Online Share Trading

[Creag]

I am considering going into online share trading. I am not looking to make this a career or anything on a grand scale (yet). I have always had a keen interest in economics, business, share trading, etc. So for the time being I would like to do this as a "hobby" or alternate investment avenue.

Apart from a few shares I own in/through the company I work for, I haven't ever bought into any other shares. I had a CSDP account (if that's the correct name for it) through BOE for a short while, but gave it up as I needed the money. The number of shares I owned then was quite small.

• Has anyone had experience in online share trading or presently involved?
  
• Do you recommend getting some sort of training before I get into it, and if so, any ideas?
  
• Also, apart from doing my own spreadsheets and monitoring different shares, are their any programmes or software I could buy or use to do this?
  
• Any company I should get a CSDP account through? (I bank through FNB and do not have any accounts elsewhere.)

Thanks in advance

 

[agentrfr]

ABSA/FNB allow you to trade shares right through the online banking window. I trade forex, and did share trading for a little while.

The training you need is learning all the laws, taxes, commisions, interest rates and roll-overs. Otherwise you are pretty much free to come up with your own system.

RULE 1
Never trade with more money than you are willing to loose. Never. You should have enough money in there to learn to trade with. Enough money that it hurst when the trade goes against you, but not enough to loose any sleep over.

The are a bazillion schools and trade brokers. Try sign up directly with JSE.co.za and use their platform... it's not great, but you can have a demo account and not pay for propriatary software.

But at the end of the day, buy shares in SABS. People drink when they are happy. People also drink when they are sad. Alchohol is good business.

 

[hellfire]

I am considering going into online share trading. I am not looking to make this a career or anything on a grand scale (yet). I have always had a keen interest in economics, business, share trading, etc. So for the time being I would like to do this as a "hobby" or alternate investment avenue.

Apart from a few shares I own in/through the company I work for, I haven't ever bought into any other shares. I had a CSDP account (if that's the correct name for it) through BOE for a short while, but gave it up as I needed the money. The number of shares I owned then was quite small.

• Has anyone had experience in online share trading or presently involved?
  
• Do you recommend getting some sort of training before I get into it, and if so, any ideas?
  
• Also, apart from doing my own spreadsheets and monitoring different shares, are their any programmes or software I could buy or use to do this?
  
• Any company I should get a CSDP account through? (I bank through FNB and do not have any accounts elsewhere.)

Thanks in advance

Sign up for standard bank Online Share Trading
It's R50 a month and they have a huge focus on education.
They offer many free courses from introduction to trading all the way to full day technical analysis courses.
It's all offered as part of the package and the courses rotate through all the major regional centres.

 

[Creag]

ABSA/FNB allow you to trade shares right through the online banking window. I trade forex, and did share trading for a little while.

The training you need is learning all the laws, taxes, commisions, interest rates and roll-overs. Otherwise you are pretty much free to come up with your own system.

RULE 1
Never trade with more money than you are willing to loose. Never. You should have enough money in there to learn to trade with. Enough money that it hurst when the trade goes against you, but not enough to loose any sleep over.

The are a bazillion schools and trade brokers. Try sign up directly with JSE.co.za and use their platform... it's not great, but you can have a demo account and not pay for propriatary software.

But at the end of the day, buy shares in SABS. People drink when they are happy. People also drink when they are sad. Alchohol is good business.

Many thanks for the advice. Agree that money used should never be more than willing to lose otherwise it could just become another form of gambling.

My intention is to use some of my bonus to start things off. I want to get my feet wet and learn all the lessons I can.

 

[HavocXphere]

But at the end of the day, buy shares in SABS. People drink when they are happy. People also drink when they are sad. Alchohol is good business.

I don't think investing in the South African Bureau of Standards is a good plan.

 

[marco]

OP, Stay away from trading for the next 6 months at least. You will loose all your money. The markets are too volatile at the moment. I have been trading for many years and have stayed out for months due to the thin volumes and constant good/bad news sending the markets spiraling. Most traders are sitting out at the moment.
What I mean by thin volumes is that not much trading is going on and few traders can send the market big time in any direction.
Far too volatile for trading.
Check out the good traders at www.sharechat.co.za and you will see that they are sitting on their hands.
In the mean time read up on the old posts there.

 

[marco]

I don't think investing in the South African Bureau of Standards is a good plan.

I never knew the guys at South African Bureau of Standards drank that much. Perhaps he meant SAB? No rather go for BATS long term. People smoke more in depressive times.

