Is this a good time to buy shares?

[Sly21C]

Most JSE listed company's share prices are less than what they were worth a year ago, some shares have lost half of their value and that makes them cheap and therefore attractive to buy. Now my question is should I buy shares now? Or should I wait?

 

[Gothan]

Well take everything I say with a pinch of salt, but IMHO, if you have the money (and you won't miss it for a long time, or it won't affect your day to day live as long as its tied up), then yes buy. The golden rule is, buy low, sell high. The problem is just, its gonna be a while before you can actually cash in on your stocks.

And that is the big question, will you be able to wait a long time, or do you want ot make a quick buck?

 

[JK8]

3 - 5 years enough time Gothan?
I see Platinum is almost the same price as gold, how can one buy shares in Platinum?

 

[blunomore]

I see Platinum is almost the same price as gold, how can one buy shares in Platinum?

Implats
Northam
Angloplats

 

[DJ...]

You don't buy shares in platinum, you buy shares in the producers or you invest in the futures and options market.

@OP: Your question is too broad to answer. You need to define your investment goals to determine whether the current climate will be suitable for you to invest...

 

[blunomore]

You don't buy shares in platinum, you buy shares in the producers or you invest in the futures and options market.

Hence my listing of some of the companies in which he could consider buying shares.

 

[stoke]

Ask the other question : When is it a good time to sell shares?

To answer this question:
- Select some shares that interest you
- Predict when it is that you will need your money
- Now take a look at the history of those shares, and the year on year growth of the shares, determine what time of the year these shares hop up. They all have this cute yearly pattern if you can get hold of the data.
- Now, calculate the % amount that it has gained over the last 3 years.
- Now, examine what exactly it is that that company does for a living, and using every resource at your disposal, try to figure out if it can keep doing that AND keep on profiting AND keep on beating inflation. Here, you must point out risk factors, and put them into your daily routine. Every flipping day you're going to have to watch out for these risk factors and act quickly to sell if they are going to play a part.
- Now, consider what you have to do to sell the shares, and how much time it will take for them to actually sell.
- Finally you're ready to add the brokerage fee's to your profit margins.
- The last step, before you buy ... reverse your potential profits into losses, times them by 4, and then seriously consider what it will be like to lose that money.

Now, you're ready to enter the game, but, it's still gambling, and you need to do your homework and keep a strong beady eye out, and, most importantly, be prepared to lose.

 

[guest2013-1]

Ask the other question : When is it a good time to sell shares?

To answer this question:
- Select some shares that interest you
- Predict when it is that you will need your money
- Now take a look at the history of those shares, and the year on year growth of the shares, determine what time of the year these shares hop up. They all have this cute yearly pattern if you can get hold of the data.
- Now, calculate the % amount that it has gained over the last 3 years.
- Now, examine what exactly it is that that company does for a living, and using every resource at your disposal, try to figure out if it can keep doing that AND keep on profiting AND keep on beating inflation. Here, you must point out risk factors, and put them into your daily routine. Every flipping day you're going to have to watch out for these risk factors and act quickly to sell if they are going to play a part.
- Now, consider what you have to do to sell the shares, and how much time it will take for them to actually sell.
- Finally you're ready to add the brokerage fee's to your profit margins.
- The last step, before you buy ... reverse your potential profits into losses, times them by 4, and then seriously consider what it will be like to lose that money.

Now, you're ready to enter the game, but, it's still gambling, and you need to do your homework and keep a strong beady eye out, and, most importantly, be prepared to lose.

Back in the 80's / early 90's my dad and I played "virtual stock market" a little game we devised and to see if we can beat each other with out investments making profit etc.

My strategy was based on the "buy low sell high" and the way I made a decision to sell is if I hit a 33% "profit" regardless of high the stock went in the end. If it dipped lower I just hung onto it, no rush.

The trick here is to choose a company that won't go under. So buying stock in places like M$/Google/Neotel (not telkom, lol) or something would probably have the best long term benefits.

What I also did as a long term plan to beat my dad was to buy R1000 worth of stock. If the price went up and I was worth R1500. I'll sell off R500 worth of shares and wait for it to fall to the price I bought it at originally or lower. Then I'll buy another R1000 worth of shares effectively by just adding another R500 and not shelling out the full R1000 for stock.

If it never dipped below the threshold I bought at or lower, I made R500 profit off of the stock. Sure I might have less stocks than I bought but it's worth the same so if I cashed out I'd still have made the R500 profit.

So if I see this is stable for a couple of months and it doesn't dip down I'll push the R500 into another stock I was following.

Now would be a great time to buy. But start slow. Don't push in R50 000 into the stock market now. Maybe R1000 a month i shares. The market is fluctuating now and losses can be recorded. Just remember:

Monetary value of stocks != (thats the sign for not "is not equal to") the number of stocks you hold.

So if you buy a 1000 stocks you own a 1000 stocks. That will never change. So if you bought in a big company and 10 years from now the stock prices climbed back up etc, you still own 1000 stocks but the monetary value is higher

Friend of mine I taught this to is buying in Blackberry, Nokia and Siemens. Blackberry stock dropped a lot and because he liked the phone he figured he'll do a few hundred rand in stock every month.

 

[remybfg10k]

Brokerage fees ftl

 

[werner]

i dont know the s.a. market, but it is a good idea to look back at the great depression.

three times more money was lost by people who decided "wow, stocks are cheap, i'll get some" in the years that followed.

bulltrap/dead cat bounce. whatever.

 

[guest2013-1]

Brokerage fees ftl

Brokerage fee's are quite low these days compared to what it was. If you decide to do it yourself or get a broke to do it, usually doesn't cost an arm and a leg. The thing is just you can't trade 50 times a month on the same stock because of fluctuations and you getting cold feet, otherwise you'll spend more money in brokers fee's than the profit you'll make (or not make)

i dont know the s.a. market, but it is a good idea to look back at the great depression.

three times more money was lost by people who decided "wow, stocks are cheap, i'll get some" in the years that followed.

bulltrap/dead cat bounce. whatever.

That is true, and this is why he needs to be careful to choose a reputable company to invest in. a great indicator is history, so you might want to go look at companies that made it through the great depression and are still around today (if there even is! lol) or just choose someone who won't go down no matter what, like Google and M$.

Owning a 1000 stocks in a company that doesn't exist anymore is pointless, that is why it's important to choose a strong horse except with stocks its less likely you'll be wrong if you did the right research compared to playing the ponies