The beginners struggle

[kiora]

Plus
13)Inheritance:What share portfolio will be in your inheritance?
An investment portfolio with set & forget companies
OR a trading portfolio.Good luck with something only you can manage
14)Diversity in a portfolio is the antithesis of returns.The more "spreading the risk" there is, the lower the expected return long term .The averaging out effect on returns
Having cash,bonds TD in a portfolio over the long term(which is expected for retirement savings to lower volatility) lowers the returns by a considerable margin and increase the risk of lower returns long term

[iceman]

I would like to suggest to any "newbies" (I´ve been one for 25 years in this game) reading this thread, that they read Percy´s post 726 on the PAZ thread on the "Unlisted" section. It describes how millionaires are made in this game.

[percy]

You missed "Then I just kept adding to my/our holding on each positive announcement."
So brought from 3.5 cents up to 25 cents.
I would suggest you read the whole PAZ thread.

ps.The more research I do the luckier I become..lol.

[kiora]

You missed "Then I just kept adding to my/our holding on each positive announcement."
So brought from 3.5 cents up to 25 cents.
I would suggest you read the whole PAZ thread.

ps.The more research I do the luckier I become..lol.

Great effort for a book seller

[SBQ]

You missed "Then I just kept adding to my/our holding on each positive announcement."
So brought from 3.5 cents up to 25 cents.
I would suggest you read the whole PAZ thread.

ps.The more research I do the luckier I become..lol.

What if the announcements were negative? That's why I said you got lucky and certainly not a method new investors should have 'hopes' on. I certainly wouldn't encourage it just like I don't encourage hope to those that buy lottery tickets under the basis of "You never know..." What if you were working with far larger sums like 6 or 7 figures in PAZ and at what impact would it have on it's liquidity?

I'm not saying you were wrong in your investment. I'm saying that to assume a statement "That's how millionaires are made" is completely wrong to the person wanting to get rich from share investing. I have very little experience trading "penny stocks" because the studies in finance i've done at school specify share prices that fall under this category come at different regulations and on all parts, do not meet 'listing requirements' on major stock exchanges (ie. NYSE & Nasdaq delists stocks that fall under $1/share if traded more than 30 day period). They're normally OTC types where their financial statements go unaudited and hence, why they say it's basically gambling instead of investing. So having said this, my explanation is all about liquidity and that's something the NZX doesn't have a lot of ; so it's a poor statement to imply people can make millions of the NZX (look at the behaviour? i've seen actions such as larger NZX companies like TWG issuing new shares to dilute existing share ownership or issue new shares to pay off loans just to prop up their balance sheet or pay dividends (what? issue new shares to pay dividends? isn't that like robbing Peter to pay Paul just so Paul wouldn't feel so bad that his share holdings got diluted a bit?).

I've been living in NZ for over 20 years, the locals that tell me about sharemarket investing tell me that it's a scam and they recall the days of the NZX crash in '86 and how so and so Brierly Investments scammed investors to how Hanover Finance scammed cash deposit investors... yet when they point me to the examples of buying real estate, they keep telling me "At least you can drive by and see it!" Maybe i'm in the wrong circle but i've found the subject of finance is not often talked about at dinner time table. It's rarely spoken about in detail on TV Morning News or on any time slot on NZ TV. Very different to the daytime TV I see in Canada where financial literacy is routinely talk about day and night.. and more so into the schools for children to learn. What is the NZ gov't doing about teaching financial literacy? Leaving it to Uni? Even then it's not taught much.

I won't comment on the attitude that "This is NZ and if you don't like it, you can move back".

[kiora]

Yes NZX is very rarely talked over the dinner table.
My acquaintances also mostly think of it as a scam,risky investment etc etc
If I mention how much the portfolio is up they go,SELL,if it sounds to good be true,then its not true
Why ? Mostly harks back to 1987 etc
A bit of it may come down to Kiwi attitudes about talking about money
Investors have been living in the past & not looking past property.
I sense this is/will slowly changing when they realize the issues with liquidity in property versus the share market
Luck doesn't come in to investing,investors make their own luck.
There is enough liquidity in the NZ share market if you are an investor.

[SBQ]

Yes NZX is very rarely talked over the dinner table.
My acquaintances also mostly think of it as a scam,risky investment etc etc
If I mention how much the portfolio is up they go,SELL,if it sounds to good be true,then its not true
Why ? Mostly harks back to 1987 etc
A bit of it may come down to Kiwi attitudes about talking about money
Investors have been living in the past & not looking past property.
I sense this is/will slowly changing when they realize the issues with liquidity in property versus the share market
Luck doesn't come in to investing,investors make their own luck.
There is enough liquidity in the NZ share market if you are an investor.

Not if there's without a change in NZ's tax laws that favour ownership of multiple rental properties (where all can be sold off without paying capital gains tax). I hate to keep sounding like a tape recorder on repeat but nearly every OECD nation has taxation that is heavily slated against profiting off real estate, while having little or NO tax on gains from investments in equities or a savings / investment plan portfolio.

Yet we often hear the complaint by NZ gov't and critics saying NZ needs to diversify investment away from real estate. It's all very contradicting when I see attempts to make housing affordable such as a ban on foreign buyers acquiring NZ residential properties? Com'on, let's be real here... the politicians themselves are stuck into that game of profiting from real estate ventures, why is it not good enough for the public? It's been cited by the OECD org that NZ's housing prices are excessively unaffordable -> but nobody is listening.

To the issue of liquidity, I ask, well look at other countries and see what % of assets is contained into real estate vs the % value contained in equities? Anotherwords, what % of wealth does the NZX represent in comparison to the % value of ALL real estate in NZ? This is a problem because for many decades, the NZ gov't has expressed people need to diversify away from holding too many houses and look elsewhere to diversify such as in the NZX. What they misunderstand is the NZX simply does not have the assets or listed companies to support such a move. Just imagine if all the rental properties switched hands to principle resident home owners while the proceeds would go into the NZX? What impact would that have? It would be insane. The reason why other exchanges won't have this problem is they attract companies world wide. When the NYSE displays their banner "Where the whole world trades" they mean it because every major foreign company you can think of lists in the US exchanges. They're not going to come to NZX and if there are NZ companies that grow large enough... such as Xero, they end up leaving. So if it's so easy for a NZ company to leave, then why would it be so difficult for NZ investors to move their $ abroad? This is how complex the situation is and it doesn't matter how many years you've invested in the NZ market, one should know it has major limitations.... and you should certainly not advise beginners that the NZX is the be all end all place to buy shares.

[iceman]

SBQ, you are completely wrong in your highlighted criticism of my post. I'm not guessing. I'm stating a fact that was meant as an interesting reading for "newbies" this thread was started for.

[winner69]

SBQ, you are completely wrong in your highlighted criticism of my post. I'm not guessing. I'm stating a fact that was meant as an interesting reading for "newbies" this thread was started for.

Seems some are their own worst enemy

[Snow Leopard]

I thought the make-up of the NZX indicies were supposed to be top secret information and kept from the masses at all costs!

Revolution