----- Original Message -----
Sent: Sunday, 24 June 2001 16:24
Subject: [sharechat] Do many of us trade
too much ? (investors not traders)
The internet seems to have an effect on shareholders,
many people are becoming more involved with their
share
investments. It used to be possible to put the
share certificates
away in a draw and forget about them. Hopefully
after a period of
years their value would of
increased.
These days
however we are constantly being informed
how our shares are performing, we see the charts
. all the news,
the gossip etc all unfold before us on our
computer screens.
Is this necessarily a good thing
?
Take the following
fictitious example.
Fred comes into 100000 dollar inheritance, he
decides to invest it
on the sharemarket. He reads the posts on the
shareforum etc
and decides to buy 4 shares in four companies at
25000 dollars each.
Intending to hold them for the long term. Lets
say he buys Frucor,
Telstra, waste management and
Wrightsons.
After just a few months Frucor
shares take a plunge, now this supposed
long term holder is suddenly being bombarded with
negative comments
about the company. He then sees all the chatters
are recomending buying
Rubicon, before you know it hes switching his
stock. The supposed long term buy
has lasted only a few months. Then one of the
other stocks has a temporary
setback and he is changing his portfolio
again.
Sound
familiar? Which ever shares you hold there always seems to be
another
that looks more attractive. I suspect that many
people would be much
better off financially if they just stuck to
their present portfolio
and forgot about it for five years.
Remember shares
like pets arnt just for christmas
nick
See IRG research reports
