Buying Shares

[nickyboy]

Can you provide any evidence to support these views and allegations?
80% of retail investors dont lose money. Specially as the majority invest in etfs. It is highly unlikely that 80% of people with self invested personal pension make losses if they did the government would ban them.

A 10% spread on poorly researched companies? There is no such thing as poorly researched company nowadays. Warren Buffets cigar butt companies dont exist anymore.

The market makers spread (bid to offer or ask) is a based on liquidity AND competition. One market maker no competition....and lots of risk for the market maker. Despite that a 10% spread is very very rare.

Let's look at mj Gleeson, not that small a company but shares are tightly held. Or put another way bought and held longer than the average. I have seen spreads of 600p (sell) 640 (buy) it does vary though. It would appear to be difficult to make a profit on them? But the reason the spread is so wide is people hold for a lot longer than normal for companies of that size implying the opposite of nickyboy ie profitable.


The experts advice is buy and hold. Or put another way you will make losses by panicking.

As an aside I wasn't willing to buy mj Gleeson because of the spread but a bargain is a bargain no matter what the spread. The spread today is 704 sell 736 buy, very large. It could be larger when the market is open.
I Bought at 580 using a limit order. I am up including all buying costs And the spread by 20.8%. A bargain is a bargain and hold long term.

And I have no insider information (I didn't know in advance about the covid19).

There are loads of sub £50m market cap stocks with spreads exceeding 10% on AIM and the Standard Segment of the Main List. Most of these have no research written either independently or by their broker. To give an example I invested in a company recently with a market cap of £11m. The spread is currently 22%. But if the stars align I stand to make about 3x return. Completely off radar, completely unresearched

Regarding the 80% number it seems to be widely quoted. I did ask my broker (the main guy at a brokerage with several hundred trading clients). He said most of the active traders lost money

 

[Notafettler]

There are loads of sub £50m market cap stocks with spreads exceeding 10% on AIM and the Standard Segment of the Main List. Most of these have no research written either independently or by their broker. To give an example I invested in a company recently with a market cap of £11m. The spread is currently 22%. But if the stars align I stand to make about 3x return. Completely off radar, completely unresearched

you are hopeful more than just the stars to align! For instance how do you come up with 3× ?

Regarding the 80% number it seems to be widely quoted. I did ask my broker (the main guy at a brokerage with several hundred trading clients). He said most of the active traders lost money

I was unaware you were talking about traders. I assumed you were talking about people who bought shares not day traders. Are you talking about day traders?
If I was looking for your type of profit why take on 22% spread?
New river reit
year low 50p
year high 244p
Present price 58.2p
Spread 57.4p to 58.2p
I would say that it is more likely to be 3x timer. Easier than a share with a 22% spread.
IF it was still paying the same dividend as its last one the dividend would be 38%
If in 2 years time it started to pay it's dividend again but only at half the original that would be a 19% dividend. And the share price would be considerably higher.

 

[Notafettler]

Another in my opinion interesting article

https://www.moneyobserver.com/coronavirus-looking-business-winners-and-losers

 

[Notafettler]

This is all about investment trusts. It is 27 minutes long. As you all have all the time world!! It maybe of interest. I on the other hand haven't got all the time in the world...well I have but I want to kill some voles/mice which are destroying my vegetable garden, so I am going to sit with a spade and wait to see them creating there runs. Then chop them in pieces...hopefully!!
https://www.investorschronicle.co.u...nt-trusts-for-market-madness-and-safe-havens/

 

[Eziemnaik]

Friend of mine just gave me an advice how to win on the stock market every time, you just have to follow the instructions from the picture

 

[steveindenmark]

I worked for Barclays many years ago and played the stock market a bit.

My advice is that no matter how much you want to kid yourself that this is an investment. It is not. You must convince yourself that this is like opening a window and throwing a handful of banknotes out on a windy day. If some of them blow back in, then your a winner.

It can be exciting watching the graph go up day after day. But most of the time it will go up too slowly. Often it will go down and you will wonder how it can go down when you bought it at rock bottom. It is just like gambling and can become just as addictive. If you cannot afford to just throw that money in the bin. Then dont do it.

But if you can afford it. It can be really good fun.

 

[Notafettler]

I worked for Barclays many years ago and played the stock market a bit.

