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For those who entered our share game at the YP Field Days in September and who can't remember what shares they selected, we have attached the "full list" as at January 25th. Good luck in the game! It runs through to the end on March. YP Field Days Share Game.pdf
While the severity of recent global stockmarket events cannot be understated, it is important to retain some rationality. “Billions Wiped Off Sharemarkets”, “Stocks Plunge On Fears Of Global Turmoil” and even “Bloodbath” are among headlines seen in recent weeks. The standard photo of a Wall Street trader with his head in his hands pops on the front pages of various publications. When markets inevitably rally a few days later, I always look to see the “Billions Added to Sharemarkets” headline, but alas, I’ve never seen it. It obviously lacks the drama! A decision to join the many shareholders who sell their shares during these panic-driven frenzies should not be made lightly. Humans are impulsive, and people’s best laid plans are in danger of being thrown out the window if they act at the first sign of sharemarket weakness. US Recession, US Ratings Downgrade, European Debt – whatever the reason, it is important to remember that the market corrections associated with these events, like the dotcom bubble of the early 2000s, September 11 and the 1987 stockmarket crash, are likely to be only temporary and in each case, global stockmarkets recovered and achieved new highs. With current events following on from the Global Financial Crisis, it seems that this “bear market” has lasted for longer than usual, with months (or even years) where it feels like the market has gone nowhere. Most investors hold shares, or have shares in their super fund, as part of a long term investment strategy. These events provide distractions to this strategy, but should not fundamentally alter it. I don’t completely advocate a “do nothing, ride it out” strategy, however if you hold quality Australian Shares in companies that are continuing to grow and pay strong dividends, it may pay to consider your overall position carefully before joining the “panic sellers”. I can help you review your shares and investments and ensure they are suitable for you. Please contact me on (08) 8333 2488. Scott Keeley
With the scramble on to raise money and reduce debt many companies are coming to the market with well priced share purchase plans (SPPs). Second line companies in particular are offering shares at good discounts to the current market price. In the past SPPs were fairly tame affairs with the maximum value of shares available limited to $5,000 or less. Since the credit crunch many companies have applied for dispensation to increase the maximum to $10,000 or $15,000. The higher amount of shares on offer has made some of the offers very attractive. With some of the offers up 10% to 30% below current market price they are providing good opportunities for investors. There are a number of worthwhile strategies depending on each investor’s circumstances. These include the opportunity to “average down” the cost base of a share, crystallize capital losses, or just simply make a quick profit. At the end of the day it is important that investors appreciate that there are always some risks in any share strategy, with the risks generally reflecting the potential profit. Investors are well advised to only apply for shares that they are comfortable holding for the medium term just in case markets take a turn for the worst.