Why Do You Invest in NZX Rather than ASX

[ENP]

Why do you personally invest in companies on the NZ stock exchange as opposed to the AUS stock exhange and vice versa.

Also what sort of trading/investing techniques do you use and do they differ between these two markets?

[forest]

A little lower brokerage cost, no FX cost, NZ companies are more likely to attach imputation credits to dividend and living in NZ I feel more in tune with NZ companies.

Investing technique? I analyze the fundamentals and time with a TA component.

Here you have it.

[Sideshow Bob]

At the moment have no Australian shares on the radar due to exchange rate.

[lissica]

Invested in both ASX and NZX. No reason why you need to invest solely in one.

On the NZX because
-you get imputation credits you can actually use
-I like to keep some money in NZ, because I'm a Kiwi

On the ASX because
-I'm currently working in Australia, earning AUD$
-There are more companies to invest in. Currently 75% of our holdings are in Australia, because compared to the NZX, the choices are better and so is the liquidity
-It's more interesting. The same companies get discussed to death on the NZX, because there aren't that many

[Doyle]

-Understand the country and the economy drivers better
-No foreign exchange risk
-Imputation Credits

It's a nice feeling looking round the place and thinking, I own shares in that.

[Dr_Who]

Aussie is where the action is. You cant be part of the action by staying on the sideline.

[JBmurc]

From a traders point of view the ASX to the NZX is like shopping at NZ's biggest supermarket compared to NZ's smallest dairy
If your only investing a small amount into yeild stocks an you really want no hassels NZX is fine

[belgarion]

I invest in the NZX for two reasons:

1. Yield and tax free capital gains
2. Mix that with significant FX swings and you're onto a great little earner.

Note: investment horizon is measured in 6-36 months or longer - i.e. don't buy and sell that frequently.

[beacon]

Apart from liquidity, company size, Govt interference etc., look at how investor friendly NZX disclosures are for NZ listed companies. You'll see the signal:
"A co's given this info". Where is the info? No info
"B co's given this info". Where is the info? No info
"C co's given this info". Where is the info? No info
"D co's given this info". Where is the info? No info
"E co's given this info". Where is the info? No info
...

[POSSUM THE CAT]

The sooner the NZX is taken over by ASX the better we would get some decent imformation. ASX brokerage is less tha NZX brokerage.

[ENP]

Does everyone on here just use "value investing" like the Warren Buffet technique?

And is the best way to learn more about stocks read books, read financial statements, pretend stock market games or the real thing? I want to pull the trigger and get involved in share/stock investing but don't know the best way to go about it. Also don't know if now is a good time to get into it, since maybe I've missed the market up-turn?

[macduffy]

Does everyone on here just use "value investing" like the Warren Buffet technique?

And is the best way to learn more about stocks read books, read financial statements, pretend stock market games or the real thing? I want to pull the trigger and get involved in share/stock investing but don't know the best way to go about it. Also don't know if now is a good time to get into it, since maybe I've missed the market up-turn?

Too many big, open-ended questions there, ENP to get useful answers!

A lot depends on your investment philosophy, appetite for risk, need for income from your investments, stage of life etc.

Personally I invest in NZ for long term imputed dividend income, partly because I don't rate NZ stocks very highly for their growth potential - with a few exceptions.

I invest in Aust for the depth of the market and the diversity ( banks, resources etc) that we don't have locally and for growth. They don't all succeed, of course, but an occasional AOE - a five bagger for me - or BOW or CPB go a long way to making it worthwhile.

I hold a well diversified Aust portfolio, around 15 stocks at any time and I don't worry about trying to "time" the exchange rate or the fact that Aust dividends aren't tax effective for NZ'ers. I've never been able to time the market with any precision but I don't buy individual stocks in a downtrend and I try to keep from buying anything when the market is itself trending down. "The trend is your friend."

Read all you can. Having an interest in the market is the first requirement!

[Enumerate]

It is my belief that the ASX is the better market - better disclosure, better enforcement, more mature organisations.

Generally, I only invest in the NZX where income is derived from interest or dividends.

I find there is more opportunity in Australia for growth stocks (better governance is a factor as well).

Apart from the major issues with the NZX, in terms of regulation/governance/enforcement/scale - I just hate their web site. They drop historical documents attached to their announcements after a few months - they have only recently discovered the .pdf format and still do not use it universally. As an investor resource - it is the worst pile of dung I have ever been forced to use.

I have had two occasions on the NZX where smart a$$ "merchant banks" have naked shorted stocks that they subsequently couldn't cover (due to trading halts or lack of liquidity). They clearly continue to get away with this behaviour. Hence, I have no confidence with the NZX as a market regulator. This has never happened to me on the ASX despite the fact that vast majority of my trades are on this market.

[ENP]

So you invest in NZ stocks just for dividend income regardless of the share price as long and the dividend % is good enough? That's where I'm leaning towards in NZ companies. Mainly blue chip companies with stable/growing dividends. If I'm just investing for dividends, does it matter about the share price then now that I've missed the "up-turn"

[CJ]

If I'm just investing for dividends, does it matter about the share price then now that I've missed the "up-turn"Unless the yeild is better than money in the bank, you need the capital growth as well to balance the risk/reward.

You may have missed the bounce from the bottom but you should still expect capital gains to accumulate if you pick well. That is not to saw we wont get a double dip and you will get losses in the short term

[ratkin]

About ten decent NZ stocks including AIA SKC PPL TWR WHS

However if your building a decently diversified portfolio then it wont be long before you run out of options. I hold
around thirty different stocks on the NZ and asx (and a few british) .
If your starting out investing then may as well make a holding in the NZ ones first