 

[Creag]

Sign up for standard bank Online Share Trading
It's R50 a month and they have a huge focus on education.
They offer many free courses from introduction to trading all the way to full day technical analysis courses.
It's all offered as part of the package and the courses rotate through all the major regional centres.

Thanks for the heads up on Standard. I was not aware that they offer free courses/education. That's definitely worth attending. Although I would not be a complete noob, if I am going to make this an investment (in it for the long-term), then it is 100% worth while to learn everything I can.

Another thought on trading, I was definitely thinking more in terms of shares that have historically performed well, so the likes of SAB Miller would be up there. Their shares are quite expensive though.

Colleague of mine at work has been trading for a while, but seems to be doing his own thing.

What he is doing, which I like, is he is focusing on shares which provide dividends. He sees the dividends (in the longer term) as becoming a part of his "fixed" income and leaves him less dependent on his pension.

 

[Creag]

OP, Stay away from trading for the next 6 months at least. You will loose all your money. The markets are too volatile at the moment. I have been trading for many years and have stayed out for months due to the thin volumes and constant good/bad news sending the markets spiraling. Most traders are sitting out at the moment.
What I mean by thin volumes is that not much trading is going on and few traders can send the market big time in any direction.
Far too volatile for trading.
Check out the good traders at www.sharechat.co.za and you will see that they are sitting on their hands.
In the mean time read up on the old posts there.

Thanks marco. I'll definitely check out the forums.

Interesting to hear your comments on the volatility. I have been looking at the Allshare Index for sometime now. I have been shaking my head at the way it has been moving up and down. No direction. Jitters over the slightest bit of international news in the US or EU or China. Crazy, I say.

Although I hear your sentiment, I would like to start somewhere to start getting experience

 

[marco]

Yes, just stay out of trading for now. Invest in good stocks will make you more money.

 

[Creag]

Thanks marco

 

[Markd]

So the question is, will you be trying to trade or are you going to be investing? Do you have the time to trade? Are you going to be sitting at the computer for several hours every day waiting for your signal to buy or sell?

Like you this is a bit of a hobby for me, but I dont regard myself as a trader. I look for good stocks to invest in and I buy them. If they go too far south I sell them, otherwise I let them ride. This takes up a fair amount of time - about as much time as a hobby should

You'd also need to try and work out if you are going to analyse a stock on a technical or fundamental basis, or perhaps use some kind of combination.

There are alot of resources out there for you to educate yourself on - plenty of youtube videos. Also as someone mentioned Standard Banks platform has alot of good educational material, plus free seminars and things to go to to learn, so i recommend that.

Ultimately, what works for you, and your real education, will come from your experience of buying and selling in the real world, with real money at risk. You will pay your 'school fees' no doubt, but we all do

It's an excellent hobby to have, and very rewarding when you do start making good investments with decent growth and return!

 

[Hiro ZA]

i recommend Standard Bank OST. They have tons and tons of free training seminars you can attend and the website is slick. with regards to shares, there are 2 ways to look at it. you could either go the TRADING route or the INVESTING route. The former would imply you buy and sell over relatively short time periods. More risky, but potential for quicker returns. I personally go the INVESTING route as I get far to nervy by volality. so i buy shares in companies i reckon will go up, and then just leave it alone for months or even years.

another concept is Fundamental Analysis vs Technical Analysis. the former implies you give more weight to the quality of the company and its results, the latter implies you focus more on the current trending data. Each view has its advantages and disadvantages, but go for the courses and it will start to make more sense.

 

[hellfire]

Thanks marco. I'll definitely check out the forums.

Interesting to hear your comments on the volatility. I have been looking at the Allshare Index for sometime now. I have been shaking my head at the way it has been moving up and down. No direction. Jitters over the slightest bit of international news in the US or EU or China. Crazy, I say.

Although I hear your sentiment, I would like to start somewhere to start getting experience

Volatility is where money is made. Higher risk = higher reward.
You also don't necessarily need to invest in shares.
Single stock futures, currency futures, CFDs, bonds and more are offered on nearly all the major trading platforms.

 

[Creag]

So the question is, will you be trying to trade or are you going to be investing? Do you have the time to trade? Are you going to be sitting at the computer for several hours every day waiting for your signal to buy or sell?

