Forum Archive Index - January 2000

[Phil Eriksen <phil@acepay.co.nz>]

Derek wrote:
> 
> What  is secure stock?
> Is an agriculture stock, because have an assets?
> How much you pay for assets if those are under company liquidity, and
> we will calculate depreciation?
> Is a building company , when we have hundreds of houses and
> commercials building for rent ?
> Average person own 2 houses. To whom we sell house if we have not
> population growing?
> More people moving out of  NZ at the moment, then arriving.
> Is an  oil  company , where drilling give you chance 1 to 10  to
> strike oil?
> Is a forestry industry, when one match stick may burn all your
> investment?
> Is a fishing company, which may have bad luck due to new NZ fishing
> regulation?
> Or maybe a Bank. But what  was happened in Japan or in Korea not long
> ago?
> IT ,Tech stocks  almost every body saying are clear speculation, but
> what's about AFF then?
> What they be doing if  we got a disease such in England. Will you be a
> touch by "Mad Investor Disease" ?
> Could you make a comments,
> what in your opinion secure stock in NZ is?

I don't really think there is such a thing as a secure stock.  Every
stock in history that I know of has gone both up and down, and every
business has good and bad times.  So, in search of a "secure stock"
perhaps you shouldn't be in the stock market.  Put the money in the
bank?  Well, following on from your points, what about runaway
inflation, a banking crisis?  Ok then, just stick the damn cash under
the bed - uh oh, what about burglars.

Alas, security is an illusion.  Whatever stock you buy, whatever you do
to invest your money, there is a chance you will lose it.  The only way
to be "truly secure" is to give away every cent you have, and sign up
for a benefit.  This way there is no way your net worth can decrease,
and you are now the proud owner of the most secure "job" in the world.

Seriously, the closest to a "secure" stock, in my opinion, is the best
company in a relatively stable, established industry.  If you pick 10
competing companies, analyse each one carefully, and more importantly,
compare the merits of the stocks (and the underlying businesses!) to
each other and buy the company that clearly has important advantages,
you'll struggle to go far wrong.  And that is why the NZ market is so
frustrating and having money offshore is a must - you can't find 10 of
anything to compare in such a tiny market!

Cheers,
Phil

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