 2008

Reealjrd said:
Well if you want to earn huge profit in your investment this is the right time for you as the rate of all the share are not too much you can easily purchase them but remember purchase different sector shares to minimize the risk of loss. That would be all from my side and now its all your destiny where it takes you.

This sounds like the contents of a Chinese Fortune Cookie.

im_daniel · 4 November 2008

Julia said:
This sounds like the contents of a Chinese Fortune Cookie.

Lol so true especially the last sentence

Some newbie questions

drunkntigr

doctorj

Hatchet Moderator

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seasprite

Sean K

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Reealjrd

skyQuake

Sunburnt Land

tech/a

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Reealjrd

seasprite

benhua

Julia

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im_daniel

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