Like you this is a bit of a hobby for me, but I dont regard myself as a trader. I look for good stocks to invest in and I buy them. If they go too far south I sell them, otherwise I let them ride. This takes up a fair amount of time - about as much time as a hobby should

You'd also need to try and work out if you are going to analyse a stock on a technical or fundamental basis, or perhaps use some kind of combination.

There are alot of resources out there for you to educate yourself on - plenty of youtube videos. Also as someone mentioned Standard Banks platform has alot of good educational material, plus free seminars and things to go to to learn, so i recommend that.

Ultimately, what works for you, and your real education, will come from your experience of buying and selling in the real world, with real money at risk. You will pay your 'school fees' no doubt, but we all do

It's an excellent hobby to have, and very rewarding when you do start making good investments with decent growth and return!

At the moment I am looking at developing this into a long term investment tool. I also do not have time to sit and watch share prices. Not yet anyway

So this is going to become a hobby and long term investment strategy. I have other mechanisms of saving and investing (RA's, endowments, unit trusts and pension fund).

I would like to see my shares grow. I would prefer shares which return in dividends too, so that I can either reinvest it or use it in the longer term as an alternate source of income.

I am happy to make mistakes so long as they aren't reckless shots in the dark. The missus understands this too

i recommend Standard Bank OST. They have tons and tons of free training seminars you can attend and the website is slick. with regards to shares, there are 2 ways to look at it. you could either go the TRADING route or the INVESTING route. The former would imply you buy and sell over relatively short time periods. More risky, but potential for quicker returns. I personally go the INVESTING route as I get far to nervy by volality. so i buy shares in companies i reckon will go up, and then just leave it alone for months or even years.

another concept is Fundamental Analysis vs Technical Analysis. the former implies you give more weight to the quality of the company and its results, the latter implies you focus more on the current trending data. Each view has its advantages and disadvantages, but go for the courses and it will start to make more sense.

I think my preference would tend toward fundamental analysis for the time being. Maybe in the future when I have got a bit more experience and had time to watch the market a bit more, then the odd technical analysis investment could happen.

Volatility is where money is made. Higher risk = higher reward.
You also don't necessarily need to invest in shares.
Single stock futures, currency futures, CFDs, bonds and more are offered on nearly all the major trading platforms.

Agree. Looking at it another way, no risk, no reward. But as the song goes, you got to know when to hold them, know when to fold them, know when to walk away, etc.

 

[marco]

Volatility is where money is made. Higher risk = higher reward.
You also don't necessarily need to invest in shares.
Single stock futures, currency futures, CFDs, bonds and more are offered on nearly all the major trading platforms.

Not in this type of volatility. It swings the other way as soon as you place a trade.
The traders are sitting out. That makes the volumes thin and the few traders can swing the market either way. You WILL loose your money in this market. This is not a traders market, it is an investors market at this stage.
SA's best website forum for traders is at www.sharenet.co.za
You will see that they are sitting on their hands and waiting. Once the market is back to normal, all hell breaks loose and you will see the activity.
Follow the good guys and you will make money. Not now.

 

[jambai]

I think that is an very generalised statement to make Marco.I worked for a hedge fund and volotilty was the time when they made the most money and is their bread and butter.You cant say that every trader is setting on the side line,anyway not sure what time frame you talking about but 2012 has been a positive year for most traders and hedge funds/asset managers

 

[Creag]

I think that is an very generalised statement to make Marco.I worked for a hedge fund and volotilty was the time when they made the most money and is their bread and butter.You cant say that every trader is setting on the side line,anyway not sure what time frame you talking about but 2012 has been a positive year for most traders and hedge funds/asset managers

If I look at the performance of my pension, which is exposed to the market, it's been a reasonable start to 2012 for me. Then again, I'm not the one trading or making any decisions, fortunately

 

[hellfire]

Not in this type of volatility. It swings the other way as soon as you place a trade.
The traders are sitting out. That makes the volumes thin and the few traders can swing the market either way. You WILL loose your money in this market. This is not a traders market, it is an investors market at this stage.
SA's best website forum for traders is at www.sharenet.co.za
You will see that they are sitting on their hands and waiting. Once the market is back to normal, all hell breaks loose and you will see the activity.
Follow the good guys and you will make money. Not now.

There is no way that professional traders (i.e. equity desk traders at investment banks) are sitting out of the market.

 

[DJ...]

If I can give you one piece of advice, it is to take whatever marco has to say with a massive pinch of salt. As someone directly involved in the market on a daily basis, I can assure you that he is talking out of his arse...