Advice for a market débutant

[Fudo_Myou]

Hi. Having gotten serious about saving in recent years, I'm now looking to start accumulating some stocks. I'm just south of 40, and this is my retirement / unforeseen disaster fund, so we're (hopefully) talking very long term here. I have around 120k at the moment, to which I'm currently adding 30k+ a year.

The stocks I've got my eye on at the moment are TEL, RYM, IFT, POT, and maybe TTK, SKC, CNU. As a non-resident, I won't benefit from imputation credits, but only pay 15% non-resident withholding tax on dividends (and no tax in Japan), making growth and no/low-imp stocks attractive.

However, looking at market trends, I get the impression that now is the wrong point in the cycle to be entering the market. I wonder if I'd be better off sitting on the sidelines for the next 12, 18 or however many months it takes for things to play out, then doing a little bargain shopping in the next accumulation phase. Once I buy, I'm generally looking to hold for a long time (Yes, I'm currently reading Benjamin Graham).

Are my assumptions reasonable? And, if keeping my powder dry is the best short-med. term strategy, any suggestions on where to park my money? Any thoughts / advice would be appreciated.

[CJ]

. As a non-resident, I won't benefit from imputation credits, but only pay 15% non-resident withholding tax on dividends (and no tax in Japan), making growth and no/low-imp stocks attractive.

As a non resident, you will receive a supplimentary dividend with each dividend which effectively eliminates you NRWT cost.

As a person living in Japan, why do you want to invest in NZ. I assume this is your planned retirement location?

[Fudo_Myou]

As a non resident, you will receive a supplimentary dividend with each dividend which effectively eliminates you NRWT cost.

Ah, so that's what 'supp.' means on the dividends. I had been wondering.

As for why NZ, that's trickier. No, I probably won't retire there. But I have bank accounts there, interest rates have been much better, I visit yearly, pay closer attention to the economy, etc., so it seemed to make sense. I don't keep money in Japan because interest rates are zero and one day (who knows when, but one day) that mountain of debt is going to come crashing down. Would Australia be a better bet for someone in my position? Or American stocks through something like E-trade (Singapore)?

[percy]

Your choice of NZ stocks is excellent.Maybe add a power company,and an Aussie Bank.
Choice of country I can't help.

[CJ]

I probalbly would choose Australia or US but then I would also go with what you know an if that is NZ, stay with that. Choice of stocks looks nice and safe with a reasonable yeild and chance of capital gain.

[elZorro]

Fudo, here is one chart you should also look at. I've been trying to make a profit on shares since 2004, and apart from a brief positive spell, I've found it tough going. It would have been far easier to buy some gold bars. You'll need to decide if the Dow/gold ratio is really on its way back up, or could drop down to near one, before buying any shares. I have been supporting gold explorers, and by that I mean it hasn't worked too well either, yet. They all burn through a lot of cash from shareholders, and only a few make it big. You'll need to be nimble and uncaring with your shares in the interim. If you do get a profit appearing, think hard about taking it. Don't watch it drift down again. And that is all I've learnt so far. All the best.

[Fudo_Myou]

Ok, thanks to all for your comments, they've given me a few things to think about - nice to get some perspectives other than the voices in my head.

[BIRMANBOY]

So El Zorro you have been trying to make a profit since 2004 and apart from "brief positive spell" its "been tough going" And you are offering advice to someone new to investing. You should be ashamed of yourself. Perhaps your lack of success has got something to do with your suggestion of utilizing Dow -gold ratio? Perhaps its because you choose things that promise big rewards and never quite deliver? Fudo says he is in it for the long haul so why suggest "You'll need to be nimble and uncaring with your shares in the interim. If you do get a profit appearing, think hard about taking it. Don't watch it drift down again."

Fudo, here is one chart you should also look at. I've been trying to make a profit on shares since 2004, and apart from a brief positive spell, I've found it tough going. It would have been far easier to buy some gold bars. You'll need to decide if the Dow/gold ratio is really on its way back up, or could drop down to near one, before buying any shares. I have been supporting gold explorers, and by that I mean it hasn't worked too well either, yet. They all burn through a lot of cash from shareholders, and only a few make it big. You'll need to be nimble and uncaring with your shares in the interim. If you do get a profit appearing, think hard about taking it. Don't watch it drift down again. And that is all I've learnt so far. All the best.

[BIRMANBOY]

Your stock selections look very reasonable. The only thing I would add is that in my opinion rather than waiting for the "best time" to buy you might consider buying on the periodic dips that most stocks go through. If you have access to a 5 year chart facility you may see a stock that has experienced 3 or 4 or more swings or dips over the 5 years. if you look to add holdings in the dips you have the benefit of averaging out your occasional "high" buy. For example with TTK every now and then it dips down to 2.30 or so so I buy. But it generally trades higher. This also has returned a good dividend (so far). Having some cash to buy when "good" opportunities arrive is good but its impossible for most people to know when or if the "good " time has arrived. I believe steady and continual accumulation across a broad selection will serve the conservative, long term investor well.

Hi. Having gotten serious about saving in recent years, I'm now looking to start accumulating some stocks. I'm just south of 40, and this is my retirement / unforeseen disaster fund, so we're (hopefully) talking very long term here. I have around 120k at the moment, to which I'm currently adding 30k+ a year.

The stocks I've got my eye on at the moment are TEL, RYM, IFT, POT, and maybe TTK, SKC, CNU. As a non-resident, I won't benefit from imputation credits, but only pay 15% non-resident withholding tax on dividends (and no tax in Japan), making growth and no/low-imp stocks attractive.

However, looking at market trends, I get the impression that now is the wrong point in the cycle to be entering the market. I wonder if I'd be better off sitting on the sidelines for the next 12, 18 or however many months it takes for things to play out, then doing a little bargain shopping in the next accumulation phase. Once I buy, I'm generally looking to hold for a long time (Yes, I'm currently reading Benjamin Graham).

Are my assumptions reasonable? And, if keeping my powder dry is the best short-med. term strategy, any suggestions on where to park my money? Any thoughts / advice would be appreciated.

[elZorro]

So El Zorro you have been trying to make a profit since 2004 and apart from "brief positive spell" its "been tough going" And you are offering advice to someone new to investing. You should be ashamed of yourself. Perhaps your lack of success has got something to do with your suggestion of utilizing Dow -gold ratio? Perhaps its because you choose things that promise big rewards and never quite deliver? Fudo says he is in it for the long haul so why suggest "You'll need to be nimble and uncaring with your shares in the interim. If you do get a profit appearing, think hard about taking it. Don't watch it drift down again."

Birmanboy, maybe you're right. Perhaps you're the hotshot and I'm not. I'm not ashamed of the effort I've put in to understand the markets. I have found it far easier to make a dollar in business, luckily. And despite your decrying my opinion on the dow-gold ratio, it spells out why buying shares in the last few years has been a big punt compared with the period before 1987, for example. I'll get back to breakeven sometime, and then I'll see if I'm still interested in shares.

And I am trying to help Fudo out. He/she might have saved very hard to get that cash together, and I'm saying there are no sure bets at the moment. Share investing, even for the long haul, carries risks not seen in a savings account. If the dow-gold ratio starts properly going the other way, it'll be easier then.

This result from a team of experts in long-term share investments.