My advice is that no matter how much you want to kid yourself that this is an investment. It is not. You must convince yourself that this is like opening a window and throwing a handful of banknotes out on a windy day. If some of them blow back in, then your a winner.

It can be exciting watching the graph go up day after day. But most of the time it will go up too slowly. Often it will go down and you will wonder how it can go down when you bought it at rock bottom. It is just like gambling and can become just as addictive. If you cannot afford to just throw that money in the bin. Then dont do it.

But if you can afford it. It can be really good fun.

You are saying that nobody makes money on the stockmarket.
You are saying that everyone's pension is worth less than they put in.

 

[Notafettler]

Another interesting article this is about post coronavirus.
The important part (in my opinion) is the move to shorter supply chains and a move to bring production home.
One thing I made a note of a few years back was that Adidas had moved a factory back to Germany. The factory was highly automated. Staffing cost very low capital cost of automation very high. Production though was a just in time, no warehouses stacked with huge amounts of trainers. Some of which will have to be reduced significantly as they will never take off. Nike is even further ahead at automation and bringing prodction back home. The cost of this sort of automaton is falling rapidly. Ocado has for years said it was going to sell its technology. It Appeared it was just talk until last year when they got 3 orders for there technology. Share price doubled.

https://www.moneyobserver.com/five-...l&utm_campaign=MOports260420 (1)&utm_content=

 

[steveindenmark]

You are saying that nobody makes money on the stockmarket.
You are saying that everyone's pension is worth less than they put in.

I must have missed the bit where I said nobody makes money on the stock market. Maybe I missed it because I have personally made quite a bit on the stock market.

What I did say is that it is a gamble and that you can lose it and if you are looking at it as an investment, you need to be OK losing it.

If you are using a broker and the op didnt suggest that, you have more chance of success , as that is his profession.

 

[Notafettler]

You must convince yourself that this is like opening a window and throwing a handful of banknotes out on a windy day.deprivation
If some of them blow back in, then your a winner.
If you cannot afford to just throw that money in the bin.

That's not definition of winner. Not losing all your money is not the definition of being a winner
If you cannot afford to just throw that money in the bin.

But if you can afford it. It can be really good fun

It's supposed to be an investment not a game something to be taken seriously.
Investing in the stock market is not like gambling. You never mentioned anything about using a broker. Did use one? Feel free to tell me what a broker is.
Do you mean financial adviser?
Stockbroker never gives advice. You go to a financial adviser for financial advice.
And it's not free.

 

[steveindenmark]

That's not definition of winner. Not losing all your money is not the definition of being a winner
If you cannot afford to just throw that money in the bin.


It's supposed to be an investment not a game something to be taken seriously.
Investing in the stock market is not like gambling. You never mentioned anything about using a broker. Did use one? Feel free to tell me what a broker is.
Do you mean financial adviser?
Stockbroker never gives advice. You go to a financial adviser for financial advice.
And it's not free.
[/QUOTE

a broker who buys and sells securities on a stock exchange on behalf of clients

Mate you could cause an arguement in an empty house. People like you are exactly what the ignore button was made for

 

[Notafettler]

a broker who buys and sells securities on a stock exchange on behalf of clients

Yes but they don't give advice. So how will using them (impossible to buy shares with out them) help you do better as they don't give advice???

 

[nickyboy]

Yes but they don't give advice. So how will using them (impossible to buy shares with out them) help you do better as they don't give advice???

There are three main sorts of broking arrangements:

1) Execution only (where they don't give advice, they just do the trade you want. That's what you're talking about)
2) Advisory (where they will give opinion on your proposed trades and will also contact you with investment proposals)
3) Discretionary (where you give them your money and they make the investment decisions)

A single brokerage can offer more than one. For example the one I use for execution only does all three

 

[Once a Wheeler]

Here's a great place to start:
https://www.youinvest.co.uk/sites/default/files/guide/file/AJBell_First-time_Investor_Guide.pdf
Work at it, face up to the fact that you will suffer losses, keep going, reap the long-term benefits. Sounds a bit like cycling.

 

[shirokazan]

As a further aside the return on bonds don't rise with inflation.

Err, index-linked gilts?
https://moneyterms.co.uk/gilts/index-linked/