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Brian, IMHO that's good advice. Hope it
helps John. Cheers Graeme
Hi again John
I've got to get back to
you again because I had overlooked the fact that you had made earlier
postings regarding your portfolio. I feel that in your last posting
you were asking the wrong question when you asked about selling CAV &
LNN and my comments were not really appropriate.
On examination of
your portfolio (presuming it hasn't changed substantially)
1. With
the exception of FFS, which is your star performer, the only others to show
a gain are CAV & LNN
the very ones you ask about
selling.
2. Overall you are down some $9,000 with some quite large
individual losses.
3. The gain on FFS of $7,500 offsets what
otherwise would be a quite substantial overall loss
Your selling
question should have been related to the bad performers.....6 of which are
showing losses in excess of 20% ranging right up to 68%.
I
repeat the following points, most of which have been covered by other
'Chatters'
1. The total amount you have invested is a considerable
sum at $139k, particularly in this sluggish NZ market. If this is a major
part of your liquid resources it is too high to risk, half would be better
on fixed deposit.
2. You have too many individual
companies to keep track of - again half would be ample ( from 16 to 8
)
3. It is vital that you keep close track of the price
movements of your shares and work on some sort of stop loss. This is
not easy because of normal fluctuations but you need to set some
level. A figure of 10% is often muted, but this can be somewhat tight
in certain circumstances, however a 20% loss should ring the alarm
bells and you should bail out. Unfortunately you have 6 over 20 % and
another 3 over 10% so the situation has got rather out of
control.
What to do ?
1. Nothing and hope the overall
situation improves. Some possibly will in time
2. Bite the bullet and
get rid of your deadwood reducing your overall holding.
3. FFS is
showing you a good gain but the prudent investor would have taken some of
the profit on this.
There is still an element of
speculation here. Up to you.
4. Your portfolio should have a base
of solid companies (say half of your holding). GPG is pretty
good and LNN , CAV ,CEN not so bad. You could add PFI which gives good
quarterly dividends and is able to weather the ups and downs. This base may
not provide spectacular results but it should be reasonably stable and give
you dividends. Then you can afford to have a few more risky ones. But watch
them like a hawk, working on stop losses.
Finally on your charting
question - I can't see it will be off any use to you at all. Watch the
prices and work on stop losses. You can get all the basic information you
need from the various brokers web-sites including basic charts of past
performance and company reports.
Best of
luck
BG
At 14:28 12-07-00 +1200, you wrote:
I guess I suffer from every
newbies complaint. The when to sell syndrome.
ETC.ETC.
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