Friday, March 30, 2012

Good Morning March 30, 2012

Good morning to the last day of this first quarter of 2012.

Today will probably see some selling off of stocks for the profits gained in 2012 so far.

Don't worry that is not a bad thing. In fact I would recommend everyone to take and lock in profits at some time.  It is really the only way to make money on stocks.

Don't fret about seeing the stock rise even after you sell. You have just allowed someone else to make a little profit. 

But I admit it does feel good if you sell at the top, and watch the price fall.

Then of course you can often make plans to buy in a stock later.

This afternoon may see some good opportunities for buying in some stocks that have been sold off this week.

Keep an eye out for that and look to buy if you feel there are some bargains to be had.

Monday, March 26, 2012

Prediction for the week Ending 30th March 2012

This week is a nice week to end the first quarter of 2012.

Because it has a clear cut ending there is little vaguery as to what the effects of the second quarter will be.

My theory is that all the major players in Wall Street will aim  to lock in as many profits as possible this week.

So the bull run on the market willl continue Monday and Tuesday.

Wednesday March 28 to the close of business on Friday will see some downward pressure on the markets as institutions seek to close positions and pull in profits.

Look for major sectors that improved dramatically to fall in this last week of the quarter. Sectors such as Financials,

There will of course be lots of reasons given as to why the market will fall, from Europe, through housing concerns, consumer confidence to threat of war with Iran.

Most of these reasons may be made to sound plausible, but over thirty years of experience I have seen this scenario many times.

It happens far too often to be pure chance. It must just be institutional profit taking.

Be prepared to follow the roller coaster down a little, it can be a good buying opportunity in late Friday trading as some bargains may be had.

Monday April 2, 2012 will see some recovery as the climb through a slow second quarter will begin. 

Wednesday, March 21, 2012

Watch Advisors on TV With Care

It is ok to watch programs on stock investing.

Watch programs such as Mad Money with Jim Cramer and Fast Money with care. These CNBC programs are great sources for fiinding out about possible investments.

Be CAUTIOUS: Analysts and Market Makers also watch these programs and you will often see tipped stocks on these programs rapidly increase in price.

Why is this?  Market Makers and Analysts know that stocks tipped by experts on these shows will attract a lot of attention from the average investor. The average investor will see the price rise as a positive and buy-in too quickly. They will though also see the stock proce often fall within a few days.

The wise small investor will watch these pundit programs and make notes as to the stocks talked about.

Put them on a watch list and leave them alone for several days or weeks.  Yes you will miss the initial upsurge of the stock but you will not be locked in when that surge washes through and the stock falls to its original trading point.

As the stock falls to near its old trading level. If things still look good to you, then consider buying in that stock

Buy in good quantities if you can in order to reduce the trading costs by averaging.  Trading costs are the death of many a small investor.

If a trade to buy and sell costs $10 each your single share of stock will need to rise #20 before you can break even.

If you buy 10 shares then a stock needs only rise $2 to break even.

Buy 100 shares of the same stock and it need only rise 20 cents to break even.

Tuesday, March 20, 2012

A 6% Dividend

Where can you earn 6% on your cash these days?

The INGPrime Rate Trust (PPR) is one such source of income.  The Trust specializes in short term loans to major corporations and trades in a range of $5.40 - $5.60 per share.  It has spiked up to over $6 a few months ago and fell recently down to below $5. Now it is back within its normal track of around $5.50

Declaration: The author owns Stock of PPR within his portfolio.

I have this stock within my portfolio for its income potential. The stock pays a dividend monthly and is therefore more like a Bond than a Stock. Current dividends are around 3 cents per share. I have this stock as a long term hold and buy on any fall of the stock below its normal trading range.

At a whopping 6% return on average dividends this stock has maintained a good dividend throughout the past three years. I think you should maybe consider the investment if you think that it might fit in with your investing style.

Monday, March 19, 2012

What May Be Good for APPL May be Good for T

With Apple trading at over $600  per share that may be a little out of the average investors range.

Where might you go to follow their success?

Possibly look to AT&T (T) trading in the low $30's AT&T have had some good dividends and have a long standing contract to serve Apple's iPad customers with wireless service.

Disclosure:The Author holds  AT&T (T) Stock in his portfolio.

AT&T has recently looked to increase income by slowly raising it's data prices, this has been coupled with investment to expand current networks and it seems that as fast as they expand the pipeline for wireless users the pipeline fills and data usage increases to fill available capacity.

AT&T has coped well with the demand and I believe that they will continue to look to serve the Apple users within their contracts successfully maintaining their market share as other carriers come into the market in order to compete.

AT&T therefore could be a medium term play for those looking to gain from iPad sales without the risk of having a very major portion of their portfolio in Apple (APPL)

Thoughts on Apple Inc.

Bank of America?

Just watching CNBC's The Closing Bell I was struck by the amount of excitement expressed that Bank of America (BAC) hit $10 this morning.

I am a long term holder and buyer of Bank of America. Sadly it has been one of my dogs.

Some of my first investments were made back in 2006 and 7, then folks where was this stock trading? Up around $50 -60 per share. It was also paying a pretty nice dividend of around 50 cents per share too.

Since then of course I saw my stake plummet and about a year ago it was bottoming out at around $4 per share. and struggled to get approval to pay anything more than 1 cent per share.

So it is nice to see this old dog coming back. It is nice to see CNBC getting excited that the stock has doubled in a year. But folks reality check here, I am waiting on a share price of 18.20 per share.

Why $18.20 that is my break even point to get back the money invested five years ago and which has been dead as I bought down to the bargain basement. Even that amount may be a long time coming.  Though with recent financials moves it may be that Bank of America begins to look cheap.

Welcome to the First Day

Welcome to my new blog.

I have been investing in stock markets for over thirty years now.

I began investing in the London Stock Exchange in 1980, soon after I got my first job.

Those days one had to call a broker, lodge funds with them and buy or sell real share certificates. There was no online direct trading as today and the whole process was full of strange jargon. Jobbers, At Market, At Best, Going Short, Longs. All very confusing. Though the jobbers are now gone. Much of the jargon remains.

I hope to lead you through the jargon if you are new, If you have been around for a while then hopefully I might lead us to some golden leads for good investment. If you are a professional, then maybe you may learn something from this very old Muppet.

Apple Anyone?

Today the news on the web and on CNBC was full of Apple's conference call.

The Board of Apple announced today that they would begin a dividend payment and also announced a share buyback to the tune of $10 billion.

So what do I as a non share holder think?  Do I want to jump on the Apple steamroller?

Honestly at over $590 per share and looking towards over $700 Apple is way beyond my means as far as investing directly.

Is it a bad investment?  No Apple seems to be a very good investment, if you have at least $500,000 to invest.  The cost of buying enough shares in order to make a decent profit and compensate for risk is too much.  I would advocate never buying less than 50 (fifty) shares in a company. Good companies even deserve 100 shares.

Why this policy?

It is in order to decrease the cost per share of all the added costs from brokerage.

Say we take Apple at $595.

Buy one share at a broker charge of $10. We need the price to rise to $605 to break even. But we must hold because our broker charges another $10 to sell. So to sell and break even we need a selling price above $615 but even that $20 doesn't give us profit.

So Apple is too big to be a worthwhile small quantity purchase.

The more shares one buys at a time the better. If one could afford 100 shares on that same apple stock one would only need a twenty cents rise to break even.

This is my first rule.

Consider brokerage in the equations before buying or selling.